EXHIBIT 10.5

[CISCO LETTERHEAD]

November 19, 2007

Wim Elfrink

[ADDRESS]

 

Re: International Assignment Agreement

Dear Wim:

I am pleased to confirm your international assignment to India. This letter of
agreement outlines the terms and conditions of your international assignment.
Your international assignment is also subject to the terms of Cisco’s Long Term
International Assignment Policy (the “International Assignment Policy”) and the
Tax Equalization Policy as they apply to international assignees generally.
However, where an express term of this Agreement and the International
Assignment Policy conflict, this Agreement will govern.

Your point of origin is the Netherlands (the “home country”) and your country of
reference during your assignment is India (the “host country”). We understand
you are a resident of the United States for tax purposes.

This Agreement supersedes and replaces, in its entirety, your previous Agreement
of International Assignment from the Netherlands to the United States dated
November 9, 2001 and any prior employment agreement except to the extent set
forth in Exhibit A or as otherwise required by the laws of the Netherlands.

New Assignment

Your international assignment began on January 3, 2007.

Effective as of August 13, 2007, your job title is Executive Vice President,
Customer Advocacy and Chief Globalization Officer. In this capacity, you will
report to John Chambers, or his successor(s) and/or designee(s). As the
Executive Vice President, Customer Advocacy and Chief Globalization Officer, you
will be responsible for such duties and responsibilities as Mr. Chambers or his
successor or designee assign. You will be required to travel in India, and/or
internationally during your international assignment.

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Wim Elfrink

November 19, 2007

Page 2

Term

Although neither this assignment nor this letter alters your status as an
at-will employee, it is anticipated that your international assignment will last
for up to two to three years. Your international assignment may be extended or
shortened if expressly agreed upon in writing by you and Cisco.

Salary and Bonus

You will remain an employee of the home country and be paid on its payroll. Your
annual base salary will be EUR 547,275 (USD 750,000 as of August 1, 2007). You
will also be eligible to participate in Cisco’s Executive Incentive Plan
(“EIP”). Your participation in the EIP will be subject to the terms and
conditions of the EIP. Your target bonus percentage under the EIP for fiscal
year 2008 will be 125 percent (125%) of your annual base salary.

Your salary and bonuses will be paid to you in Euro from your home country less
applicable deductions and withholdings; however, pursuant to the Tax
Equalization Policy, you will receive a Host Country Tax Payment to off-set any
additional amounts you are required to pay in taxes due to your international
assignment on the same basis as other international assignees.

Benefits

Life insurance, business travel accident insurance, retirement plans, disability
and healthcare coverage will be provided from the home country while on
assignment. For additional information about benefits coverage, please refer to
the Benefits section on Cisco’s intranet and access the link to Worldwide Plans.
Your vacation entitlements will continue to be governed by the policies in
effect for the home country and your PTO accrual will remain unchanged. However,
working hours, public holidays and sick leave will follow policies in effect for
the host country, India.

Please be aware that in the case of a medical or security emergency, Cisco has
contracted with International SOS (“ISOS”) to provide employees working abroad
with access to a full range of medical information and emergency services,
including medical assistance, international healthcare, security services and
outsourced customer care. Additional information about ISOS, is available on
Cisco’s intranet at wwwin.cisco.com/employee/benefits/isos.shtml.

Relocation

[                    ] of Cartus has been working with the ART Group (“ART”) and
Fragomen, Del Rey, Bernsen & Loewy, LLP (“Fragomen”) to arrange all aspects of
your international relocation. To the extent that your relocation is not already
completed, [                    ], together with ART and Fragomen will continue
to assist you with various details and arrangements, including: passport, visa,
and local work permit requirements; housing requirements; transportation to your
new location; and shipment of household goods and personal effects.

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Wim Elfrink

November 19, 2007

Page 3

Cisco has provided relocation assistance to India for you, your spouse and your
children, and covered many of the expenses associated with the move. Cisco will
continue to provide relocation assistance to India for you, your spouse and your
two sons, and cover the following expenses:

 

  •  

You and your family will receive a host country cultural orientation and
language training to assist with your move.

On-Going Allowances and Reimbursements

Cisco has adopted a “Balance Sheet Approach” in compensating employees on
international assignments, to ensure that assignees can maintain purchasing
power similar to that which they would have enjoyed in their home country,
assuming the same salary, grade level and family size. Therefore, during your
international assignment, you will be entitled to the following allowances or
reimbursements to cover additional costs incurred as a result of your
international assignment. In addition, any amount of allowance/reimbursement
that is not used by you in any given month shall be carried over to the next
month(s) and made available to you (in addition to the maximum allowance
specified) in the subsequent month(s). Notwithstanding the foregoing, with
respect to any allowance/reimbursement that would otherwise be treated as a
deferred compensation arrangement under Section 409A of the Internal Revenue
Code of 1986, as amended (“Section 409A”) if the amount were carried over into a
subsequent taxable year, any portion of such allowance/reimbursement that is
unused as of each December 31 (including amounts carried over from a prior month
in the same calendar year) shall not be carried-over into the next calendar year
and made available to you. Cisco will reimburse you for business expenses in
accordance with Cisco’s applicable reimbursement policies; however, if you incur
any business related travel expenses that are not reimbursed by Cisco under such
policies, any of the allowances below may be used to cover such expenses.

Housing Assistance:

Cisco will reimburse the monthly rental payments on the residence that will be
leased on your behalf in India. You understand and agree that your host country
residence will be used not only as your personal residence, but for business
purposes as well, including as a forum to showcase and test Cisco’s technology.
The annual cost for this lease is not to exceed INR 24,632,200 (USD 556,932 as
of January 3, 2007) with scheduled annual inflation increases pursuant to the
signed lease contract.

In order to maintain the property, Cisco has contracted with Epitome services
for house maintenance to be paid on your behalf by Cisco. The annual cost of
this benefit is not to exceed INR 2,600,000 (USD 58,786 as of January 3, 2007).
Cisco will also reimburse you for the cost of domestic household assistance. The
annual cost of this benefit is not to exceed INR 710,000 (USD 16,053 as of
January 3, 2007).

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Wim Elfrink

November 19, 2007

Page 4

For your security and the security of Cisco’s property, Cisco has contracted
with a security firm for these services to be paid on your behalf. The annual
cost of this benefit is not to exceed INR 1,212,000 (USD 27,403 as of January 3,
2007).

Cisco will continue to provide housing assistance in the United States as it
will be necessary for you to return to the United States for business purposes.
This housing assistance will be paid from the Netherlands payroll in the monthly
amount not to exceed EUR 10,835 (USD 14,845 as of August 1, 2007). Cisco will
continue to assist with the costs of utilities in the United States at a cost
not to exceed USD 300 per month.

Property Management:

If you elect not to sell or rent your home country residence, Cisco will
reimburse you for the costs for property management of that residence in
accordance with the International Assignment Policy.

Dependent Education Reimbursement:

Cisco will reimburse you the annual cost of tuition for each of your dependent
children attending elementary or secondary school at the host location with a
cost not to exceed INR 1,000,000 (USD 22,610 as of January 3, 2007) in the
aggregate per school year.

Home Leave Travel Allowance:

Cisco will reimburse you for the cost of airfare for you, your spouse, and your
children to return to your home in the Netherlands or to the United States each
year. As a guideline, this allowance typically covers three trips per year. The
annual cost of this benefit is not to exceed USD 50,000.

Automobile Assistance:

The costs for the rent or purchase two family-style automobiles, the services of
two drivers during your international assignment and standard automobile
insurance on such two vehicles for you and your spouse will be paid on your
behalf by Cisco. The annual cost is not to exceed INR 2,381,800 (USD 53,852 as
of January 3, 2007).

In addition, Cisco will continue to pay you the transportation allowance that
you were provided in connection with your international assignment to the United
States from the Netherlands as it will be necessary for you to return to the
United States for business purposes. That allowance shall continue to be paid
through payroll in the Netherlands and shall be in the amount of EUR 1,850 (USD
2,535 as of August 1, 2007) each month.

Relocation Payment:

After you have completed your first full year working on international
assignment in India, Cisco will pay you a lump sum relocation allowance equal to
EUR 27,574 (USD 37,776 as of August

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Wim Elfrink

November 19, 2007

Page 5

1, 2007) per year paid through payroll in the Netherlands for relocation,
adjustment and transition assistance. The first payment shall be made on or
about the one year anniversary of your international assignment and subsequent
payments on or about your subsequent annual anniversary dates. This payment
shall be in lieu of the Miscellaneous Relocation Payment set forth in the
International Assignment Policy.

The assignment allowances will have already been implemented. Please notify
[                    ] of Cartus, if you have any questions regarding these
payments. In addition, please notify Cartus of any changes in your family size
within 30 days while you are on assignment. These changes may affect the
structuring of your benefits package or allowances.

Repatriation

Upon completion of your international assignment, Cisco will provide you with
relocation assistance related to your move back to the United States. This will
include one-way business class travel for you and your qualifying dependents;
shipment of household goods and personal effects and temporary living in your
home country.

Assuming your international assignment is successful, upon its termination Cisco
will attempt to employ you in a position comparable to your then current
position and which utilizes the skills and experience you gained during your
international assignment. If Cisco is unable to provide you with a position
comparable to your then current position, Cisco will attempt to provide you with
a position comparable to your position immediately prior to the commencement of
your international assignment. Your base salary and target bonuses, in either
case, will be at a level commensurate with the position offered. If Cisco is
unable to offer you a position, your employment will terminate and Cisco will
pay you an amount equal to the sum of (i) one year of your then current annual
salary, and (ii) the target annual bonus for your level under the EIP (together
the “Severance”). Cisco’s obligation to pay the Severance will be contingent
upon your execution and the effectiveness of a release agreement in a form
provided by Cisco within 30 days of your “separation from service” from Cisco as
that term is defined in Section 409A. This Severance would be in lieu of any
entitlement you may have to notice of termination, to pay in lieu of notice of
termination, or to any other severance payment from any source. This section
supersedes any termination of employment provision of the International
Assignment Policy.

Taxes

Your international assignment will be covered by Cisco’s Tax Equalization Policy
and you hereby acknowledge that you have accepted all the terms and conditions
set forth in Exhibit B. Your pay will be subject to annual hypothetical tax
deductions in amounts determined by Ernst & Young (“EY”). Cisco’s philosophy
regarding tax equalization is that as an international assignee, you will
neither materially gain nor lose from the differences in income and social tax
costs between your home and host country, within certain parameters. Tax
equalization applies to Cisco equity awards as described in the Tax Equalization
Policy. Any Indian Fringe Benefits tax related to your equity income will be
handled in the same manner as other international assignees assigned to India.
For purposes of tax equalization, your home country will be the

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Wim Elfrink

November 19, 2007

Page 6

United States. Cisco has retained EY, an independent tax accounting firm, to
provide assistance with the preparation of both your home and local country tax
filing obligations and to prepare annual tax equalization calculations. Please
contact [                            ] in EY’s Tax Department for any questions.

Fees associated with tax services provided by EY and other tax consulting
services, including any services provided by your tax advisor in the
Netherlands, shall be paid on your behalf by Cisco not to exceed USD 75,000 per
year.

Notwithstanding the foregoing, if this Agreement or any benefit payable to you
hereunder is subject to Section 409A and you are a “specified employee” (within
the meaning of Section 409A) as of the date you separate from service from
Cisco, then any payments scheduled to be made to you pursuant to this Agreement
during the first six months following your separation from service shall be
delayed and shall accrue interest at the applicable federal rate for such six
month period. The delayed payments (and including any accrued interest) shall be
paid immediately following the end of the six month delay. In no event shall
Cisco be liable for any taxes or penalties imposed under Section 409A with
respect to any benefit(s) paid to you pursuant to this Agreement. All
reimbursements under this Agreement that are subject to Section 409A shall be
made no later than the end of the calendar year next following the calendar year
in which the applicable expenses are incurred and the Severance, if any, shall
be paid no later than the 15th day of the third month following the year in
which your international assignment terminates. Any tax equalization payments
shall be paid within the time periods described in Section 1.409A-1(b)(8)(iii)
of the Treasury Regulations under Section 409A.

Dispute Resolution

You and Cisco acknowledge and agree that any and all disputes or claims arising
from or relating to your recruitment to or employment with Cisco (including but
not limited to disputes or claims arising from or relating to this Agreement),
or the termination of your employment, will be resolved solely and exclusively
pursuant to final and binding arbitration in lieu of any evidentiary hearing
before a government agency and/or a court trial before a judge or jury, pursuant
to the terms of Cisco’s Arbitration Agreement and Policy, a copy of which can be
found at
http://wwwin.cisco.com/HR/employee/proprietary_info/agreement2arbitrate.shtml.
The agreement to arbitrate means that both you and Cisco have expressly waived
any and all rights to a trial before a court or a jury.

General

Cisco’s personnel policies and standards of business apply to your assignment,
unless a written exception is provided by a company representative authorized to
make that exception or is otherwise set forth in this Agreement.

This Agreement sets forth the entire agreement between you and Cisco regarding
your international assignment except that existing agreements with Cisco such as
your agreement to arbitrate, your proprietary information and inventions
agreement and agreement(s) establishing at-will employment are not superseded by
this agreement, unless expressly provided to the contrary herein.

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Wim Elfrink

November 19, 2007

Page 7

This Agreement can only be modified by a written document signed in writing by
Randy Pond or his successor(s) or designee(s) and approved by the Compensation
and Management Development Committee of the Board of Directors. Please note that
Cisco reserves the right to unilaterally modify the provisions of this Agreement
and/or the documents incorporated herein as legal requirements may dictate, new
practices may require or for other reasons at the discretion of Cisco. In the
event such modifications are made, notification will be provided to you.

This Agreement shall be governed by, and construed in accordance with, the laws
of the State of California (except its choice-of-law provisions).

We are excited to have you join our operations in India. If you are in agreement
with the terms and conditions of your assignment as outlined in this letter and
in the attached policies, please sign the two originals and return one to the
person listed below.

 

BY CISCO SYSTEMS, INC.       APPROVED & ACCEPTED  

 

/s/ Randy Pond

 

Randy Pond                            

 

 

November 19, 2007

Date

   

 

/s/ Wim Elfrink

 

Wim Elfrink                            

 

 

November 19, 2007

Date

Executive Vice President, Operations,

Processes and Systems

      Executive Vice President, Customer Advocacy and Chief Globalization
Officer   Return one original to:     [                    ]       Cisco
Systems, Inc.       170 West Tasman Dr.       San Jose, CA 95134       United
States  

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EXHIBIT A

 

1. Termination of the Employee’s home country employment agreement will be
subject to a notice period of two (2) months. Notice must be given before the
end of a calendar month, in which case the formal notice period will start on
the first day of the month following the month during which notice was served.

 

2. The Employee shall be entitled to an annual holiday allowance of 8% of the
gross annual base salary, payable in the month of May of the current year. If
the Employee performed work during only a part of the year, the holiday
allowance shall be calculated and paid proportionately.

 

3. The Employee shall be entitled to 25 days’ holiday a year, which the Employee
shall take in consultation with and after approval by the Employer.

In principle, accrued holidays must be taken in the calendar year in which they
accrue. Excess holidays (i.e., holidays accrued during a certain year which have
not been taken during the calendar year in which they accrued) must be taken
between 1 January and 1 April of the subsequent calendar year in consultation
with the Employer. If, after consultation, the holidays are not taken during the
said period, the Employer shall designate the period during which the holidays
must be taken. If, in spite of this, the designated holiday period is not taken,
the claim to the excess holidays shall lapse.

Upon termination of the employment relationship, the Employee shall not be
entitled to any salary over holidays and/or hours which have been taken but
which have not yet accrued. The Employee shall be obliged to repay the Employer
any salary already received over such holidays and/or hours at the end of the
employment relationship.

 

4. If the Employee is ill or unable to perform work for any other reason, he
shall be obliged to inform the Employer thereof on the first day of absence.

If the Employee is unable to perform his work as a result of illness, he shall
remain entitled to 100% of his last earned salary for a period of 52 weeks,
unless the illness was caused intentionally by him or ensued from an infirmity
in respect of which he intentionally gave the Employer false information when he
entered into the employment agreement, in the event he causes an obstruction of
or delay in the recovery process, or if the Employee - despite being able to do
so - refuses to perform other suitable work for his own Employer or - with the
prior approval of the Industrial Insurance Board - for another employer.

The wages will be reduced by:

- the amount of any financial benefit which the Employee receives under any
statutorily prescribed insurance or under any insurance or from many fund which
was agreed upon in or results from the employment agreement;

- the amount of income earned by the Employee, whether in or outside the
employer-employee relationship, from work which he has performed in the period
during which the contractually agreed work could have been performed if he had
not been prevented from doing so.

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If the Employee’s incapacity for work was caused by a third party, the Employer
shall not be obliged to pay the Employee’s salary or a supplement to his social
security benefits. If, in that case, the Employee can hold a third party liable
for loss of income in connection with his incapacity for work, he shall assign
his claim against the third party to the Employer, for which he will receive an
amount equal to the amount which he would have received if the third party had
not been involved in the incapacity for work. The Employer will pay the amount
to which the Employee is in that case entitled in monthly installments, the
amount of which shall be determined by the Employer.

The Employer will not invoke the provisions contained above, if and insofar as
the Employee cannot hold the third party liable.

 

5. The Employer shall compensate 50% of the Employee’s premium payable for the
standard insurance class of the Company’s health insurance plan. The Company
does not contribute to the costs of participating in insurance plans other than
the Company plan.

The Employer has taken out accident insurance, i.e. “Cisco’s Worldwide Business
Travel Accident Insurance (BTA)”, for the benefit of the Employee.

 

6. As required, the Employee has joined the employers pension scheme in the
Netherlands. Both employee and employer participate in the costs of this scheme.
Under the scheme there is an employer contribution for the following pensions:
old age pension, survivors pension, orphans pension and occupational disability
benefit. By way of example, for fiscal 2007, Cisco’s contribution to this scheme
was approximately EUR 135,000 (USD 184,950 as of August 1, 2007). The
contribution percentage increases with age and the contribution amount is
generally determined as a percentage of certain cash compensation of the
employee. Contributions are used to purchase insurance which has a specified
minimum guaranteed annual rate of return.

 

7. Neither during the employment term nor upon termination of the employment
shall the Employee inform any third party in any form, directly or indirectly,
of any particulars concerning or related to the business conducted by the
Employer or its affiliated companies which he could reasonably have known were
not intended for third parties, regardless of the manner in which he learned of
the particulars.

Any violation of the obligation to maintain confidentiality as set forth in the
preceding paragraph shall carry a penalty of NLG 10,000, immediately payable by
the Employee to the Employer and without prejudice to any other claims which the
Employer may have, including the right to full damages.

 

8. Insofar as the rights specified hereinafter are not vested in the Employer by
operation of law on the grounds of the employment relation between the parties,
the Employee covenants that he shall transfer and, insofar as possible, hereby
transfers to the Employer any rights of whatever nature in or arising from
inventions made by the Employee in the discharge of his duties, both in the
Netherlands and abroad.

 

9. The foregoing provisions on this Exhibit A shall be governed by the laws of
the Netherlands.

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EXHIBIT B

CISCO SYSTEMS, INC.

INTERNATIONAL ASSIGNMENT TAX EQUALIZATION POLICY AGREEMENT

I acknowledge having read the Tax Equalization Policy of Cisco Systems, Inc.
(“Cisco”), located at
http://wwwin.cisco.com/FinAdm/Tax/StockOptions/stock_faq.shtml, and understand
the personal impact of the Policy. Any questions concerning this Policy with
Cisco have been fully explained to my satisfaction. I accept that all
interpretations under this agreement shall be controlled by the Policy of Cisco,
which is included as part of this agreement. Cisco shall have the right and
privilege at any time it deems necessary and proper to amend, add, or delete
provisions to and from this Policy without prior notice.

I understand and agree that all tax positions affecting income, deductions and
credits outside the scope of the Policy (i.e., amounts not covered by the
Policy) are the responsibility of the employee. Cisco is not liable for any
taxes, penalties, or interest resulting from a successful challenge by any tax
authority of any item not covered by the Policy.

In addition, I understand the employee is fully responsible for all penalties
and interest charges assessed by any tax authority due to the employee’s failure
to (1) provide information to Ernst & Young on a timely basis, (2) notify
Ernst & Young of any significant personal income or investment transactions, or
(3) cooperate with Cisco with respect to the tax equalization process.

I understand and agree that Cisco will reduce my compensation by an estimated
hypothetical tax. The estimated hypothetical tax is an amount which approximates
my periodic estimated tax deductions calculated with reference to compensation,
benefits, deductions and credits otherwise available to me had I remained in my
home country, except as otherwise provided in this Policy. In return, Cisco will
advance wages that I have not yet earned to assist with the payment of my actual
home and host country tax liabilities within the limits prescribed by the
Policy.

I understand that these wage advances provided by Cisco for payment of taxes
constitutes an obligation by me to Cisco, which will be reconciled with the
final liabilities that are Cisco’s responsibility through the annual tax
equalization settlement calculation. After completion of the tax equalization
settlement statement for each taxable year, I agree to repay any obligation for
each taxable year within thirty (30) days. If I fail to repay any obligation to
Cisco within thirty (30) days after completion of the tax equalization
settlement statement, then, unless Cisco and I have agreed otherwise in writing,
Cisco shall have the right to:

 

  a) reduce any foreign assignment allowances or reimbursements due to me,
and/or

 

  b) reduce future amounts paid to me whether as wages, salary or other
compensation for services performed in light of my having received wage advances
that I have not yet earned.

The total obligation will become immediately due and payable if my employment
with Cisco or any of its affiliate corporations is terminated, whether
voluntarily or involuntarily.

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If I fail to furnish tax records in response to a request by Cisco pursuant to
the Policy, or cease employment with Cisco or any of its subsidiaries for any
reason before the tax records needed to complete the year-end tax equalization
settlement statement under the Policy are available, then Cisco shall have the
right to calculate such amounts by making reasonable assumptions of probable
taxes. If an amount is owed to Cisco, Cisco shall also have the right to require
immediate payment of such amount, including the right to reduce future amounts
paid to me whether as wages, salary or other compensation for services performed
in light of my having received wage advances that I have not yet earned, unless
Cisco and I have agreed otherwise in writing.