Document:

<PAGE>   1
                                                                   EXHIBIT 10.12

                               CISCO SYSTEMS, INC.

                                    WORLDWIDE
                        SENIOR MANAGEMENT INCENTIVE PLAN
                            EVP, SR VP, VP, DIRECTOR
                                     FY 2001

I.   INTRODUCTION

     A.   THE OBJECTIVE OF THE SENIOR MANAGEMENT INCENTIVE PLAN is to
          financially reward Executive Vice Presidents, Senior Vice Presidents,
          Vice Presidents, Directors and employees in Grades 13 and 14 for their
          contributions to the success and profitability of Cisco Systems, Inc.

     B.   PARTICIPANTS: This plan applies solely to Vice Presidents and
          Directors of Cisco Systems or participating Cisco subsidiaries in the
          following positions:

          POSITION
          --------
          Executive Vice President
          Senior Vice President
          Vice President
          Director (excluding Sales Positions)
          Employees in Grades 13 and 14

          Any exceptions to the above will need to be approved in writing by the
          President. The participant must be employed in a bonus-eligible
          position on or before the first working day of the last fiscal quarter
          of Fiscal Year 2001 and must be employed on the last working day of
          that year to be eligible for an FY01 bonus. Participants may not be
          concurrently enrolled in any other bonus, sales or incentive plan.
          Participants in the Plan with less than one year of service will be
          eligible for a prorated bonus amount. In no event will any individual
          accrue any right or entitlement to a bonus under this Plan unless that
          individual is employed by Cisco Systems or a participating Cisco
          subsidiary on the last working day of Fiscal Year 2001.

     C.   EFFECTIVE DATE: The Plan is effective for the Fiscal Year 2001
          beginning July 30, 2000 through July 28, 2001.

     D.   CHANGES IN PLAN: The Company presently has no plans to change the
          Senior Management Incentive Plan during the fiscal year. However, the
          Company reserves the right to modify the Senior Management Bonus Plan
          in total or in part, at any time. Any such change must be in writing
          and signed by the President. The President or plan designers reserve
          the right to interpret the plan document as needed.

     E.   ENTIRE AGREEMENT: This Plan is the entire agreement between Cisco
          Systems, Inc. and the employee regarding the subject matter of this
          Plan and supersedes all prior compensation or incentive plans or any
          written or verbal representations regarding the subject matter of this
          Plan.

II.  BONUS PLAN ELEMENTS

A.   BASE SALARY is determined by the participant's manager, on the Focal review
     date scheduled for either August 1, April 1, or October 1 of each year. The
     annual base salary in effect at the end of the Fiscal Year 2001 represents
     the basis for the bonus calculation.
<PAGE>   2

B.   BONUS TARGET PERCENTAGE is a percentage level of base salary determined by
     the position.

     POSITION                                                        BONUS %
     --------                                                        -------
     EXECUTIVE VICE PRESIDENT                                          60%
     SENIOR VICE PRESIDENT                                             60%
     VICE PRESIDENT                                                    50%
     DIRECTOR (EXCLUDING SALES POSITIONS)                              40%
     GRADE 14                                                          40%
     GRADE 13                                                          40%

C.   INDIVIDUAL PERFORMANCE MULTIPLIER is based upon the manager's evaluation of
     performance and contribution for the fiscal year. This factor may range
     from 0.70 - 1.50. The assigned factor may also be a zero resulting in no
     bonus based on the manager's evaluation of performance and contribution. A
     written performance evaluation is required in conjunction with any assigned
     factor of zero.

     Employees who were given corrective feedback, on a Performance Improvement
     Plan and/or performing at a level of "Not Satisfactory" (N), at any time
     during the fiscal year may receive a lower Individual Performance
     Multiplier resulting in a lower bonus. The assigned multiplier may also be
     a zero resulting in no bonus based on the manager's evaluation of
     performance and contribution. A written performance evaluation is required
     in conjunction with any assigned factor of zero.

D.   COMPANY PERFORMANCE MULTIPLIER is based upon achieving an established
     worldwide Revenue target and a worldwide Profit Before Interest and Tax
     (PBIT) target per the current Plan. The PBIT achievement to target is more
     heavily weighted relative to the worldwide Revenue target. Typically, 80%
     of each objective must be achieved for any bonus to be paid. Maximum payout
     under the Plan is 200% or a multiplier of two. When the Revenue and PBIT
     percentages of goal fall between the stated percentages on the matrix, the
     Company Performance Multiplier will be determined using a straight-line
     interpolation approach. The applicable targets for Fiscal Year 2000 are
     approved by the Cisco Board of Directors within the first 90 days of the
     fiscal year.

                         COMPANY PERFORMANCE MULTIPLIER

<TABLE>
<S>                     <C>       <C>       <C>       <C>       <C>       <C>
                        120%      0.90      1.10      1.30      1.90      2.00
                        110%      0.85      1.00      1.10      1.60      1.90
      REVENUE AS A      100%      0.80      0.90      1.00      1.30      1.60
       % OF GOAL         90%      0.75      0.85      0.95      1.15      1.30
                         80%      0.70      0.80      0.90      1.00      1.15

                                    80%       90%      100%      110%      120%
</TABLE>

                                     PBIT AS A % OF GOAL

       EXAMPLE:                   COMPANY PERFORMANCE
                                  Actual Revenue Performance is 100% of goal
                                  Actual PBIT Performance is 110% of goal

                                  COMPANY PERFORMANCE MULTIPLIER = 1.30

<PAGE>   3

E.   CUSTOMER SATISFACTION MULTIPLIER is based upon achievement of an overall
     worldwide customer satisfaction survey score. The multiplier may range from
     0.95 - 1.20 based on the following criteria:

<TABLE>
<CAPTION>
           WORLDWIDE SATISFACTION SCORE                     FACTOR
           ----------------------------                     ------
<S>             <C>                                         <C>
                    < 4.23                                   0.95
                  4.23 - 4.30                                1.05
                  4.31 - 4.38                                1.10
                    4.39 +                                   1.20
</TABLE>

F.   COMPANY STRATEGIC PERFORMANCE MULTIPLIER measures Cisco's annual revenue
     growth compared to select competitor company annual revenue growth.
     (Revenue is measured quarterly and combined to determine annual revenue
     growth percentage.) The multiplier is determined based on the revenue
     growth difference of Cisco and the selected competitor companies. The
     multiplier may range from 0.90 to 1.30.

                    COMPANY STRATEGIC PERFORMANCE MULTIPLIER

<TABLE>
<CAPTION>
                                                    Exceed Competitors
              Less Than         Equal to               Growth By
             Competitors       Competitors     10 pts    20 pts     30 pts
             -----------       -----------     ------    ------     ------
<S>             <C>               <C>           <C>        <C>        <C>
                0.9               1.0           1.1        1.2        1.3
</TABLE>

     EXAMPLE: Cisco Annual Revenue Growth is 30%
              Select Competitor Company Revenue Growth is 20%
              30% - 20% = 10% or 10 points
              Multiplier = 1.1

G.   PRORATION MULTIPLIER accounts for the number of calendar days during the
     fiscal year that the employee was in the bonus-eligible position. For
     example, the Proration Multiplier for an employee who has been on the Plan
     the entire year will be "1.00". For an employee who has been on the plan
     for 6 months, this factor will be "0.50". Employees in the following
     situations will have a proration factor of less than "1.00":

     o    Participants in the Plan who transferred to a new position not
          governed by any incentive plan.

     o    Employees who transferred from one bonus-eligible position to another
          bonus-eligible position. Employees in this situation will have their
          bonus prorated based on length of time in each position.

     o    Employees who have been on the Plan less than 12 months (such as a new
          hire).

     o    Employees who have been on a leave of absence of any length during the
          fiscal year.

     o    Employees who have been on the Plan, terminated their employment, and
          returned to a bonus-eligible position all in the same fiscal year.

     o    Employees working less than a 40-hour week will receive bonuses
          prorated according to the following schedule:

          20 - 39 hours/week: prorated according to the average
                              number of hours worked
          <20 hours/week:     not bonus eligible

<PAGE>   4

          Any modification to the above schedule must be approved by the
          next-level Manager and Compensation in advance of the year-end close
          date.

H.   BONUS FORMULA AND CALCULATION EXAMPLE: Assume a base salary of $195,000 at
     the 40% level, individual performance multiplier of 1.10, company
     performance multiplier of 1.30, a customer satisfaction multiplier of 1.05,
     a company strategic performance multiplier of 1.10 and a proration
     multiplier of 1.00.

                               SAMPLE CALCULATION

<TABLE>
                  BONUS        INDIVIDUAL        COMPANY         CUSTOMER       COMPANY
   BASE           TARGET      PERFORMANCE      PERFORMANCE      SATISFACTION   STRATEGIC      PRORATION     TOTAL
  SALARY        PERCENTAGE     MULTIPLIER       MULTIPLIER      MULTIPLIER     MULTIPLIER     MULTIPLIER    BONUS
<CAPTION>

<S>          <C>   <C>     <C>    <C>      <C>     <C>      <C>    <C>     <C>   <C>     <C>   <C>   <C>   <C>
 $195,000    X     0.40     X     1.10      X      1.30      X     1.05     X    1.10     X    1.00    =   $128,829
</TABLE>

          In this example, the total bonus equals 66.1% of base salary.

I.   MIDYEAR BONUS PAYMENTS: If the Company Performance Multiplier is at a
     minimum of 1.00 (midyear revenue and PBIT), a partial payment will be
     distributed to eligible employees midway through the fiscal year. This
     advance will be 50% of the bonus target by level, reduced by any advances,
     unearned commission advances, draws, or prorations and appropriate state
     and federal withholdings. The bonuses will be paid to employees who have
     met job expectations and were hired on or before the first day of the
     second quarter of Fiscal Year 2001 and are active on the day of
     distribution. For example, a Director would receive an advance equal to 20%
     of base salary. In no event, however, will any right or entitlement to such
     a partial payment accrue to any eligible participant unless that individual
     is employed by Cisco Systems or a participating Cisco subsidiary on the
     distribution date.

     If the Company Performance Multiplier is not at a minimum of 1.00 (midyear
     revenue and PBIT), a partial payment may be distributed to employees midway
     through the fiscal year. This payment will be 25% of the bonus target by
     level. For example, a Director would receive an advance equal to 10% of
     base salary. If the company performance fails to achieve minimum revenue
     and PBIT targets resulting in no year-end payout, an additional 25% of the
     bonus target may be paid.

     Employees who are given corrective feedback, on a Performance Improvement
     Plan and/or are performing at a level of "Not Satisfactory" (N) at the end
     of the second quarter are not eligible to receive a partial payout midway
     through the fiscal year. Employees who have entered into a Mutual
     Separation Agreement may not be eligible to receive a midyear bonus payout
     or year-end payout based on manager discretion. An employee may not be
     eligible to receive a midyear payout based on manager discretion and
     subject to Human Resources concurrence.

III. PROCEDURES AND PRACTICES

     A.   PROCEDURE:

          1.   A copy of the Plan will be made available to each participant.

          2.   All bonus payments will be made after the company's collection of
               all applicable withholding taxes.

     B.   BUSINESS CONDUCT: It is the established policy of Cisco Systems, Inc.
          to conduct business with the highest standards of business ethics.
          Cisco employees may not offer, give, solicit or receive any payment
          that could appear to be a bribe, kickback or other irregular type of
          payment from anyone involved in any way with an actual or potential
          business transaction. Gifts, favors and entertainment are allowed such
          that they are consistent with our business practice, do not violate

<PAGE>   5

          any applicable laws, are of limited value ($50.00 or less) and would
          not embarrass Cisco if publicly disclosed.

     C.   TRANSFERS AND TERMINATIONS: Employees who are participants in the
          Senior Management Incentive Plan and who transfer to a new position
          not governed by this Plan will be eligible on a pro-rata basis for the
          applicable period and paid as defined by the Plan. Employees who
          transfer into the plan from another plan will be subject to proration
          as well. Payments from the plan are subject to reduction by advances,
          unearned commission advances, draws or prorations and appropriate
          state and federal withholdings. Any exceptions to the Plan must be
          designated in writing and approved by the President.

          A participant must be employed as of the last working day of the
          fiscal year to be eligible for the year-end bonus. A participant must
          be employed on the day of distribution to receive a partial midyear
          payment under paragraph II-I. If an employee terminates prior to the
          applicable date, the employee will not be eligible for such bonus or
          partial payment.

     D.   EMPLOYMENT AT WILL: The employment of all Plan participants at Cisco
          Systems, Inc. or the participating Cisco subsidiaries is for an
          indefinite period of time and is terminable at any time by either
          party, with or without cause being shown or advance notice by either
          party. This Plan shall not be construed to create a contract of
          employment for a specified period of time between Cisco Systems, Inc.
          or a participating Cisco subsidiary and any Plan participant.

     E.   PARTICIPATING CISCO SUBSIDIARY: For the 2001 Fiscal Year, the
          following Cisco subsidiaries will be participating subsidiaries in the
          plan:

                  Cisco Technology, Inc.
                  Cisco Systems Sales and Services, Inc.
                  Cisco Systems Finance, Inc.
                  Cisco Systems Investment Limited
                  Cisco Systems Capital Corporation<PAGE>   1
                                                                     EXHIBIT 4.1
                                                                          PAGE 1

                                STATE OF DELAWARE

                        OFFICE OF THE SECRETARY OF STATE

                                   ----------

         I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO
HEREBY CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
BUSINESS TRUST REGISTRATION OF "CALPINE CAPITAL TRUST III", FILED IN THIS OFFICE
ON THE TWENTY-EIGHTH DAY OF JUNE, A.D. 2000, AT 8:30 O'CLOCK A.M.

                                        /s/ EDWARD J. FREEL
                                       -----------------------------------------
                                       Edward J. Freel, Secretary of State
                          [SEAL]
3252483 8100                           AUTHENTICATION: 0530368

001331135                                        DATE: 06-29-00
<PAGE>   2
                              CERTIFICATE OF TRUST

         The undersigned, the trustees of Calpine Capital Trust III, desiring to
form a business trust pursuant to the Delaware Business Trust Act, 12 Del. C.
Section 3801 et seq., hereby certify as follows:

         (a)      The name of the business trust being formed hereby (the
                  "Trust") is "Calpine Capital Trust III."

         (b)      The name and business address of the trustee of the Trust
                  which has its principal place of business in the State of
                  Delaware is as follows:

                  The Bank of New York (Delaware)
                  White Clay Center, Route 273
                  Newark, Delaware 19711

         (c)      This Certificate of Trust shall be effective as of the date of
                  filing.

Dated: June 28, 2000

                                        /s/ PETER CARTWRIGHT
                                       -----------------------------------------
                                       Peter Cartwright
                                       Administrative Trustee

                                        /s/ ANN B. CURTIS
                                       -----------------------------------------
                                       Ann B. Curtis
                                       Administrative Trustee

                                        /s/ THOMAS R. MASON
                                       -----------------------------------------
                                       Thomas R. Mason
                                       Administrative Trustee
<PAGE>   3
                                       THE BANK OF NEW YORK (DELAWARE),
                                       as Delaware Trustee

                                       By: /s/ WILLIAM T. LEWIS
                                          --------------------------------------
                                          Name: WILLIAM T. LEWIS, SVP
                                          Authorized Signatory

                                       THE BANK OF NEW YORK, as
                                       Property Trustee

                                       By: /s/ MICHELE L. RUSSO
                                          --------------------------------------
                                          Name: MICHELE L. RUSSO
                                          Authorized Signatory

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00015-of-00352.parquet"}]]