Extreme Networks
Annual Report 2011

Plain-text annual report

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549 Form 10-K/A(Amendment No. 1) xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year ended July 3, 2011OR oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934For the Transition Period from to Commission File Number 000-25711___________________________Extreme Networks, Inc.(Exact name of registrant as specified in its charter) ___________________________ Delaware 77-0430270(State or other jurisdiction ofincorporation or organization) (IRS EmployerIdentification Number) 3585 Monroe StreetSanta Clara, California (408) 579-2800(Address of principal executive offices including zip code) (Registrant's telephone number, including area code) ___________________________SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: Title of each class Name of each exchange on which registeredCommon Stock, $0.001 Par Value The NASDAQ Global Select MarketSECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:NoneIndicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No xIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No xIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filingrequirements for the past 90 days. Yes x No oIndicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, tothe best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment tothis Form 10-K. oIndicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data Filerequired to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorterperiod that the registrant was required to submit and post such files). Yes o No oIndicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.See the definitions of “large accelerated filer, “accelerated filer,” and “smaller reporting company”in Rule 12b-2 of the Exchange Act. Large accelerated filer o Accelerated filer xNon-accelerated filer o(Do not check if a smaller reporting company) Smaller reporting company oIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No xThe aggregate market value of voting stock held by non-affiliates of the Registrant was approximately $270.6 million as of December 23, 2010, the lastbusiness day of the Registrant's most recently completed second fiscal quarter, based upon the per share closing price of the Registrant's common stock asreported on The NASDAQ Global Select Market on such date. This calculation does not reflect a determination that certain persons are affiliates of theRegistrant for any other purpose.As of October 15, 2011, there were 92,908,482 shares of the Registrant's Common stock outstanding.___________________________DOCUMENTS INCORPORATED BY REFERENCENone.EXTREME NETWORKS, INC.FORM 10-K/ATABLE OF CONTENTS PART III Item PAGE 10.Directors, Executive Officers and Corporate Governance4 11.Executive Compensation15 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters29 13.Certain Relationships and Related Transactions, and Director Independence31 14.Principal Accounting Fees and Services33 Part IV 15.Exhibits34 Signatures35 EXPLANATORY NOTEWe are filing this Amendment No. 1 on Form 10-K/A (this “Amendment”) to our Annual Report on Form 10-K for the fiscal year ended July 3, 2011, as filedwith the U.S. Securities and Exchange Commission (“SEC”) on August 30, 2011 (the “Original Filing”), solely for the purpose of including the informationrequired by Part III of the Original Filing because we no longer intend to file our definitive proxy statement within 120 days of the end of our fiscal yearended July 3, 2011 as our board of directors has determined that we will hold the next annual meeting of stockholders no earlier than January 13, 2012. Asrequired by Rule 12b-15 under the Securities Exchange Act of 1934, as amended, new certifications by our Principal Executive Officer and PrincipalFinancial Officer are being filed as exhibits to this Amendment under Item 15 of Part IV. We are also making conforming changes to the cover page and tothe Exhibit Index to this Amendment.Except as described above, no other changes have been made to the Original Filing, and all other Items of the Original Filing have been omitted from thisAmendment. The Original Filing continues to speak as of the date of the Original Filing, and we have not updated the disclosures contained therein toreflect any events which occurred at a date subsequent to the filing of the Original Filing other than as expressly indicated in this Amendment. Accordingly,this Amendment should be read in conjunction with the Original Filing and our other filings made with the SEC on or subsequent to August 30, 2011. PART III Item 10.Directors, Executive Officers And Corporate GovernanceDirectorsThe following table provides information concerning the age, tenure on our board of directors, or our Board, and class of our directors and nominees.Name Age Director Since ClassKenneth Levy, Director 68 2001 IOscar Rodriguez, Director, President and Chief Executive Officer 51 2010 IGordon L. Stitt, Director 55 1996 IJohn H. Kispert, Director 48 2009 IIEdward B. Meyercord, III, Chairman of the Board of Directors 46 2009 IIHarry Silverglide, Director 65 2004 IICharles Carinalli, Director 63 1996 IIIEdward H. Kennedy, Director 57 2011 IIIJohn C. Shoemaker, Director 68 2007 IIIDirectors in Class I are serving a term expiring at the 2011 annual meeting of stockholders. Directors in Class II are serving a term expiring at the 2012annual meeting of stockholders. Directors in Class III are serving a term expiring at the 2013 annual meeting of stockholders. There are no familyrelationships among any of our directors or executive officers.The biographies of each of our directors below contains information regarding the person's service as a director, business experience, director positionsheld currently or at any time during the last five years, information regarding involvement in certain legal or administrative proceedings, if applicable, andthe experiences, qualifications, attributes or skills that caused the Nominating and Corporate Governance Committee and our Board to determine that theperson should serve as a director.Class I Directors Serving a Term Expiring at the 2011 Annual MeetingKenneth Levy. Mr. Levy has served as one of our directors since October 2001. Mr. Levy is a private investor and the Chairman Emeritus of KLA-TencorCorporation, a semiconductor company. Mr. Levy co-founded KLA Instruments, the predecessor to KLA-Tencor Corporation, and served it in variouspositions, including as a member of its Board of Directors, as its Chairman of the Board and as its Chief Executive Officer until retiring in October 2006. Mr.Levy has also served on the Boards of Directors of Juniper Networks, Saifun Semiconductor, PowerDsine Inc. and various private companies. Mr. Levy holdsa Bachelors of Science in Electrical Engineering from City College of New York and a Master's of Science in Electrical Engineering from SyracuseUniversity. Mr. Levy is a member of the National Academy of Engineering.4Mr. Levy's business, executive officer, and technology industry experience provides our Board with a valuable resource in understanding companyoperations and evaluating strategic opportunities.Gordon L. Stitt. Mr. Stitt has served as either the Chairman of our Board or as a member of our Board since our inception in May 1996. Mr. Stitt is one ofour co-founders, served as our President and Chief Executive Officer from our inception until August 2006 and remained employed by us until December2006. From July 2009 through December 2010, Mr. Stitt became our part-time employee, performing services as a market development consultant. In 1989,Mr. Stitt co-founded Network Peripherals, Inc., a network technology company, where he served as Vice President of Marketing, then as Vice President andGeneral Manager of the OEM Business Unit until 1995. Mr. Stitt holds a Bachelors of Science in electrical engineering and computer science from SantaClara University and a Masters in Business Administration from the Haas School of Business of the University of California, Berkeley.As our co-founder, and with experience as an executive in networking companies, Mr. Stitt has extensive experience in our industry and the markets forour products. Mr. Stitt provides our Board with expert perspective on industry trends and strategic opportunities, as well as insight into our operations, fromexecution, cultural, competitive and industry points of view.Oscar Rodriguez. Mr. Rodriguez has served as our President and Chief Executive Officer since August 2010 and as one of our directors since October2010. From April 2007 to August 2010, Mr. Rodriguez served as a director and the Chief Executive Officer and President of Movius Interactive Corporation,a mobile media solutions provider. Prior to joining Movius, beginning in April 2006 to April 2007, Mr. Rodriguez served as the Vice President of the CarrierEthernet business and the Chief Marketing Officer of Alcatel-Lucent's Enterprise Business Group. From August 2003 until April 2006, Mr. Rodriguez servedas Chief Executive Officer, President and a director of Riverstone Networks, Inc., an ethernet infrastructure solutions provider, which was acquired by LucentTechnologies in April 2006. From October 2000 to August 2003, Mr. Rodriguez held various positions at Nortel Networks Corporation, atelecommunications systems company, including as Divisional President, Enterprise Solutions Business; Divisional President, Intelligent Internet Business;and Vice President Portfolio & Operations, Local Internet Business. Mr. Rodriguez also sits on the Dean's Board of Advisors for the College of Engineering atthe University of Central Florida. Mr. Rodriguez holds a Bachelors of Science in computer engineering from the University of Central Florida and a Mastersof Business Administration from the Kenan-Flagler Business School at the University of North Carolina, Chapel Hill.Mr. Rodriguez has extensive executive experience in the communications technology industry and provides strong financial and operational expertiseto our Board. As our current President and Chief Executive Officer, Mr. Rodriguez also provides our Board with important insights about our company and itsoperations.Class II Directors Serving a Term Expiring at the 2012 Annual MeetingJohn H. Kispert. Mr. Kispert has served as one of our directors since May 2009. Mr. Kispert has served as President and Chief Executive Officer and as adirector of Spansion, Inc., flash memory manufacturer, since February 2009. From 1995 to February 2009, Mr. Kispert held various executive managementpositions at KLA-Tencor Corporation, most recently as President and Chief Operations Officer from January 2006 to January 2009 and as Executive VicePresident and Chief Financial Officer from March 2000 to December 2005. Previously, Mr. Kispert served in a number of positions with the IBM Corporation.Mr. Kispert received a Bachelors of Science degree in political science from Grinnell College and a Masters of Business Administration from the Universityof California, Los Angeles.Mr. Kispert has extensive management and leadership experience and provides our Board with technology, leadership and financial expertise that aidsour Board in understanding corporate needs and strategic opportunities.Edward B. Meyercord, III. Mr. Meyercord is currently Chairman of our Board and has served as one of our directors since October 2009. Mr. Meyercordhas served as Chief Executive Officer and Director of Critical Alert Systems LLC, a wireless communications company, since July 2010. From January 2009to July 2010, Mr. Meyercord founded and served as President of Council Rock Advisors LLC, an advisory services company. From December 2006 untilJanuary 2009, Mr. Meyercord served as Chief Executive Officer of Cavalier Telephone & TV, a voice and data services company. From 1996 to 2006, Mr.Meyercord served in multiple roles with Talk America, Inc., a telecommunications company which was acquired by Cavalier Telephone & TV, lastly as ChiefExecutive Officer and a member of the board of directors. Mr. Meyercord received a Bachelor's degree in economics from Trinity College in Hartford, CT anda Masters of Business Administration from New York University.Mr. Meyercord has extensive executive experience in management, corporate finance and corporate strategy. His background in thetelecommunications industry provides our Board with valuable industry expertise in one of our key markets.5Harry Silverglide. Mr. Silverglide has served as one of our directors since June 2004. From January 1997to July 2002, Mr. Silverglide served as our Vice President of Sales. From May 1995 to January 1997, he served as Vice President of Western Region Sales forBay Networks.Mr. Silverglide's experience, and particularly his extensive experience in sales and sales organizations,including his experience with our sales organization and distribution channels, provides our Board with valuable insight regarding sales management andsales strategy.Class III Directors Serving a Term Expiring at the 2013 Annual MeetingCharles Carinalli. Mr. Carinalli has served as one of our directors since October 1996. Since 1996, Mr. Carinalli has been a Principal of CarinalliVentures. From 1999 to May 2002, Mr. Carinalli was Chief Executive Officer and a director of Adaptive Silicon, Inc., a semiconductor company. FromDecember 1996 to July 1999, Mr. Carinalli served as President, Chief Executive Officer and a director of Wavespan, Inc., a wireless broadband company thatwas acquired by Proxim, Inc. From 1970 to 1996, Mr. Carinalli served in various positions for National Semiconductor, Inc., lastly as Senior Vice Presidentand Chief Technical Officer. Mr. Carinalli also serves on the boards of directors of Fairchild Semiconductor and Atmel Corporation. Mr. Carinalli holds aBachelors of Science in electrical engineering from the University of California, Berkeley and a Master's of Science in electrical engineering from Santa ClaraUniversity.Mr. Carinalli provides our Board with extensive engineering and engineering management expertise, as well as management expertise and technologyexpertise, which aids our Board in understanding product development, engineering management and strategic planning, as well as risk assessment andplanning.Edward H. Kennedy. Mr. Kennedy has served on our Board since April 2011. Mr. Kennedy has served as the Chief Executive Officer and President ofTollgrade Communications, Inc., a telecommunications company, since June 2009 and served as its Chairman until it was acquired in May 2011 by TalonHoldings, Inc., an affiliate of Golden Gate Capital. From September 2007 until March 2010, Mr. Kennedy served as the Chief Executive Officer and Presidentof Rivulet Communications, Inc., a medical video networking company. From February 2004 until September 2007. Mr. Kennedy served as Venture Partnerat Columbia Capital. From January 2002 until January 2004, Mr. Kennedy served as President of Tellabs North American Operations and Executive VicePresident of Tellabs, a mobile solutions provider. From March 1999 until January 2002, Mr. Kennedy was President and Chief Executive Officer (and co-founder) of Ocular Networks, an optical access equipment supplier. He has also held various executive positions at leading telecom equipment companies,including Alcatel and Newbridge Networks Corporation.Mr. Kennedy has extensive financial and executive leadership experience in technology companies, including networking companies, and providesmanagement and financial expertise to our Board.John C. Shoemaker. Mr. Shoemaker has served as one of our directors since October 2007. From 1990 to June 2004, Mr. Shoemaker held variousexecutive management positions at Sun Microsystems, Inc., a network computing company, including as Executive Vice President, Worldwide OperationsOrganizations and Executive Vice President, Computer Systems. He was responsible for all Sun business units and SPARC microprocessor development.Previously, Mr. Shoemaker served in a number of senior executive positions with the Xerox Corporation, a provider of document management technologyand services. Mr. Shoemaker is currently a director of Altera Inc., a provider of programmable logic solutions. He previously served as Chairman of the boardof directors of SonicWALL, Inc., formerly a network security and remote access software firm. Mr. Shoemaker holds a Bachelor of Arts degree from HanoverCollege and a Masters of Business Administration from Indiana University's Kelley School of Business, where he is Principal Director of the IndianaUniversity Foundation.Mr. Shoemaker has extensive executive experience in senior level management positions in the technology industry, particularly in hardware systems,and provides strong operational, management and financial expertise to our Board.Arrangements Regarding Appointment of DirectorsOscar Rodriguez, our President and Chief Executive Officer, was appointed to our Board in connection with an offer letter of employment we enteredinto with him in August 2010. Pursuant to the offer letter, Mr. Rodriguez must immediately resign as a member of our Board upon the date his employmentwith us terminates.In October 2010 we entered into an agreement with several entities and persons associated with Ramius Advisors, who we collectively refer to as the“Ramius Group.” Under this agreement, we increased the size of our Board to nine directors, creating a Class III vacancy, and we agreed to a process for theappointment of a person to fill the vacant position. Once6elected, we agreed to appoint such director to certain committees of our Board. In April 2011, we appointed Mr. Kennedy to fill the Class III vacancy and toour Audit Committee.Corporate GovernanceOur Board currently consists of nine directors. Currently, the directors are divided into three classes - Class I, Class II and Class III, with each classconsisting of a minimum of two directors. Our Board is being de-staggered over a three year period, with all Directors being elected to one year terms at theend of the expiration of their current term, commencing in 2011. The Class I directors are Kenneth Levy, Oscar Rodriguez, and Gordon L. Stitt. The Class IIdirectors are John H. Kispert, Edward B. Meyercord, III and Harry Silverglide. The Class III directors are Charles Carinalli, Edward Kennedy, and John C.Shoemaker.Our Board has determined that, other than Gordon L. Stitt and Oscar Rodriguez, each member of our Board is an independent director for purposes ofthe NASDAQ Marketplace Rules. In making these independence determinations, our Board has concluded that these directors do not have an employment,business, family or other relationship which, in the opinion of our Board, would interfere with the exercise of independent judgment in carrying out theresponsibilities of a director.Currently, our Class I, Class II and Class III directors serve until the annual meetings of stockholders to be held for the years of 2011, 2012 and 2013,respectively, and until their respective successors are duly elected and qualified. Commencing with the meeting for 2011, at each annual meeting ofstockholders, the successors to directors whose terms expire at that meeting are elected to serve from the time of election and qualification until the nextannual meeting following their election. Our Board has a mandatory retirement age of seventy (70).Edward B. Meyercord, III was elected as our Independent Chairman in 2011, and his duties as Independent Chairman include:•chairing executive sessions of the independent directors;•ensuring that independent directors have adequate opportunities to meet without management present;•serving as designated contact for communication to independent directors, including being available for consultation and direct communicationwith major stockholders;•ensuring that the independent directors have an opportunity to provide input on the agenda for meetings of our Board;•assuring that there is sufficient time for discussion of all agenda items; and•being identified as the recipient of communications with stockholders in the annual meeting proxy statement.Our Board elects our President, Chief Financial Officer, Secretary and all executive officers. All executive officers serve at the discretion of our Board.Each of our officers devotes his full time to our affairs. Our directors devote time to our affairs as is necessary to discharge their duties. In addition, our Boardhas the authority to retain its own advisers to assist it in the discharge of its duties. There are no family relationships among any of our directors, officers orkey employees.Board Leadership StructureOur Board leadership structure currently consists of an Independent Chairman, and a Chief Executive Officer. In the current structure, the roles of ChiefExecutive Officer and Chairman of our Board are separated. Edward B. Meyercord, III has served as the Independent Chairman of our Board since April 2011,while Oscar Rodriguez serves as our President and Chief Executive Officer. Separating these positions allows our Chief Executive Officer to focus on settingour strategic direction and for day-to-day leadership and performance, while allowing the Chairman of our Board to lead our Board in its fundamental role ofproviding advice to, and independent oversight of, management.Our Board recognizes the time, effort, and energy that our Chief Executive Officer is required to devote to his position in the current businessenvironment, as well as the commitments required to serve as the Chairman of our Board, particularly as our Board's oversight responsibilities continue togrow. While our Bylaws and Corporate Governance Guidelines do not require that the Chairman of our Board and Chief Executive Officer positions beseparate, our Board believes that separating these positions is the appropriate leadership structure for us at this time and results in an effective balancing ofresponsibilities, experience and independent perspective to meet the current corporate governance needs and oversight responsibilities of our Board.Board's Role in Risk OversightOur Board has an active role, as a whole and also at the committee level, in overseeing management of the risks we face.7This role is one of informed oversight rather than direct management of risk. Our Board regularly reviews and consults with management on strategicdirection, challenges and risks we face. Our Board also reviews and discusses with management quarterly financial results and forecasts. The AuditCommittee of our Board oversees management of financial risks, and its charter tasks the committee to provide oversight of and review at least annually ourrisk management policies, including its investment policies and anti-fraud program. The Compensation Committee of our Board is responsible for overseeingthe management of risks relating to and arising from our executive compensation plans and arrangements. These committees provide regular reports,generally on a quarterly basis, to the full Board.Management is tasked with the direct management and oversight of legal, financial, and commercial compliance matters, which includes identificationand mitigation of associated areas of risk. Our General Counsel provides regular reports of legal risks to the Audit Committee and our Board. Our ChiefFinancial Officer and the Vice President Corporate Controller provide regular reports to the Audit Committee concerning financial, tax and audit relatedrisks. In addition, the Audit Committee receives periodic reports from management on our compliance programs and efforts, investment policy and practicesand the results of various internal audit projects. Management and the Compensation Committee's compensation consultant provide analysis of risks relatedto our compensation programs and practices to the Compensation Committee.Meetings of the Board of DirectorsOur Board held twenty four meetings during the fiscal year ended July 3, 2011. No director serving on our Board in fiscal year 2011 attended fewerthan 75% of the aggregate of the meetings of our Board and the meetings of the committees on which he served.Executive SessionsThe independent members of our Board meet regularly in executive session (without the participation of executive officers or other non-independentdirectors), generally before or after a regularly scheduled Board meetings or at such other times requested by our independent directors. Executive sessions ofthe independent directors are chaired by our Chairman. The executive sessions include discussions and recommendations regarding guidance to be providedto the Chief Executive Officer and such topics as the independent directors determine.Committees of the Board of DirectorsOur Board has a separately-designated standing Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee.Our Board has adopted a written charter for each of these committees, each of which is available on our website at http://www.extremenetworks.com/about-extreme/corp-governance.aspx.Current Committee MembershipName Audit Committee Compensation Committee Nominating and Corporate GovernanceCommitteeCharles Carinalli Member Chairman MemberJohn H. Kispert Chairman Edward H. Kennedy Member Kenneth Levy ChairmanEdward B. Meyercord, III Member John C. Shoemaker Member Member Harry Silverglide MemberAudit Committee. The current members of the Audit Committee are Messrs. Carinalli, Kennedy, Kispert and Shoemaker. Mr. Kispert serves as Chairman.Each member of the Audit Committee has been determined by our Board to be independent for purposes of the NASDAQ Marketplace Rules and the rules ofthe SEC as these rules apply to audit committee members. Our Board has determined that Mr. Kispert is an audit committee financial expert, as defined in therules of the SEC. The Audit Committee retains our independent auditors, reviews and approves the planned scope, proposed fee arrangements and terms ofengagement of the independent auditors, reviews the results of the annual audit of our financial statements and the interim reviews of our unaudited financialstatements, evaluates the adequacy of accounting and financial controls, reviews the independence of our auditors, and oversees our financial reporting onbehalf of our Board. The Audit Committee is also responsible for establishing procedures for the receipt, retention and treatment of complaints received by usregarding questionable accounting or auditing matters, including the anonymous submission by our employees of concerns regarding accounting or auditingmatters. In addition, the Audit Committee reviews with our independent auditors the scope and timing of their audit services and any other services they areasked to perform, the independent auditor's report on our consolidated8financial statements following completion of their audit, and our critical accounting policies and procedures and policies with respect to our internalaccounting and financial controls. The Audit Committee also assists our Board in fulfilling its oversight responsibilities with respect to financial risks,including risk management in the areas of financial reporting, internal controls, and compliance with legal and regulatory requirements. The AuditCommittee held nine meetings during the fiscal year ended July 3, 2011.Compensation Committee. The current members of the Compensation Committee are Messrs. Carinalli, Meyercord, and Shoemaker. Mr. Carinalli servesas Chairman. Each member of the Compensation Committee has been determined by our Board to be independent for purposes of the NASDAQ MarketplaceRules as they apply to compensation committee members. The Compensation Committee has responsibility for, among other things, discharging our Board'sresponsibilities relating to compensation and benefits of our officers, including responsibility for evaluating and reporting to our Board on mattersconcerning management performance, officer compensation and benefits plans and programs. In carrying out these responsibilities, the CompensationCommittee is required to review all components of executive officer compensation for consistency with our compensation philosophy. The CompensationCommittee also administers our stock option plans and stock incentive plans. The Compensation Committee assists our Board in fulfilling its oversightresponsibilities with respect to the management of risks arising from our compensation policies and programs. The charter of the Compensation Committeeprovides that the Compensation Committee may delegate duties or responsibilities to subcommittees or to one member of the Compensation Committee fromtime to time, as appropriate. However, historically the Compensation Committee has delegated duties or responsibilities only under limited circumstances.Our President and Chief Executive Officer and our Head of Human Resources assist the Compensation Committee in its deliberations with respect to thecompensation of our executive officers, except that our Chief Executive Officer does not play a role in the Compensation Committee's deliberationsregarding his own compensation determination, other than discussing his performance objectives with the Compensation Committee. The other executiveofficers do not play a role in the Compensation Committee's deliberations regarding their own compensation determination, except that each executiveofficer discusses his or her individual performance objectives with our Chief Executive Officer, and our General Counsel may be present for deliberations andmay provide advice to the Compensation Committee regarding legal issues associated with compensation plans and decisions. The CompensationCommittee held eleven meetings during the fiscal year ended July 3, 2011. For more information about the Compensation Committee, see the discussionbelow under the heading “Executive Compensation.”Nominating and Corporate Governance Committee. The current members of the Nominating and Corporate Governance Committee areMessrs. Carinalli, Levy, and Silverglide. Mr. Levy serves as Chairman. Each member of the Nominating and Corporate Governance Committee has beendetermined by our Board to be independent for purposes of the NASDAQ Marketplace Rules as they apply to nominating committee members. TheNominating and Corporate Governance Committee identifies, reviews, evaluates and nominates candidates to serve on our Board, is responsible forrecommending corporate governance principles, codes of conduct and compliance mechanisms applicable to us, and assists our Board in its annual reviewsof the performance of our Board, each committee and management. The Nominating and Corporate Governance Committee assists our Board in fulfilling itsoversight responsibilities with respect to the management of risks associated with board organization, membership and structure, succession planning for ourdirectors and executive officers, and corporate governance. The Nominating and Corporate Governance Committee held six meetings during the fiscal yearended July 3, 2011.Compensation Committee Interlocks and Insider ParticipationEach of Charles Carinalli, Edward B. Meyercord, III and John C. Shoemaker served as a member of the Compensation Committee in fiscal 2011. None ofour executive officers has served on the board of directors or compensation committee of any other entity that has, or has had, one or more executive officerswho served as a member of our Board or Compensation Committee during the 2011 fiscal year. No member of the Compensation Committee was, duringfiscal year 2011 or any prior period, an officer or employee of ours.Director NominationsDirector Qualifications. In fulfilling its responsibilities, the Nominating and Corporate Governance Committee considers numerous factors inreviewing possible candidates for nomination as director, including:•the appropriate size of our Board and its Committees;•the perceived needs of our Board for particular skills, background and business experience;•the skills, background, reputation, and business experience of nominees and the skills, background, reputation, and business experience alreadypossessed by other members of our Board;•nominees' independence from management;•nominees' experience with accounting rules and practices;9•nominees' background with regard to executive compensation;•applicable regulatory and listing requirements, including independence requirements and legal considerations, such as antitrust compliance;•the benefits of a constructive working relationship among directors; and•the desire to balance the considerable benefit of continuity with the periodic injection of the fresh perspective provided by new members. While we do not have a formal diversity policy, in evaluating the qualifications of the candidates, the Nominating and Corporate GovernanceCommittee considers many factors, including issues of character, judgment, independence, age, education, expertise, diversity of experience, length ofservice, other commitments and ability to serve on committees of our Board, as well as other individual qualities and attributes that contribute to boardheterogeneity, including characteristics such as race, gender, and national origin. The Nominating and Corporate Governance Committee evaluates suchfactors, among others, and does not assign any particular weighting or priority to any of these factors.Other than the foregoing there are no stated minimum criteria for director nominees, although the Nominating and Corporate Governance Committeemay also consider other factors as it may deem, from time to time, are in the best interests of us and our stockholders. The Nominating and CorporateGovernance Committee believes that it is preferable that at least one member of our Board should meet the criteria for an “audit committee financial expert”as defined by SEC rules. Under applicable listing requirements, at least a majority of the members of our Board must meet the definition of “independentdirector.” The Nominating and Corporate Governance Committee also believes it appropriate for one or more key members of management to participate asmembers of our Board. Identifying and Evaluating Candidates for Nomination as Director. The Nominating and Corporate Governance Committee annually evaluates thecurrent members of our Board whose terms are expiring and who are willing to continue in service against the criteria set forth above in determining whetherto recommend these directors for election. The Nominating and Corporate Governance Committee regularly assesses the optimum size of our Board and itscommittees and the needs of our Board for various skills, background and business experience in determining if our Board requires additional candidates fornomination.Candidates for nomination as director come to the attention of the Nominating and Corporate Governance Committee from time to time throughincumbent directors, management, stockholders or third parties. These candidates may be considered at meetings of the Nominating and CorporateGovernance Committee at any point during the year. Candidates are evaluated against the criteria set forth above. If the Nominating and CorporateGovernance Committee believes at any time that our Board requires additional candidates for nomination, the Nominating and Corporate GovernanceCommittee may poll directors and management for suggestions or conduct research to identify possible candidates and may engage, if the Nominating andCorporate Governance Committee believes it is appropriate, a third party search firm to assist in identifying qualified candidates.The Nominating and Corporate Governance Committee evaluates any recommendation for director nominee proposed by a stockholder. In order to beevaluated in connection with the Nominating and Corporate Governance Committee's established procedures for evaluating potential director nominees, anyrecommendation for director nominee submitted by a stockholder must be sent in writing to the Corporate Secretary, 3585 Monroe Street, Santa Clara, CA95051 and must be received at our principal executive offices not less than 120 days nor more than 150 calendar days in advance of the date that our proxystatement was released to stockholders in connection with the previous year's annual meeting of stockholders, except that if no annual meeting was held inthe previous year or the date of the annual meeting has been changed by more than 30 calendar days from the date contemplated at the time of the previousyear's proxy statement, notice by the stockholders to be timely must be received not later than the close of business on the tenth day following the day onwhich public announcement of the date of such meeting is first made. For purposes of the foregoing, “public announcement” shall mean disclosure in abroadly disseminated press release or in a document publicly filed by us with the SEC. The recommendation for director nominee submitted by a stockholdermust contain the following information:•the candidate's name, age, contact information and present principal occupation or employment;•a description of the candidate's qualifications, skills, background, and business experience during, at a minimum, the last five years, includinghis/her principal occupation and employment and the name and principal business of any corporation or other organization in which thecandidate was employed or served as a director; and•a statement signed by the candidate that the candidate is willing to be considered and willing to serve as a director if nominated and elected. In addition, our bylaws permit stockholders to nominate directors for consideration.10All directors and director nominees must submit a completed form of directors' and officers' questionnaire as part of the nominating process. Theevaluation process may also include interviews and additional background and reference checks for non-incumbent nominees, at the discretion of theNominating and Corporate Governance Committee. In addition, nominees must enter into an agreement to abide by the Company's Code of Conduct anddisclose any voting arrangements or compensation provided by third parties in connection with their service on the Company's Board.The Nominating and Corporate Governance Committee evaluates incumbent directors, as well as candidates for director nominee submitted bydirectors, management and stockholders consistently using the criteria stated in our policies and procedures and selects the nominees that, in the Nominatingand Corporate Governance Committee's judgment, best suit the needs of our Board at the time. Communications with DirectorsEdward B. Meyercord, III has been selected by our directors as our Independent Chairman and, as such, is responsible for receiving, distributing andarranging responses to communications from our stockholders to our Board. Stockholders may communicate with our Board by transmitting correspondenceby mail, facsimile or email, addressed as follows:Chairman of the Board (or individually named director(s))Extreme Networks, Inc.3585 Monroe StreetSanta Clara, CA 95051The Chairman transmits each communication as soon as practicable to the identified director addressee(s), unless (i) there are safety or security concernsthat mitigate against further transmission of the communication; or (ii) the communication contains commercial matters not related to the stockholder's stockownership, as determined by the Chairman in consultation with legal counsel. Our Board or individual directors are advised of any communication withheldfor safety, security or other reasons as soon as practicable.Director Attendance at Annual MeetingsWe use reasonable efforts to schedule our annual meeting of stockholders at a time and date to maximize attendance by directors, taking into accountthe directors' schedules. In cases where management, in its reasonable business judgment, expects stockholder attendance at our annual meeting to besignificant, we encourage director attendance at the annual meeting. Directors make every effort to attend our annual meeting of stockholders whenmeaningful stockholder attendance at the meeting is anticipated. Messrs. Carinalli, Kispert, Rodriguez, Shoemaker, and Stitt attended our 2010 annualmeeting of stockholders.Section 16(a) Beneficial Ownership Reporting ComplianceSection 16(a) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, requires our executive officers, directors and persons whobeneficially own more than 10% of our common stock to file initial reports of beneficial ownership and reports of changes in beneficial ownership with theSEC. These persons are required by SEC regulations to furnish us with copies of all Section 16(a) forms filed by such person. Based solely on our review ofthe forms furnished to us and written representations from certain reporting persons, we believe that all filing requirements applicable to our executiveofficers, directors and persons who beneficially own more than 10% of our common stock were complied with in the fiscal year ended July 3, 2011, exceptthat a Form 4 was not timely filed for Michael L. Seaton with respect to a transaction in May 2011.Code of Ethics and Corporate Governance MaterialsOur Board has adopted a charter for its Audit, Compensation and Nominating and Corporate Governance Committees, which are available on ourwebsite at http://www.extremenetworks.com/about-extreme/corp-governance.aspx. Our Board has also adopted a Code of Business Conduct and Ethics thatapplies to all of our employees, officers and directors. The Code of Business Conduct and Ethics can be found on our website athttp://www.extremenetworks.com/about-extreme/corp-governance.aspx.We believe that good corporate governance is essential to ensure that we are managed for the benefit of stockholders. Our Board has adopted ourCorporate Governance Guidelines to address key corporate governance issues. The Nominating and Corporate Governance Committee is responsible forreviewing the Corporate Governance Guidelines and recommending to our Board any changes to them. The Corporate Governance Guidelines can be foundon our website at http://www.extremenetworks.com/about-extreme/corp-governance.aspx.Executive Officers11The following table sets forth information regarding our executive officers:Name Age PositionOscar Rodriguez 51 President and Chief Executive OfficerJames T. Judson 57 Interim Vice President, Chief Financial OfficerGavin Cato 43 Vice President, EngineeringMargaret Echerd 52 Vice President, Corporate Controller, and Principal Accounting OfficerMimi Gigoux 50 Senior Vice President, Human ResourcesDavid Ginsburg 48 Senior Vice President, Chief Marketing OfficerDiane C. Honda 46 Vice President, General Counsel and SecretaryMichael L. Seaton 47 Vice President, Worldwide Sales and ServicesOscar Rodriguez. Biographical and related information for Mr. Rodriguez is set forth above under the heading “Board of Directors.”James T. Judson. Mr. Judson has served as our Interim Vice President, Chief Financial Officer since March 2011. Since March 2006, Mr. Judson hasserved as a financial executive advisor to small and mid-sized companies. From April 2005 to March 2006, Mr. Judson served as Interim Chief FinancialOfficer of Omnicell, Inc. From February 2005 to April 2005, Mr. Judson was Omnicell's Vice President of Finance. Mr. Judson has served as a director ofOmnicell since April 2006. From 1998 until his retirement in January 2002, Mr. Judson served as Vice President of Finance and Planning for theWorldwide Operations group of Sun Microsystems, a network computing company. Mr. Judson received a Bachelors of Science in industrialmanagement from Purdue University and a Masters of Business Administration from Indiana University.Gavin Cato. Mr. Cato has served as our Vice President, Engineering since June 20, 2011. Prior to joining us, Mr. Cato was in charge of strategicalliances for the Elster Group, a utilities company from August 2010 to June 2011. From February 2009 to August 2010, Mr. Cato was in independentconsultant with the Timewater Group. From 2006 to February 2009, Mr. Cato served in various roles with Tekelec, lastly as Vice President, MarketDevelopment and Corporate Development. Prior to Tekelec, Mr. Cato held leadership roles in product research, development and engineering; productmanagement and business development; and in key management roles for both large companies, such as IBM, and Nortel Networks in addition to severalstart-up firms. Mr. Cato holds both a Bachelors of Science and a Masters of Science in electrical engineering from Duke University, a PhD in electricalengineering from North Carolina State University, and a Masters of Business Administration from Duke University.Margaret Echerd. Ms. Echerd has served as our Vice President, Corporate Controller and Principal Accounting Officer since September 2011. Ms.Echerd previously served as out Assistant Corporate Controller from June 2010 to September 2011. Prior to joining us, Ms. Echerd served as CorporateController of XeroCoat, Inc., a solar technology company, from December 2008 to May 2010. From October 2006 to July 2008, Ms. Echerd served as theUS Controller for Align Technology, Inc., a medical device company. Ms. Echerd, who is a certified public accountant, earned a Bachelors of BusinessAdministration in Marketing from Texas A&M University and a Masters of Business Administration in Corporate Finance from Golden Gate University.Mimi Gigoux. Ms. Gigoux has served as our Senior Vice President of Human Resources since April 2011. Prior to joining us, Ms. Gigoux served asChief Human Resources Officer and Senior Vice President of Aviat Networks, a mobile broadband technology company, from January 2010 to April2011. From May 2005 to October 2009, Ms. Gigoux served as Vice President of Human Resources and Chief of Staff at Redback Networks.David Ginsburg. Mr. Ginsburg has served as our Senior Vice President, Chief Marketing Officer since July 2011. Prior to taking on this role, Mr.Ginsburg served as our Senior Vice President, Product Marketing from November 2010 through June 2011. Prior to joining us, Mr. Ginsburg was VicePresident of Marketing for InnoPath. Prior to InnoPath, he held marketing leadership positions at Lucent, Riverstone Networks, Allegro Networks andNortel Networks. In addition, Mr. Ginsburg held various management and engineering positions with Cisco, Alcatel, and in the U.S. Army. Mr. Ginsburgholds a Bachelors of Science in electrical engineering from Rensselaer Polytechnic Institute in New York and is a former chair of the Broadband ContentDelivery Forum. 12Diane C. Honda. Ms. Honda has served as our Vice President, General Counsel and Secretary since October 2009. Ms. Honda previously served asour Vice President and Associate General Counsel. from November 2004 to October 2009. Prior to joining us, Ms. Honda held legal or business positionswith Speedera Networks, Inc., Riverstone Networks, Inc., Legato Systems, Inc., and Hewlett-Packard Company. She received a Bachelors of Science inApplied Math Computer Science and Industrial Management from Carnegie Mellon University and a Juris Doctorate. from Santa Clara University Schoolof Law.Michael L. Seaton. Mr. Seaton has served as our Vice President for Worldwide Sales and Services since May 2010. Mr. Seaton previously served as ourVice President and General Manager of Worldwide Services from July 2007 to May 2010. From November 2004 to July 2007, Mr. Seaton was our VicePresident of Sales Operations and Strategic Alliances. Prior to joining us, Mr. Seaton held various positions at AT&T, Lucent Technologies and Avaya. Mr.Seaton holds a Bachelors of General Studies with a concentration in mathematics and computer science from the University of Michigan and a Masters ofBusiness Administration from Florida State University.13REPORT OF THE COMPENSATION COMMITTEEThe Compensation Committee of the Board of Directors has reviewed and discussed the Compensation Discussion and Analysis required byItem 402(b) of the Securities and Exchange Commission's Regulation S-K with management. Based on such review and discussions, the CompensationCommittee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in our Annual Report on Form 10-K for thefiscal year ended July 3, 2011, as amended.The material in this report shall not be deemed to be “soliciting material” or “filed” with the Securities and Exchange Commission, shall be deemed“furnished” in our Annual Report on Form 10-K for the fiscal year ended July 3, 2011, as amended, and shall not be deemed incorporated by reference intoany filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, as a result of furnishing the disclosure in thismanner.COMPENSATION COMMITTEECharles Carinalli, ChairmanEdward B. Meyercord, IIIJohn C. Shoemaker14Item 11.Executive CompensationCompensation Discussion and AnalysisCompensation Philosophy and ObjectivesOur executive compensation philosophy and objectives are to provide a competitive overall compensation package that allows us to attract highquality candidates for senior leadership positions, to retain these employees and to establish a total compensation program which motivates and rewardsindividual and team performance in alignment with our goals, principal among which is the creation of stockholder value. We establish market competitivetarget levels of total compensation, focusing on both current pay and the opportunity for long term compensation. We target compensation at the 60thpercentile for salary, total cash compensation and long term incentives. Annual compensation for a given executive is determined with reference tocompetitive market data, as well as the individual's experience, knowledge, skills, education, performance and importance to our business. Our compensationprogram is designed to motivate individual and team accountability for our absolute and relative competitive performance.Named Executive OfficersThis “Executive Compensation” section of our Annual Report on Form 10-K/A presents compensation earned by our “named executive officers” (asdefined by SEC rules). For the fiscal year ended July 3, 2011, our named executive officers and their respective titles were as follows:Name TitleOscar Rodriguez President and Chief Executive Officer, DirectorJames T. Judson Interim Vice President, Chief Financial OfficerDavid Ginsburg Senior Vice President, Chief Marketing OfficerMichael L. Seaton Vice President of Worldwide Sales and ServicesDiane Honda Vice President, General Counsel and SecretaryBob L. Corey Former Acting President and Chief Executive Officer and Former Executive Vice President, ChiefFinancial OfficerPaul A. Hooper (1) Former Vice President, Corporate Marketing(1) Mr. Hooper is included under Item 402(a)(3)(iv) of Regulation S-K.Oscar Rodriguez was appointed as our President and Chief Executive Officer in August 2010, and a summary of our employment agreement with Mr.Rodriguez is provided in the “Summary of Employment and Other Agreements” section below. James Judson was appointed our Interim Chief FinancialOfficer in March 2011. Michael L. Seaton was appointed as Vice President of Worldwide Sales and Services in May 2009. Diane Honda was appointed as ourVice President, General Counsel and Secretary in October 2009. David Ginsburg was appointed as our Senior Vice President, Chief Marketing Officer in July2011. Bob L. Corey resigned from the Company effective March 9, 2011. Paul A. Hooper resigned from the Company effective July 8, 2011.Compensation ProcessThroughout the year, our Compensation Committee Chair meets with our Head of Human Resources to monitor issues relating to executivecompensation. At the end of the fiscal year, our CEO conducts a quantitative assessment of each named executive officer's performance for the past fiscal yearbased upon the officer's individual and team business goals and objectives. Our CEO and our Head of Human Resources also review the competitivebenchmarking assessments of similarly situated executives in comparable companies in our industry, the competitive position of us relative to comparablecompanies in our industry, and the available salary and equity merit increase budget for the Company. Our CEO then makes specific recommendations to theCompensation Committee for any changes to base salary, target bonus opportunities, other cash incentives and equity awards, if appropriate. TheCompensation Committee considers these proposals and makes any final approvals required in executing their duties. In addition, the CompensationCommittee similarly assesses the performance of our CEO, based on the achievement of the approved financial goals, performance metrics, and strategicobjectives identified to improve our operating performance. Our CEO is not present at the time the Compensation Committee reviews his performance anddiscusses his compensation. The Compensation Committee retains an independent compensation consultant to provide data and advice and to conduct athird-party review and assessment of proposed compensation plans. The consultant also provides guidance to the CEO, Head of Human Resources and theCommittee in making compensation decisions.15Peer Group Selection and BenchmarkingThe Compensation Committee seeks to set the base salary and total compensation of our executives, including our named executive officers, at the 60thpercentile of the compensation of similarly-situated executives in comparable companies in our industry with whom we directly compete in our hiring andretention of executives. However, the Compensation Committee has the authority to approve position specific compensation packages that are above orbelow this level based on the executive's specific experience, knowledge, skills, education, performance and importance to the business. In addition to thesefactors, the Compensation Committee also considers the information provided by its advisors and the comparative compensation of our other officers whendetermining an individual's actual pay level.For our fiscal year ended July 3, 2011, the Compensation Committee engaged Radford, an Aon Consulting Company, as an independent advisor toprovide competitive market data regarding the components of our executive compensation. Radford reports directly to the Compensation Committee, andworks with management to gain access to compensation information. We paid the fees charged by Radford for its engagement by the CompensationCommittee with respect to its services related to fiscal year 2011 compensation.For the Compensation Committee's deliberations regarding our fiscal year 2011 executive compensation, the Compensation Committee reviewed aRadford Executive Benchmark Survey which includes the following companies which make up our peer group:• ADTRAN, Inc.• NETGEAR, Inc.• Blue Coat Systems• Novatel Wireless, Inc.• Digi International• QAD• EMS Technologies• QLogic Corporation• Emulex• RadiSys Corporation• F5 Networks• Sonos Networks• Harmonic• Super Micro Computer• Infinera• Westell Technologies, Inc.• MRV Communications Inc. The Radford assessment examined a range of pay levels including the 25th, 50th and 75th percentile of the applicable benchmark group to reflect a rangeof pay to be considered when determining individual pay elements.Compensation Program ElementsThe main elements of our compensation program and their respective purposes are as follows:Element PurposeBase salary Attract and retain talented employees. Serve as a primary element of compensation.Annual cash incentives Encourage and reward employees who achieve overall corporate goals and individual objectives, particularly in the shortterm.Annual long-term equityincentives Encourage and reward employees who achieve overall corporate goals and individual objectives, particularly in the longterm. Encourage employee retention. Align the interests of officers and stockholders.Change in control andseverance benefits Retain officers during the pendency of a proposed change in control transaction. Avoid adverse impacts to the morale ofofficers and uncertainty regarding continued employment. Align the interests of officers and stockholders in the event of achange in control.Benefit plans Attract and retain talented employees. Provide assurance of financial support in the event of illness or injury. Encourageretirement savings. Encourage additional equity ownership by employees.The Compensation Committee does not have a set formula for determining the mix of pay elements for named executive officers. Other than certainchange in control and severance benefits, our executives generally receive only compensation elements that are provided to our rank-and-file employees.2011 Compensation DecisionsAs a result of the process and purposes described above, in 2011 the Compensation Committee made the following compensation decisions withrespect to our named executive officers:Base Salary16The Compensation Committee, together with our Head of Human Resources and CEO, reviewed the base salaries for our executive officers for the fiscalyear ending July 3, 2011. The Compensation Committee made modest adjustments to the salaries of Mr. Seaton, Ms. Honda and Mr. Corey effective as of thebeginning of fiscal 2011. In addition, during the fiscal year, the Compensation Committee reviewed and approved the offers to Messrs. Rodriguez, Judson,and Ginsburg when they joined the Company, including their salaries for fiscal 2011.For additional information regarding the Compensation Committee's decisions with respect to named executive officers who resigned during the fiscalyear ended July 3, 2011, including a summary of separation arrangements, see the discussion below under the heading “Summary of Employment and OtherAgreements.”Annual IncentivesOur Compensation Committee establishes an Executive Incentive Plan each year, designed to reward our executives for the successful management ofour business. The structure and elements of the plan are reviewed and modified annually based upon expectations for our business based on our Board-approved operating plan. In July 2010, our Board, upon the recommendation of the Compensation Committee, approved the terms of our Fiscal 2011Executive Incentive Bonus Plan, or our “2011 Incentive Plan.”The 2011 Incentive Plan is a restricted stock-based bonus program that provides payouts which are earned based on (i) corporate achievement of pre-established objectives and (ii) on continued employment through a specified date. All employees who are not on a commission plan are eligible for the 2011Incentive Plan. In order to participate in the 2011 Incentive Plan, participants must have been employed by us for a minimum of one full fiscal quarter andmust be employed by us, or one of our subsidiaries, on the day the restricted shares vest. Under the terms of the 2011 Incentive Plan the CompensationCommittee established bonus targets for our named executive officers under our 2011 Incentive Plan and set the targets for officers hired or promoted duringthe course of the year. The number of restricted shares an Executive received was to be calculated based upon the number of shares equal to 150% of theparticipant's target bonus divided by the opening price of the Company's stock on the first day of fiscal 2011.The restricted shares issued under the 2011 Incentive Plan were to vest, if at all, on August 15, 2011 as follows:•One third if the Company's Board approved revenue and operating profit targets are satisfied;•One-third if such revenue and operating profits targets are exceeded by specified amounts; and•One-third of the shares vesting if the Executive remains employed on August 15, 2011, with the exception of Messrs. Ginsburg and RodriguezThe Compensation Committee approved awards of a total of 1,688,521 RSUs under the revised 2011 Incentive Plan to our employees and management.The individual target bonus percentages for Messrs. Rodriguez, Judson, Seaton, Hooper, Ginsburg, Corey and Ms. Honda were 100%, 60%, 0%, 40%, 50%,60% and 40%, respectively. The table below sets forth the maximum number of RSUs that could have vested for each named executive officer,approximately 67% of which was dependent upon attaining the revenue and non-GAAP operating profit targets described above and approximately 33% ofwhich was dependent upon the executive remaining with us in August 2011. Under our 2011 Incentive Plan, our non-GAAP operating profit is determined onthe same basis that we report non-GAAP operating profit publicly.Participant Title Number of RSUsOscar Rodriguez President and Chief Executive Officer 342,533David Ginsburg Senior Vice President, Chief Marketing Officer 50,000Diane Honda Vice President, General Counsel and Secretary 53,190Bob L. Corey Executive Vice President, Finance and Chief Financial Officer 119,682Paul A. Hooper Vice President, Corporate Marketing 59,574We did not meet our performance targets, so none of the shares allocated for achievement of these goals vested under the 2011 Incentive Plan. One-thirdof the shares for each participant under the 2011 Incentive Plan that was employed by us on August 15, 2011, including named executive officers, vested inaccordance with their terms.Sales Commission PlanMr. Seaton did not participate in our 2011 Incentive Plan, but instead participated in a separate sales commission plan.17For 2011, Mr. Seaton was paid a fixed percentage based upon a set quota, with a target total commission of $250,000 based on total revenue, though the totalamount achievable by Mr. Seaton was uncapped. A fixed percentage was used to make the plan easy to understand and to directly tie Mr. Seaton'scompensation to our success. Because our management wanted to incentivize Mr. Seaton to maximize sales of our products and services and therebymaximize his own compensation, there were no maximum amounts established for Mr. Seaton's sales commission plan.Long-Term Equity Incentive Compensation2005 Equity Incentive PlanUnder our 2005 Equity Incentive Plan, or the 2005 Plan, we may grant stock options, stock appreciation rights, restricted stock, RSUs, performanceshares, performance units, and other share-based or cash-based awards to employees and consultants. The 2005 Plan also authorizes the grant of awards ofstock options, stock appreciation rights, or SARs, restricted stock, and RSUs to non-employee members of our Board and deferred compensation awards toofficers, directors and certain management or highly compensated employees. Under the 2005 Plan, all stock options must be granted with an exercise priceper share that is not less than the fair market value of a share of our common stock on the effective date of grant of the option. The 2005 Plan replaced the1996 Stock Option Plan, the 2000 Nonstatutory Stock Option Plan, and the 2001 Nonstatutory Stock Option Plan. Pursuant to the 2005 Plan, up to27,000,000 shares of our common stock are authorized for issuance. As of July 3, 2011, 9,823,324 shares were available for future grant under the 2005 Plan.New Hire Grants; Promotional GrantsGenerally, we grant equity awards to our new employees, including our named executive officers, in connection with the start of their employment, andwe occasionally grant equity awards in connection with the promotion of employees. New-hire stock options granted to named executive officers generallyvest as follows: one-fourth vests one year after the officer's employment start date, and the remaining shares vest monthly over the following three years at arate of 1/48th of the entire option each month, subject to the officer's continued employment with us. Promotional stock options granted to named executiveofficers generally vest monthly over the four years following the date of grant at a rate of 1/48th of the entire option each month, subject to the officer'scontinued employment with us. However, our Board or the Compensation Committee has approved certain exceptions to vesting schedules for new-hire andpromotional equity awards in the past. For example, see “Change in Control and Severance Agreements,” below. The aggregate amounts of the new-hire orpromotional grants to named executive officer are negotiated with the named executive officer.The following table sets forth information on new-hire or promotional grants to named executive officers in fiscal year 2011:Named Executive Officer Equity Award Grant Date Number of Shares Subject toStock Option GrantApproved Other Equity Award, If AnyOscar Rodriguez, President and Chief Executive Officer November 3, 2010 900,000 150,000James T. Judson, Interim Vice President and ChiefFinancial Officer May 2, 2011 100,000 Michael L. Seaton, Vice President, World Wide Sales &Services November 3, 2010 100,000 50,000David Ginsburg, Senior Vice President, Chief MarketingOfficer February 2, 2011 400,000 50,000Annual Merit GrantsWe have typically granted each named executive officer an additional stock option and RSU grants on an annual basis, with the goal of providingcontinued incentives to retain strong executives and improve corporate performance. Merit based annual stock options granted to named executive officersgenerally vest monthly over the four years following the date of grant at a rate of 1/48th of the entire option each month, subject to the officer's continuedemployment with us. RSU grants generally vest over a 2 year period, with 50% vesting after the first year and 50% vesting at the end of the second year,subject to the officer's continued employment with us. However, our Board or the Compensation Committee has approved certain exceptions to vestingschedules in the past.In January 2011, the Compensation Committee evaluated the performance of each of our named executive officers and, decided to grant any meritbased annual stock options and RSUs. The following table sets forth information on merit based18stock options and RSUs grants to named executive officers in fiscal year 2011:Named Executive Officer Equity AwardGrant Date Number of Shares Subject to StockOption Grant Approved Other EquityAward, If AnyMichael L. Seaton February 2, 2011 65,000 21,450Vice President, World Wide Sales &Services Diane Honda February 2, 2011 40,000 13,200Vice President, General Counsel andSecretary Bob L. Corey (1) February 2, 2011 80,000 26,400Former Executive Vice President andChief Financial Officer Paul A. Hooper (2) February 2, 2011 45,000 14,850Former Chief Marketing Officer (1)Mr. Corey resigned from the Company effective March 9, 2011.(2)Mr. Hooper resigned from the Company effective July 8, 2011.Award Granting Procedures; Policy on Timing of Equity GrantsOur process with regard to grants of equity compensation awards to Board members, officers, and non-officer employees is as follows: •The general practice for equity awards is to make grants once per quarter, during open trading windows only, on the second trading day followingthe public announcement of quarterly financial results, pursuant to a list to be circulated to the appropriate granting authority prior to theproposed approval date.•All grants are to be approved by the Compensation Committee.•Grants are to be approved at Compensation Committee meetings (not by unanimous written consent, except in extraordinary circumstances).•Granting authority may not be delegated to management.•Our Board and management are to continue monitoring processes and policies recommended by the SEC, self-regulatory authorities and outsideadvisors.•All Board and Compensation Committee minutes are to be circulated to the directors as soon as reasonably practicable (generally, within twoweeks of meeting). Counsel should attend all Board and Compensation Committee meetings, and must be present when stock is granted.•Our Board has directed management to propose a mechanism for monitoring compliance with and reporting to our Board on our policies andprocedures relating to options grants.These processes were adopted by our Board in April 2007, and are designed to ensure that we continue to employ best practices and procedures withrespect to equity compensation awards. In addition, we monitor the number of shares that we are utilizing for all of our equity compensation programs, including new hire grants, promotionalgrants and annual merit grants, in order to prudently manage stock option expense and potential dilution of stockholder ownership. The CompensationCommittee in consultation with Radford approved a target gross equity pool that could be used for all grants issued to new hires, promotion grants and meritgrants, and to reflect industry practices for managing the overall stock option burn rate. In compliance with industry best practices and guidance from RiskMetrics' Institutional Stockholder Services (ISS), the Compensation Committee examines the trends for burn rate levels and equity vehicles to manage theplan within the standards and norms established by ISS. Our dilution rate is measured as a gross number of equity awards in a given year, expressed as apercentage of the outstanding common stock at the end of each fiscal year.Change in Control and Severance AgreementsEach of our named executive officers are employed at-will. However, from time to time, we implement plans or enter into agreements that wouldprovide benefits payable to certain employees, including named executive officers, in connection with the termination of employment, a change in ourcontrol or other situations. Without these benefits, officers may be19tempted to leave us prior to the closing of the change in control, especially if they do not wish to remain with the entity after the transaction closes, and anydepartures could jeopardize the consummation of the transaction or our interests if the transaction does not close. The Compensation Committee believesthat these benefits therefore serve to enhance stockholder value in the transaction, and align the officers' interest with those of our stockholders in change incontrol transactions.Our agreements with named executive officers are described under “Summary of Employment and Other Agreements” below. The potential paymentsthat each of named executive officer would have received if a change in control or termination of employment had occurred on July 3, 2011 are set forthunder “Potential Payments Upon Termination or Change in Control” below.Other BenefitsWe provide other customary benefits that are comprehensive and apply uniformly to all of our employees, including our named executive officers. Ouremployee benefits program includes medical, dental, prescription drug, Medical and Dependent Care Flexible Spending contribution, vision care, disabilityinsurance, life insurance benefits, business travel insurance, 401(k) savings plan with employer match , educational assistance, employee assistance programand holidays. We do not include a fixed vacation allowance for named executive officers, as they typically travel extensively and are required to be availableto us even while vacationing. We do not provide a defined benefit retirement pension plan, supplemental life insurance or the use of company vehicles to ournamed executive officers.In January 1999, our Board adopted our 1999 Employee Stock Purchase Plan, or the Purchase Plan. In December 2005, our stockholders approved anamendment to the Purchase Plan to increase the maximum number of shares of common stock that may be issued under the plan by 5,000,000 to a total of12,000,000 shares. The Purchase Plan permits eligible employees, including our named executive officers, to acquire shares of our common stock throughperiodic payroll deductions of up to 15% of total compensation. No more than 1,000 shares may be purchased on any purchase date per employee, and eachoffering period has a maximum duration of 3 months. The price at which the common stock may be purchased is 85% of the lesser of the fair market value ofour common stock on the first day of the applicable offering period or on the last day of the respective purchase period. None of our named executive officersparticipated in the Purchase Plan.Tax ConsiderationsThe Compensation Committee has considered the provisions of Section 162(m) of the Internal Revenue Code, or the Code, and related TreasuryDepartment regulations, which restrict deductibility of executive compensation paid to our named executive officers holding office at the end of any year tothe extent this compensation exceeds $1,000,000 for any of these officers in any year and does not qualify for an exception under the statute or regulations.Income from options granted under our stockholder-approved stock option plan would generally qualify for an exemption from these restrictions so long asthe options are granted by a committee whose members are “outside directors” (as defined by Section 162(m)) and have an exercise price no less than the fairmarket value of the shares on the date of grant. We expect that the Compensation Committee will continue to be comprised solely of outside directors, andthat any options granted to our executive officers will be approved by the Compensation Committee. The Compensation Committee does not believe that ingeneral other components of our compensation are likely to exceed $1,000,000 for any executive officer in the foreseeable future, and therefore concludedthat no further action with respect to qualifying this compensation for deductibility was necessary at this time. In the future, the Compensation Committeeexpects to continue evaluating the advisability of qualifying its executive compensation for deductibility. The Compensation Committee's policy is toqualify its executive compensation for deductibility under applicable tax laws as practicable.Compensation Risk EvaluationThe Compensation Committee requested that management review and report to the Compensation Committee regarding elements of our compensationsystem that could affect risk and in particular had any potential to result in material risk to us and the report was made and evaluated by the CompensationCommittee in August 2010. Included in the analysis were such factors as the behaviors being induced by our fixed and variable pay components, the balanceof short-term and long-term performance goals in our incentive compensation system, the established limits on permissible incentive award levels, internalcontrols, including financial, operational and compliance policies and practices.Stock Ownership and HedgingAt present, the Compensation Committee has not established any equity or security ownership requirements for its executive officers which is a policythat is reviewed annually as part of the regular review of our pay plans. We prohibit executive officers from hedging the economic risk of ownership of ourstock. Summary Compensation TableThe following table sets forth information for fiscal year 2011 concerning the compensation of our named executive20officers:SUMMARY COMPENSATION TABLE Name and Principle Position Year Salary ($) Bonus ($) (1) Stock Awards ($)(2) Option Awards ($)(2) Non-EquityIncentive PlanCompensation ($)(1) All OtherCompensation($) (3) Total ($)Oscar Rodriguez 2011 473,140 — 454,500 1,249,560 886,435(9) 83,385(6) 3,147,020President and Chief Executive 2010 — — — — — — —Officer 2009 — — — — — — —James T. Judson 2011 105,035 — — 160,380 — 226 265,641Interim Vice President 2010 — — — — — — — and Chief Financial Officer 2009 — — — — — — —David Ginsburg 2011 174,352 — — 740,640 184,000(9) 1,358 1,100,350Senior Vice President and 2010 — — — — — — —Chief Marketing Officer 2009 — — — — — — —Michael L. Seaton 2011 275,000 — 230,436 259,194 181,137 270 946,037Vice President, World Wide Sales 2010 266,667 — 145,220 — — 270 412,157& Services 2009 259,594 — — — — 225 259,819Diane Honda 2011 259,583 — 102,298 74,064 107,444(9) 270 543,659Vice President, General Counsel 2010 237,500 — 82,200 — — 325 320,025and Secretary 2009 223,594 25,898 — 27,050 50,400(5) 180 327,122Bob L. Corey (7) 2011 274,115 — 218,031 148,128 296,261(4) (9) 585 937,120Former Executive Vice President 2010 422,839 — 308,250 494,185 — 742 1,226,016 and Chief Financial Officer 2009 — — — — — — —Paul A. Hooper (8) 2011 280,000 — 114,818 83,322 120,340(9) 270 598,750Former Chief Marketing 2010 280,000 — 153,440 — — 270 433,710Officer 2009 274,000 — — — — 270 274,270(1)Bonus amounts represent discretionary fixed bonuses. Performance-based bonuses are generally paid under our bonus plans and sales commission plan and represented as Non-Equity Incentive Plan Compensation.(2)Represents the aggregate grant date fair value computed in accordance with Accounting Standards Codification, or ASC, Topic 718, and do not reflect whether our namedexecutive officer has actually realized a financial benefit from the award. For information on the assumptions used to calculate the value of the awards, refer to Note 7 to ourconsolidated financial statements in our Form 10-K for the fiscal year ended July 3, 2011. In accordance with SEC rules, the amounts shown exclude the impact of estimatedforfeitures related to service-based vesting conditions.(3)Comprised of contributions to group term life insurance and other miscellaneous items.(4)Includes $54,503 of retention bonus.(5)Includes $20,000 of retention bonus.(6)Includes $81,840 of allowance for relocation expenses.(7)Mr. Corey resigned from the Company effective March 9, 2011.(8)Mr. Hooper resigned from the Company effective July 8, 2011.(9)Mr. Rodriguez, Mr. Ginsburg, Ms. Honda, Mr. Corey, and Mr. Hooper were granted RSUs under our 2011 Incentive Plan with a total maximum payout of $886,435, $184,000,$107,444, $241,758 and $120,340, respectively, subject to vesting as described in Executive Compensation - 2011 Executive Compensation Decisions - Incentive Plans. None ofthe performance metrics were achieved, and none of these RSUs vested.Summary of Employment and Other AgreementsThe following is a description of employment and other agreements between us and our named executive officers and with our President and ChiefExecutive Officer, Oscar Rodriguez, who was appointed subsequent to the end of our 2010 fiscal year.President and Chief Executive OfficerIn August 2010, we entered into an offer letter of employment with Mr. Rodriguez for service as our President and Chief Executive Officer. Pursuant tothe terms the offer letter of employment, Mr. Rodriguez is to receive an annual salary of $550,000, less applicable taxes and withholdings, and be eligible toparticipate in our standard employee benefits plans. In addition, Mr. Rodriguez was granted a one-time option to acquire 900,000 shares of our commonstock with an exercise price equal to the closing price of our common stock on the grant date. One-fourth of these shares vest one year after thecommencement of Mr. Rodriguez's employment with us, and the remaining shares vest monthly over the following three years at a rate of 1/48th of the entireoption each month, subject to Mr. Rodriguez's continued employment with us. The vesting of the shares subject to this option may be accelerated upon achange in control, pursuant to the terms and conditions of the Severance Plan. Mr. Rodriguez was also granted 100,000 shares of restricted stock that vest inthree annual installments, subject to his continued employment with us. To compensate Mr. Rodriguez for the loss of a performance bonus at his formercompany, we21awarded him 50,000 shares of restricted stock that vest on the first anniversary of his employment with us, subject to his continued employment with us. Inaddition, we entered into an Executive Change in Control Severance Agreement with Mr. Rodriguez in the form standard for our executive officers underwhich Mr. Rodriguez would be entitled to receive a lump sum payment equal to (i) 18 months of his base salary, less applicable withholding taxes, in certaincircumstances involving a change of control in us, or (ii) 12 months of his base salary, less applicable withholding taxes, in certain circumstance involvingour termination of Mr. Rodriguez's employment without cause. Mr. Rodriguez was also awarded a one time, lump-sum cash payment of $50,000 to relocatehis household from Florida to California, such amount to be grossed up for tax purposes. Pursuant to the offer letter, we appointed Mr. Rodriguez to ourBoard in October 2010 and he must immediately resign as a member of our Board upon the date his employment with us terminates.Interim Chief Financial OfficerUnder an offer letter of employment to be our Interim Chief Financial Officer, Mr. Judson is paid an annual base salary of $350,000, less applicabletaxes and withholdings. He also is eligible to participate in our bonus plans with an annual target of 60% of his then current annual base salary. In addition,Mr. Judson was granted a one-time option to acquire 100,000 shares of our common stock with an exercise price equal to the closing price of our commonstock on the grant date. Fifty percent of these shares shall vest six months after the commencement of Mr. Judson's employment with us, and the remainingshares vest one year after the commencement of employment. Mr. Judson is not entitled to participate in the Company's Severance Plan.In September 2011, the Compensation Committee approved a grant of 50,000 RSUs to Mr. Judson which will vest on March 14, 2012. Former Acting Chief Executive Officer and Chief Financial OfficerBob L. Corey, our former Chief Financial Officer and Acting Chief Executive Officer, resigned in March 2011. In connection with his resignation, andin consideration for his execution of a general release of claims, our Compensation Committee agreed to accelerate vesting of Mr. Corey's option awards suchthat 206,250 of the shares subject to one option grant and 100,000 shares subject to a second option grant vested on March 9, 2011, and the CompensationCommittee agreed that such vested option shares may be exercised for a 12 month period ending March 9, 2012.Executive Change in Control Severance PlanOn February 8, 2006, the independent members of our Board, upon the recommendation of the Compensation Committee, approved the terms of anExecutive Change in Control Severance Plan in order to ensure retention of key personnel and continuity of the business in the event of a change in controlof the business. On August 7, 2008, the independent members of our Board, upon the recommendation of the Compensation Committee, approved anamendment and restatement of the Executive Change in Control Severance Plan. We refer to this plan, as amended and restated, as the “Severance Plan.”Cash Compensation and BenefitsUnder the Severance Plan for participants other that Mr. Rodriguez, severance compensation, health care and other benefits are provided to a SeverancePlan participant if the participant is terminated without cause or resigns as a result of certain adverse circumstances described in the Severance Plan within 12months after a change in control. The amount of this severance compensation that would be provided to a participant is equal to that participant's thencurrent salary and target bonus for the applicable “severance benefit period.” The Compensation Committee has established that the severance benefit periodfor participants is 18 months in the case of the chief executive officer, 12 months in the case of officers who report directly to the Chief Executive Officer and6 months in the case of eligible vice presidents designated by the Compensation Committee. In addition, the severance benefit period establishes the periodof time during which health care and other benefits are provided to a participant. For Mr. Rodriguez, solely a change of control gives him the right to thebenefits to which he is entitled under the Severance Plan. Mr. Judson is not eligible to participate in the Severance Plan.Equity AwardsThe Severance Plan provides that equity awards granted prior to August 7, 2008 (the effective date of the amendment to the plan) with respect toindividuals who were participants as of that date and certain other equity awards as determined by the Compensation Committee at the time of grant aretreated as follows in the event of a Change in our Control:•if the participant's options and SARs are not assumed or otherwise continued by an acquirer, 100% of the participant's then unvested options andSARs would accelerate;22•if the participant is not terminated and an acquirer assumes the participant's outstanding options and SARs, the vesting of fifty percent (50%) ofthe participant's then unvested options and SARs would accelerate as of the date of the change in control and the remainder of the participant'sunvested options and SARs would vest in equal monthly installments over a period equal to one half of the remainder of the participant's originalvesting schedule;•if the participant is terminated and the participant's options and SARs are assumed or otherwise continued by an acquirer, 100% of theparticipant's then unvested options and SARs would accelerate; and•the vesting of all other awards, including restricted stock and RSUs, would accelerate. However, the Severance Plan further provides that, unless otherwise determined by the Compensation Committee at the time of grant, equity awardsgranted after August 7, 2008 (the effective date of the amendment to the plan) to participants are treated as follows in the event of a Change in our Control:•if equity awards are not assumed or otherwise continued by an acquirer, accelerated vesting would occur only with respect to the number ofmonths in the applicable participant's severance benefit period;•if equity awards are assumed or otherwise continued by an acquirer, acceleration of vesting of these awards would occur only upon a DoubleTrigger Termination, and then would accelerate 100%; and•all equity awards are treated the same under the plan in the event of a Change of Control. In the event that any payment or benefit received or to be received by a participant under the Severance Plan or otherwise would subject the participantto any excise tax pursuant to Section 4999 of the Code due to the characterization of such payments as an excess parachute payment under Section 280G ofthe Code, then, notwithstanding the other provisions of the Severance Plan, the amount of such payments would not exceed the amount which produces thegreatest after-tax benefit to the participant. The Severance Plan does not provide for payment of any applicable excise tax by us or other “gross-up” paymentsto offset the impact of any applicable excise tax.Certain DefinitionsFor purposes of the Severance Plan, the following definitions apply:“Cause” means the occurrence of any of the following: (i) the participant's theft, dishonesty, misconduct, breach of fiduciary duty for personal profit, orfalsification of any our documents or records; (ii) the participant's material failure to abide by our code of conduct or other policies (including, withoutlimitation, policies relating to confidentiality and reasonable workplace conduct); (3) misconduct by the participant within the scope of Section 304 of theSarbanes-Oxley Act of 2002 as a result of which of we are required to prepare an accounting restatement; (4) the participant's unauthorized use,misappropriation, destruction or diversion of any tangible or intangible asset or corporate opportunity of ours (including, without limitation, the participant'simproper use or disclosure of our confidential or proprietary information); (5) any intentional act by the participant which has a material detrimental effect onour reputation or business; (6) the participant's repeated failure or inability to perform any reasonable assigned duties after written notice from us of, and areasonable opportunity to cure, such failure or inability; (7) any material breach by the participant of any employment, non-disclosure, non-competition,non-solicitation or other similar agreement between the participant and us, which breach is not cured pursuant to the terms of such agreement; or (8) theparticipant's conviction (including any plea of guilty or nolo contendere) of any criminal act involving fraud, dishonesty, misappropriation or moralturpitude, or which impairs the participant's ability to perform his or her duties with us.“Change in our Control” means the occurrence of any of the following:•any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act, other than a trustee or other fiduciary holding our securitiesunder an employee benefit plan, becomes the “beneficial owner” (as defined in Rule 13d-3 promulgated under the Exchange Act), directly orindirectly, of our securities representing more than fifty percent (50%) of the total combined voting power of our then-outstanding securitiesentitled to vote generally in the election of directors;•we are party to a merger or consolidation which results in the holders of our voting securities outstanding immediately prior thereto failing toretain immediately after such merger or consolidation direct or indirect beneficial ownership of more than fifty percent (50%) of the totalcombined voting power of the securities entitled to vote generally in the election of our directors or the surviving entity outstanding immediatelyafter such merger or consolidation;•the sale or disposition of all or substantially all of our assets or consummation of any transaction having similar effect (other than a sale ordisposition to one or more of our subsidiaries); or23•a change in the composition of our Board within any twelve (12) month period as a result of which fewer than a majority of the directors areIncumbent Directors (defined as a director who either (i) is a member of our Board as of February 8, 2006, or (ii) is elected, or nominated forelection, to our Board with the affirmative votes of at least a majority of the Incumbent Directors at the time of such election or nomination, but(iii) was not elected or nominated in connection with an actual or threatened proxy contest relating to the election of our directors). However, to the extent that any amount constituting nonqualified deferred compensation subject to Section 409A of the Code would become payableunder the Severance Plan by reason of a Change in our Control, such amount shall become payable only if the event constituting a Change in our Controlwould also constitute a change in ownership or effective control of us, or a change in the ownership of a substantial portion of our assets, within the meaningof Section 409A of the Code.Indemnity AgreementsWe have entered into indemnification agreements with our executive officers and directors. These indemnification agreements require us to indemnifythese individuals to the fullest extent permitted by law.Grants of Plan-Based AwardsThe following table sets forth certain information with respect to stock and option awards and other plan-based awards, including non-equity incentiveawards, granted during the fiscal year ended July 3, 2011 to our named executive officers. For a narrative description of the various plan-based awards setforth in the following table, see the discussion above under the heading “Compensation Discussion and Analysis.”GRANTS OF PLAN-BASED AWARDS Estimated Future Payments Under Non-EquityIncentive Plan Awards (1) All Other StockAwards: All Other OptionAwards: Name Grant Date Approval Date Threshold ($) Target ($) Maximum ($)(2) Number of Shares ofStock Or Units (#) Number of SecuritiesUnderlying Options (#) Exercise or BasePrice of OptionAwards ($/Sh) Grant Date Fair Valueof Stock and OptionAwards ($) (3) (7)Oscar Rodriguez 11/3/2010 10/18/2010 — 550,000 825,000 442,553 900,000 3.03 2,590,495James T. Judson 5/2/2011 4/25/2011 — 210,000 315,000 100,000 3.17 160,380David Ginsburg 2/2/2011 1/24/2011 — 147,500 221,250 50,000 400,000 3.68 924,640Michael L. Seaton 2/2/2011 1/24/2011 — 250,000 N/A(4) 71,450 65,000 3.68 350,790 11/3/2010 10/18/2010 — 100,000 3.03 138,840Diane Honda 8/4/2010 7/26/2010 — 109,200 163,800 53,190 161,166 2/2/2011 1/24/2011 — 13,200 40,000 3.68 122,640Bob L. Corey (5) 8/4/2010 7/26/2010 — 350,000 525,000 119,682 362,636 2/2/2011 1/24/2011 — 26,400 80,000 3.68 245,281Paul A. Hooper (6) 8/4/2010 7/26/2010 — 112,000 168,000 59,574 180,509 2/2/2011 1/24/2011 — 14,850 45,000 3.68 137,971(1)Our annual incentives usually are (and, in fiscal year 2011, were) based upon threshold, target and maximum payout amounts set by our Board, upon the recommendation of theCompensation Committee, at the beginning of each fiscal year. The actual amounts earned by each named executive officer for fiscal year 2011 is set forth in the SummaryCompensation Table elsewhere in this Annual Report on Form 10-K/A under the heading “Non-Equity Incentive Plan Compensation.”(2)The maximum amount payable if results exceed objectives was 150% for our named executive officers.(3)The grant date fair value is generally the amount we would expense in our financial statements over the award's service period in accordance with ASC Topic 718, but doesexclude the impact of estimated forfeitures related to service-based vesting conditions.(4)Mr. Seaton does not participate in our incentive plans, but instead has a separate commission plan as discussed in additional detail elsewhere in this Annual Report on Form 10-K/A under the heading “Sales Commission Plan.”(5)Mr. Corey resigned from the Company effective March 9, 2011.(6)Mr. Hooper resigned from the Company effective July 8, 2011.(7)Mr. Rodriguez, Mr. Ginsburg, Ms. Honda, Mr. Corey, and Mr. Hooper were granted RSUs under our 2011 Incentive Plan with a total maximum payout of $886,435, $184,000,$107,444, $241,758 and $120,340, respectively, subject to vesting as described in Executive Compensation - 2011 Executive Compensation Decisions - Incentive Plans. None ofthe performance metrics were achieved, and none of these RSUs vested.Outstanding Equity Awards at Fiscal Year-EndThe following table sets forth certain information with respect to the value of all unexercised options previously awarded to our named executiveofficers as of July 3, 2011.24OUTSTANDING EQUITY AWARDS Option Awards Stock AwardsName Number of SecuritiesUnderlyingUnexercised OptionsExercisable (#) Number of SecuritiesUnderlyingUnexercised OptionsUnexercisable (#) OptionExercise Price($) OptionExpiration Date Number of Sharesor Units of StockThat Have NotVested (#) Market Value ofShares or Units ofStock That HaveNot Vested ($) (1)Oscar Rodriguez — 900,000(3) 3.03 11/3/2017 100,000(12) 324,000 50,000(13) 162,000 195,035(14) 631,913.00 97,518(14) 315,958James T. Judson — 100,000(4) 3.17 5/2/2018 David Ginsburg — 400,000(5) 3.68 2/2/2018 50,000(15) 162,000.00Michael L. Seaton 30,000 — 3.53 8/3/2016 33,333(16) 107,999 116,875 10,625(6) 4.25 10/26/2017 21,450(17) 69,498 42,500 85,000(7) 4.25 10/26/2017 3,125(18) 10,125.00 27,083 72,917(8) 3.03 11/3/2017 1,875(18) 6,075 — 65,000(9) 3.68 2/2/2018 5,000(18) 16,200Diane Honda 15,000 — 6.89 11/19/2014 17,730(19) 57,445 7,500 — 4.09 7/5/2015 17,730(14) 57,445 10,000 — 4.49 10/25/2015 17,730(14) 57,445 10,000 — 3.53 8/3/2016 13,200(17) 42,768 9,375 625(10) 4.25 10/26/2017 39,583 10,417(11) 2.05 11/5/2018 — 40,000(9) 3.68 2/2/2018 Bob L. Corey (2) 140,000 — 2.09 3/9/2012 — —Paul A. Hooper (20) 60,000 — 10.51 8/26/2012 19,858(19) 64,340 45,834 — 5.75 7/18/2013 19,858(14) 64,340 60,000 — 8.12 2/26/2014 19,858(14) 64,340 30,000 — 4.89 8/4/2015 14,850(17) 48,114 116,875 10,625(6) 4.25 10/26/2017 42,500 85,000(7) 4.25 10/26/2017 — 45,000(9) 3.68 2/2/2018 (1)The market value of the RSUs that have not vested is based on the closing market price of our common stock on July 1, 2011 of $3.24.(2)Mr. Corey resigned from the Company effective March 9, 2011.(3)This stock option vests as to 25% of the shares on August 23, 2011 and as to 1/48th of the shares each month over the three years thereafter.(4)This stock option vests with respect to 50,000 shares on September 14, 2011 and 50,000 on March 14, 2012. (5)This stock option vests as to 25% of the shares on November 29, 2011 and as to 1/48th of the shares each month over the three years thereafter.(6)This stock option vests monthly and will be fully vested on October 26, 2011.(7)This stock option vests with respect to 42,500 shares on October 26, 2011 and 42,500 shares on October 26, 2012.(8)This stock option vests as to 25% of the shares on May 10, 2011 and as to 1/48th of the shares each month over the three years thereafter.(9)This stock option vests as to 25% of the shares on February 2, 2012 and as to 1/48th of the shares each month over the three years thereafter.(10)This stock option vests monthly and will be fully vested on October 1, 2011.(11)This stock option vests monthly and will be fully vested on May 1, 2012.(12)These RSUs vest as to 33.3% of the units each anniversary over three years, starting August 23, 2011.(13)These RSUs fully vested on August 23, 2011.(14)These RSUs were to vest on August 15, 2011, subject to our attainment of revenue and non-GAAP operating profit targets and the named executive officer's continuedemployment with us.(15)These RSUs vest on September 8, 2013, subject to our attainment of revenue and non-GAAP operating profit targets and the named executive officer's continued employmentwith us.(16)These RSUs vest 50% on May 10, 2012 and 50% vest on 5/10/2013(17)These RSUs vest monthly over two years and will be fully vested on February 2, 2013, subject to the named executive officer's continued employment with us.(18)These RSUs vest 100% on March 5, 2012.(19)These RSUs were to vest on August 15, 2011, subject to the named executive officer's continued employment with us.25(20)Mr. Hooper resigned from the Company effective July 8, 2011.Option Exercises and Stock Vested During Last Fiscal YearThe following table sets forth certain information concerning option exercises by our named executive officers and vesting of our common stock heldby them during the fiscal year ended July 3, 2011.OPTION EXERCISES AND STOCK VESTED Option Awards Stock AwardsName Number of SharesAcquired on Exercise (#) Value Received on Exercise($) Number of SharesAcquired on Vesting (#) Value Realized on Vesting($) (1)Michael L. Seaton — — 79,667 233,381Diane Honda — — 50,000 133,000Bob L. Corey (2) — — 112,500 299,250Paul A. Hooper (3) — — 56,000 148,960(1)Represents the amount realized based on the market price of our common stock on the vesting date.(2)Mr. Corey resigned from the Company effective March 9, 2011.(3)Mr. Hooper resigned from the Company effective July 8, 2011.Pension Benefits and Nonqualified Deferred Compensation PlansWe do not have any plans with any of our named executive officers that provide for payments or other benefits at, following, or in connection withretirement. We also do not have any defined contribution or other plan with any of our named executive officers that provides for the deferral ofcompensation on a basis that is not tax qualified.Potential Payments upon Termination or Change in ControlWe have entered into the following agreements that may require us to provide compensation to our named executive officers in the event of atermination of employment or a change in control of us:•Offer letters of employment with each of our current named executive officers. We previously entered into offer letters of employment with Messrs.Corey and Hooper, but due to their resignations, the provisions in their offer letters are no longer in effect.•The Severance Plan. These agreements, including the circumstances that would trigger payments or the provision of other benefits, and material conditions and obligationsapplicable to the recipient of payments and benefits, are described in “Summary of Employment and Other Agreements” elsewhere in this “ExecutiveCompensation” section of this Annual Report on Form 10-K/A. The following table describes the potential payments that we would have been required to make upon our termination of each of our named executiveofficers, whether or not within one year following a change in our control, had we terminated such officer as of July 3, 2011 under the assumptions set forth inthe footnotes to the table. Accordingly, the table does not present information regarding named executive officers whose service to us was terminated prior tothis date. Except as expressly noted, these assumptions have not actually occurred.26POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL Name and Category of Payment Potential Paymentsupon TerminationOther Than for Cause($) (1) Potential PaymentsFollowing Change inControl WithoutTermination OtherThan for Cause ($) (2) Potential Paymentsupon TerminationOther Than for CauseFollowing Change inControl ($) (3) Oscar Rodriguez Salary(4) 550,000 (5) — 775,000 (5) Bonus 550,000(10) — 775,000 (6) Equity award vesting acceleration(7) 1,433,807 — 1,433,807 Health and welfare benefits 21,700(8) — 21,700 (8) Total 2,555,507 — 3,005,507 David Ginsburg Salary(4) 147,500 — 295,000 (5) Bonus 73,750 — 147,500 (6) Equity award vesting acceleration(7) — — 162,000 Health and welfare benefits — — — (8) Total 221,250 — 604,500 Michael Seaton Salary(4) — — 275,000 (5) Bonus — — 106,000 (6) Equity award vesting acceleration(7) — — 209,897 Health and welfare benefits — — 13,056 (8) Total — — 603,953 Diane Honda Salary(4) 136,500 — 273,000 (5) Bonus 54,600 — 109,200 (6) Equity award vesting acceleration(7) — — 215,104 Health and welfare benefits 10,842 — 21,684 (8) Total 201,942 — 618,988 Bob L. Corey (11) Salary(4) 375,000 — 375,000 (5) Bonus 225,000 — 225,000 (6) Equity award vesting acceleration(7) — — — Health and welfare benefits 15,888 — 15,888 (8) Total 615,888 — 615,888 Paul A. Hooper (12) Salary(4) 140,000 — 280,000 (5) Bonus 56,000 — 112,000 (6) Equity award vesting acceleration(7) — — 241,134 Health and welfare benefits 11,232 — 22,464 (8) Total 207,232 — 655,598 (1)Assumes termination without “cause” as of July 3, 2011, not within one year after a change in control. “Cause” is described, as applicable to each officer, in the “Summary ofEmployment and Other Agreements” section of this Annual Report on Form 10-K/A. As a condition to receiving any benefits under this column, the applicable named executiveofficer is required to execute a general release of known and unknown claims in a form satisfactory to us.(2)Assumes a hypothetical change in control as of July 3, 2011, with no termination without cause within one year after the change in control. Also assumes that the companyacquiring us in the hypothetical change in control did not assume or substitute equivalent replacements for the outstanding equity27awards of the participants in the Severance Plan.(3)Assumes termination without cause as of July 3, 2011, within one year after a change in control.(4)The amounts listed in these rows do not include the payment of accrued salary that would be due upon termination of employment, are not adjusted for any applicable taxwithholding, and do not include portions of bonuses that may be payable on a pro-rated basis based on the amount earned as of the time of the termination of employment.(5)Under the Severance Plan, if a participant in the Severance Plan is terminated without cause or resigns as a result of certain adverse circumstances described in the Severance Planwithin 12 months after a change in control, among other things, the participant would be entitled to a lump sum payment in an amount equal to the aggregate amount of hismonthly salary for a period of 18 months in the case of the chief executive officer and 12 months in the cases of the other named executive officers.(6)Under the Severance Plan, if a participant in the Severance Plan is terminated without cause or resigns as a result of certain adverse circumstances described in the Severance Planwithin 12 months after a change in control, among other things, the participant would be entitled to a lump sum bonus payment for a period of 18 months in the case of the chiefexecutive officer and 12 months in the cases of the other named executive officers with the applicable annual bonus amount to be based upon the aggregate of all annualincentive bonuses that would have been earned by the participant for the fiscal year of termination of employment, determined as if 100% of all applicable performance goalswere achieved.(7)Assumes a price per share of our common stock equal to $3.24, the closing market price on July 1, 2011 (the last business day of our last fiscal year). In the case of shares ofcommon stock or RSUs, represents the aggregate value of all shares that would be accelerated. In the case of stock options, represents the aggregate spread (i.e., the differencebetween the exercise price and the closing price of our common stock on July 1, 2011) with respect to all options that would be accelerated. The exercise price of all stock optionsheld by our named executive officers as of such date was greater than $3.24 resulting in no aggregate spread value for these stock options.(8)Under the Severance Plan, if a participant in the Severance Plan is terminated without cause or resigns as a result of certain adverse circumstances described in the Severance Planwithin 12 months after a change in control, among other things, the participant is entitled to reimbursement of 18 months of COBRA premiums in the case of the chief executiveofficer and 12 months of COBRA premiums in the cases of the other named executive officers. Assumes our payment of all premiums necessary to cover the applicable officerfrom July 3, 2011 until the 18 or 12 month anniversary thereof, as applicable, assuming that the applicable officer was covered under our group health plan as of July 3, 2011,that the officer timely elected to continue these benefits until the 18 or 12 month anniversary thereof, as applicable, and that premiums remain at the amounts in effect as of July3, 2011.(9)Under Mr. Rodriguez's offer letter agreement, he is entitled to 12 months salary in the event he is terminated without cause or resigns as a result of certain adverse circumstances asdescribed in his offer letter.(10)Under Mr. Rodriguez's offer letter agreement, he is entitled to a payment equal to the pro rata portion of his target bonus through his date of termination in the event he isterminated without cause or resigns as a result of certain adverse circumstances as described in his offer letter.(11)Mr. Corey resigned from the Company effective March 9, 2011.(12)Mr. Hooper resigned from the Company effective July 8, 2011Director CompensationDuring our fiscal year ended July 3, 2011, the compensation policies for service on our Board and its committees were, and the compensation paid toour directors was, as follows:Cash CompensationEach non-employee director receives (a) $40,000 in cash compensation annually for service in this position and (b) the applicable compensation setforth below for serving as a chair or as a member of one or more of the committees of our Board. For service on any special committee that may be formed byour Board from time to time, our Board determines compensation on a case-by-case basis upon a recommendation from the Compensation Committee basedon the anticipated amount of time and work related to service on the special committee and other factors as the Compensation Committee may consider. Eachdirector receives reimbursement of expenses related to attendance of meetings of our Board and its committees.Annual Committee Member Compensation Audit Committee$20,000Compensation Committee$10,000Nominating and Governance Committee$10,000 Additional Annual Retainers for Chairman or Committee Chair Audit Committee Chair$10,000Compensation Committee Chair$10,000Chairman of the Board$17,500Equity CompensationEach non-employee director automatically is granted an initial 8,333 shares of our restricted stock and an initial option to purchase 25,000 shares ofour common stock. These options and restricted stock grants are made under our 2005 Plan, pursuant to the standard option agreement used under the 2005Plan for directors. The grant date for awards is generally the second trading day following the public announcement of quarterly financial results followingthe director's appointment. Each option and restricted stock grant vests 1/3 each year (or, if earlier in any year, 1/3 on the date of the annual meeting ofstockholders in that year), subject to the respective director's continuous service on our Board for that period. There is a two year post-28termination exercise period for options granted to non-employee directors during and after fiscal year 2005.On the date of each annual meeting of our stockholders, each non-employee director and automatically is granted 5,000 shares of our restricted stockand an option to purchase 15,000 shares of our common stock. These options and restricted stock grants are made under the 2005 Plan, pursuant to thestandard option agreement used under the 2005 Plan for directors. The exercise price per share of each option, and the grant price of each share of restrictedstock, is the closing sale price of our common stock on the NASDAQ Global Market at the close of business on the date of grant (the date of the annualmeeting of stockholders). Each option and restricted stock grant vests in full on the date one year after the date of grant (or, if earlier, the date of the nextsubsequent annual meeting of stockholders), subject to the respective director's continuous service on our Board for that period.Following the 2010 annual meeting of stockholders, each non-employee director received a grant of 5,000 shares of our restricted stock and an optionto purchase 15,000 shares of our common stock, at an exercise price of $3.02. In connection with Mr. Kennedy's appointment to our Board in April 2011, hereceived a grant of 8,333 shares of our restricted stock and an option to purchase 25,000 shares of our common stock at an exercise price of $3.17 on the dateof grant.In July 2001, our Board ratified and approved a policy regarding the acceleration of vesting of shares subject to options granted to directors upon achange-in-control. Under the policy, in the event of a change in control that occurs prior to a director's termination of service with us, the shares subject tooptions vest fully. The policy defines a change-in-control as a single or series of sales or exchanges of voting stock, a merger or consolidation, the sale, ortransfer of all or substantially all of the assets, or a liquidation wherein the stockholders immediately before the change-in-control do not retain, immediatelyafter the change-in-control, more than 50% of the total combined voting power of us or the corporation to which the assets were transferred. This policyapplies to all options granted to directors after July 2001.2011 Director Compensation The compensation information for our non-employee directors and Gordon L. Stitt during the fiscal year ended July 3, 2011 is set forth below:Name Director FeesEarned or Paid inCash ($) Stock Awards($) (1) OptionAwards ($)(1) Total ($)Charles Carinalli 90,000(2) 15,100 20,757 125,857Edward Kennedy 15,000(3) 26,415 39,875 81,290John H. Kispert 70,000(4) 15,100 20,757 105,857Kenneth Levy 50,000(5) 15,100 20,757 85,857Edward B. Meyercord, III 65,500(6) 15,100 20,757 101,357John C. Shoemaker 70,000(7) 15,100 20,757 105,857Harry Silverglide 57,500(8) 15,100 20,757 93,357Gordon L. Stitt 40,000(9) 15,100 20,757 75,857(1)Represents the aggregate grant date fair value computed in accordance with ASC Topic 718 and do not reflect whether the director has actually realized a financial benefit fromthe award. For information on the assumptions used to calculate the value of the awards, refer to Note 7 to our consolidated financial statements in our Form 10-K for the fiscalyear ended July 3, 2011. In accordance with SEC rules, the amounts shown exclude the impact of estimated forfeitures related to service-based vesting conditions.(2)Consists of $40,000 for annual retainer, $20,000 for service on the Audit Committee, $20,000 for service as the Chairman of the Compensation Committee and $10,000 forservice on the Nominating and Corporate Governance Committee.(3)Mr. Kennedy was appointed to our Board and Audit Committee in April 2011. Consists of $10,000 for annual retainer and $5,000 for service on the Audit Committee.(4)Mr. Kispert was appointed as Chairman of the Audit Committee in July 2009. Consists of $40,000 for annual retainer, $20,000 for service on the Audit Committee, and $10,000for service as the Chairman of the Audit Committee.(5)Consists of $40,000 for annual retainer and $10,000 for service as the Chairman of the Nominating and Corporate Governance Committee.(6)Consists of $40,000 for annual retainer, $10,000 for service on the Compensation Committee, and $15,500 for service as Chairman of the Board.(7)Consists of $40,000 for annual retainer, $20,000 for service on the Audit Committee and $10,000 for service on the Compensation Committee.(8)Consists of $40,000 for annual retainer, $15,000 for service on the Audit Committee, and $2,500 for service on the Nominating and Corporate Governance Committee.(9)Consists of $40,000 for annual retainer.Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters29Beneficial Ownership InformationThe following table sets forth, as of October 15, 2011, certain information with respect to the beneficial ownership of our common stock by: (i) eachstockholder known by us to be the beneficial owner of more than 5% of our common stock, (ii) each named executive officer, (iii) each of our directors anddirector nominees, and (iv) all executive officers and directors as a group.Except as otherwise indicated, the address of each beneficial owner is c/o Extreme Networks, Inc., 3585 Monroe Street, Santa Clara, CA 95051.Name and Address (1) Amount andNature ofBeneficialOwnership (2) Percent ofClass (3)Holders of Greater than 5%: Starboard Value LP 9,115,000(4) 9.8%599 Lexington Avenue, 19th Floor New York, New York 10022 Soros Fund Management LLC 8,816,666(5) 9.5%888 Seventh Avenue, 33 rd Floor New York, New York 10106 Heartland Advisors, Inc. 6,570,600(6) 7.1%789 N. Water St. Suite 500 Milwaukee, WI 53202 BlackRock, Inc. 5,734,878(7) 6.2%3585 Monroe St Santa Clara CA 95051 Renaissance Technologies, LLC 3,883,295(8) 4.2%800 Third Avenue, 33rd Floor New York, NY 10022 Directors and Named Executive Officers: Charles Carinalli 494,216(9) *Edward Kennedy 8,333(10) *John H. Kispert 70,000(11) *Kenneth Levy 340,000(12) *Edward B. Meyercord, III 101,000(13) *John C. Shoemaker 138,333(14) *Harry Silverglide 211,327(15) *Gordon L. Stitt 4,115,433(16) 4.4%Oscar Rodriguez 531,250(17) *James T. Judson 50,000(18) *David Ginsburg 150,000(19) *Michael L. Seaton 359,125(20) *Diane Honda 179,324(21) *Bob L. Corey 40,000(22) *Paul A. Hooper —(23) All Executive Officers and Directors as a Group (17 persons) 6,285,792 7.3%* Less than 1%(1)Except as otherwise indicated, the persons named in this table have sole voting and investment power with respect to all shares of common stock shown as beneficially owned bythem, subject to community property laws where applicable and to the information contained in the footnotes to this table.30(2)Under the rules of the SEC, a person is deemed to be the beneficial owner of shares that can be acquired by the person within 60 days upon the exercise of options.(3)Calculated on the basis of 92,908,482 shares of common stock outstanding as of October 15, 2011, provided that any additional shares of common stock that a stockholder hasthe right to acquire within 60 days of October 15, 2011 are deemed to be outstanding for purposes of calculating that stockholder's percentage of beneficial ownership. Theseshares are not, however, deemed to be outstanding and beneficially owned for the purpose of computing the percentage ownership of any other person.(4)According to a Schedule 13D/A filed by the stockholder with the SEC on August 17, 2011.(5)According to a Schedule 13G/A filed by the stockholder with the SEC on February 14, 2011.(6)According to a Schedule 13G/A filed by the stockholder with the SEC on February 1, 2011.(7)According to a Schedule 13G/A filed by the stockholder with the SEC on February 4, 2011.(8)According to a Schedule 13G/A filed by the stockholder with the SEC on February 11, 2011.(9)Includes 255,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(10)No shares issuable pursuant to options exercisable within 60 days of October 15, 2011(11)Includes 31,667 shares issuable pursuant to options exercisable within 60 days of October 15, 2011. Includes 33,333 shares held by the Kispert Family Trust UTD September13, 2000.(12)Includes 280,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011. Includes 10,000 shares held in the Gloria and Kenneth Levy Foundation, acharitable foundation with Gloria & Kenneth Levy as trustees. Includes 330,071 shares held in The Levy Family Trust, DTD 2-18-83, Gloria and Kenneth Levy are trustees.(13)Includes 31,667 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(14)Includes 70,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(15)Includes 170,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(16)Includes 460,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(17)Includes 281,250 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(18)Includes 50,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(19)Includes 100,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(20)Includes 282,083 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(21)Includes 97,291 shares issuable pursuant to options exercisable within 60 days of October 15, 2011.(22)Includes 40,000 shares issuable pursuant to options exercisable within 60 days of October 15, 2010. Mr. Corey resigned from the Company effective March 9, 2011.(23)Mr. Hooper resigned from the Company effective July 8, 2011.Equity Compensation Plan InformationWe currently maintain two compensation plans that provide for the issuance of our common stock to officers and other employees, directors andconsultants. These consist of the 2005 Plan and the Purchase Plan, which have been approved by our stockholders. The Purchase Plan was adopted by ourBoard in January 1999, and was approved by our stockholders in February 1999. The 2005 Plan was adopted by our Board in October 2005, and wasapproved by our stockholders in December 2005, replacing our prior equity compensation plans. The 2005 Plan expressly provides that, without theapproval of a majority of the votes cast in person or by proxy at a meeting of our stockholders, the administrator of the 2005 Plan (the CompensationCommittee or other committee or subcommittee of our Board or, in the absence of a committee, our Board) may not provide for either the cancellation ofoutstanding options or SARs in exchange for the grant of new options or SARs at a lower exercise price or the amendment of outstanding options or SARsreduce the exercise price.The following table summarizes our equity compensation plans as of July 3, 2011:Plan Category Number of Securities to beIssued Upon Exercise ofOutstanding Options,Warrants and Rights Weighted AverageExercise Price ofOutstanding OptionsWarrants and Rights Number of SecuritiesRemaining Available forFuture Issuance Under EquityCompensation Plans (3)Equity compensation plans approved by security holders 12,061,245 (1) 2.94 12,964,042 (4)Equity compensation plans not approved by security holders 165,663 (2) 7.44 —Totals 12,226,908 3.00 12,964,042(1)Of this amount, options for 7,252,238 and 3,095,486 shares of restricted stock were outstanding under the 2005 Plan, and options for 1,713,521 were outstanding under the1996 Plan.(2)Of this amount, options for 93,002 shares were outstanding under the 2000 Stock Plan and options for 72,661 were issued under the 2001 Stock Plan.(3)Effective as of December 2, 2005, the 1996 Plan, the 2000 Stock Plan and the 2001 Stock Plan were terminated and up to 11,000,000 shares subject to awards that remainedoutstanding under the 1996 Plan, the 2000 Stock Plan the the 2001 Stock Plan as of December 2, 2005 and which subsequently terminate without having been exercised orwhich are forfeited to the Company were added to the shares available under the 2005 Plan.(4)Of this amount 3,140,718 shares were available for issuance under the Stock Purchase Plan and 9,823,324 shares were available for issuance under the 2005 Plan.Item 13. Certain Relationships and Related Transactions, and Director Independence31Offer Letter with Gordon L. StittWe entered into an offer letter with Gordon L. Stitt, a member of our Board, in July 2009 pursuant to which he was to devote 60% of his time to hismarket development consulting duties for an aggregate annual salary of $300,000. In July 2010, the one-year term of the offer letter ended, and our Boarddetermined to continue Mr. Stitt's employment on a month-to-month basis, on the same terms as in his offer letter and subject to termination by either party atany time. The contract with Mr. Stitt was terminated on December 31, 2010.Reporting, Review and Approval of Related Party TransactionsPursuant to the charter of the Audit Committee, the Audit Committee has the responsibility and duty to approve all related-party transactions afterreviewing each transaction for potential conflicts of interests and other improprieties. Pursuant to our Code of Business Conduct and Ethics:•Each employee, including each executive officer, is prohibited from engaging in activities that compete with us or compromise our interests unlessfirst notifying our General Counsel or Head of Human Resources, and obtaining a waiver in writing in each instance. Each employee is required toinform his or her manager or our legal department of any conflict of interest, and is encouraged to consult with his or her manager or our legaldepartment if the employee becomes aware of any conflict or potential conflict, or has a question as to a potential conflict.•Each member of our Board is prohibited from participating in any activities that are contrary to our interests, or which interfere with the director'sability to perform his or her duties objectively and effectively, or which interfere with the director's duty of loyalty to us and our stockholders. Eachmember of our Board is required to disclose to our Board any potential conflict of interest regarding or personal interest in any transaction our Boardis considering. As to any potential conflict, the independent directors consult, as appropriate, with management and counsel in assessing thepotential conflict, and the appropriate action or procedure for addressing or avoiding the potential conflict. A director is required to recuse himselfor herself from participation in any deliberation or decision regarding a matter or transaction in which there is a conflict of interest between ourinterests and the director's personal interests or the interests of any other entity to which the director provides services. In the event a directorbecomes aware of any potential corporate opportunity that the director believes would have any direct or indirect value to us, the director is requiredto advise the Chief Executive Officer or our Board of the opportunity. In addition, each director is required to notify our Board of any outside boardseats, public or private, on which the director has agreed to serve. Related party transactions in which a director may be involved are subject to thereview of the Audit Committee.•The Code of Business Conduct and Ethics provides the following non-exhaustive list of examples of actual or potential conflicts with respect to thepersons subject to the Code of Business Conduct and Ethics (a “Subject Person”):◦receipt, by a Subject Person or a member of his or her family, of improper personal benefits as a result of the Subject Person's position withus;◦use by the Subject Person of our property for his or her personal benefit;◦engagement by the Subject Person in activities that interfere with the Subject Person's loyalty to us or his or her ability to perform duties orresponsibilities effectively;◦work by a Subject Person simultaneously (whether as an employee or a consultant) for a competitor, customer or supplier;◦a Subject Person, or a member of his or her family, having a financial interest in a customer, supplier or competitor which is significantenough to cause divided loyalty with us, or the appearance of divided loyalty (with the significance of a financial interest depending onmany factors, such as size of investment in relation to the Subject Person's income, net worth and/or financial needs, the Subject Person'spotential to influence decisions that could impact the Subject Person's interests, and the nature of the business or level of competitionbetween us and the supplier, customer or competitor);◦acquisition, by a Subject Person or a member of his or her family, of an interest in property (such as real estate, patent or other intellectualproperty rights or securities) in which the Subject Person has reason to know we have, or might have, a legitimate interest;◦receipt, by a Subject Person or a member of his or her family, of a loan or a guarantee of a loan from a customer, supplier or competitor(other than a loan from a financial institution made in the ordinary course of business and on an arm's-length basis);◦a Subject Person's divulging or using our confidential information - such as financial data, customer information, or computer programs - forthe Subject Person's own personal or business purposes that are not first approved by our VP General Counsel or VP Human Resources inwriting;◦a Subject Person's making gifts or payments, or providing special favors, to customers, suppliers or32competitors (or their immediate family members) with a value significant enough to cause the customer, supplier or competitor to make apurchase, or take or forego other action, which is beneficial to us and which the customer, supplier or competitor would not otherwise havetaken;◦a Subject Person's being given the right to buy stock in other companies or receipt of cash or other payments in return for promoting theservices of an advisor, such as an investment banker, to us;◦a Subject Person's, or his or her family member's, solicitation or acceptance of valuable gifts, payments, special favors or other considerationfrom customers, suppliers or competitors; and◦a Subject Person's giving or receipt or gifts not in compliance with the Foreign Corrupt Practices Act. Item 14. Principal Accounting Fees and ServicesPrincipal Accounting Fees and ServicesThe following table sets forth the fees accrued or paid to the Company's independent registered public accounting firms for the fiscal years ended July3, 2011 and June 27, 2010. Ernst and Young LLP KPMG LLP 2011 2010 2011 (4)Audit fees (1)$530,531 $1,482,000 $900,000Audit related fees (2)168,365 78,000 —Tax fees (3)55,258 204,000 — $754,153 $1,764,000 $900,000(1)Audit fees relate to professional services rendered in connection with the audit of the Company's annual financial statements and internal control over financial reporting,quarterly review of financial statements included in the Company's Quarterly Reports on Form 10-Q and audit services provided in connection with other statutory andregulatory filings.(2)Audit-related fees comprise fees for professional services that are reasonably related to the performance of the audit or review of the Company's financial statements.(3)Tax fees relate to professional services rendered in connection with tax audits, international tax compliance, and international tax consulting and planning services.(4)Represents fees accrued or paid to KPMG from November 2011 through end of the fiscal 2011.The Audit Committee's policy is to pre-approve all audit and permissible non-audit services provided by our independent auditors. These services mayinclude audit services, audit-related services, tax services and other services. Any pre-approval is detailed as to the particular service or category of services.Our independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by ourindependent auditors in accordance with this pre-approval policy. For fiscal year 2011 and 2010, all fees paid to our independent auditors were pre-approvedin accordance with this policy without exception.The Audit Committee on an annual basis reviews the services performed by the independent registered public accounting firm, and reviews andapproves the fees charged by the accounting firm. The Audit Committee has considered the role of the independent registered public accounting firm inproviding tax and other non-audit services to us and has concluded that these services are compatible with the accounting firm's independence as ourindependent auditors.33PART IVItem 15. Exhibits and Financial Statement Schedules Incorporated by Reference ExhibitNumber Description of Document Form Filing Date Number FiledHerewith 31.1 Section 302 Certification of Chief Executive Officer X 31.2 Section 302 Certification of Interim Chief Financial Officer X 32.1 Section 906 Certification of Chief Executive Officer X 32.2 Section 906 Certification of Interim Chief Financial Officer X34SIGNATURESPursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed onits behalf by the undersigned, thereunto duly authorized. EXTREME NETWORKS, INC.(Registrant) Date: October 31, 2011 /s/ Oscar Rodriguez Oscar Rodriguez President and Chief Executive Officer 35EXHIBIT 31.1I, Oscar Rodriguez, certify that:1.I have reviewed this Amendment No. 1 to the annual report on Form 10-K for the fiscal year ended July 3, 2011 of Extreme Networks, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recentfiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the registrant's internal control over financial reporting; and5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant's ability to record, process, summarize and report financial information; and(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controlover financial reporting.Date:October 31, 2011/s/ OSCAR RODRIGUEZ Oscar Rodriguez President and Chief Executive Officer EXHIBIT 31.2I, James T. Judson, certify that:1.I have reviewed this Amendment No. 1 to the annual report on Form 10-K for the fiscal year ended July 3, 2011 of Extreme Networks, Inc.;2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make thestatements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects thefinancial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined inExchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, toensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within thoseentities, particularly during the period in which this report is being prepared;(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under oursupervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements forexternal purposes in accordance with generally accepted accounting principles;(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about theeffectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recentfiscal quarter (the Registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely tomaterially affect, the registrant's internal control over financial reporting; and5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to theregistrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonablylikely to adversely affect the registrant's ability to record, process, summarize and report financial information; and(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controlover financial reporting.Date:October 31, 2011/s/ JAMES T. JUDSON James T. Judson Interim Vice President and Chief Financial Officer EXHIBIT 32.1CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Amendment No. 1 to the Annual Report of Extreme Networks, Inc. (the “Company”) on Form 10-K for the fiscal year ended July 3,2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, in the capacities and on the dates indicatedbelow, each hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best oftheir knowledge:(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ OSCAR RODRIGUEZ Oscar Rodriguez President and Chief Executive Officer October 31, 2011A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signaturethat appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will beretained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.EXHIBIT 32.2CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002In connection with the Amendment No. 1 to the Annual Report of Extreme Networks, Inc. (the “Company”) on Form 10-K for the fiscal year ended July 3,2011, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, in the capacities and on the dates indicatedbelow, each hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best oftheir knowledge:(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ JAMES T. JUDSON James T. Judson Interim Vice President and Chief Financial Officer October 31, 2011A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signaturethat appears in typed form within the electronic version of this written statement required by Section 906, has been provided to the Company and will beretained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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