Enterasys Networks, Inc.

Transcription

1 Enterasys Networks, Inc. Bid Contact Mike Swierk Ph Address 79A Charles St Rochester, NH Item # Line Item Notes Unit Price Qty/Unit Total Price Attch. Docs JP JP Data Communications Products & Services Supplier Product Code: First Offer - 1 / contract Y Y Supplier Total $0.00 p. 1

2 Enterasys Networks, Inc. Item: JP Data Communications Products & Services Attachments Signed Cover Letter.pdf Enterasys Response-State of Utah JP14001.doc Exception.doc Claim of Business Confidentiality.pdf PROTECTED-Financial Statements.zip WSCA Master Price File.xlsx Detailed Parts List.pdf Redacted WSCA Response.zip p. 2

3 p. 3 State of Utah

4 WSCA-NASPO Data Communications Solicitation # JP14001 September 11, 2013 State of Utah Jennifer Porter Purchasing Agent / Contract Analyst 1 State Office Building Suite 3150 Salt Lake City, Utah RE: Enterasys Networks Response to Data Communications Products & Services Solicitation JP14001 Dear Ms. Porter, Thank you for providing Enterasys Networks, Inc. (Enterasys) with the opportunity to submit a response to the State of Utah s Data Communications Products & Services Solicitation JP Enterasys is a premier global provider of wired and wireless network infrastructure and security solutions. Enterasys was the FASTEST growing networking company in We have been successfully deploying network and security solutions for almost three decades and remain true to our customer-centric philosophy that There is nothing more important than our customers. As a current WSCA contract holder, Enterasys provides products and services to a number of state entities and political subdivisions in participating states across North America. Enterasys has experienced increased demand from new customers and state purchasing departments seeking to participate in WSCA and looks forward to the opportunity of continuing to provide products and world-class services through the contract. Enterasys proposal contains responses the Mandatory Requirements, Equipment and Service Offerings in sections , Financial Statements, References, Attachment C-Cost Schedule as well as one Attachment labeled Exception. Enterasys has taken no exceptions to the mandatory requirements in the RFP. Enterasys has entered a Claim of Business Confidentiality for non-public financial information included in our proposal response. We are confident our proposal meets the State of Utah s requirements. Should any questions arise as a result of our submission, please feel free to contact the dedicated Contract Administrator, Michael Swierk, at Again, thank you for the opportunity to participate in this RFP. Sincerely, Enterasys Networks, Inc. Julie Hale Director, Sales Operations Page 1 of 94 p. 4

5 WSCA-NASPO Data Communications Services Solicitation # JP14001 The State of Utah Division of Purchasing and General Services In conjunction with Request for Proposals JP14001 WSCA-NASPO Master Agreement for DATA COMMUNICATIONS PRODUCTS & SERVICES July 1, 2013 Page 2 of 94 p. 5

6 WSCA-NASPO Data Communications Solicitation # JP14001 Table of Contents Section 1: WSCA-NASPO Solicitation General Information 3 Section 2: General Proposal Requirements and Information 12 Section 3: Data Communications Provider Mandatory Minimum Requirements 13 Section 4: Data Communications Provider Qualifications 14 Section 5: Service Offering Qualifications Data Communications Services Requirements DATA CENTER APPLICATION SERVICES NETWORKING SOFTWARE NETWORK OPTIMIZATION AND ACCELERATION OPTICAL NETWORKING ROUTERS SECURITY STORAGE NETWORKING SWITCHES WIRELESS UNIFIED COMMUNICATIONS (UC) SERVICES 27 Section 6: Evaluation 29 Section 7: Master Agreement Terms and Conditions/Exceptions 32 Attachment B Reference Form 35 Attachment C Cost Schedule 38 Page 3 of 94 p. 6

7 WSCA-NASPO Data Communications Services Solicitation # JP14001 REQUEST FOR PROPOSAL DATA COMMUNICATIONS PRODUCTS AND SERVICES CONTRACT Solicitation # JP14001 Revised 5/30/2013 Section 1: WSCA-NASPO Solicitation General Information 1.1 Purpose of Request for Proposal (RFP) The State of Utah, Division of Purchasing is requesting proposals in conjunction with WSCA- NASPO Cooperative Purchasing Organization, LLC (WSCA-NASPO). The purpose of this request for proposal is to establish master agreements with qualified manufacturers to provide Data Communications products and services outlined in the specifications for all participating States. The services resulting from the award of this solicitation are to be available to all state entities, cities, counties, higher education, school districts and other political subdivisions on an as needed basis under the same pricing and terms and conditions agreed to in the Master Agreement. It is anticipated that this RFP may result in Master Agreement awards to multiple contractors. While the primary purpose of this solicitation is to select a proposer(s) who can offer the Products or Services for all Participating States, proposers are permitted to submit a proposal on more limited geographical areas, but not less than one entire Participating State. Proposers must clearly describe the geographical limits (e.g. by State name) if proposing a geographical area less than that of all Participating States. However, if a proposer elects to submit a Proposal for a single State then the proposer must be willing to supply the entire State and will not be allowed to add additional States following award or at any time during the term of the contract or any renewals. A Participating State may evaluate and select a proposer for award in more limited geographical areas (e.g. A single state) where judged to be in the best interests of the State or States involved. Each participating entity shall select the authorized contractor(s) they choose to do business with during the participating addendum process. A participating entity may require the authorized contractor(s) to submit additional information regarding their firm as part of the selection process during the execution of a participating addendum. This information could include, but is not limited to; partners or resellers approved under their PA, business references, number of years in business, technical capabilities, and the experience of both their sales and installation personnel. Each participating entity has the option to select one or more product categories or services from the resulting Master Agreement(s) during the execution of the participating addendum process. Each participating entity has the option to negotiate an expanded product line within the product category offering and within the scope of this RFP during the Participating Addendum process. Any additional incremental discounts available to a Participating Entity, if offered, may be provided at the discretion and as the sole legal obligation of the Contract provider or their Authorized Sub-Contractor to the Participating Entity and negotiated during the Participating Addendum process. All Participating entities have the right to put dollar limits and certain line item, parts or on the total amount purchased per occasion on their individual PA s as they deem appropriate. The resulting Master Agreement will be awarded with the understanding and agreement that it is for the sole convenience of the participating entities. The participating entities reserve the right to obtain like goods or services from other sources when necessary. This RFP is designed to provide interested proposers with sufficient basic information to submit Page 4 of 94 p. 7

8 WSCA-NASPO Data Communications Solicitation # JP14001 proposals meeting minimum requirements, but is not intended to limit a proposal's content or exclude any relevant or essential data. Suppliers are encouraged to expand upon the specifications to evidence service and capability. Response: Read and understood. 1.2 WSCA-NASPO Background Information WSCA-NASPO is a cooperative purchasing organization of all 50 states, the District of Columbia and the organized US territories. WSCA-NASPO is a subsidiary of the National Association of State Procurement Officials (NASPO). NASPO is a non-profit association dedicated to strengthening the procurement community through education, research, and communication. It is made up of the directors of the central purchasing offices in each of the 50 states, the District of Columbia and the territories of the United States. For more information consult the following websites and Obligations under master agreements that result from this cooperative procurement are limited to those states and other eligible entities that execute a Participating Addendum: 63G-6a Participation of a public entity or a procurement unit in agreements or contracts of procurement units -- Cooperative purchasing -- State cooperative contracts. (2) A public entity may obtain a procurement item from a state cooperative contract or a contract awarded by the chief procurement officer under Subsection (1), without signing a participating addendum if the quote, invitation for bids, or request for proposals used to obtain the contract includes a statement indicating that the resulting contract will be issued on behalf of a public entity in Utah. Financial obligations of Participating States (Entities) are limited to the orders placed by the departments, agencies and institutions of that Participating State (Entity) having legally available funds. Participating States incur no financial obligations on behalf of its political subdivisions, other governmental entities or other eligible entities. Unless otherwise specified in the solicitation or a Participating Addendum, the resulting master price agreement(s) will be permissive. This RFP is designed to provide interested Offerors with sufficient basic information to submit proposals meeting minimum requirements, but is not intended to limit a proposal's content or exclude any relevant or essential data. Proposals must be succinct, concise, and as short as possible to allow for efficient evaluation. Blanket marketing material and unnecessary elaborate brochures or representations beyond what is sufficient to present a complete and effective proposal are not acceptable. Offerors must respond to any or all of the 11 categories that follow. The following product and service categories are included in this RFP: 1. Data Center Application Services 2. Networking Software 3. Network Optimization and Acceleration 4. Optical Networking 5. Routers 6. Security 7. Storage Networking 8. Switches 9. Wireless Page 5 of 94 p. 8

9 WSCA-NASPO Data Communications Services Solicitation # JP Unified Communications 11. Services Response: Read and understood. 1.3 Objective The objective of this RFP is to obtain deeper volume price discounts than are obtainable by an individual state or local government entity. This discount is based on the collective volume of potential purchases by the numerous state and local government entities. The savings realized by the contractor in managing one comprehensive WSCA-NASPO Master Agreement rather than numerous state and local contracts should result in the most attractive service level and discounts available in the marketplace. The Master Agreement(s) resulting from this procurement may be used by state governments (including departments, agencies, institutions), institutions of higher education, political subdivisions (i.e., colleges, school districts, counties, cities, etc.), and other eligible entities subject to approval of the individual state procurement director and local statutory provisions. Participation by political subdivisions, other government entities and other eligible participants is with the authorization or acknowledgement of the specific state chief procurement official, and the execution of a Participating Addendum. Response: Read and understood. 1.4 Solicitation Background This is a rebid for the current for the WSCA-NASPO Data Communications Equipment, Supplies and Services contracts. Eight (8) Manufacturers currently have Master Contracts to provide Data Communications Equipments, Supplies and Services. They are as follows: Alcatel-Lucent AR1466 Brocade Communications AR214 Cisco Systems AR233 Enterasys Networks, Inc. AR1471 Extreme Networks AR1471 Hewlett-Packard - AR1464 Juniper Networks AR229 Meru Networks AR218 Although the State of Utah and WSCA-NASPO does not guarantee any usage or spend under these contracts, for bid purposes only, the total combined spend on these contracts for 2012 was $204 million dollars. Response: Read and understood. 1.5 Issuing Office and Solicitation Number The State of Utah, Division of Purchasing is the issuing office for this document and all subsequent addenda relating to it. The reference number for the transaction is Solicitation # JP This number must be referred to on all proposals, correspondence, and documentation relating to the RFP. Response: Read and understood. 1.6 WSCA-NASPO Contract Administrator The WSCA-NASPO Contract Administrator designated by WSCA-NASPO and the State of Utah, Division of Purchasing and General Services is: Page 6 of 94 p. 9

10 WSCA-NASPO Data Communications Solicitation # JP14001 Name: Jennifer Porter State of Utah Division of Purchasing and General Services State Office Building, Capitol Hill Room 3150 Salt Lake City, UT jenniferporter@utah.gov Phone: Fax: Response: Read and understood. 1.7 Proposal Submittal Offers must be received, according to instructions, by the posted due date and time. Offers received after the deadline will be non-responsive. Proposals are due August 30, 2013 at 11:00 am MST Questions will be accepted until July 26, 2013 at 11:00 am MST Data Communication RFP Release Webinar is scheduled for July 11, Webinar details will be posted on the WSCA-NASPO website ( The preferred method of submitting your original master proposal packet is electronically in Microsoft Word and Excel through BidSync, ( or you may mail or drop off your hard copies to the address noted in Section 1.6 of this RFP on or before the due date and time. The original master proposal packet shall include a separate document or sealed envelope labeled SOLICITATION # JP14001 Cost Schedule that contains the pricing document. Please note that the State of Utah Division of Purchasing office is closed on Saturday and Sunday and therefore does not accept deliveries on those days. When submitting an offer electronically through BidSync, please allow sufficient time to complete the online forms and upload documents. The solicitation will end at the closing time listed in the offer. If you are in the middle of uploading your documents at the closing time, the system will stop the process and your offer will not be received by the system. It is recommended that the submission process be completed the day prior to the due date, with the knowledge that any changes/updates will be accepted through the due date and time. Electronic offers may require the uploading of electronic attachments. BidSync s site will accept a wide variety of document types as attachments. However, the submission of documents containing embedded documents (zip files), mov, wmp, and mp3 files are prohibited. All documents should be attached as separate files. BidSync customer support may be contacted at (800) for guidance on the BidSync site. Respondents are responsible for ensuring that their BidSync registration information is current and correct. The State of Utah accepts no responsibility for missing or incorrect information contained in the vendor registration in BidSync. Incorrect or missing vendor registration information may result in failure to receive notification from BidSync regarding this procurement. In addition to the original master proposal packet submission, Respondents are required to send one (1) hard copy and one (1) electronic version (Microsoft Word and Excel) of the complete proposal, excluding pricing information, to each of the evaluation team members listed below. Each proposal packet shall be marked with the solicitation number and be in accordance with the Page 7 of 94 p. 10

11 WSCA-NASPO Data Communications Services Solicitation # JP14001 submittal requirements. The original master sent to the WSCA-NASPO Master Agreement Administrator identified in Section 1.6 of this RFP will prevail in resolving any discrepancies. Alaska Ted Fawcett Contracting Officer ted.fosket@alsaka.gov California - Bonnie Bahnsen bonnie.bahnsen@dgs.ca.gov Nevada Marti Marsh Purchasing Officer mmarsh@admin.nv.gov New Jersey Vicente Azarcon Procurement Specialist vicente.azarcon@treas.state.nj.us Utah Jennifer Porter Purchasing Agent State of Utah jenniferporter@utah.gov Response: Read and understood. 1.8 Current State Participants The States currently participating in the existing contracts are: Alaska, Arkansas, California, Colorado, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kentucky, Louisiana, Minnesota, Missouri, Montana, Nevada, New Jersey, Oklahoma (Grand River Dam Authority), Oregon, South Dakota, Utah, Washington, Wisconsin and Wyoming. States with Intent to Participate The following states have executed an Intent to Participate thru WSCA-NASPO, which simply indicates that they want to be formally listed in the published Request for Proposal as participating in the solicitation process: California, Hawaii, Minnesota, Missouri, Montana, Nevada, New Jersey, South Carolina, South Dakota, Utah, Vermont and Washington. All 56 NASPO members are eligible to participate in all WSCA-NASPO contracts when and if they decide they want to, in accordance with their individual statutory requirements. Response: Read and understood. 1.9 Governing Laws and Regulations This procurement is conducted by the State of Utah, Division of Purchasing & General Services, in accordance with the Utah Procurement Code. These are available at the Internet website for the State of Utah s Division of Purchasing & General Services. The laws of the State of Utah will govern all Master Agreements that result from this procurement unless the Data Communications Products and Services Provider and participating entity agree in a Participating Addendum that the laws of another jurisdiction will govern purchases made by purchasing entities within the jurisdiction of the participating entity. Response: Read, understood and will comply. Page 8 of 94 p. 11

12 WSCA-NASPO Data Communications Solicitation # JP Length of Contract The Master Agreement(s) resulting from this RFP will be for a period of five years (initial term). The Master Agreement(s) may be extended beyond the original Master Agreement period for a two (2) year period, by mutual agreement. Response: Read and understood Pricing Structure Pricing Structure: Pricing for the WSCA-NASPO Master Agreements shall be based on the Percent Discount off the current global MSRP Schedule applicable to United States customers. Response: Read and understood Price Guarantee Period Price Guarantee Period: The Data Communication Provider s Discount rate shall remain in effect for the term of the WSCA-NASPO Master Price Agreement. Response: Read and understood Price Escalation Equipment, Supplies and Services: Data Communications provider may update the pricing on their MSRP price list one time every year after the first year of the original contract term. The WSCA-NASPO Contract Administrator will review a documented request for a Price Schedule price list adjustment only after the Price Guarantee Period. Response: Read, understood and will comply Price Reductions In the event of a price decrease in any category of product at any time during the contract in a Provider s Price Schedule, including renewal options, the WSCA-NASPO Contract Administrator shall be notified immediately. All Price Schedule price reductions shall be effective upon the notification provided to the WSCA-NASPO Master Agreement Administrator. Response: Read, understood and will comply Usage Reporting Requirement All Data Communication Provider s will be required to provide quarterly usage reports to the WSCA- NASPO Contract Administrator or designee. The initiation and submission of the quarterly reports are the responsibility of the Data Communication Contract Provider. You are responsible to collect and report all sales data including your resellers and partners sales associated with your Master Agreement. There will be no prompting or notification provided by the WSCA-NASPO Contract Administrator. Quarterly reports must coincide with the quarters in the fiscal year as outlined below: Quarter #1: July 1 through September 30, due annually by October 30. Quarter #2: October 1 through December 31, due annually by January 30. Quarter #3: January 1 through March 31, due annually by April 30. Quarter #4: April 1 through June 30, due annually by July 30. Respondents must identify the person responsible for providing the mandatory usage reports. This contact information must be kept current during the Master Agreement period. The WSCA- Page 9 of 94 p. 12

13 WSCA-NASPO Data Communications Services Solicitation # JP14001 NASPO Contract Administrator must be notified if the contact information changes. The contact information for the person responsible for the mandatory quarterly usage reporting must be specified per Section The purpose of the Master Agreement usage-reporting requirement is to aid in Master Agreement management. The specific report content, scope, and format requirements will be provided to the awarded Data Communications Products and Services Provider s during Master Agreement execution. Some WSCA-NASPO States may require additional reporting requirements. Those requirements will be addressed through the individual participating entity s Participating Addendum process. Failure to comply with this requirement may result in Master Agreement cancellation. Response: Read, understood and will comply Standard Contract Terms and Conditions Any Master Agreement resulting from this RFP will include, but will not be limited to, the WSCA- NASPO Standard Master Agreement Terms and Conditions, the State of Utah Additional Terms and Conditions (Appendix A) and any additional terms and conditions specific to WSCA-NASPO participating addendums for participating entities. The WSCA-NASPO Master Agreement Terms and Conditions and State of Utah Additional Terms and Conditions will take highest precedence in any contract resulting from this solicitation. Vendors must clearly identify exceptions to the WSCA-NASPO Standard Master Agreement Terms and Conditions and the State of Utah Additional Terms and Conditions in the bid submission. Vendor exceptions must include proposed solution language. Failure to submit exceptions and/or solution language will constitute vendor acceptance of WSCA-NASPO and State of Utah Additional Terms and Conditions. No third party terms and conditions will be allowed in resulting contracts awarded under this solicitation. Additional vendor terms and conditions must be submitted with the solicitation bid response for legal review and contract applicability. Submission of vendor terms and conditions with a bid response does not guarantee acceptance. Vendor terms and condition will not include any reference to website URLs that house additional terms and conditions. All terms and conditions associated with resulting contracts will be identified and attached to the WSCA- NASPO Master Agreement. The State of Utah reserves the right to accept, reject, and/or negotiate vendor terms and conditions after the award(s) have been made if it is in the best interest of the State of Utah. Participating States reserve the right to negotiate vendor terms and conditions during the Participating Addendum process. Vendor terms and conditions included with a bid response are limited to a maximum of 10 pages (8 1/2 x 11 inch paper, 10 pt Arial font, and single sided). Failure to adhere to these terms and conditions requirements may result in vendor disqualification. Response: Read and understood. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer. Page 10 of 94 p. 13

14 WSCA-NASPO Data Communications Solicitation # JP Questions All questions must be submitted through BidSync. Answers will be given via the BidSync website. Questions received after the Question/Answer period will not be answered. No agency employee, board member, or evaluation committee member should be contacted concerning this solicitation during the solicitation posting and selection process. Failure to comply with this requirement may result in vendor disqualification. Response: Read, understood and comply Discussions with Respondents (Oral Presentation) An oral presentation by a Respondent to clarify a proposal may be required at the sole discretion of the WSCA-NASPO Master Agreement Administrator. However, the WSCA-NASPO Contract Administrator may award a Master Agreement based on the initial proposals received without discussion with the Respondent. If oral presentations are required, they will be scheduled after the submission of proposals. Oral presentations will be made at the Respondents expense. Response: Read and understood Protected Information The Government Records Access and Management Act (GRAMA), Utah Code Ann., Subsection , provides in part that: the following records are protected if properly classified by a government entity: (1) trade secrets as defined in Section if the person submitting the trade secret has provided the governmental entity with the information specified in Section (Business Confidentiality Claims); (2) commercial information or non-individual financial information obtained from a person if: (a) disclosure of the information could reasonably be expected to result in unfair competitive injury to the person submitting the information or would impair the ability of the governmental entity to obtain necessary information in the future; (b) the person submitting the information has a greater interest in prohibiting access than the public in obtaining access; and (c) the person submitting the information has provided the governmental entity with the information specified in Section ; * * * * * (6) records the disclosure of which would impair governmental procurement proceedings or give an unfair advantage to any person proposing to enter into a contract or agreement with a governmental entity, except that this Subsection (6) does not restrict the right of a person to see bids submitted to or by a governmental entity after bidding has closed;... GRAMA provides that trade secrets, commercial information or non-individual financial information may be protected by submitting a Claim of Business Confidentiality. To protect information under a Claim of Business Confidentiality, the Respondent must: 1. provide a written Claim of Business Confidentiality at the time the information (proposal) is provided to the State, and 2. include a concise statement of reasons supporting the claim of business confidentiality (Subsection (1)). Page 11 of 94 p. 14

15 WSCA-NASPO Data Communications Services Solicitation # JP submit an electronic redacted (excluding protected information) copy of your proposal response. Copy must clearly be marked Redacted Version. Failure to submit a redacted version may result in release of your entire proposal. A Claim of Business Confidentiality may be appropriate for information such as client lists and non-public financial statements. Pricing and service elements cannot be protected. An entire proposal cannot be protected under a Claim of Business Confidentiality or Proprietary. Failure to comply with this requirement many result in your proposal being ruled Non-Responsive and no longer considered. The claim of business confidentiality must be submitted with your proposal on the form which may be accessed at: To ensure the information is protected, the Division of Purchasing asks the Respondent to clearly identify in the Executive Summary and in the body of the proposal any specific information for which a Respondent claims business confidentiality protection as "PROTECTED". All materials submitted become the property of the State of Utah. Materials may be evaluated by anyone designated by the State as part of the sourcing team. Materials submitted may be returned only at the State's option. Response: Read and understood. Enterasys has entered a Claim of Business Confidentiality for the non-public financial information included in our proposal response. The following proposal attachments are submitted as PROTECTED information: UAe_2012 Enterprise Networks Holdings BV Amsterdam.pdf Gores ENT Holdings Consolidated Financial Statements SEPT 2011 Revised.xls Enterasys Networks Inc. Financial Statements P12 September 2012 Revised.xls 1.20 WSCA Administrative Fee The Contracted Supplier must pay a WSCA-NASPO administrative fee of one quarter of one percent (.025%) in accordance with the terms and conditions of the contract. The WSCA-NASPO administrative fee shall be submitted quarterly and is based on the actual sales of all products and services in conjunction with your quarterly reports. The WSCA-NASPO administrative fee must be included when determining the pricing offered. The WSCA-NASPO administrative fee is not negotiable and shall not be added as a separate line item on an invoice. Additionally, some WSCA-NASPO participating entities may require that an administrative fee be paid directly to the WSCA-NASPO participating entity on purchases made by purchasing entities within that State. For all such requests, the fee percentage, payment method and payment schedule for the participating entity s administrative fee will be incorporated in the Participating Addendum. Data Communications Provider will be held harmless, and may adjust (increase) the WSCA-NASPO Master Agreement pricing by the fee percentage for that participating entity accordingly for purchases made by purchasing entities within the jurisdiction of the State. All such agreements may not affect the WSCA-NASPO fee or the prices paid by the purchasing entities outside the jurisdiction of the participating entities requesting the additional fee. Response: Read, understood and will comply. Page 12 of 94 p. 15

16 WSCA-NASPO Data Communications Solicitation # JP Interest Any payments that a Contracted Supplier makes or causes to be made to WSCA-NASPO after the due date as indicated on the Quarterly Report schedule shall accrue interest at a rate of 18% per annum or the maximum rate permitted by law, whichever is less, until such overdue amount shall have been paid in full. The right to interest on late payments shall not preclude WSCA-NASPO from exercising any of its other rights or remedies pursuant to this agreement or otherwise with regards to Data Communication Provider s failure to make timely remittances. Response: Read, understood and will comply Proposal Offer Firm Responses to this RFP, including proposed discounts offered will be considered firm for one hundred and sixty (160) days after the proposal due date. By signature (electronic or otherwise) and submission of a proposal, the person signing verifies that they are authorized to submit the proposal and bind the firm to provide the products/services in the proposal and potential Master Agreement. Response: Read, understood and will comply Cancellation of Procurement This RFP may be canceled at any time and any and all proposals may be rejected in whole or in part when the State of Utah, Division of Purchasing and General Services determines such action to be in the best interest of the State of Utah. Response: Read and understood Right to Waive The sourcing team reserves the right to waive minor irregularities at its sole discretion. Response: Read and understood Right to Accept All or Portion It is our intent to accept the entire line of Data Communications Equipment and Services (included in the scope) from the awarded Data Communications Providers, however we reserve the right to accept all or a portion of a Respondents proposal. Response: Read and understood Service Line Additions and Updates During the term of the contract, Data Communications Providers may submit a request to update the awarded items (within the scope listed in IDENTIFY SECTION) as new technology is introduced, updated or removed from the market. The Master Agreement Administrator will evaluate requests and update the contract offering via written amendment as appropriate. The Data Communications Service Provider shall update the dedicated website, price lists, and catalogs to reflect approved changes. Pricing must utilize the same pricing structure as was used for services falling into the same service category. Response: Read, understood and will comply Right to Publish Throughout the duration of this procurement process and Master Agreement term, Respondents, Data Communications Providers and their authorized contractors must secure from the WSCA- Page 13 of 94 p. 16

17 WSCA-NASPO Data Communications Services Solicitation # JP14001 NASPO Contract Administrator prior approval for the release of any information that pertains to the potential work or activities covered by this procurement or the Master Agreement. The Data Communications Provider shall not make any representations of WSCA-NASPO s opinion or position as to the quality or effectiveness of the services that are the subject of this Master Agreement without prior written consent of the WSCA-NASPO Contract Administrator. Failure to adhere to this requirement may result in disqualification of the Respondents proposal or termination of the Master Agreement for cause Response: Read, understood and will comply Changes in Representation The Contracted Supplier must notify the WSCA-NASPO Contract Administrator of changes in the Contracted Supplier s key administrative personnel, to the extent that there may be adverse impacts to the contract. The WSCA-NASPO Contact Administrator reserves the right to require a change in Contracted Supplier(s) representatives if the assigned representative(s) is not, in the opinion of the WSCA-NASPO Contract Administrator, meeting the terms and conditions of the contract. Response: Read, understood and will comply E-Rate Requirement All award contractors must commit to participation in the Federal Communication Commission's E-rate discount program established under authority of the Federal Telecommunications Commission Act of Participation in, and implementation of, this program must be provided without the addition of any service or administration fee by the contractor. Response: Read, understood and will comply. Enterasys is an E-Rate Service Provider in good standing with the FCC and maintains an up-to-date SPAC and SPIN Section 508 Compliant Respondents must meet all Federal and State regulations required to these type of products including but limited to accessible products by describing their support of the applicable provisions of the Workforce Investment Act of 1998, Section 508. Response: Read, understood and comply Glossary Authorized Contractor: The Prime Contractor as listed as Contractor under the resulting Master Agreement(s) as a result of this RFP. Authorized Sub Contractor: sub Contractor, Reseller, Partner, etc. Authorized by the Contractor (Prime) to sell only the products and services listed under the Master Agreement (s) established as a result of this RFP. This authorized sub contractor must have the authority and ability to accurately reflect the ability of the Respondent to meet the requirements detailed in this RFP. WSCA-NASPO Contract Administrator: A dedicated person with the authority and ability to manage compliance with the scope and terms and conditions for this contract. Mandatory Minimum Requirements: Requirements that must be met in order to be considered for further evaluation. Mandatory minimum requirements are non-negotiable. An offer that does not meet the mandatory minimum requirements will be disqualified from further consideration. Participating Addendum: A Participating Addendum must be executed by any State that decides to adopt a WSCA-NASPO Master Agreement. Page 14 of 94 p. 17

18 WSCA-NASPO Data Communications Solicitation # JP14001 A Participating Addendum shall be executed for each contractor by the individual State desiring to use their contract. Additional States may be added with the consent of the contractor and the Lead State (on behalf of WSCA-NASPO) through execution of Participating Addendums. A Participating Addendum allows for each Participating State to add terms and conditions that may be unique to their State. The Participating State and the Contractor shall negotiate and agree upon any additional terms and conditions prior to the signing and execution of the Participating Addendum. States are not mandated to sign a Participating Addendum with all awarded vendors. Participating Entity: A State that has indicated intent to participate in the solicitation process, or after award, a State that has executed a participating addendum. Purchasing Entity: Any end-user in a participating State that is eligible to use the Master Agreement(s) through the participating addendum, including but not limited to State Agencies, Counties, Cities, Education, and other entities. Qualified Entity: An entity that is eligible to use the Master Agreement(s). Usage Report Administrator: A contractors person responsible for the quarterly sales reporting and payments described in Section 1.15 Usage Reporting Requirement. Volume Discount: A percentage discount offered by the seller to the buyer for purchasing a stated dollar amount of Data Communications services and products to be delivered at one time or for a specified period. Sourcing Team: The technical and business team charged with setting requirements for the Data Communications procurement, and its subsequent evaluation. Response: Read and understood. Section 2: General Proposal Requirements and Information 2.1 Proposal Content and Format Requirements Proposals must be detailed and concise. Unless otherwise stated in your proposal as an exception, Respondents agree to comply with every section, subsection, attachment and addendum of this RFP. Each proposal must be submitted in Microsoft Word or Excel, labeled and organized in a manner that is congruent with the section number, headings, requirements, and terminology used in this RFP. Proposal documents must be Arial font size 10. Respondent responses that are limited to a specified number of pages are referring to single sided pages. As an example, a response that is limited to a document that is no more than two pages long may be submitted on one double sided page, but not two double sided pages. Response: Read, understood and comply. 2.2 RFP Revisions Revisions, if any, and all written questions and the State s answers, will be posted on the BidSync website. Solicitation documents will not be mailed to prospective Proposers. Respondents must register (free of charge) as a vendor with BidSync in order to have access to the RFP and related Page 15 of 94 p. 18

19 WSCA-NASPO Data Communications Services Solicitation # JP14001 documents. Respondents are responsible for ensuring that their registration information is current and correct. The State of Utah accepts no responsibility for missing or incorrect information contained in the supplier s registration information on BidSync. The State of Utah accepts no responsibility for a prospective Respondent not receiving solicitation documents and/or revisions to the solicitation. It is the responsibility of the prospective Respondent to obtain the information provided through BidSync. Response: Read, understood and comply. 2.3 Right to Waive The State of Utah reserves the right to waive any informality or technicality in any proposal. Response: Read and understood. 2.4 Proposals Become Property of the State of Utah All proposal contents become the property of the State of Utah. All proposal content is proprietary during the proposal evaluation process. Upon Master Agreement award, the successful Respondents proposals will be open to public inspection, by request, with the exception of any proposal content that is marked as proprietary or confidential by the Respondent. All content designated as proprietary or confidential must be supported by documentation as to the rationale for the proprietary nature of the information. Response: Read, understood and comply. 2.5 News Releases News releases or other public disclosure of information pertaining to this RFP or the statewide contracts may not be published without the prior written permission of the State of Utah. Response: Read, understood and will comply. 2.6 State Seal Use The Utah Great Seal Rule states, in section R Custody and Use, that no facsimile or reproduction of the Great Seal may be manufactured, used, displayed, or otherwise employed by anyone without the written approval of the Lieutenant Governor." Other participating States have similar rules that must be adhered to by Respondents or interested parties. Response: Read, understood and will comply. Section 3: Data Communications Provider Mandatory Minimum Requirements 3.1 General Information This section contains requirements that must be addressed in order for your proposal to be considered for the evaluation phase of this RFP. All of the items described in this section are non-negotiable. Respondents are required to complete: Mandatory Requirements (M) All Respondents must meet the (M) requirements listed in this section, and explain how the requirement is met. A no response on the acceptance document or omission of the required explanation will disqualify the service from further evaluation. Response: Read and understood. Page 16 of 94 p. 19

20 WSCA-NASPO Data Communications Solicitation # JP Equipment Offering (M) Identify Equipment Offering in sections Response: Read, understood and comply. Enterasys has proposed a broad range of equipment offerings in sections Proposed equipment includes switching and routing solutions featuring a variety of chassis, stackable and standalone-based options. A complete wireless offering that includes standalone wireless access points and controller-based solutions. Network Management solutions that deliver unified wired and wireless management for complete centralized visibility and control of both the network and third party systems as well as Security solutions such as Network Access Control. Detailed technical responses and equipment lists have been included for each proposed category below: Networking Software Enterasys has proposed our NetSight Management Software Suite offering under the Networking Software category. In addition, Enterasys has proposed services offerings for Network Management and Automation as well as Data Center Management and Automation as additional professional services categories Routers Network Edge Routers Core Routers Security Intrusion Detection/Protection and Firewall Appliances Secure Access Switches Campus LAN Access Switches Campus LAN Core Switches Campus Distribution Switches Data Center Switches Software Defined Networks (SDN) Virtualized Switches and Routers Software Defined Networks (SDN) Wireless Access Points Outdoor Wireless Access Point Wireless LAN Controllers Wireless LAN Network Services and Management Cloud-based services for Access Points Bring Your Own Device (BYOD) Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of equipment proposed in each category Service Offering (M) Identify Service Offerings for all products offered in Sections Response: Read, understood and comply. Enterasys has included a broad range of service offerings for the proposed equipment in sections Below is an overview Page 17 of 94 p. 20

21 WSCA-NASPO Data Communications Services Solicitation # JP14001 of the available service offerings; additional detail is included in section Services: Maintenance Services Express Parts Our maintenance services provide full access to the latest firmware updates, ensuring you get the most from your network equipment. Advance parts replacement options range from next business day to two hour response and are available with or without an onsite field engineer. On-site Enterasys On-site maintenance program allows you to have an Enterasys-certified expert on site to help diagnose and repair network faults and serve as a liaison with product engineers for problem escalation when necessary. Software and Appliance Services Enterasys Software and Application Services maintenance programs allow you to avoid the expense of purchasing different revision levels, protecting your software investments. Our Appliance Services will help support elements that are critical to most effectively configure, maintain, support, upgrade and manage these product-specific Application environments. Enterasys Professional and Partner Services Both Enterasys and its authorized partners offer a broad range of professional services to help customers assess, plan, design, implement, and optimize their technology solutions. Enterasys Professional Services provides access to highly skilled and experienced networking specialists for all implementation related activities including but not limited to: design review, staging, implementation and project management, as well as advanced integration and technical training services. These services deliver flexibility, efficiency and cost savings, so you can select the type and level of service for each implementation task. Training Enterasys believes that technical training is an important element of doing business and will allow you to unleash the full value of your Enterasys solution. We offer a modular approach to technical certification training focused on practical, hands-on learning that s relevant to supporting and optimizing your Enterasys solutions to meet your business requirements. Our knowledgeable instructors use multiple methods to meet our varying customer educational requirements, ensuring that you are equipped to more effectively manage and support your network. Enterasys makes it easy to fully leverage your technology investment by offering the flexibility to take advantage of our training classes wherever you are. Our wide variety of educational courses and technical certifications are offered at many global Authorized Training Centers or regional training events, at your location in a customized training session, or from the comfort of your home or office via our web-based live virtual classroom. Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of proposed services offerings in each category Insurance Requirement (M) This pertains to the State of Utah insurance requirements. Other Participating States may identify different insurance requirements during the participating addendum process. Data Communications Provider s and their authorized contractors shall procure and maintain insurance which shall protect the authorized contractor and The State and/or purchasing entity Page 18 of 94 p. 21

22 WSCA-NASPO Data Communications Solicitation # JP14001 (as an additional insured) from any claims from bodily injury, property damage, or personal injury covered by the indemnification obligations set forth herein. The Data Communications Provider s authorized contractor shall procure and maintain the insurance policies described below at their own expense and shall furnish to the procurement manager, upon award, an insurance certificate listing the participating State(s) as certificate holder and as an additional insured. The insurance certificate must document that the Commercial General Liability insurance coverage purchased by the authorized contractor to include contractual liability coverage applicable to this Master Agreement. In addition, the insurance certificate must provide the following information: the name and address of the insured; name, address, telephone number and signature of the authorized agent; name of the insurance company (authorized to operate in all States); a description of coverage in detailed standard terminology (including policy period, policy number, limits of liability, exclusions and endorsements) and an acknowledgment of notice of cancellation to the participating States. Authorized contractor is required to maintain the following insurance coverage s during the term of the WSCA-NASPO Master Agreement: 1) Workers Compensation Insurance The Data Communications Provider s authorized contractor must comply with Participating State s requirements and provide a certificate of insurance. 2) Commercial General Liability Policy per occurrence - $1,000,000. Coverage to include bodily injury and property damage combined single limit. 3) Business Automobile Policy to include but not limited to liability coverage on any owned, non-owned, or hired vehicle used by Data Communications Provider s authorized contractor personnel in the performance of this Master Agreement. The business automobile policy shall have the following limits of liability: Per Occurrence - $1,000,000, Annual Aggregate - $3,000,000, Annual Aggregate applying to products and services - $3,000,000. Coverage must include premises and operations, bodily injury and property damage, personal and advertising injury; blanket contractual, products and services, owner named as an additional insured. The State of Utah must be listed as an additional insured. Within 10 days of contract award, the Contracted Supplier and/or Authorized Contractor must submit proof of certificate of insurance that meets the above requirements or the Participating States requirements. Response: Read, understood and comply. Enterasys will submit proof of insurance that meets the above requirements within 10 days of contract award Delivery (M) The prices offered shall be the delivered price to any WSCA-NASPO purchasing entity. All deliveries shall be F.O.B. destination with all transportation and handling charges paid by the contractor. Responsibility and liability for loss or damage shall remain the Contractor until final inspection and acceptance (within 30 days after delivery for external damage and 30 days for any concealed damage) when responsibility shall pass to the Buyer except as to latent defects, fraud and Contractor s warranty obligations. The minimum shipment amount will be found in the special terms and conditions. Any order for less than the specified amount is to be shipped with the freight prepaid and added as a separate item on the invoice. Any portion of an order to be shipped without transportation charges that is back ordered shall be shipped without charge. Response: Read, understood and comply. Page 19 of 94 p. 22

23 WSCA-NASPO Data Communications Services Solicitation # JP Service Offering Documentation (M) Upon request, user and/or technical documentation should be supplied for all procured products and services. Manuals may be available via the Contracted Supplier s website. The manual shall contain user and technical instructions appropriate to the service. Response: Read, understood and comply. Enterasys product manuals are available in the Downloads section of the Enterasys Support Site Documentation includes: Configuration Guides, Installation Guides, CLI Reference Guides, Feature Guides and Release Notes. Customers will be required to create a user name and password to sign in to the Enterasys Support Site for access to documentation. User and/or technical documentation can be supplied in whatever manner is most convenient to the customer Data Communications Provider Contract Administrator and Usage Report Administrator (M) The Contracted Supplier shall provide a Contract Administrator to manage compliance with the scope and terms and conditions for this contract. The following Information, at a minimum, regarding the Contract Administrator shall be provided: Response: Read, understood and comply. a. Administrator s number of years experience in the Data Communications Services business. Response: Enterasys has assigned a Contract Administrator with 14 years of experience in the Data Communications Services business to manage the contract. b. Confirmation that the Data Communications Provider Contract Administrator has authority to enforce the scope of work and terms and conditions of the resulting contract. Response: Comply. The Contract Administrator has authority to enforce the scope of work and terms and conditions of the resulting contract. The Contracted Supplier shall also provide a Usage Report Administrator responsible for the quarterly sales reporting described in Section 1.15 Usage Reporting Requirement. Response: Comply. The assigned Contract Administrator will be responsible for providing quarterly sales reporting described in Section 1.15 Usage Reporting Requirement emarket Center Cooperation (M) To be eligible for contract award, the Contractor must agree to cooperate with WSCA-NASPO and SciQuest (and any authorized agent or successor entity to SciQuest) with uploading a hosted catalog or integrating a punchout site. The contract requirements are in section 7. Response: Comply. Enterasys agrees to cooperate with WSCA-NASPO and SCiQuest with uploading a hosted catalog into the emarket Center based on the requirements in section 7. Section 4: Data Communications Provider Qualifications 4.1 General Information: Provide any pertinent general information about the depth and breadth of the Offeror s product and service offerings and their overall use and acceptance in the Data Communications marketplace. Response: Enterasys Networks is one of the fastest growing companies in the networking industry, providing patented and differentiated wired and wireless network infrastructure as well as security and management solutions. Enterasys One Fabric is the industry's first fabric-based networking solution to extend visibility and control from virtual servers to mobile devices for cloud computing, software-defined networking, and data center Page 20 of 94 p. 23

24 WSCA-NASPO Data Communications Solicitation # JP14001 environments. OneFabric enables our customers to provision the network from the data center to the mobile edge with consistent performance to deliver a positive end user experience through enhanced application analytics, all managed from a single pane of glass. With over 20,000 customers and sales in over 90 countries, Enterasys addresses the complexities of today s megatrends around Mobile, Social, Cloud and Big Data, serving customers across major verticals including education (K-12 and higher education), healthcare, government, manufacturing and hospitality. Awards & Accolades The success of Enterasys solutions in the marketplace is well demonstrated by our ability to win awards as well by the accolades we continue to earn from major industry research firms and analysts. Enterasys was recently recognized as a top industry leader in the Dell Oro Group 2013 Enterprise Edge Report, ranking fourth in overall market share among leading Ethernet Edge Switch vendors. The full press release is available at In addition, Enterasys leadership was recognized by leading industry analyst firm Info- Tech in all of our major product categories of Switching, NAC and WLAN. The reports for each product category are listed below: Switching: Tech_Enterprise_LAN_Vendor_Landscape.pdf NAC: Vendor-Landscape.pdf WLAN: Landscape.pdf April 2012 Enterasys is among the distinguished list of winning recipients of the eighth annual Manufacturing Leadership 100 Awards, honored at the Manufacturing Leadership Summit in Palm Beach, FL, April 29 May 2, Enterasys was selected by Manufacturing Executive, the global community for manufacturing leadership and producer of the Manufacturing Leadership Summit and ML100 Awards program. Enterasys' VP of Engineering Operations & Quality Brad Martin received an individual award in the Next-Generation Leadership and Culture category, and the company also received honors in the Information Leadership category. "We are honored to be recognized in two separate categories by Manufacturing Executive and feel the award is strong validation of our commitment to customers. At Enterasys, we live by our motto 'there is nothing more important than our customers' and our culture of continuous improvement helps us provide the best quality and highest performing product," said Brad Martin, VP of Engineering Operations & Quality, Enterasys. "Our recently implemented quality initiative strengthened processes across the board in order to ensure product quality is a key competitive differentiator for us. March 2012 Enterasys received several award wins from the sixth annual Stevie Awards for Sales & Customer Service gala banquet at Caesars Palace in Las Vegas. Enterasys project isaac won the Gold Stevie Award for New Collaboration Solution. Enterasys also won a Silver Stevie Award for Contact Center of the Year (up to 100 seats), and a Bronze Stevie Award for Innovation in Customer Service. Page 21 of 94 p. 24

25 WSCA-NASPO Data Communications Services Solicitation # JP14001 The Stevie Awards for Sales & Customer Service are the world s top sales, contact center and customer service awards. The Stevie Awards organizes several of the world s leading business awards shows, including the prestigious American Business Awards SM and International Business Awards SM. Enterasys isaac is a patent-pending, first-of-its-kind technology that gives IT the ability to manage network devices via Twitter, SalesForce.com Chatter, and Facebook. Isaac provides a simple and intuitive social media interface to OneFabric Control Center. The technology enables customers to use familiar social media interfaces to manage their networks. With isaac, administrators can communicate directly with machines, both giving commands and receiving information. All conversations can be pulled together, and information can be shared in a group setting. Administrators can also service customers more effectively because configuration details can be easily viewed. Enterasys strives to create a competitive differentiator and improve customer loyalty by providing the best customer service experience in the networking industry through its Global Technical Assistance Center (GTAC). This is validated by Enterasys having recently achieved a high Net Promoter Score, or NPS, of +8.1 based on input from its global customers in a variety of industries. In support of this goal, Enterasys employs a fully in-sourced customer service organization with best practices via Salesforce.com s cloud-based CRM tool, which enables workforce optimization through automated workflows and balanced performance scoring, as well as internal and external crossfunctional collaboration and self-service capabilities, including access to knowledge base and incident reporting management. We re delighted to kick off our celebration of the 10 th year of the Stevie Awards movement with the 2012 Stevie Awards for Sales & Customer Service, which is the first program in which we conferred Silver and Bronze Stevie Awards, said Michael Gallagher, president and founder of the Stevie Awards. It s gratifying and inspiring to have received so many remarkable entries for this year s competition. More than 1,000 entries from organizations of all sizes and in virtually every industry were submitted to this year s competition, an increase of almost 30 percent over Finalists were determined by the average scores of 93 professionals worldwide, acting as preliminary judges. We are proud to be honored by the Stevie Awards for isaac as well as the world-class services and support provided by our GTAC, said Vala Afshar, Chief Customer Officer, Enterasys. We stand by our motto that there is nothing more important than our customers. We will continue to make our customers our number one priority, and offer them innovative products and stellar support to help them better manage their business. February 2012 Enterasys received the 2011 Product of the Year Award from Technology Marketing Corporation's (TMC ) Internet Telephony magazine. With social media quickly becoming the mainstay of online communications, Enterasys developed isaac to integrate the cloud and mobile infrastructure with the social network. This enables IT to provide real-time responses to business needs anytime, anywhere, said Vala Afshar, Chief Customer Officer at Enterasys Networks. Receiving the Internet Telephony product of the year award validates the power of isaac to leverage social media for secure, predictive management and control of their wireless and wired IP networks to improve the user experience. Enterasys isaac is a social media interface that securely enables networks to communicate with humans in the language of social networking. Enterasys isaac enables your IT network to communicate its status and receive your commands all from pervasive Page 22 of 94 p. 25

26 WSCA-NASPO Data Communications Solicitation # JP14001 social networks including Twitter, Facebook and Salesforce Chatter. Enterasys isaac is available with NetSight, a key component of Enterasys OneFabric TM Control Center delivering single-pane of glass management for end-to-end application delivery assurance. I am happy to grant Enterasys with a Product of the Year Award. The editors of Internet Telephony have verified that isaac displays quality and innovation plus provides real needs in the marketplace, stated Rich Tehrani, CEO, TMC. I would like to congratulate the entire team at Enterasys for their commitment to advancing IP communication technologies. January 2012 Enterasys isaac, the industry's first social media interface that connects the IT network to the social network, was selected for an eschool Media 2012 Readers Choice Award. Enterasys isaac has successfully enabled K-12 school districts and higher education institutions to leverage social media for secure, predictive management and control of their wireless and wired IP networks. "Educational institutions are under intense pressure to deploy technology that further enables the educational process, while keeping expenses down and staying within budget," said Ram Appalaraju, vice president of marketing at Enterasys Networks. "The fact that school administrators nominated isaac for this honor demonstrates that they've successfully harnessed social media innovation to have a direct impact on operational simplicity. This is the most disruptive technology that tangibly reduces open IT cases and improves the user experience." This prestigious acknowledgment is given annually to K-12 and higher education technology products. The winners were selected by the editors of eschool Media (eschoolnews.com, ecampusnews.com, and eclassroomnews.com) from 1,400 reader nominations. The winning products were determined by the quantity of nominations received per product, including how the products improve teaching, learning, or school administration and to what effect. "The eschool Media Readers Choice Awards program is designed to give educators an honest peer-reviewed assessment of the technology products that are making a difference in today's classrooms," said Dennis Pierce, Editor-in-Chief of eschool News. "The nominations for the isaac solution from Enterasys detailed how isaac helps administrators tap into their school's network via Twitter, Facebook or other social media platforms to make instant updates and improve operational efficiency a must for any ed-tech decision maker." November 2011 Enterasys Wireless was selected as a District Administration Readers Choice Top 100 Product of To date, more than 500 K-12 school districts rely on Enterasys Wireless solutions to provide reliable classroom access, enhanced learning and centralized management for streamlined visibility and monitoring for Bring Your Own Device (BYOD) programs. This prestigious acknowledgement is given annually to K-12 education products that have supported education innovation. The winners were selected by the editors of District Administration from hundreds of nominations submitted by readers, including school superintendents and district-level Page 23 of 94 p. 26

27 WSCA-NASPO Data Communications Services Solicitation # JP14001 directors in districts across the United States. The winning products were determined by the quantity of nominations received per product, as well as an evaluation of product quality based upon readers' nominations and explanations. "Enterasys is honored by this award as it demonstrates the impact our wireless solutions are having on educators across the country to make their jobs easier and create a better learning environment for students," said Chris Crowell, president and CEO at Enterasys Networks. "We are committed to helping our K-12 customers deploy and optimize networking solutions that are uniquely tuned to their environment and specific needs." June 2011 Enterasys Networks Global Technical Assistance Center was a recipient of a Customer Interaction Solutions magazine 2011 CRM Excellence Award. This marks the second customer service award for Enterasys in as many years, having also won the 2010 CRM Elite award from Destination CRM. Customer Interaction Solutions has been the premier publication in the CRM, contact center and teleservices industries since We have been using Enterasys products in our data center for many years, said Brent Herring, Associate Director of IT University of Central Arkansas. The responsiveness of the Enterasys GTAC support organization is the best we receive from all of our technology vendors. The GTAC truly is a valued member of the University of Central Arkansas support team. Through Salesforce CRM and Service Cloud 2 applications, including the streamlining of critical global sales and customer data in multiple languages and currencies, Enterasys Networks' Global Technical Assistance Center (GTAC) provides customers and partners with direct, high-touch access to GTAC personnel. As opposed to a one-hour call back, or call-coordinator strategy used by many other vendors in the networking marketplace, Enterasys combines the use of leading software technology with long-tenured support staff and an in-sourced support model. Through its Automated Call Distribution (ACD) system, the customer or partner is connected directly to GTAC Engineers and Technical Teams who are responsible for supporting specific product lines 24x7x Warranty Specify the Offeror s standard warranty offerings for the products and services proposed in the response to this RFP. Response: As a customer-centric company, Enterasys endeavors to provide the best possible workmanship and design to ensure a positive first impression for our clients. In the event that one of our products fails due to defects in one of these factors, we have developed a comprehensive warranty that protects customers and promises a simple way to get your products repaired as soon as possible. Below is a listing of the applicable warranties for all Enterasys products lines. Table 1 Product Warranty Warranty Duration¹ Hardware Replacement² Technical Support (8x5 Phone, Web & Knowledge Firmware Releases³ Page 24 of 94 p. 27

28 WSCA-NASPO Data Communications Solicitation # JP14001 Base) 800 Series Lifetime NBD Shipment 1 Year Lifetime Telephone, Lifetime Web & KB A, B, C, D, G-Series Lifetime NBD Shipment⁴ Lifetime Lifetime 7100 Series, N, S, X-Series, Common Uplink, XSR, C5210 Wireless Controller 1 Year Return to Factory Repair 1 Year 90 Days Appliances IPS/SIEM, NAC, NMS (NetSight), Mobile IAM C20/C20N, Accessories, Standalone and Outdoor Access Points AP2630, AP2640, AP3630, AP standalone AP s AP2650, AP2660, AP3660, AP3765e, AP3765i, AP3767e Outdoor AP s. All outdoor NEMAbased solutions, including associated indoor AP, enclosure, connectors, cables, antennas, mounting brackets and power supplies. Enterasys Wireless Indoor Access Point Models (fit mode) AP2605, AP2610, AP2620, AP3605, AP3610, AP3620, AP3705i, AP3710e, 1 Year Return to Factory Repair 1 Year Return to Factory Repair 1 Year 90 Days 1 Year No Lifetime⁵ NBD Shipment⁵ Lifetime⁵ 1 Year⁷ Page 25 of 94 p. 28

29 WSCA-NASPO Data Communications Services Solicitation # JP14001 AP3710i, AP3725e Enterasys Wireless Controllers (C4110, C5110 and C25) Lifetime⁶ 15 Business Day Return to Factory⁶ Lifetime⁶ 1 Year⁷ I-Series 5 Years Return to 5 Years 2 Years Factory Repair All Software 90 Days N/A 90 Days No 4.3 Website ¹Lifetime is defined as End of Sale plus 5 years, except in the case of Wireless Controllers, which have warranty duration of End of Sale plus 1year. ²Actual delivery times may vary depending on specific End User location. ³Warranty coverage for premium licenses on lifetime warranty products is limited to 1 year, except for Advance Routing and IPV6 Routing licenses for the B5/C5, previous B/C generations and G3 which have lifetime coverage. See section 2. II. C for more information about Enterasys Software/Firmware Version Schema. ⁴Advanced Replacement NBD Delivery applies to A2, B2/C2, B3/C3 in NA, Western Europe, Australia. ⁵For products sold prior to 6/1/2009, the warranty duration is 1 Year and hardware replacement is Return to Factory Repair. ⁶For products sold prior to 1/1/2011, the warranty duration is 1 Year and the hardware replacement is Return to Factory Repair. ⁷Maintenance releases only. Coverage for AP firmware maintenance releases begins on the initial purchase date of the associated wireless controller. A copy of Enterasys Standard Warranty is attached separately with our proposal response. Enterasys Standard Warranty is also available at Award contractors are required to establish and maintain a website applicable to the WSCA/NASPO contract which will allow Participating States to see applicable contract price list, discounts on said price list, approved resellers or partners for their state and any additional information that may be required to assist the participating states in obtaining information concerning the contract award. The State of Utah representing WSCA/NASPO reserves the right to require the award contractor to add additional items to assist in this process. Specify Websites used by the Offeror to facilitate customer ordering under awarded contracts. This is a mandatory requirement. Response: Comply. Enterasys will work to establish websites that meet all WSCA/NASPO and Participating State requirements. Today, Enterasys hosts several websites for customers ordering through our existing WSCA Master Agreement. Each website is designed to accommodate the specific requirements identified by Participating States and at a minimum includes contract price lists, contract discounts, approved resellers and general contact information. Page 26 of 94 p. 29

30 WSCA-NASPO Data Communications Solicitation # JP14001 Below is a current list of websites for the existing WSCA contract and Participating States: Utah - Master WSCA Contract Website: Alaska - Participating Addendum Website: aspx California - Participating Addendum Website: Colorado - Participating Addendum Website: Hawaii - Participating Addendum Website: Louisiana -Participating Addendum Website: Missouri - Participating Addendum Website: Nevada - Participating Addendum Website: New Jersey - Participating Addendum Website: Washington - Participating Addendum Website: Customer Service Specify the Offeror s standard customer service policies and detail the escalation process used to handle customer-generated issues. Response: Using a process driven and systematic approach, Enterasys ensures that all customer contact is managed in the most practical and efficient manner. Customers can rest assured knowing that one of the industry s best support organizations is behind your network. From Enterasys multiple award-winning Global Technical Support Center (GTAC) providing 24x7 access to reliable technical help, to the comprehensive Enterasys SupportNet offerings that let you choose the exact level of service ideal for your organization, to comprehensive downloads, Enterasys has you covered. All contact into GTAC is documented with appropriate context, including inquiry type, subject, owner, timelines, technology and product information, customer and partner contact, and other relevant data required for timely resolution delivery. Customer contact is fully managed by a state-of-the-art Customer Relationship Management (CRM) solution. GTAC is able to manage and prioritize the contact lifecycle using service level agreements (SLA) that guide the workflow, ownership, and required actions needed to resolve and close cases in a satisfactory manner. SLA conformance levels and adherence is automated with built-in workflow rules, notifications, and assignments and system visibility extends to engineering and management. Support Case Type Definitions The support case priority levels and definitions are as follows: Page 27 of 94 p. 30

31 WSCA-NASPO Data Communications Services Solicitation # JP14001 Case Priority 1 (P1) Customer's network segment or management application is down or experiencing a consistent, measurable performance impact with no immediate resolution available. Phone Support Technician notifies Technical Support Engineer immediately Technical Support Engineer engaged on call after 2 hours Development Engineering engaged after 4 hours until resolutions or workaround provided. Generally Available firmware provided within 90 calendar days. P2 Customer's network is experiencing intermittent failure or degradation of network or management application. Phone Support Technician notifies Technical Support Engineer after 1 day Technical Support Engineer engaged after 5 days Development Engineering engaged after 8 days. Workaround or internal code provided within 15 days. Generally Available firmware provided within 90 calendar days. P3 Customer has issues that do not affect normal network or management application operation and/or questions concerning product function or use. Phone Support Technician notifies Technical Support Engineer after 3 days Technical Support Engineer engaged after 10 days Development Engineering engaged after 15 days. Workaround or internal code provided within 30 days. Generally Available firmware provided within 90 calendar days. GTAC Priority and Escalation Management Enterasys sets a higher priority on problems and escalation management for customers with current service contracts. This ensures that the appropriate resources within Enterasys Networks are utilized to resolve outstanding technical problems as efficiently as possible. Table 1 below shows case severity definitions and escalation guidelines. These are guidelines only and are subject to change. Priority Management When a customer contacts the GTAC a Technical Support Engineer will work with the customer to assign a mutually agreeable priority level to your problem that will be reflected in the support case opened on the customer s behalf. Severity definitions are listed in Table-1. Table-1 Case Severity Definitions and Response Management Guidelines Case Priority Response Time Progress Time Case Priority Response Time Progress Time Restore Time (SW fix or Workaround) C1 1 Hour (7x24x365) 2 hours Enterasys engaged until provided Fault Correction Time (SW/FW) Update Frequency 90 days 4 hours C2 6 hours 5 days 15 days 90 days 1 day C3 2 business days 10 days 30 days 90 days 1 day C4 Immediate acknowledgement 60 days N/A N/A N/A Restore Time (Note: A (day) elapsed time is measured in terms of business days (Mon-Fri). Fault Correction Page 28 of 94 p. 31

32 WSCA-NASPO Data Communications Solicitation # JP14001 Escalation Management Response Times Our systematic escalation process is intended to notify and brief various levels of management throughout the life cycle of the case. Escalation timeframes are measured on a 24x7x365 basis. Table-2 below describes the Enterasys case escalation notification matrix. Table-2: Case Escalation Management Notification Matrix Notification Levels C1 - Critical C2 High Priority C3 Medium Priority Support Engineer Immediate Immediate Immediate GTAC Manager Immediate Immediate 10 days Director, Global Technical Immediate 48 hours 10 days Services Vice President, Global 2 hours 72 hours 20 days Technical Services Executive Management (CTO/EVP Eng) 4 hours None None Escalation Lifecycle The Escalation Lifecycle is defined by the following: Discovery: The GTAC Support Engineer is gathering and reviewing information. Once the data is reviewed, the GTAC Support Engineer will determine if additional information is required, corrective action is available or a recreation attempt is needed. Recreation: The GTAC Support Engineer is in the process of attempting to replicate the reported behavior. Once replicated, the GTAC support engineer will determine if the behavior is a bug and will document it in the bug tracking database. If the behavior is not a bug or is a result of misconfiguration, the customer and case note will be updated. If GTAC is unable to reproduce the reported behavior, additional information or debugging may be required at the customer site. Remediation: The GTAC Support Engineer has determined there is an anomaly and/or the development team s assistance is required. While in this status, updates from engineering will be used by the GTAC to keep the customer/partner updated on progress to resolution. Release Packaging: Once a resolution or enhancement has been tested and verified along with a firmware version and release date determined, the escalation moves into this status. Customers will receive updates every two weeks as to the official release status until the firmware/software is Generally Available (GA) and posted on our firmware download site. Generally Available: Once a resolution has been identified the escalation will be put into this status. If the resolution is a new firmware release, customers will receive automated notifications and the case will close within 15 days. If the resolution is a configuration change, or hardware replacement, the GTAC engineer will close the escalation after confirming the resolution with the customer. 4.5 Firm a. Provide a brief history of your firm including the following: 1. Number of years providing Data Communications Services being offered in response to this RFP. Response: Enterasys has been in the networking industry for over 30 years, having originated as part of the highly successful company known as Cabletron Systems, which was founded in Built upon strong Page 29 of 94 p. 32

33 WSCA-NASPO Data Communications Services Solicitation # JP14001 engineering principles, Cabletron Systems helped develop the networking industry with the continual introduction of new technologies. Enterasys was formed in March 2000 specifically to seize enterprise market opportunities and to better serve its customers. Enterasys was officially spun up into the parent company, Cabletron, on August 6th, 2001, and began trading under the symbol of ETS on the New York Stock Exchange. On October 1, 2008, Enterasys, SER Solutions, Inc. and Siemens Enterprise Communications merged to form a market-leading provider of voice and data products, services and solutions. As a multi-billion dollar provider of hardware, software, and services, the new company is delivering serviceoriented networks that enable voice, video, and data service-oriented applications in a mobile and secure manner. Today, Enterasys is part of Siemens Enterprise Communications, one of only three global providers of end-to-end enterprise communication solutions. We re a $3 Billion dollar a year company with a combined 10,000 employees, servicing over 90% of the Fortune 100 and 75% of the Fortune 500 customers in over 90 countries. We re number three in the world in Voice Over IP revenue, and we re the world s top revenue performer in the area of managed services from communications providers. 2. Number of separate services provided in each of the area categories described in this RFP. Response: Enterasys has responded with 31 separate product and service offerings. A breakdown of each category offering is outlined below Networking Software area category Routers category: Network Edge Routers Core Routers Security category: Intrusion Detection/Protection and Firewall Appliances Secure Access Switches category: Campus LAN - Access Switches Campus LAN - Core Switches Campus Distribution Switches Data Center Switches Wireless category: Access Points Outdoor Wireless Access Point Wireless LAN Controllers Page 30 of 94 p. 33

34 WSCA-NASPO Data Communications Solicitation # JP Wireless LAN Network Services and Management Bring Your Own Device (BYOD) Services category: Maintenance Services Express Parts On-site Software and Appliance Services Professional Services category. Survey/ Design Services Implementation Services Optimization Remote Management Services Consulting/Advisory Services Data Communications Architectural Design Services Statement of Work (SOW) Services Network Management and Automation Data Center Management and Automation Training category. Classroom Attendance via our Authorized Training Centers Onsite Training Regional Training Classroom Attendance via the Enterasys Virtual Classroom Technical Certifications b. Describe specifically what makes your firm a stable long term partner for WSCA-NASPO. Response: As a current contract holder, Enterasys is fully committed to a long term partnership with WSCA-NASPO. We have established operational procedures and dedicated resources to support a large base of customers who rely on the contract to procure product and services. At Enterasys, all aspects of our operations are built around the mantra that there is nothing more important than our customers. Our 96% customer satisfaction rating and award-winning support organization provide strong proof that we re on the right track. Leading companies worldwide are partnering with Enterasys to offer innovative solutions to solve business and IT challenges. Enterasys, together with our channel partners, has helped customers drive down IT costs while improving business productivity and efficiency. Enterasys was the FASTEST growing networking company in And 2012 proved to be another year of strong growth for Enterasys, as it was the third consecutive year of revenue growth for the company and we are proud to have a NetPromoter score of 81, higher than industry bellwethers such as Apple and Cisco. NetPromoter is the gold standard for companies who want to translate customer experience into profitable growth. In addition, Enterasys also has less Page 31 of 94 p. 34

35 WSCA-NASPO Data Communications Services Solicitation # JP14001 than five percent employee attrition much lower than industry average. The company s strong culture, executive team and product portfolio was also recognized by several leading publications and analyst firms. Enterasys has been in the networking industry for over 30 years and helped develop the networking industry with the continual introduction of new technologies. We have a strong history of technology leadership and product innovation. Our patent portfolio exemplifies our innovations in secure, intelligent, automated and integrated networking hardware and software solutions. We have assembled an experienced team of developers and engineers and have established a corporate culture that facilitates continuous product innovation and plan to continue investing in research and development to strengthen and increase the functionality of our technology solutions. Further, Enterasys R&D efforts are prioritized not by what we think everyone should be doing, but rather by the problems customers are asking us to solve. Some of our new product offerings include the OneFabric Edge architecture, a purpose-built architecture for edge networking to support mobile application delivery; Enterasys Mobile IAM (Mobile Identity and Access Manager), its BYOD network solution; and Enterasys IdentiFi, a new Wi-Fi solution encompassing access points, controllers and management software purpose-built to support hyper-dense wireless environments with advanced analytics. In addition, Enterasys recently announced several new awards that solidify its place as a leading provider of wired and wireless network infrastructure and security solutions. The new awards include: InformationWeek 500: Enterasys CIO Dan Petlon was recognized at #80 on the InformationWeek 500 list, which lists today s most innovative users of business technology. Internet Telephony Excellence Award: TMC listed Enterasys Mobile IAM among the winners of its Internet Telephony Award, which acknowledges excellence in the IP communications industry. Info-Tech WLAN Champion: In the Wireless LAN category, Enterasys was placed firmly within the Champion quadrant, recognized for excellence within the wireless landscape as the technology continues to evolve. Search Networking Network Innovation Award: Enterasys recently received the Network Innovation Award for Enterasys isaac, recognizing its contribution to remote network management strategy. Boston Globe Top Place to Work: Enterasys was named as one of the Top Places to Work in Boston, coming in 4th out of 35 in the large business category. Enterasys accepted the award during a ceremony held at the Revere Hotel in Boston. CCMA Ireland Contact Centre and Shared Services Award 2012: Enterasys won this award at the CCMA awards at the Burlington Hotel in Dublin Ireland for International Shared Services Centre of the Year. District Administration Reader s Choice Top 100 Products: Enterasys IdentiFi Wi-Fi solution was recognized by readers of District Administration for its exceptional performance and ease of management for K-12 school districts. These new honors are in addition to other awards the company has received throughout the year, including: Boston Business Journal: Best Places to Work and 2012 CIO of the Year Stevie Awards for Sales & Customer Service: Enterasys Isaac won the Gold Stevie Award for New Collaboration Solution, Enterasys won the Silver Stevie Page 32 of 94 p. 35

36 WSCA-NASPO Data Communications Solicitation # JP14001 Award for Contact Center of the Year, and a Bronze Stevie Award for Innovation in Customer Service. Our services, support and training offerings have been developed and are continuously improved based on customer feedback. Gartner says both new and existing customers cite our support as a differentiator. Enterasys prides itself on delivering on promises and being a vendor that customers want to do business with. One of the ways this is achieved is by providing quick, nohassle support. The quality of support Enterasys provides sets us apart from the competition and demonstrates our commitment to customers. There are three main ways that Enterasys support is differentiated: Enterasys support personnel are 100% in-sourced. Enterasys GTAC is staffed only by Enterasys employees, with an average tenure of 13+ years with the company. Enterasys personalizes the support customers receive you ll meet your support person via telephone so you know who you ll be working with before you make the final decision to invest with Enterasys. The innovative technology behind Enterasys support process enables Enterasys to manage multi-channel customer contact with total cross-functional visibility and response management. Having all of support employees in-house provides significant advantages including: Tight integration with R&D, which fosters group collaboration, accelerates on-thejob training, and enables problem-solving problems in real-time Low attrition rates achieved by recognizing and investing in support staff. 2-tier call center design, including support and engineering, allows them to meet customer s demand for faster results no need to wait through five tiers of escalation as with other vendors. Enterasys is known for having the industry s best service and support, receiving validation from customers, analysts and industry experts. Enterasys received Gold, Silver and Bronze awards from the 2013 & 2012 Stevie Awards for Sales & Customer Page 33 of 94 p. 36

37 WSCA-NASPO Data Communications Services Solicitation # JP14001 Service. Enterasys also won the 2011 CRM Excellence Award from Customer Interaction Solutions Magazine. For the second year in a row, Enterasys GTAC was honored for helping clients improve workflow. This marks the second customer service award for Enterasys in as many years, having also won the 2010 CRM Elite award from Destination CRM. c. Describe specifically what information the Data Communications Provider contract administrator would provide at annual meetings with an entity that has executed a participating addendum. Response: The contract administrator would discuss any issues experienced with use of the contract and corrective actions needed to ensure compliance. The contract administrator would review quarterly sales and general performance of the current list of resellers. We would also provide a roadmap for upcoming release of new products in the awarded product equipment categories. Additional discussion topics might also include marketing activities for upcoming product and service campaigns available to WSCA Participating States. d. Describe how you plan to implement the contract including having a single point of contact to perform and manage all aspects of this contract. Response: The designated contract administrator will serve as a single point of contact responsible for coordinating all contract related activities from Enterasys corporate headquarters in Salem, NH. Activities include but are no limited to processing of updates, usage reporting and addressing contract-related questions. The contract administer will be responsible for communicating contract use procedures to regional Account Management Teams and Authorized Partners to ensure performance is consistent across all WSCA Participating States. Upon award, regional training will be scheduled with the teams to ensure successful and consistent implementation of the contract. Follow-on quarterly and as needed information sessions will be scheduled to communicate contract developments and updates as well. e. Describe in detail your firm s escalation management plan including contact information. Response: The Enterasys escalation management team is comprised of the following departments dedicated to supporting WSCA customers. Contract Administration Support Michael Swierk Contract Analyst Salem, NH Phone: mswierk@enterasys.com Page 34 of 94 p. 37

38 WSCA-NASPO Data Communications Solicitation # JP14001 Mike Swierk is responsible for contract administration and will assist with processing of contract updates, extensions and addressing contract-related questions. Sales Management Peter Katavolos Director of Sales, North East Region Phone: pkatavol@enterasys.com James Harris Director of South Region Sales & Service Phone: (404) jharris@enterasys.com Paul Corning Director of Sales, North America Central Phone: (913) pcorning@enterasys.com Josh Baird Director of Sales, West Region Cell: (408) jbaird@enterasys.com Peter, Jamie, Paul and Josh are responsible for regional sales across North America. Each supports a specific region in the country with sales local Account Managers reporting directly to them. Specifically, Peter, Jamie, Paul and Josh are responsible for Enterasys sales and marketing related activities for Northeast, South, Central and West Coast regions. Charlie Van Pelt North America Director of Channels and Business Development Partner Management Phone: cvanpelt@enterasys.com As the North America Director of Channels and Business Development, Charlie is responsible for directing partner program activities and managing a full staff of Channel Partner Account Executives. Technical Support Steve Kelly Technical Support Management Escalation Phone: kelly@enterasys.com Page 35 of 94 p. 38

39 WSCA-NASPO Data Communications Services Solicitation # JP14001 Steve Kelly leads our technical support effort as managing director of our GTAC located at our corporate headquarters in Salem, NH. He helps ensure that service SLAs are met and can coordinate additional GTAC support resources both remote and on-site, as needed. Vala Afshar Chief Marketing Officer & Chief Customer Officer Phone: vafshar@enterasys.com Vala Afshar is our Chief Customer Officer and is responsible for helping Enterasys provide world-class service which consistently scores ahead of our competitors with respect to customer satisfaction and willingness of our customers to recommend Enterasys products and solutions to others. Vala is an innovator and customer advocate who is always looking for ways to enhance support processes and applications and has been instrumental in helping Enterasys garner numerous awards for customer satisfaction, service automation and program excellence. 4.6 Authorized Sub Contractor Relationships Respondents may propose the use of Servicing Subcontractors or partners however, the Contractor shall remain solely responsible for the performance under the terms and conditions of the Contract if Servicing Subcontractors are utilized. This includes sales report information. The Contractor will be responsible to collect, and report this information from all partners or resellers representing your contract. Response: Read, understood and comply. a. Briefly describe what your firm requires from potential contractors to become an Authorized Data Communications Reseller. Provide an Authorized Contractor List. Response: At a minimum Enterasys requires authorized channel partners to sign a Partner Program Agreement to establish a mutually beneficial business partnership. A list of authorized partners is provided below for consideration. Authorized Partner List Synergetics DCS Southwest Surveillance Solid IT Networks R & D Data Propducts Packet Fusion North River IT Services NE Systems Incorporated Siemens Enterprise Communications CDW-G CDW Black Box Corporation JT Tech Evolve Technologies Network Management Corporation IK Electric Howard Technology Solutions Accuvant All Phase Xtelesis Universal Data, Inc Structured Communication Systems, Inc. Starnet Data Design SkyRider Communications, Inc. New West Technologies M&S Communications Group Livewire LLC Kinetix Technologies Intervision Systems Page 36 of 94 p. 39

40 WSCA-NASPO Data Communications Solicitation # JP14001 Technologies EyeP Solutions Dynamic Systems, Inc. DMD Data Systems Cornerstone Technologies Communications, Cabling & Networking Carousel Industries Attain Technologies, LLC DBA High Touch b. Describe in detail how your firm currently measures an authorized contractors performance. Response: Enterasys utilizes a partner program model to measure the performance of authorized partners using technology from Salesforce.com, coupled with innovative best practices. There are four main authorized partner designations: Registered, Gold, Platinum and Diamond. Each designation requires partners to achieve annual revenue milestones as well as technical and sales certifications to maintain their status level. c. Describe in detail the process for revoking a designation as a sub contractor from an authorized contractor for issues related to customer service, or other authorized contractor performance related issues. Response: Enterasys conducts annual reviews to evaluate performance of all authorized partners based on reporting information from Salesforce.com. The reviews focus on performance criteria defined in partner designations. If partners underperform, Enterasys Channel Account Executives will take steps to help improve their position with additional sales and technical training modules or other means as needed. If the partner does not improve after implementation of corrective actions they may be moved down a level or removed from the program altogether. d. Describe in detail how your firm will support and assist an authorized contractor in improving their performance and the corrective action process. Response: Enterasys Sales Operations Management and Channel Account Executives will analyze reporting information from Salesforce and work with partners to make improvements in these areas. Enterasys may offer additional training modules, schedule regular strategy meetings and participate in sales calls to ensure partners have appropriate resources to succeed. If the partner does not improve after implementation of corrective actions they may be moved down a level or removed from the program altogether. e. Describe in detail the process that your firm uses to track and respond to issues and concerns from both your authorized contractors and from participating entities. Response: Enterasys utilizes a partner portal to manage issues raised by partners. In addition, each partner is assigned a Channel Account Executive who is responsible for managing the relationship and escalation of issues to upper management. Page 37 of 94 p. 40

41 WSCA-NASPO Data Communications Services Solicitation # JP14001 Additionally, Enterasys GTAC will provide participating entities with technical support, which is available 24 hours a day, 365 days a year. Through Enterasys Automated Call Distribution (ACD) system, participating entities will connect directly to GTAC Engineers and technical teams who are responsible for supporting specific product lines 24x7x365. Enterasys GTAC is staffed only by Enterasys employees, with an average tenure of 13+ years with the company. These experts work in locations around the globe to ensure coverage for all time zones in multiple languages. In addition, the GTAC maintains top-of-the-line technology labs for optimal issue re-creation and fast answers to complex questions. Enterasys offers priority setting of problems and escalation management. This ensures that the appropriate resources within Enterasys are utilized to resolve outstanding technical problems as efficiently as possible as described above in section 4.4 Customer Service. f. Describe in detail how your firm will track, report and verify sales from your designated Data Communication partners and authorized contractors. Response: Enterasys utilizes Salesforce.com to track sales from our designated partner base. In addition, the Enterasys contract administrator works directly with all authorized partners to collect contract sales for reporting purposes. Section 5: Service Offering Qualifications 5.1 General Information This section contains mandatory minimum requirements that must be met in order for your proposal to be considered for the evaluation phase of this RFP. All of the items described in this section are non-negotiable. Respondents are required to complete: Mandatory Requirements (M) All Respondents must meet the (M) requirements listed in this section, and explain how the requirement is met. A no response on the acceptance document or omission of the required explanation will disqualify the service from further evaluation General Business Requirements Each provider must meet the following mandatory general business requirements: Terms and Conditions (M) Respondents must indicate their acceptance of the State of Utah Standard Terms and Conditions in addition to the WSCA-NASPO Terms and Conditions attached to this RFP as Attachment A and Attachment B. Any exceptions to these terms and conditions must be clearly identified in bid response and during the question and answer period on BidSync. Significant exceptions may constitute grounds for rejecting Respondent proposals. Response: Read, understood and comply. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Page 38 of 94 p. 41

42 WSCA-NASPO Data Communications Solicitation # JP14001 Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer Experience (M) Respondents must be able to provide reference service contracts from a minimum of five government or commercial customers for their Data Communications Product and Services offerings. Government references are preferred. References must include environments and complexity that is similar in scope to those described within this RFP. Any proposals from Respondents that cannot meet these requirements will not be considered. The Respondent must provide specific contact information describing their reference service contracts, which may be verified. Response: Read, understood and comply. The following Enterasys customers have submitted Attachment B Reference Forms. Twin Rivers Unified School District 1333 Grand Avenue, Sacramento, CA Contact: Gene Smith, Director of IT Phone: (916) gene.smith@twinriversusd.org Nicholls State University Highway 1, Thibodaux, LA Contact: Slade Besson, Director of Telecommunications / Networking Information Technology Phone: (985) slade.besson@nicholls.edu Matanuska-Susitna Borough School District 501 North Gulkana, Palmer, AK Contact: Justin Michaud, Chief Information Officer (CIO) Phone: (907) Justin.Michaud@matsuk12.us University of Central Arkansas 201 Donaghey Ave, Conway, AR Contact: Brent Herring, Associate Director of Information Technology Phone: (501) brenth@uca.edu Monroe Township Board of Education 1629 Perrineville Road, Monroe Township, NJ Contact: Reggie Washington, Director of Information Systems Phone: (732) reggie.washington@monroe.k12.nj.us Page 39 of 94 p. 42

43 WSCA-NASPO Data Communications Services Solicitation # JP Financial Stability (M) The Data Communications Product and Services vendor must provide audited financial statements to the State and should meet a minimum Dun and Bradstreet (D&B) credit rating of 4A2 or better, or a recognized equivalent rating. Please provide the Respondent s D&B Number and the composite credit rating. The State reserves the right to verify this information. If a branch or wholly owned subsidiary is bidding on this RFP, please provide the D&B Number and score for the parent company that will be financially responsible for performance of the agreement. Prime contractors working on behalf of Respondents must submit financial statements that demonstrate financial stability, and adequate working capital, but do not need to meet 4A2 credit rating requirements. Response: Read, understood and comply. Enterasys Networks, Inc. is a wholly-owned subsidiary of Enterprise Networks Holdings, Inc., also a Delaware corporation. Enterprise Networks Holdings, Inc. is a wholly-owned subsidiary of Enterprise Networks Holdings B.V., ("ENHBV"). ENHBV is the joint venture entity between the investment funds managed by The Gores Group, LLC, a Delaware limited liability company ("Gores"), and Siemens Aktiengesellschaft, a German company ("Siemens AG"). Enterasys has entered a Claim of Business Confidentiality for the non-public financial information included in our proposal response. The following proposal attachments are submitted as PROTECTED information: UAe_2012 Enterprise Networks Holdings BV Amsterdam.pdf Gores ENT Holdings Consolidated Financial Statements SEPT 2011 Revised.xls Enterasys Networks Inc. Financial Statements P12 September 2012 Revised.xls Enterasys Networks Dun and Bradstreet number is: Enterasys Networks D&B rating is: ER Other General Responsibilities (M) The Respondent must provide the personnel, equipment, tools, and expertise to meet the requirements in this RFP. Response: Read, understood and will comply. Personnel and Expertise Enterasys will ensure the appropriate resources are available to meet the requirements in this RFP. Resources include a dedicated contract administrator, personnel from our direct Account Management and Channel Partner sales teams, GTAC Technical Support Engineers, Professional Services Engineers as well as members from Enterasys upper management team. Direct access is also available to product developers and experienced executives upon request. Enterasys supports a technical work force of certified technicians dedicated to providing sales, services and global support to customers across North America. Enterasys employees have a 13 year average tenure in engineering and support. All of Enterasys engineers go through internal training programs for a period of at least two weeks per year including one week of hands-on training of our latest technologies and solutions. The majority of our engineers and outside Account Executives are Enterasys Systems Engineer (ESE) or Enterasys Security Systems Engineer (ESSE) certified. In addition, all Enterasys authorized partners are required to achieve technical and sales certifications to maintain their partner level status. Page 40 of 94 p. 43

44 WSCA-NASPO Data Communications Solicitation # JP14001 Equipment Enterasys has responded with our complete range of products that include a variety of switching and routing solutions, a complete wireless offering that includes standalone wireless access points and controller-based solutions. Network Management solutions that deliver unified wired and wireless management for complete centralized visibility and control of both the network and third party systems as well as Security solutions such as Network Access Control to protect network infrastructures. The Supply of Enterasys products is supported by a network of major distribution channels and strategic depot centers. The primary distribution hubs are located in Elgin, IL (US) and Shannon Ireland with several major North American active forward stocking locations with rapid response parts exchange capability. In addition to the four GTAC technical support centers, there are numerous field offices with solutions and system engineering technical staff that are tightly integrated into the services and support function with strong partnerships with the GTAC. Enterasys also leverages partnerships with industry recognized leaders such as Lucent Technologies, Siemens and UPS for additional onsite field support. Tools Enterasys leverages Salesforce.com, a powerful customer relationship management tool, which enables workforce optimization through automated workflows. Saleforce provides a platform for internal and external cross-functional collaboration and self-service capabilities, including access to knowledge base and incident reporting management to help ensure we manage our business effectively and deliver great support to our customers. Enterasys also offers a variety of self service support tools and resources to customers that include: Knowledge Base for answers to your questions or issues: Product Documentation: Firmware and software downloads: Firmware and software new release notifications via Enterasys community forum to share ideas or ask questions of other Enterasys customers: In addition, multiple access methods to reach GTAC 24x7x365 are available with: Online case management:- Via Web: an expert: Phone: toll free in U.S. (M) Computer applications and Web sites must be accessible to people with disabilities, and must comply with Participating entity accessibility policies and the Americans with Disability Act. Response: Read, understood and comply. Page 41 of 94 p. 44

45 WSCA-NASPO Data Communications Services Solicitation # JP14001 (M) Applications and content delivered through Web browsers must be accessible using current released versions of multiple browser platforms (such as Internet Explorer, Firefox, Chrome, and Safari) at minimum. Response: Read, understood and comply. Enterasys websites are designed to function on all major browsers and recent versions. 5.2 Data Communications Services Requirements Offerors may respond to any of the sections where they have substantive product offerings that address the scope detailed in each Section from All Offerors must include a response to section 5.31 services, that addresses products proposed in Products may be used by the states in branch offices, main government offices and data centers, and by overall government data communications providers offering carrier class services. Responses should consider this breadth of use and users. The scope and context of this solicitation does not include endpoints such as cell/smart phones, other mobile devices or devices designed exclusively for use by individual users. It is focused on the equipment and software infrastructure required to support provisioning of a variety of network services within a modern digital network. The user context will vary from branch offices through enterprise and statewide data communication network installations. Respondents should offer a range of solutions that are appropriate for installations of varying size and complexity. Response: Read, understood and comply DATA CENTER APPLICATION SERVICES Application networking solutions and technologies that enable the successful and secure delivery of applications within data centers to local, remote, and branch-office users using technology to accelerate, secure, and increase availability of both application traffic and computing resources Virtualized Load Balancers Virtual devices that act like a reverse proxy to distribute network and/or application traffic across multiple servers to improve the concurrent user capacity and overall reliability of applications. Capabilities should include: SSL (Secure Sockets Layer) Off-loading Caching capabilities Layer 4 Load Balancing Layer 7 Load Balancing Detailed Reporting Supports multiple load balancers in the same system for multiple groups Supports TLS1.2 Response: No current offering available WAN Optimization An appliance utilizing a collection of techniques for increasing data-transfer efficiencies across wide-area networks (WAN). Capabilities should include: CIFS (Common Internet File System) acceleration Data Compression SSL encryption/decryption for acceleration (Optional) Layer 4-7 visibility Application Specific optimization Response: No current offering available NETWORKING SOFTWARE Software that runs on a server and enables the server to manage data, users, groups, security, applications, and other networking functions. The network operating system is designed to allow shared file and printer access among multiple Page 42 of 94 p. 45

46 WSCA-NASPO Data Communications Solicitation # JP14001 computers in a network, typically a local area network (LAN), a private network or to other networks. Networking software capabilities should include: Restartable Process High availability options Targeted operating systems, i.e. DC, campus, core, wan, etc. Operating System Efficiencies Response: Comply. Enterasys NetSight Management Suite delivers a rich set of integrated management capabilities providing centralized visibility and highly efficient anytime, anywhere control of enterprise wired and wireless network resources. The NetSight Suite includes: Console with Wireless Manager, Inventory Manager, Policy Manager, Automated Security Manager, NAC Manager, Mobile Management and OneView. Enterasys NetSight licenses are available to support an unlimited number of devices. With its distributed client/server architecture, NetSight is exceptionally convenient to use. A user with appropriate security credentials anywhere on the network can access a launch page and log into any of the NetSight capabilities. NetSight simplifies routine and one-time tasks such as reconfiguring switches and access points, monitoring network performance, and isolating faults. It takes advantage of advanced functionality in Enterasys switching, routing, and wireless products including topology maps, FlexViews (graphical depictions of a broad range of network parameters), VLAN management, device discovery, and event logging. Enterasys NetSight enables our customers to take full advantage of the enhanced features and functionality of the Enterasys products. Serving as the centralized command and control component, Enterasys NetSight manages all the infrastructure components as a total system. Enterasys NetSight is standards-based and can manage all network equipment that is SNMPv1, SNMPv2 or SNMPv3 capable. Vendor specific MIBs can be loaded for additional functionality. The following provides a brief overview of the capabilities and benefits of the Enterasys NetSight Suite. Capability NetSight Console, with Wireless Management Console the foundation for centrally monitoring and managing all the components in the infrastructure. Graphically displays aggregated wired and wireless network information for centralized and simplified management of all infrastructure components as a single system Policy Management Automates the definition and enforcement of network-wide policy rules controlling QoS, priority, bandwidth, and security. With an intuitive user interface, administrators can define policies once and then automatically enforce them on Enterasys policyenabled infrastructure devices. Benefits Combines WLAN/LAN management for greater IT operational efficiency Adds value to existing management platforms Reduces total cost of ownership Fully aligns the network infrastructure with business objectives Simplifies policy lifecycle management easing IT burden Reduces troubleshooting time Minimizes risk of disruptions Page 43 of 94 p. 46

47 WSCA-NASPO Data Communications Services Solicitation # JP14001 Automated Security Management Integrates with Enterasys IPS, NAC, SIEM, and other third party security appliances to respond automatically and remediate threats in real-time. Network Access Control (NAC) Management Manages the Mobile IAM and NAC solutions providing granular control over users and applications, and featuring a high-level dash-board view of the complete security posture Inventory Management Automates management of device configurations and provides tools to capture, modify, load, and verify configurations. OneView Unified web-based interface and fine-grained interactive search for network analysis, problem solving, help desk visibility and reporting. Mobile Management Optimizes network management and help desk troubleshooting with anywhere, anytime access to critical information using popular mobile devices. Protects corporate data and ensures network availability Ensures response actions are policybased and executed consistently Reduces IT staff burden and costs Ensures that only the right users have access to the right information from the right place and time Maintains guest/contractor and user productivity Simplifies end-system compliance monitoring and reporting Delivers quick time to value Provides network control and better efficiency Streamlines IT operations and enhances staff productivity Enables audit efficiency State-of-the-art graphics reporting and topology displays enable efficiency and more effective communications Simplifies troubleshooting, help desk support tasks, problem solving across wireless and wired networks Prevents loss of user productivity Most responsive network management Enterasys NetSight provides cost-efficient choices enabling enterprises to address their priorities, optimize their budget use and demonstrate quick time-to-value. NetSight models range from a cost-efficient entry solution to full functionality for device intensive enterprises. Flexible upgrade options support deployment growth. The three NetSight models are: NMS-BASE-XX which includes basic wired/wireless management features as well as inventory management, policy management and OneView Basic (device management, alarm management and administration). Three remote clients are included in addition to unrestricted OneView connections. NMS-XX which includes basic wired/wireless management features as well as inventory management, policy management, NAC management, automated security management, mobile management, and the full OneView interface. 25 remote clients are included in addition to unrestricted OneView connections. NMS-ADV-XX which includes basic wired/wireless management features as well as inventory management, policy management, NAC management, automated security management, mobile management, and the full OneView interface. In addition, NetSight Advanced includes advanced wireless management, the OneFabric Connect API, ability to install on a primary server, redundant server and lab server, and virtual NAC appliances for full NAC deployment flexibility (require end-system Page 44 of 94 p. 47

48 WSCA-NASPO Data Communications Solicitation # JP14001 licenses). 25 remote clients are included in addition to unrestricted OneView connections. NetSight sizing chart # Managed # Aps Model Numbers Devices 5 50 NMS-ADV- 5 NMS NMS-ADV- 10 NMS-10 NMS- BASE NMS-ADV- 25 NMS-25 NMS- BASE NMS-ADV- 50 NMS-50 NMS- BASE ,000 NMS-ADV- 100 NMS-100 NMS- BASE ,500 NMS-ADV- 250 NMS-250 NMS- BASE ,000 NMS-ADV- 500 NMS-500 NMS- BASE-500 Unrestricted Unrestricted NMS-ADV- U NMS-U NMS- BASE-U Network Management and Automation Software products and solutions for data center automation, cloud computing, and IT systems management. Response: Enterasys has included a professional service offering for this category in the services section of our response Data Center Management and Automation Software products and solutions that capture and automate manual tasks across servers, network, applications, and virtualized infrastructure. Response: Enterasys has included a professional service offering for this category in the services section of our response Cloud Portal and Automation Software products and solutions for cloud management with policy-based controls for provisioning virtual and physical resources. Response: No current offering available Branch Office Management and Automation Software products and solutions for management of branch offices. Capabilities include remote troubleshooting, device management, WAN performance monitoring. Response: No current offering available NETWORK OPTIMIZATION AND ACCELERATION Devices and tools for increasing data-transfer efficiencies across wide-area networks Dynamic Load Balancing An appliance that performs a series of checks and calculations to determine which server can best service each client request in order to select the server that can successfully fulfill the client request and do so in the shortest amount of time without overloading either the server or the server farm as a whole. Page 45 of 94 p. 48

49 WSCA-NASPO Data Communications Services Solicitation # JP WAN Acceleration Appliance that optimizes bandwidth to improve the end user's experience on a wide area network (WAN). Capabilities should include: CIFS acceleration Data Compression SSL encryption/decryption for acceleration (Optional) Layer 4-7 visibility Application Specific optimization High Availability and Redundancy Limits any disruption to network uptime should an appliance face unforeseen performance issues. Transparently redistributes workloads to surviving cluster appliances without impacting communication throughout the cluster. Response: No current offering available for category OPTICAL NETWORKING High capacity networks based on optical technology and components that provide routing, grooming, and restoration at the wavelength level as well as wavelength based services Core DWDM (Dense Wavelength Division Multiplexing) Switches Switches used in systems designed for long haul and ultra long-haul optical networking applications Edge Optical Switches Provide entry points into the enterprise or service provider core networks Optical Network Management Provides capabilities to manage the optical network and allows operators to execute end-to-end circuit creation IP over DWDM (IPoDWDM) A device utilized to integrate IP Routers and Switches in the OTN (Optical Transport Network). Response: No current offering available for category ROUTERS A device that forwards data packets along networks. A router is connected to at least two networks, commonly two LANs or WANs or a LAN and its ISP's network. Routers are located at gateways, the places where two or more networks connect, and are the critical device that keeps data flowing between networks and keep the networks connected to the Internet Branch Routers A multiservice router typically used in branch offices or locations with limited numbers of users and supports flexible configurations/feature. For example: security, VoIP, wan acceleration, etc. Response: No current offering available Network Edge Routers A specialized router residing at the edge or boundary of a network. This router ensures the connectivity of its network with external networks, a wide area network or the Internet. An edge router uses an External Border Gateway Protocol, which is used extensively over the Internet to provide connectivity with remote networks. Response: Comply. Enterasys provides chassis and standalone Network Edge Routers. The Enterasys S-Series provides Terabit-class modular switch routers for edge-to-core and data center deployments Core Routers - High performance, high speed, low latency routers that enable Enterprises to deliver a suite of data, voice, and video services to enable nextgeneration applications such as IPTV and Video on Demand (VoD), and Software as a Service (SaaS). Page 46 of 94 p. 49

50 WSCA-NASPO Data Communications Solicitation # JP14001 Response: Comply. Enterasys provides chassis and standalone Core router solutions. The Enterasys S-Series provides Terabit-class modular switch routers for edge-to-core and data center deployments Service Aggregation Routers Provides multiservice adaptation, aggregation and routing for Ethernet and IP/MPLS networks to enable service providers and enterprise edge networks simultaneously host resource-intensive integrated data, voice and video business and consumer services. Response: No current offering available Carrier Ethernet Routers High performance routers that enable service providers to deliver a suite of data, voice, and video services to enable nextgeneration applications such as IPTV, Video on Demand (VoD), and Software as a Service (SaaS). Response: No current offering available SECURITY Data Center and Virtualization Security Products and Appliances Products designed to protect high-value data and data center resources with threat defense and policy control. Response: No current offering available Intrusion Detection/Protection and Firewall Appliances Provide comprehensive inline network firewall security from worms, Trojans, spyware, key loggers, and other malware. This includes Next-Generation Firewalls (NGFW), which offer a wire-speed integrated network platform that performs deep inspection of traffic and blocking of attacks. Intrusion Detection/Protection and Firewall Appliances should provide: Non-disruptive in-line bump-in-the-wire configuration Standard first-generation firewall capabilities, e.g., network-address translation (NAT), stateful protocol inspection (SPI) and virtual private networking (VPN), etc. Application awareness, full stack visibility and granular control Capability to incorporate information from outside the firewall, e.g., directorybased policy, blacklists, white lists, etc. Upgrade path to include future information feeds and security threats SSL decryption to enable identifying undesirable encrypted applications (Optional) Response: Comply. Enterasys security offerings include the Enterasys Intrusion Prevention System (IPS) which ensures the confidentiality, integrity, and availability of business critical resources with industryleading Intrusion Prevention capabilities, including: Threat containment that leverages existing network investments In-line Intrusion Prevention to provide advanced security in a specific location Patented Distributed Intrusion Prevention to automate response to threats in real-time Out-of-band Intrusion Detection that simultaneously utilizes multiple response technologies Page 47 of 94 p. 50

51 WSCA-NASPO Data Communications Services Solicitation # JP14001 Forensics tools for session reconstruction to simplify threat mitigation and resolution Enterasys IPS is unique in its ability to gather evidence of an attacker s activity, remove the attacker s access to the network, and reconfigure the network to resist the attacker s penetration technique. Enterasys IPS stops attacks at the source of the threat and can proactively protect against future threats and vulnerabilities. Enterasys IPS offers an extensive range of detection capabilities, host-based and network-based deployment options, a portfolio of IPS appliances, and seamless integration with all Enterasys solutions. Enterasys IPS utilizes a state-of-the-art highperformance, multi-threaded architecture with virtual sensor technology that scales to protect even the largest enterprise networks. When deployed in combination with Enterasys Security Information & Event Manager (SIEM) and Enterasys NMS Automated Security Manager, it facilitates the automatic identification, location, isolation and remediation of security threats. Enterasys IPS also integrates seamlessly with Enterasys Network Access Control (NAC) for post-connect monitoring of behavior once network access has been granted Logging Appliances and Analysis Tools Solutions utilized to collect, classify, analyze, and securely store log messages. Response: No current offering available Secure Edge and Branch Integrated Security Products Network security, VPN, and intrusion prevention for branches and the network edge. Products typically consist of appliances or routers. Response: No current offering available Secure Mobility Products Delivers secure, scalable access to corporate applications across multiple mobile devices. Response: No current offering available Encryption Appliances A network security device that applies crypto services at the network transfer layer - above the data link level, but below the application level. Response: No current offering available On-premise and Cloud-based services for Web and/or Security Solutions that provide threat protection, data loss prevention, message level encryption, acceptable use and application control capabilities to secure web and communications. Response: No current offering available Secure Access Products that provide secure access to the network for any device, including personally owned mobile devices (laptops, tablets, and smart phones). Capabilities should include: Management visibility for device access Self-service on-boarding Centralized policy enforcement Differentiated access and services Device Management Response: Comply. Enterasys Mobile IAM and Enterasys NAC deliver a comprehensive BYOD solution that provides total security, full IT control and predictable network experience for all users. The solutions address IT challenges being driven by today s enterprise and campus mobility Page 48 of 94 p. 51

52 WSCA-NASPO Data Communications Solicitation # JP14001 imperatives providing end-to-end visibility and control over individual users, devices and applications, in multi-vendor infrastructures. It provides complete software for: identity, access and inventory management, context-based policy enforcement, end-to-end management from a single, easy-to-use management application, auditing and reporting. Policy management is the most granular in the industry including per port, per device layer 2-4 access control, QoS/priority, rate limit/shape and more. Real time tracking and unique state change notification for over 50 attributes per device and user give IT maximum visibility into all network activity. It offers an open architecture for assessment (MDM integration) and threat response (Next Generation Firewall (NGFW), Security Information and Event Management (SIEM), Intrusion Prevention System (IPS)). The following details advanced features of the Enterasys solution critical in supporting BYOD device strategies: Advanced Context-Based Policy Management: Enterasys BYOD solutions advanced context-based policy engine is the most flexible in the industry. The attributes available for policy rule definition include authentication type, device type, user, role, location, time, and assessment status. Within each attribute, specific classifications enable the most fine-grained discriminations. It integrates with authentication services and provides unified wired, wireless and VPN enforcement. Auto Discovery: Auto Discovery automatically detects end systems and users and creates a hardware inventory for all attached end systems. The multiple methods provided for user detection include network authentication using 802.1X, Kerberos and RADIUS snooping, portal-based registration and authentication and external user-ip mapping technologies. Multiple methods are used for device detection with MAC authentication followed by IP resolution and reverse DNS lookup and multilevel device profiling. Auto discovery can discover and track 50 attributes per end system and user pair a level of detail that is unmatched in the industry. Multi-Level Device Profiling: Enterasys BYOD provides a comprehensive set of profiling capabilities and API s for integrations to extend these capabilities even further. Features include OUI based profiling, DHCP option fingerprinting with the ability to customize, captive portal, user agent profiling and network-based and agent-based assessment. With MDM integration granular device type and capability information is identified. With the Enterasys NAC API information from external profilers that are behavior based can be incorporated. Zero Effort and Secure Onboarding and Authentication: With Enterasys BYOD, end users experience Zero Effort onboarding. Not even portal registration is required with the transparent web cache/proxy redirect functionality. For flexibility portal based and automated onboarding are two additional approaches that are provided. Portal based registration with back end integration into LDAP and RADIUS means zero effort for IT. With automated onboarding Web Services are used to allow external systems, Page 49 of 94 p. 52

53 WSCA-NASPO Data Communications Services Solicitation # JP14001 such as student management, dorm management, registration and enrollment portals to provision access. Managed Guest Access Control with Sponsorship: Guest access management provides accountability, tracking and control. It is fully integrated with Enterasys BYOD. There are no additional software modules to purchase and maintain. Guest access is through a voucher, preregistration, authenticated or sponsored access. It is highly automated, including, for example, web-based guest registration with automatic workflow for a sponsor s validation and approval. No matter which vendors populate the infrastructure, Enterasys BYOD automated guest services provide unified wired/wireless access control for all non-employees. Partners, contractors, visitors or conference attendees are productive while critical business systems and resources are protected from misuse or compromise STORAGE NETWORKING High-speed network of shared storage devices connecting different types of storage devices with data servers Director Class SAN (Storage Area Network) Switches and Modules A scalable, high-performance, and protocol-independent designed primarily to fulfill the role of core switch in a core-edge Fibre Channel (FC), FCOE or similar SAN topology. A Fibre Channel director is, by current convention, a switch with at least 128 ports. It does not differ from a switch in core FC protocol functionality. Fibre Channel directors provide the most reliable, scalable, high-performance foundation for private cloud storage and highly virtualized environments Fabric and Blade Server Switches A Fibre Channel switch is a network switch compatible with the Fibre Channel (FC) protocol. It allows the creation of a Fibre Channel fabric, which is currently the core component of most SANs. The fabric is a network of Fibre Channel devices, which allows many-to-many communication, device name lookup, security, and redundancy. FC switches implement zoning; a mechanism that disables unwanted traffic between certain fabric nodes Enterprise and Data Center SAN and VSAN (Virtual Storage Area Network) Management Management tools to provisions, monitors, troubleshoot, and administers SANs and VSANs SAN Optimization Tools to help optimize and secure SAN performance (ie. Encryption of data-at-rest, data migration, capacity optimization, data reduction, etc. Response: No current offering available for category SWITCHES Layer 2/3 devices that are used to connect segments of a LAN (local area network) or multiple LANs and to filter and forward packets among them Campus LAN Access Switches Provides initial connectivity for devices to the network and controls user and workgroup access to internetwork resources. The following are some of the features a campus LAN access switch should support: Security i.sshv2 (Secure Shell Version 2) Response: Comply. Enterasys supports SSHv2 across all switch families including: S-Series, K-Series, C-Series, B-Series and A- Series. ii.802.1x (Port Based Network Access Control) Response: Comply. All Enterasys switches support IEEE 802.1x, which protects against unauthorized access to a network, DoS attacks, theft of services, etc x configuration consists of Page 50 of 94 p. 53

54 WSCA-NASPO Data Communications Solicitation # JP14001 setting RADIUS parameters on the switches to point the switch to the authentication server. In addition, multiple users/devices per port can be authenticated via IEEE 802.1X, MAC address, or web authentication, and then assigned a pre-defined operational role. iii. Port Security Response: Comply. All Enterasys switches support MAC Locking (sometimes referred to as MAC-based port locking, port locking or port security) which helps prevent unauthorized access to the network by limiting access based on a device s MAC address. MAC locking locks a port to one or more MAC addresses, preventing connection of unauthorized devices via a port. With MAC locking enabled, the only frames forwarded on a MAC locked port are those with the configured or dynamically selected MAC addresses for that port. Support is provided for two different types of MAC locking: Static MAC Locking - Locking one or more specified MAC addresses to a port. Dynamic MAC Locking - Locking one or more MAC addresses to a port based on first arrival of received frames after dynamic MAC locking is enabled. The configuration specifies the maximum number of end users that will be allowed. As each new end user is identified, it is MAC locked up to the maximum number of users. Once the maximum number of users have been MAC locked, all other users will be denied access to the port until a MAC locked address is either aged, if aging is configured, or the session for that user ends. iv.dhcp (Dynamic Host Configuration Protocol) Snooping Response: Comply. All Enterasys switches support DHCP Snooping. The Enterasys anti-spoofing solution provides a flexible and secure approach to IP spoofing detection and prevention. To mitigate the effects of these types of attacks on a network, a source MAC to source IP address binding table is created. The three basic tools used to detect source IP to source MAC address associations, based on the entries in the binding table, and take action on violations are: DHCP snooping, Dynamic ARP inspection (DAI), and IP source guard. All three methods can create IP-to-MAC bindings in the binding table, although both DAI and IP source guard can be configured to run in inspection-only mode, limiting the association of IP addresses to MAC addresses to DHCP-snooping. Bindings created as a result of DHCP exchanges with trusted servers (DHCPsnooping) take precedence over bindings created through DAI or IP source guard. Use of all three tools allows bindings to be created for users in a network where DHCP is not in use or where a DHCP exchange has not occurred since the anti-spoofing feature has been enabled. Page 51 of 94 p. 54

55 WSCA-NASPO Data Communications Services Solicitation # JP14001 VLANs Response: Comply. By default, all Enterasys switches run in 802.1Q VLAN operational mode. All ports on all Enterasys switches are assigned to a default VLAN (VLAN ID 1); you can use the CLI commands or Enterasys NetSight to create additional VLANs to customize VLANs to support your organizational requirements. Depending on the product family, Enterasys switches support a maximum of up to 4094 active VLANs. There is a distinction however, between the maximum number of active VLANs some switches support and the range of VLAN ID (VID) values. For example, while the stackable and standalone switch products support 1024 active VLANs, they do support VIDs from anywhere in the full 802.1Q specified range. The total number of active VLANs supported on the Enterasys switch product families is: Up to 4094 on S-Series and K-Series Up to 1024 on stackable (B-Series, C-Series, A-Series) Enterasys switches support traffic classification for the following VLAN types. Static and Dynamic VLANs: All VLANs on an Enterasys switch are categorized as being either static or dynamic. Static VLANs are those that are explicitly created on the switch itself, persistently remaining as part of the configuration, regardless of actual usage. Dynamic VLANs, on the other hand, are not necessarily persistent. Their presence relies on the implementation of GVRP and its effect on egress membership. Port-Based VLANs: Port-based VLANs are configured by associating switch ports to VLANs in two ways: first, by manipulating the port VLAN ID (PVID); and second, by adding the port itself to the egress list of the VLAN corresponding to the PVID. Any traffic received by a port is associated to the VLAN identified by the port's PVID. By virtue of this association, this traffic may egress the switch only on those ports listed on the VLAN's egress list. For example, given a VLAN named Marketing, with an ID value of 6, by changing the PVID values of ports 1 through 3 to 6, and adding those ports to the egress list of the VLAN, we effectively restrict the broadcast domain of Marketing to those three ports. If a broadcast frame is received on port 1, it will be transmitted out ports 2 and 3 only. In this sense, VLAN membership is determined by the location of traffic ingress, and from the perspective of the access layer where users are most commonly located egress is generally untagged. Policy-Based VLANs: Rather than making VLAN membership decisions simply based on port configuration, each incoming frame can be examined by the classification engine which uses a match-based logic to assign the frame to a desired VLAN. For example, you could set up a policy which designates all traffic between the management officers of a company to a specific VLAN so that this traffic is restricted to certain portions of the network. With respect to network usage, the administrative advantages of policy classification would be application provisioning, acceptable use policy, and distribution layer policy. Enterasys Policy provides for the configuration of role-based profiles for securing and provisioning network resources based upon the role the user or device plays within the enterprise. By first defining the user or device role, network resources can be granularly tailored to a specific user, system, service, or port-based context by configuring and assigning rules to the policy role. A policy role can be configured for any combination of Class of Service, VLAN Page 52 of 94 p. 55

56 WSCA-NASPO Data Communications Solicitation # JP14001 assignment, classification rule precedence, logging, accounting, or default behavior based upon L2, L3, and L4 packet fields. Hybrid authentication allows either policy or dynamic VLAN assignment, or both, to be applied through RADIUS authorization. The three primary benefits of using Enterasys policy in your network are provisioning and control of network resources, security, and centralized operational efficiency using the Enterasys NetSight Policy Manager. Enterasys S-Series and K-Series supports GVRP and MVRP for network VLAN propagation; Enterasys C-Series and B-Series support GVRP for network VLAN propagation. Importantly, Enterasys solutions also offer centralized visibility and management with the NetSight Suite of Management applications. NetSight allows the concurrent configuration of almost any number of switches in one configuration step automating the definition, distribution and enforcement of VLAN and policy rules across the entire network. Fast Ethernet/Gigabit Ethernet Response: Comply. Enterasys switches are available to support a variety of Fast Ethernet and Gigabit Ethernet connectivity options. The following port density options are available: S-Series Chassis: 3-slot chassis offering up to 216 triple-speed ports 4-slot chassis offering up to 288 triple-speed ports 6-slot chassis offering up to 432 triple-speed ports 8-slot chassis offering up to 576 triple-speed ports K-Series Chassis: 6-slot chassis offering up to a maximum of 144 triple-speed ports and (4) 10Gb uplinks 10-slot chassis offering up to a maximum of 216 triple-speed ports and (8) 10Gb ports Stackable Switches (C-Series, B-Series, A-Series): B-Series/C-Series: 24 and 48 port 10/100/1000Base-TX switch options supporting up to 384 ports per switch stack with 1Gig and 10Gig uplink options A-Series: 4 and 48 port 10/100 or 10/100/1000Base-TX switch options supporting up to 384 ports per switch stack with 1Gig uplink options PoE (Power over Ethernet) Response: Comply. Enterasys switches support IEEE 802.3af and 802.3at PoE across all access layer switch models. All Enterasys S-Series and K- Series triple speed copper I/O modules are PoE-enabled, stackable switches providing 24 and 48 port PoE switch models. Depending on the switch model and chassis configuration support can be provided for up to 30 watts of power per port link aggregation Response: Comply. Enterasys switches support IEEE 802.3ad link aggregation providing a standardized means of grouping multiple parallel Page 53 of 94 p. 56

57 WSCA-NASPO Data Communications Services Solicitation # JP14001 Ethernet interfaces into a single logical Layer 2 link. The formed group of Ethernet interfaces is referred to as a Link Aggregation Group (LAG). Dynamic LAG formation and activation is provided by the Link Aggregation Control Protocol (LACP). 10 Gb support Response: Comply. Enterasys switches are available with 10GB uplink options which include: 10GB-ZR-SFPP 10 Gb, 10GBASE-ZR, SM, 1550 nm, 80 km, LC SFP+ 10GB-ER-SFPP 10 Gb, 10GBASE-ER, IEEE SM, 1550 nm Long Wave Length, 40 km, LC SFP+ 10GB-LR-SFPP 10 Gb, 10GBASE-LR, IEEE SM, 1310 nm Long Wave Length, 10 km, LC SFP+ 10GB-LRM-SFPP 10 Gb, 10GBASE-LRM, IEEE MM, 1310 nm Short Wave Length, 220 m, LC SFP+ 10GB-SR-SFPP 10 Gb, 10GBASE-SR, IEEE MM, 850 nm, 33/82/300/550 m, LC SFP+ 10GB-USR-SFPP 10 Gb, Ultra Short Reach MM, 850 nm, 100m on OM3 / 150 m on OM4, LC SFP+ Port mirroring Response: Comply. The Enterasys switches support one-to-one and manyto-one port mirroring. Span Taps Response: Comply. The Enterasys switches allows you to mirror (or redirect) the traffic being switched on a port for the purposes of network traffic analysis and connection assurance. Support of IPv6 and IPv4 Response: Comply. Standards-based rapid spanning tree Response: Comply. Enterasys switches support IEEE 802.1w Rapid Spanning Tree Protocol. Netflow Support (Optional). Response: Comply. Unsampled NetFlow is supported on all Enterasys S- Series and K-Series switches Campus LAN Core Switches Campus core switches are generally used for the campus backbone and are responsible for transporting large amounts of traffic both reliably and quickly. Core switches should provide: High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Page 54 of 94 p. 57

58 WSCA-NASPO Data Communications Solicitation # JP14001 Security i. SSHv2 Response: Comply. ii. MacSec encryption Response: Enterasys S-Series S140 and S80 modules are hardware capable of supporting 802.1AE MACsec; support will be provided in a future release. iii. Role-Based Access Control Lists (ACL) Response: Comply. Enterasys switches use a role-based model to associate traffic with appropriate VLAN, QoS, port, etc. Roles are established in policy profiles that can be associated with individual users, systems, services or ports. Enterasys policy profiles enable network administrators to write a set of rules that can control and prioritize various types of network traffic. The rules that make up a policy profile contain both classification definitions and actions to be enforced when a classification is matched. Classifications include Layer 2, Layer 3 and Layer 4 fields. Policy actions that can be enforced include VLAN assignment, filtering, inbound rate limiting, outbound rate shaping, priority class mapping and logging. Support of IPv6 and IPv4 Response: Comply. 1/10/40/100 Gbps support Response: Comply. Enterasys S-Series switch I/O fabrics and I/O modules are available with a wide array of interface types and port densities (10/100/1000BASE-TX, 1000BASE SFP, 10GBASE SFP+, 10GBASE-T and 40GBASE QSFP+) to address varied network requirements.100-gig modules are planned for a future hardware release. IGP (Interior Gateway Protocol) routing Response: Comply. Enterasys S-Series supports OSPF and IS-IS Interior Gateway Routing Protocols. EGP (Exterior Gateway Protocol) routing Response: Comply. Enterasys S-Series supports BGP Exterior Gateway Routing Protocols. VPLS (Virtual Private LAN Service) Support Response: Enterasys S-Series will provide support for VPLS in a future release. VRRP (Virtual Router Redundancy Protocol) Support Response: Comply. Enterasys S-Series support VRRP. Netflow Support. Response: Comply. Enterasys S-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flowbased ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched Page 55 of 94 p. 58

59 WSCA-NASPO Data Communications Services Solicitation # JP14001 and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S- Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Campus Distribution Switches Collect the data from all the access layer switches and forward it to the core layer switches. Traffic that is generated at Layer 2 on a switched network needs to be managed, or segmented into Virtual Local Area Networks (VLANs), Distribution layer switches provides the inter- VLAN routing functions so that one VLAN can communicate with another on the network. Distribution layer switches provides advanced security policies that can be applied to network traffic using Access Control Lists (ACLs). High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Security (SSHv2 and/or 802.1X) Response: Comply. Enterasys S-Series supports SSHv2 and 802.1x, which protects against unauthorized access to a network, DoS attacks, theft of services, etc x configuration consists of setting RADIUS parameters on the switches to point the switch to the authentication server. In addition, multiple users/devices per port can be authenticated via IEEE 802.1X, MAC address, or web authentication, and then assigned a pre-defined operational role. Support of IPv6 and IPv4 Response: Comply. Jumbo Frames Support Response: Comply. Enterasys S-Series supports Jumbo frames up to 10,239 bytes. Dynamic Trunking Protocol (DTP) Response: The Dynamic Trunking Protocol (DTP) is a Cisco proprietary protocol for the purpose of negotiating trunking on a link between two VLAN-aware switches, and for negotiating the type of trunking encapsulation to be used. Enterasys S-Series supports standards-based GVRP and MVRP for network VLAN propagation. Page 56 of 94 p. 59

60 WSCA-NASPO Data Communications Solicitation # JP14001 Per-VLAN Rapid Spanning Tree (PVRST+) Response: Comply. Enterasys switches support IEEE 802.1w Rapid Spanning Tree Protocol and 802.1s Per VLAN Spanning Tree. Switch-port auto recovery Response: Comply. NetFlow Support or equivalent Response: Comply. Enterasys S-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flowbased ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S- Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Data Center Switches Data center switches, or Layer 2/3 switches, switch all packets in the data center by switching or routing good ones to their final destinations, and discard unwanted traffic using Access Control Lists (ACLs), all at Gigabit and 10 Gigabit speeds. High availability and modularity differentiates a typical Layer 2/3 switch from a data center switch. Capabilities should include: High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Ultra-low latency through wire-speed ports with nanosecond port-to-port latency and hardware-based Inter-Switch Link (ISL) trunking Response: Comply. Enterasys S-Series delivers low latency and is designed to deliver non-blocking performance. The Flex-Edge functionality and deep packet buffers makes the S-Series switch significantly less vulnerable to network congestion issues at peak traffic times than other line rate switches. All Enterasys S-Series switches include the Flex-Edge feature, which provides the unique capability to classify traffic as it enters the switch. Traffic critical to ensuring the always up operational state of the network and to maintain application continuity is identified and prioritized at ingress, prior to being passed to the packet processor. Page 57 of 94 p. 60

61 WSCA-NASPO Data Communications Services Solicitation # JP14001 Enterasys switches support IEEE 802.3ad link aggregation providing a standardized means of grouping multiple parallel Ethernet interfaces into a single logical Layer 2 link. The formed group of Ethernet interfaces is referred to as a Link Aggregation Group (LAG). Dynamic LAG formation and activation is provided by the Link Aggregation Control Protocol (LACP). Enterasys S-Series switches also support Virtual Switch Bonding (VSB) that allows for the aggregation of links on two physical chassis, providing redundancy, while at the same time allowing ports on both chassis to pass data concurrently, effectively doubling the available bandwidth. VSB aggregates two like chassis into a single virtual network device. VSB joins two chassis into a single system by extending each chassis distribution to the other chassis using one or more 10GbE port interconnect links. There are two types of VSB interconnect ports depending upon the module and option cards installed: Dedicated VSB hardware fabric extended 10GbE ports are provided on the S180 class modules. Dedicated VSB hardware interconnect ports are not standard Ethernet data ports. They provide a line rate direct connection to the fabric and automatically provide VSB entitlement to the module (no license is required). Standard software assisted Ethernet data 10GbE port Load Balancing across Trunk group able to use packet based load balancing scheme Response: Comply. Bridging of Fibre Channel SANs and Ethernet fabrics Response: The Enterasys solution is able to co-exist with Fibre Channel environments, enabling the organization to continue to leverage existing investments. Enterasys provides support for Data Center Bridging (DCB) in multiple phases with different hardware and software requirements as the underlying technology to transport Fibre Channel over Ethernet (FCoE). As an alternative, Enterasys offers a simple, yet highly effective approach to enable, optimize and secure iscsi SAN or NFS NAS deployments. The Enterasys S-Series modular switch is a key component of our overall solution, delivering an easy and effective way to optimize communications through automatic discovery, classification, and prioritization of SANs. In addition, the Enterasys solution will identify and automatically respond to security threats against virtual storage nodes, enforce role-based network access control policies, and comply with regulations for monitoring and auditing. The IEEE Data Center Bridging task group, a working group of IEEE working group, is focused on defining a new set of standards which will enable Ethernet to effectively deliver data center transport for both server and storage traffic. Terms commonly associated with DCB are Data Center Ethernet, also known as DCE, and Convergence Enhanced Ethernet (CEE). It should be understood that DCB is the task group and term commonly being used to describe tomorrow s Data Center LANs. Data Center Bridging is focused primarily on three (3) IEEE specifications: IEEE 802.1Qaz ETS & DCBX bandwidth allocation to major traffic classes (Priority Groups); plus DCB management protocol IEEE 802.1Qbb Priority PAUSE. Selectively PAUSE traffic on link by Priority Group IEEE 802.1Qau Dynamic Congestion Notification Page 58 of 94 p. 61

62 WSCA-NASPO Data Communications Solicitation # JP14001 Jumbo Frame Support Response: Comply. Enterasys S-Series supports Jumbo frames up to 10,239 bytes. Plug and Play Fabric formation that allows a new switch that joins the fabric to automatically become a member Response: Comply. Automatic module self-configuration in the S-Series allows I/O modules to receive their configuration from other I/O modules automatically. This is ideal for replacing failed modules without manually reconfiguring the replacement module. Ability to remotely disable and enable individual ports Response: Comply. Support NetFlow or equivalent Response: Comply. Enterasys S-Series and K-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flow-based ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S-Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Software Defined Networks (SDN) - Virtualized Switches and Routers Technology utilized to support software manipulation of hardware for specific use cases. Response: Enterasys has been developing SDN-like architectures since the mid-1990s. The proposed Enterasys switches, based on the OneFabric architecture, are leveraging SDN architectural components to provide centralized visibility and control over the entire network. Centralized visibility enables infrastructure and application teams to work together, eliminating costly misalignments and errors that occur through typical operational workflows. Embedded automation features improve application delivery for dynamic environments leveraging cloud, virtualization, server/storage consolidation and the consumerization of IT. The oncecomplex task of provisioning and de-provisioning servers and network infrastructure is made simple: defined locally and enforced globally achieving significant scale, improved operational efficiency and more reliable and successful application delivery. A unified management experience is provided by Enterasys NetSight s OneFabric Control Center, which allows network operations to leverage the power and intelligence built into Enterasys networking solutions. NetSight also supports and protects your investment in the myriad of third-party network devices already powering existing networks. Finally, NetSight integrates with major virtualization solutions, delivering unique and differentiated network-layer capabilities for virtual data centers. Page 59 of 94 p. 62

63 WSCA-NASPO Data Communications Services Solicitation # JP14001 Enterasys S-Series flow-based systems offer a hybrid architecture that has evolved over the years to provide a mature, scalable, agile and deployable solution. When you use a flow-based system the first packet can be used to make very sophisticated decisions in software (and thus in the controller or even other applications) and then subsequently all packets of that flow are switched in hardware. This is the innovative design that makes our proposed CoreFlow2-based switching and routing products so different. This is also the basis for all of the new, advanced and agile services that are associated with SDN Software Defined Networks (SDN) Controllers - is an application in softwaredefined networking (SDN) that manages flow control to enable intelligent networking. SDN controllers are based on protocols, such as OpenFlow, that allow servers to tell switches where to send packets. The SDN controller lies between network devices at one end and applications at the other end. Any communications between applications and devices have to go through the controller. The controller uses multiple routing protocols including OpenFlow to configure network devices and choose the optimal network path for application traffic. Response: The Enterasys development team is actively researching "southbound" API protocols including OpenFlow. The OpenFlow protocol is in the early stage of development with limited interoperability and there are concerns about the scalability of the protocol in a full scale enterprise network. While Enterasys does not currently have a committed plan to productize Openflow functionality, if the technology matures and there is market demand, support can be added via a firmware upgrade to the highly scalable flow based S-Series products Carrier Aggregation Switches Carrier aggregation switches route traffic in addition to bridging (transmitted) Layer 2/Ethernet traffic. Carrier aggregation switches major characteristics are: Designed for Metro Ethernet networks Designed for video and other high bandwidth applications Supports a variety of interface types, especially those commonly used by Service Providers Capabilities should include: Redundant Processors Redundant Power IPv4 and IPv6 unicast and multicast High bandwidth Low latency Hot swappable power supplies and fans MPLS (Multiprotocol Label Switching) BGP (Border Gateway Protocol) Software router virtualization and/or multiple routing tables Policy based routing Layer 2 functionality i. Per VLAN Spanning Tree ii. Rapid Spanning Tree iii. VLAN IDs up to 4096 iv. Layer 2 Class of Service (IEEE 802.1p) v. Link Aggregation Control Protocol (LACP) vi. QinQ (IEEE 802.1ad) Response: No current offering available. Page 60 of 94 p. 63

64 WSCA-NASPO Data Communications Solicitation # JP Carrier Ethernet Access Switches A carrier Ethernet access switch can connect directly to the customer or be utilized as a network interface on the service side to provide layer 2 services. Hot-swappable and field-replaceable integrated power supply and fan tray AC or DC power supply with DC input ranging from 18V to 32 VDC and 36V to 72 VDC Ethernet and console port for manageability SD flash card slot for additional external storage Stratum 3 network clock Line-rate performance with a minimum of 62-million packets per second (MPPS) forwarding rate Support for dying gasp on loss of power Support for a variety of small form factor pluggable transceiver (SFP and SFP+) with support for Device Object Model (DOM) Timing services for a converged access network to support mobile solutions, including Radio Access Network (RAN) applications Support for Synchronous Ethernet (SyncE) services Supports Hierarchical Quality of Service (H-QoS) to provide granular trafficshaping policies Supports Resilient Ethernet Protocol REP/G.8032 for rapid layer-two convergence Response: No current offering available WIRELESS Provides connectivity to wireless devices within a limited geographic area. System capabilities should include: Redundancy and automatic failover Response: Comply. There are no limitations with the Enterasys IdentiFi Wireless redundant architecture. Redundant Enterasys Wireless Controllers can be deployed anywhere in the network and operate in failover or load-sharing mode. When configured to operate in redundant load-sharing mode, access points can be configured for fast-failover mode to allow configuration and service restoration (in tunnel mode) in less than two seconds, thus enabling user sessions to continue uninterrupted inclusive of Voice over WLAN traffic. The secondary Enterasys Wireless Controller does not have to detect its link failure with the primary Enterasys Wireless Controller for the session availability to kick in. If the Wireless AP loses five consecutive polls to the primary controller either due to the controller outage or connectivity failure, it fails over to the secondary controller fast enough to maintain the user session. In session availability mode (as shown below), the Wireless APs connect to both the primary and secondary Enterasys Wireless Controllers. While the connectivity to the primary Enterasys Wireless Controller is via the active tunnel, the connectivity to the secondary Enterasys Wireless Controller is via the backup tunnel. Page 61 of 94 p. 64

65 WSCA-NASPO Data Communications Services Solicitation # JP14001 When switching traffic locally, APs continue to provide service even when the link to the wireless controller is severed. Importantly, Enterasys Wireless does not require additional add-on licenses to utilize the failover AP capacity (license included). IPv6 compatibility Response: Comply. NTP Support Response: Comply. Enterasys Wireless Controllers can be configured to utilize up to three NTP Servers Access Points A wireless Access Point (AP) is a device that allows wireless devices to connect to a wired network using Wi-Fi, or related standards. Capabilities should include: a/b/g/n Response: Comply. Enterasys offers a complete line of a/b/g/n compliant indoor and outdoor access point n Response: Comply ac Response: Planned for future capability. The Enterasys IdentiFi Wireless solution is designed to support a/b/g/n today with a focus on ac in the future. Enterasys plans to offer ac access point in the Q timeframe following ratification of the ac standard. Importantly, current generation Enterasys controllers, along with Enterasys s distributed data forwarding architecture, are capable of handling ac traffic. Capable of controller discovery method via DHCP (onsite controller or offsite through Cloud Architecture) Response: Comply. Enterasys IdentiFi access points can be located remotely while IdentiFi controllers can be centrally-located. This distributes data decisions and data handling, while centralizing management and control. The IdentiFi controllers can be centrally-located on premise at the Page 62 of 94 p. 65

66 WSCA-NASPO Data Communications Solicitation # JP14001 enterprise or in the cloud as a managed service offering. Both of these approaches provide centralized control over IdentiFi access points via the cloud, thus reducing the cost and complexity associated with locating dedicated controllers at every location. UL2043 plenum rated for safe mounting in a variety of indoor environments Response: Comply. Support AES-CCMP (128-bit) Response: Comply. Provides real-time wireless intrusion monitoring and detection Response: Comply. Enterasys IdentiFi Radar provides a set of advanced, intelligent, Wireless Intrusion Detection Service and Wireless Intrusion Prevention Service (WIDS and WIPS) features that are integrated into the Wireless Controller and its APs. Radar provides a basic solution for discovering unauthorized devices within the wireless coverage area. Radar performs basic RF network analysis to identify rogue APs/personal ad-hoc networks and protect against DoS attacks Outdoor Wireless Access Points Outdoor APs are rugged, with a metal cover and a DIN rail or other type of mount. During operations they can tolerate a wide temperature range, high humidity and exposure to water, dust, and oil. Capabilities should include: Flexible Deployment Options Response: Comply. Enterasys offers several outdoor AP models to meet the needs of various deployments. These industrial grade access points are designed to operate in harsh environments such as warehouses, mines, manufacturing plants, and stadiums. The AP3765i comes with an integrated six antenna array for ease of installation. The AP3765e and AP3767e include six RP-SMA antenna connectors supporting both 2.4G and 5G band antennas. The 3765 access points can be powered via 802.3at power or an optional industrial-grade external power adapter, while the 3767 requires the external power adapter. Provides real-time wireless intrusion monitoring and detection Response: Comply. Enterasys IdentiFi Radar provides a set of advanced, intelligent, Wireless Intrusion Detection Service and Wireless Intrusion Prevention Service (WIDS and WIPS) features that are integrated into the Wireless Controller and its APs. Radar provides a basic solution for discovering unauthorized devices within the wireless coverage area. Radar performs basic RF network analysis to identify rogue APs/personal ad-hoc networks and protect against DoS attacks. Capable of controller discovery method via DHCP (onsite controller or offsite through Cloud Architecture) Response: Comply. Enterasys IdentiFi access points can be located remotely while IdentiFi controllers can be centrally-located. This distributes data decisions and data handling, while centralizing management and control. The IdentiFi controllers can be centrally-located on premise at the enterprise or in the cloud as a managed service offering. Both of these approaches provide centralized control over IdentiFi access points via the Page 63 of 94 p. 66

67 WSCA-NASPO Data Communications Services Solicitation # JP14001 cloud, thus reducing the cost and complexity associated with locating dedicated controllers at every location Wireless LAN Controllers An onsite or offsite solution utilized to manage light-weight access points in large quantities by the network administrator or network operations center. The WLAN controller automatically handles the configuration of wireless access-points. Capabilities should include: Ability to monitor and mitigate RF interference/self-heal Response: Comply. Enterasys IdentiFi wireless solutions come standard with the latest in WiFi technology including Dynamic Radio Management (DRM). DRM operates independently on each radio, automatically adjusting radio power output and channel selection to accommodate changing RF environments. DRM ensures optimal AP coverage while maximizing availability and quality of user experience across the entire WLAN. Furthermore, if an AP fails, neighboring APs will increase power to maintain coverage in the affected area. Support seamless roaming from AP to AP without requiring re-authentication Response: Comply. The Enterasys IdentiFi Wireless solution centralizes the user's network point of presence, therefore abstracting and decoupling the user's IP address assignment from that of the APs location subnet. That means that the user is able to roam across any AP without losing its own IP address, regardless of the subnet on which the serving APs are deployed. In addition, an Enterasys Wireless Controller can learn about other Enterasys Wireless Controllers on the network and then exchange client session information. This enables a wireless device user to roam seamlessly between different Wireless APs on different Enterasys Wireless Controllers. Enterasys IdentiFi Wireless uses industry standards to deliver fast and secure roaming i pre-authentication (Pre-Auth) ensures that the user is authenticated to adjacent APs before entering their coverage range. Opportunistic Key Caching (OKC) is also a supported mechanism which greatly improves device roaming times. Support configurable access control lists to filter traffic and denying wireless peer to peer traffic Response: Comply. The Enterasys IdentiFi Wireless solution restricts users from peer-to-peer traffic. This not only prevents undesirable use of the system, but it protects WiFi users from neighbors. The Enterasys rolebased policy architecture also provides granular control of all user traffic seamlessly across all wireless access devices enabling customers to effectively enforce the appropriate network communications rules for each user, regardless of SSID. System encrypts all management layer traffic and passes it through a secure tunnel Response: Comply. Enterasys IdentiFi Wireless solution can be configured in Secure Tunnel mode to provide encryption, authentication, and key management between the AP and/or controllers. Policy management of users and devices provides ability to de-authorize or deny devices without denying the credentials of the user, nor disrupting other AP traffic Page 64 of 94 p. 67

68 WSCA-NASPO Data Communications Solicitation # JP14001 Response: Comply. Enterasys Wireless supports the assignment of rules and roles per user/device/application (not just to a specific VLAN or SSID) seamlessly across all wireless access devices. Leveraging the Enterasys role-based policy architecture customers can effectively enforce the appropriate network communications rules for each user, regardless of SSID. Access can be granted for all users with access to specific resources being limited or controlled based on the users role (administrator, employee, contractor, guest) in the network. No other vendor matches the control and visibility provided by Enterasys VLAN and SSID independent role-based authorization, access control and traffic management. Support configurable access control lists to filter traffic and denying wireless peer to peer traffic Response: Comply Wireless LAN Network Services and Management Enables network administrators to quickly plan, configure and deploy a wireless network, as well as provide additional WLAN services. Some examples include wireless security, asset tracking, and location services. Capabilities should include: Provide for redundancy and automatic failover Response: Comply. Historical trend and real time performance reporting is supported Response: State-of-the-art reporting provides historical and real-time data for high level network summary information and/or details. A collection of summary reports provide information on your wireless network components, including reports for AP groups, controllers, and mobility zones. Wireless reports also provide data on wireless components ranked by bandwidth and clients, such as top APs by bandwidth, top clients by bandwidth, and top controllers by clients, as well as reports on APs and controllers that are down. Management access to wireless network components is secured Response: Comply. SNMPv3 enabled Response: Comply. RFC 1213 compliant Response: Comply. Automatically discover wireless network components Response: Comply. When an Enterasys AP is powered on, it automatically begins a discovery process to determine its own IP address and the IP address of the controller. When the discovery process is successful, the Wireless AP registers with the controller Capability to alert for outages and utilization threshold exceptions Response: Comply. Alerts can be sent via SNMP Trap or Syslog. Page 65 of 94 p. 68

69 WSCA-NASPO Data Communications Services Solicitation # JP14001 Capability to support Apple s Bonjour Protocol / mdns Response: Comply. The Enterasys multicast traffic management solution is highly efficient based on distributed policy; Apple Bonjour and other chatty multicast traffic is contained in one or multiple domains based on user role and device as well as location. In addition, for optimized multicast delivery (aka Bonjour) Enterasys supports proxy ARP@AP, multicast-tounicast conversion, and Enterasys APs dynamically calculate multicast transmission speeds vs. assuming the minimum basic rate (MBR) reducing the risk that multicast traffic will bog down the WLAN network. QoS / Application identification capability Response: Comply. Enterasys IdentiFi Wireless provides role-based policies providing security, mobility and QoS priority that can be implemented on a per user, per SSID and per application basis. Enterasys Wireless provides true end-to-end Quality of Service (QoS) with each controller and AP supporting native IP prioritization (DiffServ, TOS, Precedence), Ethernet 802.1p, as well as e s WMM and TSPEC wireless QoS standards. When voice and data traffic are running on the same AP, voice traffic can be prioritized to ensure minimal delay and jitter for optimal voice quality. The wireless controllers are able to translate WMM prioritized traffic to existing QoS prioritization schemes on the wired network (TOS, DSCP, etc.) Cloud-based services for Access Points Cloud-based management of campus-wide WiFi deployments and distributed multi-site networks. Capabilities include: Zero-touch access point provisioning Response: Comply. When an Enterasys AP is powered on, it automatically begins a discovery process to determine its own IP address and the IP address of the controller. When the discovery process is successful, the Wireless AP registers with the controller. Network-wide visibility and control Response: Comply. Enterasys IdentiFi offers complete visibility and control over the wireless network. IdentiFi control and management are maintained centrally and are implemented and enforced throughout the entire network, providing operational flexibility. RF optimization, Response: Comply. Dynamic Radio Management (DRM) functionality of the Enterasys IdentiFi Wireless solution is used to help establish the optimum radio configuration for your Wireless APs. DRM is enabled by default and can: Adjusts power levels to balance coverage if another Wireless AP, which is assigned to the same SSID and is on the same channel, is added to or leaves the network. Allows wireless clients to be moved to another Wireless AP if the load is too high. Scans automatically for a channel, using a channel selection algorithm. Avoids other WLANs by reducing transmit power whenever other Wireless APs with the same channel, but different SSIDs are detected. Page 66 of 94 p. 69

70 WSCA-NASPO Data Communications Solicitation # JP14001 Firmware updates Response: Comply. Software updates can be distributed through the Enterasys Wireless Controller or with the Enterasys NetSight Inventory Manager. Both methods support the ability to perform time scheduled, mass updates. The upgrade through the Enterasys Wireless Controller allows you to select and control the state of an AP image upgrade: which APs to upgrade, when to upgrade, how to upgrade, and to which image the upgrade or downgrade should be done. The Firmware Upgrade Wizard within NetSight Inventory Manager allows you to easily perform scheduled upgrades to specific devices or groups of devices. The wizard gives you the flexibility of performing an immediate upgrade or scheduling the upgrade to take place at a later time. The download progress window within the Firmware Upgrade Wizard shows device list with status information for each device scheduled for upgrade. You can use these radio buttons to show all devices or show only those devices whose download operations are incomplete or have failed Bring Your Own Device (BYOD) Mobile Data Management (MDM) technology utilized to allow employees to bring personally owned mobile devices (laptops, tablets, and smart phones) to their workplace, and use those devices to access privileged government information and applications in a secure manner. Capabilities should include: Ability to apply corporate policy to new devices accessing the network resources, whether wired or wireless Response: Comply. The Enterasys BYOD solution delivers role-based access control that is unified across the wired and wireless infrastructure. Enterasys BYOD configuration options include time, location, authentication types, device and OS type, and end system and user groups. For example, customers can write and enforce policies that grant a precise level of network access based on the type of system connecting, the user's role in the organization, the location of a user at the time the user is connecting, or the time of day. Customers can give BYOD devices network access that is different than company owned devices. Enterasys BYOD solution automatically detects new devices entering the network and can identify them using over 50 end-device attributes, which are gathered and used to determine how to best provision access to Page 67 of 94 p. 70

71 WSCA-NASPO Data Communications Services Solicitation # JP14001 network resources. Device type can be an Operating System Family, Operating System or Hardware Type for example, Windows, Windows 7, Debian 3.0, HP Printer, iphone, ipad etc. Below is a graphic representation of the device fingerprinting provided with the Enterasys solution: Provide user and devices authentication to the network Response: Comply. Enterasys BYOD solution controls endpoint authentication. Enterasys BYOD Gateways acts as a RADIUS proxy, or RADIUS server for MAC Authentication, which communicates with the organization s RADIUS authentication services (e.g. interfaces with Microsoft Active Directory or another LDAP-based directory service). Provide secure remote access capability Response: Comply. Support 802.1x Response: Comply. Enterasys BYOD supports 802.1X (Extensible Authentication Protocol), MAC, Web-based and Kerberos Snooping (with certain restrictions) authentication. Enterasys NAC can integrate with your existing RADIUS server, LDAP and Active Directory to understand the authorized role for each user connecting to the system and use this to authorize specific access. Alternatively, this can be done through the onboard RADIUS server built into the NAC. NAC also has the ability to add users, devices, etc. to various groups that control access based on authentication type, time of day, location, device/os type, health of endsystem, etc. Network optimization for performance, scalability, and user experience Response: Comply. Enterasys comprehensive BYOD solution provides total security, full IT control and predictable network experience for all users. Enterasys solution addresses IT challenges being driven by today s enterprise and the needs to support BYOD by providing end-to-end visibility and control over individual users, devices and applications, in multi-vendor infrastructures. Enterasys BYOD solution is highly scalable and flexible in deployment. Enterasys offers a variety of out-of-band Gateways available to meet the needs of different-sized implementations and assessment server requirements. Enterasys BYOD Gateway models are available to meet the needs of different-sized implementations and multiple Gateways can be deployed to support a virtually unlimited number of endpoints UNIFIED COMMUNICATIONS (UC) A set of products that provides a consistent unified user interface and user experience across multiple devices and media types. Unified Communications that is able to provide services such as session management, voice, video, messaging, mobility, and web conferencing. It can provide the foundation for advanced unified communications capabilities of IM and presence-based services and extends telephony features and capabilities to packet telephony network devices such as IP phones, media processing devices, Voice over IP (VoIP) gateways, and multimedia applications. Additional services, such as unified messaging, multimedia conferencing, collaborative contact centers, and interactive multimedia response systems, are made possible through open telephony APIs. General UC solution capabilities should include: High Availability for Call Processing Hardware Platform High Availability Network Connectivity High Availability Page 68 of 94 p. 71

72 WSCA-NASPO Data Communications Solicitation # JP14001 Call Processing Redundancy IP Telephony Solutions utilized to provide the delivery of the telephony application (for example, call setup and teardown, and telephony features) over IP, instead of using circuit-switched or other modalities. Capabilities should include: Support for analog, digital, and IP endpoints Centralized Management Provide basic hunt group and call queuing capabilities Flexibility to configure queue depth and hold time, play unique announcements and Music on Hold (MoH), log in and log out users from a queue and basic queue statistics (from the phone E911 Support Instant messaging/ Presence Solutions that allow communication over the Internet that offers quick transmission of text-based messages from sender to receiver. In push mode between two or more people using personal computers or other devices, along with shared clients, instant messaging basically offers realtime direct written language-based online chat. Instant messaging may also provide video calling, file sharing, PC-to-PC voice calling and PC-to-regularphone calling Unified messaging Integration of different electronic messaging and communications media ( , SMS, Fax, voic , video messaging, etc.) technologies into a single interface, accessible from a variety of different devices. Ability to access and manage voice messages in a variety of ways, using inbox, Web browser, desktop client, VoIP phone, or mobile phone Visual Voic Support (Optional) Contact Center A computer-based system that provides call and contact routing for high-volume telephony transactions, with specialist answering agent stations and a sophisticated real-time contact management system. The definition includes all contact center systems that provide inbound contact handling capabilities and automatic contact distribution, combined with a high degree of sophistication in terms of dynamic contact traffic management Communications End Points and Applications Attendant Consoles IP Phones UC Network Management Provides end-to-end service management for Unified Communications. Capabilities include testing, performance monitoring, configuration management, and business intelligence reporting Collaboration Voice, video, and web conferencing; messaging; mobile applications; and enterprise social software Collaborative Video A set of immersive video technologies that enable people to feel or appear as if they were present in a location that they are not physically in. Immersive video consists of a multiple codec video system, where each meeting attendee uses an immersive video room to dial in and can see/talk to every other member on a screen (or screens) as if they were in the same room and provides call control that enables intelligent video bandwidth management Content Delivery Systems (CDS) A large distributed system of servers deployed in multiple data centers connected by the Internet. The purpose of the content delivery system is to serve content to end-users with high availability and high performance. CDSs serve content over the Internet, including web objects (text, graphics, URLs, and scripts), downloadable objects (media Page 69 of 94 p. 72

73 WSCA-NASPO Data Communications Services Solicitation # JP14001 files, software, documents), applications (e-commerce, portals), live streaming media, on-demand streaming media, and social networks Physical Security Technology utilized to restricting physical access by unauthorized people to controlled facilities. Technologies include: a. Access control systems b. Detection/Identification systems, such as surveillance systems, closed circuit television cameras, or IP camera networks and the associated monitoring systems. c. Response systems such as alert systems, desktop monitoring systems, radios, mobile phones, IP phones, and digital signage d. Building and energy controls Response: No current offering available for category SERVICES For each Category above ( ), the following services should be available for procurement as well at the time of product purchase or anytime afterwards. Response: Read, understood and comply Maintenance Services Capability to provide technical support, flexible hardware coverage, and smart, proactive device diagnostics for hardware. Response: Enterasys offers a comprehensive portfolio of maintenance services designed to address your business needs. Our maintenance services provide 24x7 access to our award winning support center, which is staffed with 100% in-house technical experts who collectively average over 13 years of technical experience. Enterasys understands that superior service and support is a critical component of your network solution. Our maintenance services provide all the post-implementation support services you need to maintain high network availability and performance cost effectively. Below is an overview of the maintenance services offerings available for all proposed product category offerings: Express Parts Our maintenance services provide full access to the latest firmware updates, ensuring you get the most from your network equipment. Advance parts replacement options range from next business day to two hour response and are available with or without an onsite field engineer. On-site Enterasys On-site maintenance program allows you to have an Enterasyscertified expert on site to help you diagnose and repair network faults and serve as a liaison with product engineers for problem escalation when necessary. Software and Appliance Services Enterasys Software and Application Services maintenance program allows you to avoid the expense of purchasing different revision levels, protecting your software investments. Our Appliance Services will help support elements that are critical to most effectively configure, maintain, support, upgrade and manage these product-specific Application environments. Page 70 of 94 p. 73

74 WSCA-NASPO Data Communications Solicitation # JP14001 The table below outlines what is provided with each option: For more information on Enterasys maintenance offerings please see: Professional Services Deployment Services Survey/ Design Services Includes, but not limited to, discovery, design, architecture review/validation, and readiness assessment. Response: Comply. Enterasys provides Survey/Design Services through our Professional Services Organization. Survey/Design Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing discovery, design, architecture review/validation, and readiness assessment services. Typical Survey/Design Services include (but are not limited to): Secure Network Readiness Assessment, Network Assessment, Wireless Assessment/Site survey, Network Security Assessment and Network design assistance. The goal of Enterasys assessments is to verify the current state/ status of the network and deploy best practices on the current and future network design. Implementation Services Includes, but not limited to, basic installation and configuration or end-to-end integration and deployment. Response: Comply. Enterasys provides Implementation Services through our Professional Services Organization. Implementation Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing basic installation, configuration and/or end-to-end integration/deployment services. Typical Page 71 of 94 p. 74

75 WSCA-NASPO Data Communications Services Solicitation # JP14001 Implementation Services include a range from basic rack/stack with L2 configuration through completed turn-key implementation for a routed L3 environment. Implementation Services can include (but are not limited to): Staging of equipment, mounting of equipment, design/configuration/testing of equipment, cutover support and post-cutover support. Enterasys Implementation Services are customized to support the specific needs of a project. The services also provide a means to augment the customer s existing staff or provide a complete implementation of the Enterasys equipment. Optimization Includes, but not limited to, assessing operational environment readiness, identify ways to increase efficiencies throughout the network, and optimize Customer s infrastructure, applications and service management. Response: Partially comply. Enterasys provides Optimization Services through our Professional Services Organization. Optimization Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing network operational readiness, increasing efficiencies and optimizing the customer s network infrastructure. Enterasys does not offer optimization for 3rd party applications or services. Typical Optimization services can include: Monthly/Bimonthly Network Health Checks, Network assessments and best practice recommendations. The goal of the Optimization Services is to assist the customer in implementing the best practice network infrastructure for their specific environment. Optimization services will provide the customer with standards based recommendations that increase network efficiency as well as overall network health. Remote Management Services Includes, but not limited to, continuous monitoring, incident management, problem management, change management, and utilization and performance reporting that may be on a subscription basis. Response: Partially comply. Enterasys provides Remote Management Services through our Professional Services Organization. Remote Management Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing problem management, change management and utilization/performance reporting using Project Management resources. Enterasys does not currently offer continuous monitoring or incident management. Page 72 of 94 p. 75

76 WSCA-NASPO Data Communications Solicitation # JP14001 Typical Remote Management services can include: remote configuration, remote troubleshooting, remote design support and various project management tasks. Project Management tasks can include: problem management, change management and reporting. Consulting/Advisory Services Includes, but not limited to, assessing the availability, reliability, security and performance of Customer s existing solutions. Response: Comply. Enterasys provides Consulting/Advisory Services through our Professional Services Organization. Consulting/Advisory Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced engineers with an average of 13 years tenure at Enterasys and 23 years expertise in providing Consulting/Advisory Services, reliability, security and performance services for existing network infrastructure solutions. Typical Consulting/Advisory Services include (but are not limited to): Network Assessment, Post-installation Wireless Assessment/Site survey, Network Security Assessment and Network Health checks. Enterasys Consulting/Advisory Services are designed to assist customers with reporting as well as maintaining and improving the existing network infrastructure. Data Communications Architectural Design Services Developing architectural strategies and roadmaps for transforming Customer s existing network architecture and operations management. Response: Comply. Enterasys provides Data Communications Architectural Design Services through our Professional Services Organization. These services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise providing strategies and roadmaps for future network architecture and upcoming technologies. Typical Data Communications Architectural Design Services include (but are not limited to): Future Network Readiness Assessment, Network Assessment, Wireless Assessment/Site survey and Network design assistance. The goal of these services is to plan/design for future solutions, growth and requirements on the network infrastructure. Statement of Work (SOW) Services Customer-specific tasks to be accomplished and/or services to be delivered based on Customer s business and technical requirements. Response: Comply. Enterasys provides Statement of Work Services through our Professional Services Organization. Statement of Work Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Page 73 of 94 p. 76

77 WSCA-NASPO Data Communications Services Solicitation # JP14001 Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise writing Statements of Work based on customer s business and technical requirements. Typical Statement of Work Services include (but are not limited to): Statement of Work writing assistance, Network implementation time/task estimating and time/task scoping. The goal of these services is to help customer s write Statements of Work that meet their business and technical requirements. Please note: Enterasys offers additional professional services for equipment categories listed in and below: 1. Network Management and Automation Software products and solutions for data center automation, cloud computing, and IT systems management. Response: Enterasys Data Center Manager (DCM) Advanced Service, provides a powerful unified management offering, automatically recognizes the VM provisioning event and dynamically provisions the virtual and physical switch with the services required by the application. DCM Service leverages Enterasys professional services expertise, embedded policy functionality in our S-Series core/data center switches and our NetSight Management Suite to provide IT administrators with a transparent, cross-functional service provisioning process that provides unified visibility and control of the Data Center by enabling the unification of the physical and virtual network and ensuring networks will have the high availability necessary for critical applications and business data. Traditionally, data center connectivity spans physical, virtual and storage networks using separate tools and management systems. To unify a data center network, it is necessary to have an integrated view of the network infrastructure, servers, storage systems and applications. The Enterasys Data Center Manager solution is designed to reduce the workload and increase the efficiency of the IT organization. Coordinating the automated assignment of virtual machines (VMs) within both the virtual and physical network fabrics, DCM ensures that proper network resources are allocated when a VM is provisioned, no matter where it is on the network. This is achieved with DCM s unique ability to automatically apply individual policies to various data objects in the switching fabric, solving the challenge of virtual machine sprawl. The use of granular policies, combined with Enterasys flowbased S-Series switching, helps users realize the goals of high availability and reliable delivery. With this approach, operational costs are lowered by providing a higher degree of automation as well as system-level management. Page 74 of 94 p. 77

78 WSCA-NASPO Data Communications Solicitation # JP Data Center Management and Automation Software products and solutions that capture and automate manual tasks across servers, network, applications, and virtualized infrastructure. Response: Enterasys Data Center Manager (DCM) Advanced Service, provides a powerful unified management offering, automatically recognizes the VM provisioning event and dynamically provisions the virtual and physical switch with the services required by the application. DCM Service leverages Enterasys professional services expertise, embedded policy functionality in our S-Series core/data center switches and our NetSight Management Suite to provide IT administrators with a transparent, cross-functional service provisioning process that provides unified visibility and control of the Data Center by enabling the unification of the physical and virtual network and ensuring networks will have the high availability necessary for critical applications and business data. Traditionally, data center connectivity spans physical, virtual and storage networks using separate tools and management systems. To unify a data center network, it is necessary to have an integrated view of the network infrastructure, servers, storage systems and applications. The Enterasys Data Center Manager solution is designed to reduce the workload and increase the efficiency of the IT organization. Coordinating the automated assignment of virtual machines (VMs) within both the virtual and physical network fabrics, DCM ensures that proper network resources are allocated when a VM is provisioned, no matter where it is on the network. This is achieved with DCM s unique ability to automatically apply individual policies to various data objects in the switching fabric, solving the challenge of virtual machine sprawl. The use of granular policies, combined with Enterasys flowbased S-Series switching, helps users realize the goals of high availability and reliable delivery. With this approach, operational costs are lowered by providing a higher degree of automation as well as system-level management Partner Services Provided by Contractor s Authorized Partners/Resellers. Subject to Contractor s approval and the certifications held by its Partners/Resellers, many Partners/Resellers can also offer and provide some or all of the Services as listed above at competitive pricing, along with local presence and support. As the prime, Contractor is still ultimately responsible for the performance of its Partners/ Resellers. Customers can have the option to purchase the Services to be directly delivered by Contractor (OEM) or its certified Partners/Resellers. Response: Comply. Enterasys authorized partners have the capability to deliver all Professional Services listed above. Page 75 of 94 p. 78

79 WSCA-NASPO Data Communications Services Solicitation # JP Training Learning offerings for IT professionals on networking technologies, including but not limited to designing, implementing, operating, configuring, and troubleshooting network systems pertaining to items provided under the master agreement. Response: Enterasys offers a full range of training options for all proposed product category offerings. The Enterasys Technical Training program is designed to provide IT professionals the skills and understanding they need to successfully manage their Enterasys solution. By using a blended learning environment, students are involved with configuring systems that emulate real-world environments in order to reinforce the lecture portion of the class. With seasoned instructorveterans, students will be guided throughout their learning path on acquiring the skills to design, build, manage, and troubleshoot Enterasys solutions. Enterasys offers the following technical training options: Classroom Attendance via our Authorized Training Centers Students have the opportunity to attend classes at either our Enterasys offices or any of our Authorized Partner Training Centers. Our technically educated instructors will lead you through a combination of lecture and hands-on lab courses that are designed to provide students with the information that they need in order to maximize their investments in Enterasys products and solutions. For a complete list of training center locations, please visit the following link: Onsite Training Onsite training delivers personalized classes focused on the topics that are important to achieving your business objectives. Our technically educated instructors come to your facility with the equipment, expertise and courseware to provide you with a valuable learning experience. Regional Training Powered by the Enterasys Mobile Classroom, Enterasys Technical Training brings our classes on the road, providing the same level of technical hands-on experiences that students would gain at our Authorized Training Centers but in a more convenient location: Closer to You. For a complete listing of locations and scheduled classes, please visit the following link: Classroom Attendance via the Enterasys Virtual Classroom The Enterasys live Virtual Classroom offers students the opportunity to take the same courses offered at our training locations, over the Internet using their personal computer. Within these classes, students would be exposed to the same material, the same technically educated instructors and the same lab exercises that they would have been exposed to had they attended an actual training class. Technical Certifications Our networking certification program has everything you need to develop your skills to maximize the performance of your network and better meet the needs of your business. You will learn the skills to successfully deploy and manage Enterasys products in your environment. We also offer a Page 76 of 94 p. 79

80 WSCA-NASPO Data Communications Solicitation # JP14001 number of certification levels, so you can choose the correct amount of training to achieve your business goals: For more information on our Technical Training offerings, please see: ADDING PRODUCTS The ability to add new equipment and services is for the convenience and benefit of WSCA- NASPO, the Participating States, and all the Authorized Purchasers. The intent of this process is to promote one-stop shopping and convenience for the customers and equally important, to make the contract flexible in keeping up with rapid technological advances. The option to add new product or service categories and/items will expedite the delivery and implementation of new technology solutions for the benefit of the Authorized Purchasers. After the contracts are awarded, additional IT product categories and/or items may be added per the request of the Contractor, a Participating State, an Authorized Purchaser or WSCA-NASPO. Additions may be ad hoc and temporary in nature or permanent. All additions to an awarded Contractor or Manufacturer s offerings must be products, services, software, or solutions that are commercially available at the time they are added to the contract award and fall within the original scope and intent of the RFP (i.e., converged technologies, value adds to manufacturer s solution offerings, etc.). Response: Read, understood and will comply New Product from Contractors If Contractor, a Participating State, an Authorized Purchaser or WSCA-NASPO itself requests to add new product categories permanently, then all awarded Contractors (Manufacturers) will be notified of the proposed change and will have the opportunity to work with WSCA to determine applicability, introduction, etc. Any new products or services must be reviewed and approved by the WSCA-NASPO Contract Administrator. Response: Read, understood and will comply Ad Hoc Product Additions A request for an ad hoc, temporary addition of a product category/item must be submitted to WSCA-NAPOS via the governmental entity s contracting/purchasing officer. Ad hoc, temporary requests will be handled on a case-by-case basis. Response: Read, understood and will comply Pricelist Updates As part of each Contractor s ongoing updates to its pricelists throughout the contract term, Contractor can add new SKUs to its awarded product categories that may have been developed in-house or obtained through mergers, acquisitions or joint Page 77 of 94 p. 80

81 WSCA-NASPO Data Communications Services Solicitation # JP14001 ventures; provided, however, that such new SKUs fall within the Contractor s awarded product categories. Response: Read, understood and will comply. Section 6: Evaluation 6.1 General Information Proposals will be evaluated for completeness and compliance with the requirements of this RFP by a sourcing team. The sourcing team may engage additional qualified individuals during the process to assist with technical, financial, legal, or other matters. Except at the invitation of the sourcing team, no activity or comments from Offerors regarding this RFP shall be discussed with any member of the sourcing team during the evaluation process. An Offeror who contacts a member of the sourcing team in reference to this RFP may have its proposal rejected. Each proposal must be submitted in Microsoft Word or Excel, or PDF labeled and organized in a manner that is congruent with the section number, headings, requirements, and terminology used in this RFP. Proposal documents must be use Arial font size 10. All proposals must be submitted in electronic form. Response: Read, understood and comply. 6.2 Administrative Requirements Compliance The sourcing team will evaluate each proposal for compliance with administrative requirements. Non compliance with any of these requirements will render a proposal non-responsive. Only those proposals that pass the administrative requirements will be evaluated further. In order to pass the Administrative Requirements, the following must be received by due date and time associated with this RFP as listed in Bid Sync References Vendor must provide a least three current account references for which your company provides similar Data Communications services for private, state and/or large local government clients (preferably government/public entities). Offerors are required to submit Attachment B - Reference Form, for business references. The business providing the reference must submit the Reference Form directly to the State of Utah, Division of Purchasing. It is the offeror s responsibility to ensure that completed forms are received by the State of Utah Division of Purchasing on or before the proposal submission deadline for inclusion in the evaluation process. Business references not received, or not complete, may adversely affect the offeror s score in the evaluation process. The Purchasing Division reserves the right to contact any or all business references for validation of information submitted. Response: Read, understood and Comply. 6.3 Minimum Scope Requirements Compliance The sourcing team will evaluate each proposal that passed the administrative requirements for compliance with Section 5.2 Data Communications Services Requirements. Scope requirements are evaluated in terms of the breadth and depth of the offeror proposal for each of the section Scope categories. Only those proposals in each section that score 70% or better will move on to cost evaluation. Response: Read, understood and comply. Page 78 of 94 p. 81

82 WSCA-NASPO Data Communications Solicitation # JP Evaluation Criteria The following table details how each proposal shall be evaluated on a basis of 100 points. An evaluation committee comprised of representatives from some WSCA-NASPO member States will be appointed by the WSCA-NASPO Contract Administrator to perform the proposal evaluation. All Offeror s proposals will be initially reviewed for compliance with the mandatory general requirements in Section 3 and Sections stated within the RFP. Any proposal failing to meet one or more mandatory requirement(s) will be considered non-responsive and deemed unacceptable, and will be eliminated from further consideration. Those proposals deemed acceptable or potentially acceptable will be evaluated against the following proposal evaluation criteria using a point-based scoring methodology. Proposal evaluation criteria are listed in relative order of importance: Response: Read and understood Cost (bid sheets including discounts off list price attached) 30% Given that technology products generally depreciate over time and go through typical product lifecycles, it is more favorable for customers to have prime contracts be based on minimum discounts off the Offeror s commercially published pricelists versus fixed pricing. In addition, Offerors must have the ability to update and refresh their respective price books, as long as the agreed-upon discounts are fixed. Minimum guaranteed contract discounts do not preclude an Offeror and/or its authorized resellers from providing deeper or additional, incremental discounts at there sole discretion. Response: Read, understood and will comply Refurbished Equipment Many IT manufacturers offer refurbished equipment at a substantially lower cost with attractive warranties that also address risk concerns some customers may have with refurbished gear. Offerors may add an optional provision for manufacturer-certified refurbished equipment to be available for procurement under this contract. This offering will not be evaluated as part of the cost scoring process. Response: Read and understood Demonstrate ability to provide products and services within scope of the RFP (Section ) 25% Response: Read and understood Qualifications, technical ability, maintenance, training and value added services 10% Response: Read and understood Ability to supply to WSCA / NASPO member states/geographical coverage -10% Response: Read and understood Offer profile and references (i.e., financial stability, presence in marketplace, adequate staff, marketing efforts etc.) 20% Response: Read and understood. Page 79 of 94 p. 82

83 WSCA-NASPO Data Communications Services Solicitation # JP Administrative (i.e., report generating ability, e-commerce, account reps, problem resolution, customer satisfaction, website hosting and other administrative related issues) 5% Response: Read and understood. At the option of the evaluation committee the WSCA-NASPO Contract Administrator may initiate discussion(s) with Offerors who submit responsive or potentially responsive proposals for the purpose of clarifying aspects of the proposal(s), however, proposals may be evaluated without such discussion(s). Such discussion(s) is not to be initiated by Offerors. Based on the competitive range of the evaluation scores, the evaluation committee may choose to make a finalist list of offeror s; if opted for, all offeror s will be notified of their status at this juncture by the Procurement Manager. Finalist Offeror s may be required, at the option of the evaluation committee, to present their proposals and possibly demonstrate their Internet website to the evaluation committee. The Procurement Manager will schedule the time and location for each Offeror presentation. Each Offeror presentation will be of equal duration for all offeror s and may also include an additional amount of time reserved for questions/answers. The sourcing team will evaluate each proposal that has passed the administrative requirements and met or exceeded the Section 3 and Section Mandatory Requirements. Response: Read, understood and will comply. Page 80 of 94 p. 83

84 WSCA-NASPO Data Communications Solicitation # JP14001 WSCA-NASPO Data Communications Equipment and Associated Products #JP14001 Firm Name: Section Number: Evaluator: Date: Score will be assigned as follows: 0 = Failure, no response 1 = Poor, inadequate, fails to meet requirement 2 = Fair, only partially responsive 3 = Average, meets minimum requirement 4 = Above average, exceeds minimum requirement 5 = Superior 1. Demonstrated Ability to meet scope of requirements (25 points possible) Scope and Varity of products provided Experience and technical ability of manufacturer Maintenance Program Training Program Service Program Demonstrate Effective Reseller Program managed by the manufacturer in WSCA / NASPO States 2. Demonstrate Qualifications and Technical Ability (10 points possible) 8 points possible 7 points possible 2 points possible 2 points possible 2 points possible 4 points possible Score Weight (0-5) X 1.6 X 1.4 X.40 X.40 X.40 X Points Technical Staff Qualifications Maintenance Staff Qualifications Training Staff Qualifications Technical Suitability of Products 3. Demonstrate ability to supply WSCA / NASPO member States (10 points possible) 4. Company profile and references (20 points) Financial Statements and Records References, Reputation, Breadth and Depth of Offering 5. Demonstrate ability to provide administrative support (5 points 2 points possible 2 points possible 2 points possible 4 points possible 10 points possible 10 points possible 10 points possible 5 points possible X.40 X.40 X.40 X.80 X X 2 X 2 X 1 Page 81 of 94 p. 84

85 WSCA-NASPO Data Communications Services Solicitation # JP14001 possible) 6. Cost (30 points possible)* Services (10 Points) Product Offering Discount Percentage (20 points) TOTAL EVALUATION POINTS 30 points possible (100 points possible) * Inserted by Purchasing Total * Purchasing will use the following cost formula for the Services : The points assigned to each Offeror s cost proposal will be based on the lowest proposal price. The offeror with the lowest Proposed Price will receive 100% of the price points. All other Offerors will receive a portion of the total cost points based on what percentage higher their Proposed Price is than the Lowest Proposed Price. An Offeror who s Proposed Price is more than double (200%) the Lowest Proposed Price will receive no points. The formula to compute the points is: Cost Points x (2- Proposed Price/Lowest Proposed Price). Response: Read and understood. Purchasing will use the following cost formula for the Product Offering Discount Percentage : The points assigned to each Offeror s cost proposal will be based on the highest discount percentage. The Offeror with the highest discount percentage will receive 100% of the price points. All other Offerors will receive a portion of the total cost points based on what percentage lower their discount percentage is than the highest discount percentage. An Offeror who s Proposed percentage discount is less than double (200%) the highest discount percentage will receive no points. The formula to compute the points is: Cost Points x (2- Highest Proposed Discount/Proposed Discount). Response: Read and understood. Section 7: Master Agreement Terms and Conditions/Exceptions 7.1 WSCA-NASPO Master Agreement Terms and Conditions The WSCA-NASPO Contract Administrator referred to in section 2 of the WSCA- NASPO Master Agreement Terms and Conditions is Debra Gunderson, State of Utah Division of Purchasing and General Services. This RFP represents the WSCA-NASPO Contract Administrator s written approval of the modifications, waivers, alterations, amendments, and supplements to the Master Agreement Terms and Conditions made in this RFP and this Section 7. Response: Read and understood Except as limited in this section or elsewhere in this RFP, Participating Entities who execute a Participating Addendum may alter, modify, supplement, or amend the WSCA- NASPO Master Agreement Terms and Conditions as necessary to comply with Participating Entity law or policy with respect to their orders under the Master Agreement. A Contractor may not deliver Products or perform services under this Master Agreement until a Participating Addendum acceptable to the Participating Entity and Contractor is executed. The WSCA-NASPO Terms and Conditions are applicable to any order by a Participating Entity, except to the extent altered, modified, supplemented or amended by a Participating Addendum. By way of illustration and not limitation, this authority may apply to unique delivery and invoicing requirements, confidentiality requirements, defaults on orders, governing law and venue relating to orders by a Participating Entity, Indemnification, and insurance requirements. Statutory or constitutional requirements relating to availability of funds may require specific language in some Participating Addenda in order to comply with applicable law. The expectation is that these Page 82 of 94 p. 85

86 WSCA-NASPO Data Communications Solicitation # JP14001 alterations, modifications, supplements, or amendments will be addressed in the Participating Addendum or, with the consent of the Participating Entity and Contractor, may be included in the commitment voucher (e.g. purchase order or contract) used by the Participating Entity to place the order. Response: Read, understood and will comply. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer The term Purchasing Entity and Participating Entity shall both mean Participating Entity as that term is defined in WSCA-NASPO Master Agreement Terms and Conditions. Response: Read and understood With respect to section 11, Indemnification, the terms of any Participating Addendum may alter, modify, supplement, or amend the language in section 11 and may include a limitation of liability mutually agreeable to the Participating Entity and the Contractor. Response: Read and understood With regard to section 20, Participants, Participating Entities who are not states may under some circumstances sign their own Participating Addendum, subject to the approval of the Chief Procurement Official of the state where the Participating Entity is located. Contractors may upon request obtain a copy of the written authorization from the WSCA-NASPO Contract Administrator. Response: Read and understood. 7.2 Offeror Exceptions to Terms and Conditions The Lead State discourages exception s to contract terms and conditions in the RFP, attached Participating Entity terms and conditions (if any), and the WSCA-NASPO Master Agreement Terms and Conditions. As specified in this RFP, exceptions may cause a proposal to be rejected as nonresponsive when, in the sole judgment of the Lead State (and its evaluation team), the proposal appears to be conditioned on the exception or correction of what is deemed to be a deficiency or unacceptable exception would require a substantial proposal rewrite to correct. Moreover, Offerors are cautioned that award may be made on receipt of initial proposals without clarification or an opportunity for discussion, and the nature of exceptions would be evaluated. Further, the nature of exceptions will be considered in the competitive range determination if one is conducted. Exceptions will be evaluated to determine the extent to which the alternative language or approach poses unreasonable, additional risk to the state, is judged to inhibit achieving the objectives of the RFP, or Page 83 of 94 p. 86

87 WSCA-NASPO Data Communications Services Solicitation # JP14001 whose ambiguity makes evaluation difficult and a fair resolution (available to all vendors) impractical given the timeframe for the RFP. Response: Read and understood. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer The Lead State will entertain exceptions to contract terms and conditions in this RFP, including the WSCA-NASPO Master Agreement Terms and Conditions. Offerors are strongly encouraged to be judicious in identifying exceptions. Response: Read and understood Based on the market research conducted by the Lead State, the following provisions are intended to frame the contours of exceptions that may be acceptable, additional risk so long as the Offeror s exceptions are specified with sufficient particularity. Response: Read and understood The Lead State will consider Offeror standard terms for inspection and acceptance, so long as a reasonable time for acceptance is stated. However, the Participating Entities right to exercise revocation of acceptance under its Uniform Commercial Code must be preserved. Submit the standard terms with the offer and describe generally how commerciality in their use is established, e.g., identify publicly-available catalogs where the warranty terms are used and how long they have been in use. Response: Read and understood The Lead State will consider standard warranty and/or maintenance terms, but the alternative warranty and/or maintenance will be evaluated to determine whether they provide comparable protection to the warranty specified in section 30 of the WSCA- NASPO Master Agreement Terms and Conditions. Provide the terms of the warranty and maintenance in the offer. Also describe generally how commerciality is established for those terms, e.g., publicly-available catalogs the warranty terms are used and how long they have been in use. Provide one reference from a customer having comparable sales volume who is using the warranty and maintenance provisions, where the warranty term has expired, and who has exercised rights under the warranty. Response: Read and understood Intellectual property. The Lead State will consider license terms and conditions that as a minimum convey to Participating Entities a nonexclusive, irrevocable, perpetual, paid-up, royalty free license to use software or other intellectual property delivered with or inherent in the commodity or service, and to transfer the license rights to third parties for government purposes. Provide the terms of the license, including any terms that cover third party intellectual property used in the Offeror s solution. Offerors should be aware that Participating Entities using federal funds may be required to negotiate additional or different terms to satisfy minimum rights requirements of their federal grants. Response: Read and understood. Page 84 of 94 p. 87

88 WSCA-NASPO Data Communications Solicitation # JP Any limitation of liability provision including any exclusion of damages clause proposed by an Offeror to be the default limitation of liability provision under the Master Agreement must preserve a reasonable amount of direct damages for breach of contract, additionally permit the Participating Entity to recoup amounts paid for supplies or services not finally accepted (as in the case of advance or progress payments, if used), and preserve the right of the Participating Entity to be held harmless from costs of litigation as well as ultimate liability within limits agreed by the parties. Moreover, any limitation of liability clause proposed by an Offeror should be reciprocal, cover lost profits, and exclude claims or liability arising out of intellectual property infringement, bodily injury (including death), damage to tangible property, and data breach. Include the text of any such language if proposed. Further, provide contact information for a public entity, or private entity if no public entity exists, where the limitation of liability clause (or another clause substantially similar) operated to limit liability. If no such example exists, provide contact information for a state, or if no state exists, a higher education institution, or if none exists, a city or county represented by counsel in the negotiations who has agreed to the proposed terms and conditions. Response: Read and understood The enumerated examples in subsection 7.2 are not intended to limit the ability of Offerors to propose additional, reasonable exceptions. For any other exception, where the exception is based on claims of standard or normal commercial practice, provide contact information for a state, or if no state exists, a higher education institution, or if none exists, a city or county represented by counsel in the negotiations who has agreed to the proposed terms and conditions. Response: Read and understood. 7.3 WSCA-NASPO emarket Center In July 2011, WSCA-NASPO entered into a multi-year agreement with SciQuest, Inc. whereby SciQuest will provide certain electronic catalog hosting and management services to enable eligible WSCA-NASPO entity s customers to access a central online website to view and/or shop the goods and services available from existing WSCA- NASPO Cooperative Contracts. The central online website is referred to as the WSCA- NASPO emarket Center. Contractor shall either upload a hosted catalog into the emarket Center or integrate a punchout site with the emarket Center. Supplier s Interface with the emarket Center There is no cost charged by SciQuest to the Contractor for loading a hosted catalog or integrating a punchout site. At a minimum, the Contractor agrees to the following: 1. Implementation Timeline: WSCA-NASPO emarket Center Site Admin shall provide a written request to the Contractor to begin enablement process. The Contractor shall have fifteen (15) days from receipt of written request to work with WSCA- NASPO and SciQuest to set up an enablement schedule, at which time SciQuest s technical documentation shall be provided to the Contractor. The schedule will include future calls and milestone dates related to test and go live dates. The contractor shall have a total of Ninety (90) days to deliver either a (1) hosted catalog or (2) punch-out catalog, from date of receipt of written request. Page 85 of 94 p. 88

89 WSCA-NASPO Data Communications Services Solicitation # JP14001 Response: Read, understood and will comply. 2. Definition of Hosted and Punchout: WSCA-NASPO and SciQuest will work with the Contractor, to decide which of the catalog structures (either hosted or punch-out as further described below) shall be provided by the Contractor. Whether hosted or punch-out, the catalog must be strictly limited to the Contractor s awarded contract offering (e.g. products and/or services not authorized through the resulting cooperative contract should not be viewable by WSCA-NASPO Participating Entity users). a. Hosted Catalog. By providing a hosted catalog, the Contractor is providing a list of its awarded products/services and pricing in an electronic data file in a format acceptable to SciQuest, such as Tab Delimited Text files. In this scenario, the Contractor must submit updated electronic data annually to the the emarket Center for WSCA-NASPO Contract Administrator s approval to maintain the most up-to-date version of its product/service offering under the cooperative contract in the emarket Center. b. Punch-Out Catalog. By providing a punch-out catalog, the Contractor is providing its own online catalog, which must be capable of being integrated with the emarket Center as a. Standard punch-in via Commerce extensible Markup Language (cxml). In this scenario, the Contractor shall validate that its online catalog is up-to-date by providing a written update quarterly to the Contract Administrator stating they have audited the offered products/services and pricing listed on its online catalog. The site must also return detailed UNSPSC codes (as outlined in line 3) for each line item. Contractor also agrees to provide e-quote functionality to facilitate volume discounts. Response: Read, understood and will comply. Enterasys will work with WSCA-NASPO and SciQuest to provide a Hosted Catalog for the emarket Center. 3. Revising Pricing and Product Offerings: Any revisions (whether an increase or decrease) to pricing or product/service offerings (new products, altered SKUs, etc.) must be preapproved by the WSCA-NASPO Contract Administrator and shall be subject to any other applicable restrictions with respect to the frequency or amount of such revisions. However, no cooperative contract enabled in the emarket Center may include price changes on a more frequent basis than once per quarter. The following conditions apply with respect to hosted catalogs: a. Updated pricing files are required by the 1 st of the month and shall go into effect in the emarket Center on the 1 st day of the following month (i.e. file received on 1/01/14 would be effective in the emarket Center on 2/01/14). Files received after the 1 st of the month may be delayed up to a month (i.e. file received on 11/06/14 would be effect in the emarket Center on 1/01/15). b. Contract Administrator-approved price changes are not effective until implemented within the emarket Center. Errors in the Contractor s submitted pricing files will delay the implementation of the price changes in emarket Center. Response: Read, understood and will comply. 4. Supplier Network Requirements: Contractor shall join the SciQuest Supplier Network (SQSN) and shall use the SciQuest s Supplier Portal to import the Contractor s catalog and Page 86 of 94 p. 89

90 WSCA-NASPO Data Communications Solicitation # JP14001 pricing, into the SciQuest system, and view reports on catalog spend and product/pricing freshness. The Contractor can receive orders through electronic delivery (cxml) or through low-tech options such as fax. More information about the SQSN can be found at: or call the SciQuest Supplier Network Services team at Response: Read, understood and will comply. 5. Minimum Requirements: Whether the Contractor is providing a hosted catalog or a punchout catalog, the Contractor agrees to meet the following requirements: a. Catalog must contain the most current pricing, including all applicable administrative fees and/or discounts, as well as the most up-to-date product/service offering the Contractor is authorized to provide in accordance with the cooperative contract; and b. The accuracy of the catalog must be maintained by Contractor throughout the duration of the cooperative contract between the Contractor and the Contract Administrator; and c. The Catalog must include a Lead State contract identification number; and d. The Catalog must include detailed product line item descriptions; and e. The Catalog must include pictures when possible; and f. The Catalog must include any additional WSCA-NASPO and Participating Addendum requirements.* Response: Read, understood and will comply. 6. Order Acceptance Requirements: Contractor must be able to accept Purchase Orders via fax or cxml. a. The Contractor shall provide positive confirmation via phone or within 24 hours of the Contractor s receipt of the Purchase Order. If the Purchasing Order is received after 3pm EST on the day before a weekend or holiday, the Contractor must provide positive confirmation via phone or on the next business day. Response: Read, understood and will comply. 7. UNSPSC Requirements: Contractor shall support use of the United Nations Standard Product and Services Code (UNSPSC). UNSPSC versions that must be adhered to are driven by SciQuest for the suppliers and are upgraded every year. WSCA-NASPO reserves the right to migrate to future versions of the UNSPSC and the Contractor shall be required to support the migration effort. All line items, goods or services provided under the resulting statewide contract must be associated to a UNSPSC code. All line items must be identified at the most detailed UNSPSC level indicated by segment, family, class and commodity. More information about the UNSPSC is available at: and Response: Read, understood and will comply. 8. Applicability: Contractor agrees that WSCA-NASPO controls which contracts appear in the emarket Center and that WSCA-NASPO may elect at any time to remove any supplier s offering from the emarket Center. Response: Read and understood. Page 87 of 94 p. 90

91 WSCA-NASPO Data Communications Services Solicitation # JP The WSCA-NASPO Contract Administrator reserves the right to approve the pricing on the emarket Center. This catalog review right is solely for the benefit of the WSCA-NASPO Contract Administrator and Participating Entities, and the review and approval shall not waive the requirement that products and services be offered at prices (and approved fees) required by the Master Agreement. * Although suppliers in the SQSN normally submit one (1) catalog, it is possible to have multiple contracts applicable to different WSCA-NASPO Participating Entities. For example, a supplier may have different pricing for state government agencies and Board of Regents institutions. Suppliers have the ability and responsibility to submit separate contract pricing for the same catalog if applicable. The system will deliver the appropriate contract pricing to the user viewing the catalog. Several WSCA-NASPO Participating Entities currently maintain separate SciQuest emarketplaces, these Participating Entities do enable certain WSCA-NASPO Cooperative Contracts. In the event one of these entities elects to use this WSCA- NASPO Cooperative Contract (available through the emarket Center) but publish to their own emarketplace, the Contractor agrees to work in good faith with the entity and WSCA-NASPO to implement the catalog. WSCA-NASPO does not anticipate that this will require substantial additional efforts by the Contractor; however, the supplier agrees to take commercially reasonable efforts to enable such separate SciQuest catalogs. Response: Read, understood and will comply. Page 88 of 94 p. 91

92 WSCA-NASPO Data Communications Solicitation # JP14001 Attachment B Reference Form Please complete the following: Solicitation Number JP14001 WSCA-NASPO Data Communications RFP (Full Name of Company Requesting Reference) (Your Company Name) This form is being submitted to your company for completion as a business reference for the company listed above. This form is to be returned to the State of Utah, Division of Purchasing, via to teutsler@utah.gov or by fax to the attention of Tara Eutsler at , no later than, 2011, and must not be returned to the company requesting the reference. For questions or concerns regarding this form, please contact the State of Utah, Division of Purchasing, at dgundersen@utah.gov. When contacting the State, please be sure to include the solicitation number listed at the top of this page. QUESTIONS: CONFIDENTIAL INFORMATION WHEN COMPLETED Company providing reference: Contact Name and Title/Position: Contact Telephone Number: Contact Address: 1. In what capacity have you worked with this firm in the past? COMMENTS: 2. How would you rate this firm s knowledge and expertise? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 3. How would you rate this firm s flexibility relative to changes in the project scope and timelines? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 4. What is your level of satisfaction with materials produced by this firm? Page 89 of 94 p. 92

93 WSCA-NASPO Data Communications Services Solicitation # JP14001 (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 5. How would you rate the dynamics/interaction between firm and your staff? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 6. Who were the firm s principal representatives involved in your project and how would you rate them individually? Please comment on the skills, knowledge, behavior or other factors on which you based the rating? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) Principal Representative s Name: Rating: Principal Representative s Name: Rating: Principal Representative s Name: Rating: COMMENTS: 7. How satisfied are you with the manner in which the firm handled confidential, personal, and sensitive information? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 8. With what aspect(s) of this firm s services are you most satisfied? COMMENTS: 9. With which aspect(s) of this firm s services are you least satisfied? COMMENTS: 10. Would you recommend this firm s services to your organization again? COMMENTS: Response: Enterasys customers have participated and submitted Attachment B Reference Forms as required. Page 90 of 94 p. 93

94 WSCA-NASPO Data Communications Services Solicitation # JP14001 custom price Quantity SKU 1 Enterasys Service Unit PS-ESU-1 5 Enterasys Service Units PS-ESU-5 10 Enterasys Service Units PS-ESU Enterasys Service Units PS-ESU-20 Pricing includes T&E coverage for onsite engagements of three days or more. There is a one-year expiration. Hourly Rates Please note: When quoting hourly rates a minimum of 24 onsite hours is required. Onsite engagements during non standard hours will be charged at 1.5x the hourly rate. Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of proposed services offerings in each category above. Enterasys reserves the right to engage in special pricing on a case by case basis under competitive circumstances when bidding on one-time, fixed-priced projects and such pricing shall have no effect on the prices offered under this Contract. Page 94 of 94 p. 97

95 WSCA-NASPO Data Communications Solicitation # JP14001 Exception: WSCA NASPO Master Agreement Terms and Conditions Enterasys takes exception to the following language from section 15, insurance "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer. p. 98

96 p. 99 State of Utah

97 ENTERPRISE NETWORKS HOLDINGS B.V. AMSTERDAM Report on the annual accounts as of and for the year ended September 30, 2012 p. 100

98 ENTERPRISE NETWORKS HOLDINGS B.V. FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 CONTENTS Annual accounts Management report 2 Financial statements 21 Consolidated financial statements 21 Consolidated statement of financial position at September 30, 2012 and Consolidated statement of comprehensive income for the year ended September 30, 2012 and Consolidated statement of cash flows for the year ended September 30, 2012 and Consolidated statement of changes in equity for the year ended September 30, 2012 and Notes to the consolidated financial statements as of and for the year ended September 30, Company financial statements 103 Company statement of financial position at September 30, 2012 and Company income statement for the year ended September 30, 2012 and Company statement of change in equity for the year ended September 30, 2012 and Notes to the company financial statements as of and for the year ended September 30, Other information p. 101

99 Enterprise Networks Holdings B.V., Amsterdam Management Report for the fiscal year from October 1, 2011 to September 30, 2012 Overview of the 2012 Fiscal Year The business results of this fiscal year were influenced by reductions in business volume, in particular in our key markets Germany, LAM and EMPAC and by lower margins due to price erosion in the services business. The adverse global macroeconomic conditions continued to lead to weakening demand in our key markets in Europe, especially in Germany, Spain, UK, Belgium and Italy mainly hit the sales volume for the maintenance business. Reductions in sales coupled with lower margins and slightly increased marketing and selling costs lead to a lower EBITDA compared to last fiscal year. The Financial Statements for the twelve months ended September 30, 2012 have been prepared in accordance with International Financial Reporting Standards ( IFRS ) and its interpretations issued by the International Accounting Standards Board ( IASB ) as endorsed by the European Union ( EU ). The following were the key developments in our business during the 2012 fiscal year: Financial Review Total new orders of 2,119.6 million declined by 1.6% in fiscal year 2012 compared to the prior year period ( 2,154.5 million). The book-to-bill ratio slightly increased from 1.01 in fiscal year 2011 to 1.02 for the current fiscal year. Year over year revenue decreased by 2.7 % (2012: 2,076.5 million; 2011: 2,133.7 million). There was a decline in sales across all key markets in Germany, EMPAC and Latin America. North America slightly increase their revenue due to a favourable US dollar exchange rate, and Enterasys achieved a 12% improvement year on year on revenue. The Group increased its net loss in the fiscal year 2012 ( million) by 63.6 million compared to a net loss of 79.5 million in the fiscal year In the fiscal year 2012 EN Group experienced a lower gross profit, higher sales and marketing cost and considerably higher income taxes. The decline in gross profit ( million) was influenced by the decline in sales as well as a lower gross margin quality, particularly in Service. The increase in income taxes ( 34.9 million) was mainly caused by higher deferred taxes due to higher temporary differences and reductions in deferred tax assets. Net cash flows decreased from a total cash inflow of 40.1 million for the twelve months ended September 2011 to a total cash outflow of 68.7 million in fiscal year This change of million is mainly due to financing activities by the issuance of senior secured notes in 2011 with a principal value of million, whereas the financing activities in 2012 were limited to a revolving credit facility for 40.0 million. In addition, cash used by investing activities increased by 14.6 million mainly due to additional investments in capitalised software development cost. However, net cash provided by operating activities increased by 36.3 million due to reductions in net working capital. 2 p. 102

100 Our Business The Group is a leading global provider of communications-related products and services to enterprises. We provide our enterprise customers with critical communications products, such as voice telephony, UC and collaboration, mobility, video, contact center, data networking and security products, as well as cloud, professional and managed services to support and optimise these offerings. Our diverse solution portfolio, which has received third party industry recognition and awards for being best-in-class, and flexible service delivery model, support customers of all sizes, from small to medium-sized companies to the largest global corporations. Enterprise Networks Group which has its operational headquarters in Munich, Germany, integrates 65 domestic and foreign entities primarily with sales, service, and research and development activities. The research and development activities are primarily performed in Germany (Alsdorf, Munich, Paderborn and Witten), U.S.A, Canada, Greece, Brazil and Turkey whereas contract development is commissioned in various countries and with suppliers in Germany. Product manufacturing is exclusively operated by the legal entities in Leipzig, Germany and Curitiba, Brazil. As of September 30, 2012, total staff amounts to 10,569 FTEs (i.e. full time employees; September 30, 2011: 10,886). Our solution delivery model is based on our OpenPath initiative, which enables our customers to implement our products at virtually any stage of their migration to an IP-based system and overlay our products and services on virtually any existing enterprise communications infrastructure, which can extend the life and maximise the value of existing investments. These capabilities are enabled by our open standards-based, software-driven enterprise communications solutions for voice and UC. The OpenPath approach supports multiple environments and, as a result, is an attractive alternative for companies that have installed our competitors products. Our offerings are organised into three business segments: Voice and UC Applications, Network Infrastructure and Security, and Services. Specific product offerings fall into the following subcategories: Voice, Phones, UC and Collaboration, Contact Center Applications and Network Infrastructure and Security. 3 p. 103

101 Voice and Unified Communication ( UC ) Applications Our Voice and UC applications provide a complete enterprise communications portfolio of products, devices and services to support pure IP networks, TDM networks and converged hybrid IP-traditional networks using open technology standards. Our OpenScape Voice and UC have been recognised by Gartner as the leading all-ip enterprise offering. This segment has a range of offerings covering voice, devices, UC and Collaboration applications, management applications, contact center and specialty solutions for specific industries. Contact center applications allow organisations to scale customer service from 24-hour self-service touch tone or voice activated portals to live agent assistance, inbound or outbound. We offer a comprehensive portfolio that meets the entire range of customer contact application needs, focused on first contact resolution, enabling customers to improve revenue generation and customer support and to lower the cost of customer support. Our contact center solutions help companies retain, grow and increase customer loyalty. From multi-channel inbound, self-service, to outbound, our contact center solutions will transform your customer experiences. We offer a complete line of premise and cloudbased contact center solutions that are designed to increase the productivity of your workforce, improve business processes and allow you to manage your center with ease. Our Contact Center software applications integrate easily with CRM databases, are user-friendly, and provide performance monitoring tools that maximise investment in people and technology. Our contact center portfolio suits every type of organisation and customer experience - from the customer service to collections, and we have a wealth of experience in implementing world class contact centers around the globe. Network Infrastructure and Security Our Enterasys division designs, develops and markets network infrastructure and security solutions for enterprise customers. Our product portfolio includes multilayer switches, core routers, WAN routers, WLANs, wireless access points and network management and security solutions. Our security solutions include in-network access control, intrusion prevention, security information and event management. Our network solutions have built-in security features that can intelligently sense and automatically respond to application and user needs, as well as security threats to every wired and wireless connection. Based on open standards, our integrated hardware and software products share an open architecture and provide embedded security with a common management interface. Our customer base encompasses a wide range of public and private companies, medium and large enterprises, government agencies and educational institutions. Services The Group delivers a comprehensive global offering of professional, managed maintenance and installation services as well as cloud services for multi-vendor deployments through our Services framework. Our global services are an integral part of our strategy to provide communication infrastructure and application solutions focused on assisting companies in transitioning their networks to IP, and on integrating UC and contact center applications while maintaining and improving security. 4 p. 104

102 The Enterprise Communication Industry and Factors that impact our Business With the proliferation of different channels of enterprise communications, including telephone, e- mail, instant messaging, video and emerging social media, we believe that businesses are looking for ways to better integrate and more efficiently manage enterprise communications. Several key trends are redefining the industry landscape across each of our core segments: Voice and UC applications, Network Infrastructure and Security, and Services. Transition to Converged IP Networks Historically, businesses have used an IP-based network for data communications and a separate legacy telephony network for voice communications. These legacy telephony networks are based on circuit-switched technology, which uses proprietary operating systems that limit the ability to integrate communications with other business processes and applications relative to other networking technologies. Additionally, these legacy networks can be expensive to manage, maintain and scale as an organisation changes. As a result, some businesses are migrating to IP-based communications solutions that can address their voice, data and business applications requirements by leveraging their investment in a single converged network to simplify network management, enhance productivity and reduce costs. Adoption of Software-based UC Solutions The evolution to converged IP-based networks has facilitated two additional important trends: the transition from hardware-based to software-base communications solutions and the ability to deliver UC and Collaboration applications. The transition to software-based communications solutions allows for the integration of communications into other business processes and applications, which provides operational cost benefits. A software-based approach can provide customers with the flexibility to implement these solutions either at their own office premises or data center, or as a hosted or cloudbased service. Regardless of the implementation method, the result is a more centralised and vastly smaller, less-complex network infrastructure than a traditional distributed voice network. This streamlined approach could reduce an enterprise s cost of running its business because less equipment is required to acquire, finance, house, maintain and manage the business. Growth in Network Infrastructure and Security Growth in the Network Infrastructure and Security segment of the enterprise communications industry is being driven by a range of factors, including bandwidth demands, mobility and BYOD (Bring Your Own Device) within the enterprise and increasing security threats. A rapid rise in enterprise IP traffic is projected due to factors that include high bandwidth in new applications such as SaaS (Software as a Service), high performance computing, video, data center virtualisation, mobility, social networking and increased overall Internet traffic. As wireless technology becomes more reliable and can support higher bandwidth applications, enterprises will deploy more business-critical applications over their wireless networks, and therefore continue to invest in their enterprise s mobile infrastructure. To counter increasing and evolving security threats, enterprise must deploy network infrastructure tools with integrated capabilities that provide network security across the enterprise. 5 p. 105

103 Growth in Services As communications networks converge and transition to new technology and adoption of a host of UC applications continues across diverse platforms, the complexity of integration with existing systems could present a growing opportunity for professional services, such as consulting, design and integration services. In addition, the need to adopt these technologies cost effectively while maintaining high operational quality and availability could help drive the rapidly growing demand for managed services. Our addressable services market can be broken down into the following principal categories: professional services, managed services (including hosting), maintenance and installation services for enterprise networks (voice and data) and applications. Enterprise Communication Market Conditions in the 2012 Fiscal Year and Expectations for the Future Current assessments by independent market observers for the enterprise communications markets indicate that the economic environment will slightly improve in Gartner s 2012 IT spending growth forecast has been reduced to 5.4% down from 5.9% in constant dollar terms. (Source: Gartner: Forecast Alert: IT Spending Forecast, 3Q12 Update Dated September 28, 2012). The assessment is based on a largely unchanged macroeconomic environment from last quarter. The volume of the addressable enterprise market which is comprised of voice applications, network infrastructure solutions and corresponding support and professional services is expected to be USD 151 billion on a worldwide basis for calendar year 2012, with an expected annual growth rate of 3.9% between 2012 and For the Group s major regional markets, management expects the following developments: In Germany, where the Group is the market leader, a market growth of 2.3% is expected (therein: V&A 2.3%, NIS -0.1%, and Services 3.3%). In Europe, where the Group is the market leader, a market growth of 2.4% is expected (therein: V&A 4.1%, NIS -0.2%, and Services 2.9%). The addressable market in Latin America, where the Group is the market leader, has an expected 11.7% growth rate (therein: V&A 4.8%, NIS 8.5%, and Services 16.2%). The North American and Asian markets, where the Group has a limited market share, have an expected growth rate of 3.9% (therein: V&A 3.7%, NIS 2.3%, and Services 4.9%). The market is significantly impacted by strong price competition both at the international and national level. This is in part due to changed market conditions. As a result of the convergence of telecommunications and IT, new competitors like Microsoft are forcing their way into the market, and a transformation from a proprietary hardware business to a software and services business is taking place. EN management is convinced that its Voice & Application and web collaboration business has a clear competitive edge in this changing market. 6 p. 106

104 Position as a Leader in 2012 Magic Quadrant for Unified Communications In August 2012, Gartner has named Enterprise Networks Group as a Leader in the 2012 Magic Quadrant for Unified Communications (UC). This assessment is based on the Company s completeness of vision and ability to execute. Gartner judges a company s completeness of vision based on the current and future market direction, innovation, customer needs, and competitive forces, and how well these map to Gartner s overall evaluation of the market. Ability to execute is judged based on the quality, efficacy, and overall maturity of the products, systems, tools and procedures that enhance individual, group, and enterprise communications. According to Gartner, vendors in the Leader s quadrant have a full UC offering, strong market presence and demonstrate success in the field. They have a strong presence in related markets to expand their footprint in UC. These vendors, and their channel partners, have experience delivering UC to a broad range of enterprise types and into most geographic regions. Management identifies the following competitive advantages in the Group s UC approach: Proven, mature software-based architecture, meaning highly reliable, highly scalable solutions. Extensive capabilities to build, operate and integrate meaning we really can provide customers with the easiest path to UC. The most flexible deployment options which means that whatever the customer situation, we can usually work to support them. Innovative and compelling UC roadmap which means that customers can fully understand how their teams can collaborate now and in the future and know that we will be an innovative partner to support and guide them. New Product and Technology Developments Enterprise Networks Group continues to invest (5.7 % of revenue; 2011: 6.5%) in research and development related to delivering world class communications solutions to business enterprises large and small. In the past year, we have delivered new products and enhancements across our broad portfolio including data networking solutions (switching, routers, wireless and management), unified communications (pure and converged Voice over IP systems and desktop, wireless and mobile devices), collaboration applications (web collaboration, contact center, voice and video conferencing), secure cloud solutions, and a range of specialised vertical solutions. Highlights of our recent product announcements include: Secure Cloud Services: Enterprise Networks Group opened a new market opportunity for the Group by introducing the industry s first cloud-based voice and UC solution: Public cloud-based voice and UC available through our channel partners provide a pay as you go model for enterprises, with ease of set up and instant scalability for their voice and UC services. 7 p. 107

105 Unified Communications: A continued expansion of our award-winning next generation softwarebased, pure IP communications solutions, including: Launch of our new mid-market solution OpenScape Xpress, a modular, packaged pure IP solution aimed at the line enterprise. Launch of OpenScape Office V3, our updated SMB pure IP solution now with multi-site and virtualisation capabilities to reduce costs and increase scalability. Significantly improved end-to-end voice over IP quality with the launch of HD Audio Presence technology becoming the only vendor in the market to have this rich feature quality across our full range of desktop devices and conferencing servers. Collaboration Applications: Significantly broadening our portfolio of enterprise grade collaboration solutions including: The introduction and integration of OpenScape Web Collaboration delivering the industry s most secure desktop sharing with video conferencing capabilities. The introduction of the industry s first software-based video conferencing server (multipoint control unit) delivering HD video conferencing to the enterprise desktop without the need for costly hardware based controllers. The introduction of the industry s first mobile client to enable users to seamlessly transfer calls from their mobile device to desktop to home phone with a simple swipe gesture on their touch screen of their mobile device. Data Networks: A continued drive to lowering the TCO (Total Cost of Ownership) of secure data networks through integration, automation and control including: Introduction of an industry leading integration of wired and wireless network management systems, reducing the costs of support while improving cross network visibility and control. Introduction of our Fabric Based Network Solution driving lower costs and greater flexibility in the data center, enabling growing demands for digital storage and reliable and secure mobile application deployments. As of September 30, 2012, approximately 1,404 employees (September 30, 2011: 1,345) were employed to perform research and development for the Group. 8 p. 108

106 Results of Operations The following table presents the various lines of our Consolidated Statement of Income for the fiscal years 2012 and 2011 and expressed as percentages of revenue. In thousands of For the years ended September 30, Percentages of revenue as of September 30, Change Revenue 2,076,529 2,133,654 (2.7%) Cost of goods sold (1,379,329) (1,398,230) (1.4%) (66.4%) (65.5%) Gross profit 697, ,424 (5.2%) 33.6% 34.5% Research and development expenses (119,134) (139,954) (14.9%) (5.7%) (6.5%) Marketing, selling and general administration expenses (705,809) (685,290) 3.0% (34.0%) (32.1%) Other gains 21,011 6, % Other losses (5,371) (4,436) 21.1% Finance income (losses), net (2,328) 1,849 (225.9%) Income tax benefit (expenses) (28,666) 6,245 (559.0%) Net loss (143,097) (79,461) (80.1%) Revenue and Gross Profit Revenue primarily consists of sales of our hardware and software and associated services such as installation and maintenance, and of managed services, professional services and solutions. Revenue in fiscal year 2012 was 2,076.5 million compared to 2,133.7 million in fiscal year The following factors contributed to the revenue reduction of 57.2 million (2.7%): Weakening demand in European key markets such as Germany, Spain, UK, Belgium and Italy and also in Latin America. Decrease of the installed base in maintenance and rental contracts. Erosion in maintenance and managed service businesses. Gross profit for fiscal year 2012 was million (33.6% of revenues) compared to million (34.5%) in fiscal year The decrease in gross profit of 38.2 million reflects the decrease in revenue as well as in gross margin quality. The reason for the reduction in gross margin from 34.5% in 2011 to 33.6% for the twelve months ended September 2012 was the decline in the price level, mainly in service businesses. 9 p. 109

107 Research and development ( R&D ) expenses R&D expenses consist primarily of salaries and related personnel expenses, consultant fees and prototype expenses related to the design, development, and testing of our products. R&D expenses were million (5.7% of revenues) compared to million (6.6% of revenues) in the prior year. The reduction in R&D expenses of 20.9 million reflects higher software capitalisation and lower restructuring cost. Marketing, selling and general administration ( MSGA ) MSGA consist of expenses derived from selling and promoting our products and services and expenses incurred to manage the business such as professional services, marketing, IT, general management, administrative, and corporate expenses. MSGA expenses for the fiscal year 2011 were million (34.0% of revenues) compared to million (32.1% of revenues) in the prior year. The increase in MSGA of 20.5 million was caused by the following main reasons: high one off cost for consultants, legal fees and IT performance rebranding cost cost contribution payments to Siemens for services in regard of the Siemens trademark negative impact of the US dollar exchange rate Other Gains and Losses Other gains in fiscal year 2012 increased by 14.3 million compared to prior year mainly due to the release of provisions for anniversary awards and the realisation of a tax indemnity. Other losses increased in fiscal year 2012 by 0.9 million compared to the same period in the prior year. Financial Income and Expense In fiscal year 2012 financial income dropped by 4.2 million compared to fiscal year The decrease was mainly due to the reduction in interest income from finance leases. 10 p. 110

108 Income Taxes Net income tax expense in fiscal year 2012 was 28.7 million consisting of 11.8 million relating to deferred tax expense and 16.9 million of current tax expense. This compares to a net income tax benefit in 2011 of 6.2 million consisting of 15.6 million relating to deferred tax benefit and 9.4 million of current tax expense. Deferred tax expenses mostly relate to temporary differences and the reduction of deferred tax assets. Financial Position As of September 30, In thousands of Change Non-current assets 635, ,371 (2.5%) Current assets 881,823 1,011,630 (12.8%) Total assets 1,517,565 1,664,001 (8.8%) Non-current liabilities 442, , % Current liabilities 686, ,151 (10.0%) Total liabilities 1,128,910 1,116, % Total equity 388, ,225 (29.0%) Total equity and liabilities 1,517,565 1,664,001 (8.8%) Current assets include significant items such as trade receivables ( million) and inventories ( million). Total non-current assets ( million) include predominantly other intangible assets of million (thereof mainly patents, licenses and other similar rights ( million)), sales and lease receivables ( million), tangible fixed assets ( 90.4 million), goodwill mainly related to Enterasys ( million) and deferred tax assets ( 48.5 million). Current liabilities ( million) consist primarily of trade payables ( million), other current liabilities ( million) and current provisions ( 34.4 million). Other current liabilities include mainly payroll and payroll related expenses ( 48.9 million), deferred income ( 71.9 million), other employee-related accruals ( 40.8 million) and advance payments received ( 30.4 million). Noncurrent liabilities ( million) include apart from long-term debt ( million) primarily liabilities arising from pension plans and other commitments ( million), deferred tax liabilities of 40.6 million and other liabilities ( 33.1 million, therein mainly employee related costs at 6.9 million and deferred income of 14.7 million). See Notes to Consolidated Financial Statements as of September 30, 2012 for additional information on assets and liabilities as well as the Group s profit and loss situation. 11 p. 111

109 Liquidity In thousands of For the years ended September 30, Change absolute % Net cash provided by (used in) operating activities 16,639 (19,658) 36,297 (184.6%) Net cash (used in) investing activities (92,711) (78,148) (14,563) 18.6% Net cash provided by financing activities 2, ,006 (140,753) (98.4%) Effect of exchange rates on cash and cash equivalents 5,097 (5,124) 10,221 (199.5%) Net increase (decrease) in cash and cash equivalents (68,722) 40,076 (108,798) (271.5%) Cash and cash equivalents at end of period 177, ,300 (68,722) (27.9%) Cash Flow Used in Operating Activities Cash flows from operating activities improved on a year over year basis ( 36.3 million) mainly due to reductions in net working capital, in particular through changes in trade and other receivables ( 30.4 million; 144,5%). Cash Flow Used in Investing Activities Total cash outflow from investing activities increased from a year over year perspective at 14.6 million. Most prominently, in fiscal year 2012 the Group had more additions of capitalised software development cost ( 24.9 million) and more additions of patents and licenses ( 4.9 million) than in previous fiscal year. This cash outflow effect was partly offset by the fact that the Group had not acquired any further investments in fiscal year 2012 whereas it had spent a total of 21.8 million (FastViewer 5.0 million and incontact 16.8 million) in fiscal year Cash Flow Used in Financing Activities In fiscal year 2012 the Group generated million less cash inflows from financing activities compared to fiscal year Whereas the Group received million of proceeds from the issuance of senior secured notes, net of transactions costs, only a 40.0 million loan facility was drawn in fiscal year Employees The Group s workforce fell by 2.9% from 10,886 as of September 30, 2011 down to 10,569 as of September 30, p. 112

110 Segment information Selected segment data for the fiscal years ended September 30, 2012 and 2011 are as follows: In thousands of Net sales: For the years ended September 30, Change absolute % Voice & Applications 674, ,315 (18,140) (2.6%) Services 1,008,047 1,067,824 (59,777) (5.6%) Network Infrastructure & Security 277, ,725 24, % Other Operating Segments 116, ,790 (3,915) (3.2%) Total net sales 2,076,529 2,133,654 (57,125) (2.7%) Segment revenue reported above represents revenue generated from external customers. There were no inter-segment sales in the current fiscal or any previous year. No single customer contributed 10% or more to the Group s revenue for the fiscal years ended September 30, 2012 and In thousands of Gross profit: For the years ended September 30, Change absolute % Voice & Applications 253, ,133 (4,064) (1.6%) Services 293, ,233 (40,164) (12.1%) Network Infrastructure & Security 151, ,171 13, % Other Operating Segments (254) 6,887 (7,141) (103.7%) Total gross profit 697, ,424 (38,224) (5.2%) Geographical information The following is a summary of net sales by geographic area: In thousands of Net sales: For the years ended September 30, Change absolute % Germany 883, ,386 (16,642) (1.8%) EMPAC* 578, ,092 (42,452) (6.8%) LAM (Latin America) 230, ,090 (22,707) (9.0%) NAM (North America) 383, ,086 24, % Total net sales 2,076,529 2,133,654 (57,125) (2.7%) * EMPAC includes two subregions both EMEA (i.e. Europe without Germany and Middle East) and APAC (i.e. Asia Pacific) which are reported as an unity since business responsibility lies with one executive manager. 13 p. 113

111 Corporate Responsibility Corporate Social Responsibility (CSR) Corporate social responsibility means the voluntary contribution of a company to a sustainable development of its business which goes beyond any legal requirements (compliance). It is a synonym for responsible entrepreneurial behaviour which management is expected to adopt at both managing the operational business, at considering ecological aspects, at managing relations with its employees and its interactions with stakeholders. To foster a sound CSR management EN Group established an organisational body in April 2010 whose working principles are set to be in line with standard ISO This is an international standard providing guidelines for social responsibility released by the International Organisation for Standardisation (ISO). The standard offers guidance on socially responsible behaviour and possible actions. However it does not contain requirements and therefore, in contrast to ISO management system standards, is not certifiable. CSR management at EN Group intends to set up a CSR report defining a Group-wide standard applicable for all EN entities with reference to the following aspects: code of conduct, employees, health, society and environment. To name a few examples: CSR management is going to elaborate a standard code of conduct applicable for all EN employees and minimum requirements as to how our suppliers are expected to do socially sound business. Secondly, a platform for best practice sharing is being elaborated. Our management supports CSR as the public perception of an organisation s social responsibility performance may have an impact on EN s competitive advantage, its reputation, its ability to attract and retain workers and customers, the maintenance of employees morale, commitment and productivity, the appraisal by investors, by the financial community and external sponsors and finally EN s relationship with competitors and suppliers, government authorities and media. Corporate Governance The Company is registered as a private limited liability company in the Netherlands (besloten vennootschap: B.V.) and has a one tier management board. The Articles of Association do not provide for a supervisory board. The management board consists of three members (managing directors A) nominated by Gores and two representatives (managing directors B) nominated by Siemens AG. The policy governing the general affairs of the Company are determined by the board of managing directors. The managing directors A are charged with the day-to-day affairs of the Company, the managing directors B are charged with the monitoring of the day-to-day affairs of the Company. The Chairman of the management board is a managing director A and is appointed by the managing directors A. Each managing director has one vote. With the exception of decisions requiring unanimous approval, which is defined by a majority of the general meeting of shareholders, the board of managing directors decides by a simple majority of votes cast, provided that no decision shall be passed without the approval of at least one managing director A. In the event of a tie, the proposal will be rejected. 14 p. 114

112 The Senior Executive Team responsibilities on a global basis are: Top Executives CEO - overall responsibility for EN Group CFO - responsible for all financial matters Executive Directors Service Voice & Applications Network Infrastructure and Security Managing Directors for the Regions Germany Europe / Middle East / Asia North America South America Business Support Units Finance Supply Chain Human Resources Legal Marketing The Senior Executive Team of Enterprise Networks Group is supported in Corporate Governance topics by: - Internal Audit - Compliance Office - Data and Security Offices - Corporate Social Responsibility Department - Internal Control Officer Risk Management The Group has implemented risk evaluation and mitigation processes. The Senior Executive Team is required to quarterly evaluate and report all known risks within their area of responsibility. The consolidated risk management is reviewed by the Top Executives and the mitigations are monitored respectively. Risks of the Future Development of the Business Global Economic Conditions The Group operates still in a low-growth economic environment, evidenced by market volatility, reduced consumer confidence and diminished liquidity and credit availability. Continued concerns about the duration and severity of these economic conditions have led many of EN s existing and potential customers to curtail capital expenditures, including those related to information technology and communications. The development in the Euro area is still subject to close monitoring. 15 p. 115

113 Competition and Market Consolidation The trend toward industry consolidation in the Group s markets goes on. Companies that are strategic alliance partners in some areas of EN s business may acquire or form alliances with our competitors, thereby reducing their business with the Group. Management believes that industry consolidation may result in stronger competitors that are better able to compete as sole-source vendors for customers. This could lead to more variability in our operating results and could have a material adverse effect on our business, operating results, and financial condition. Furthermore, particularly in the service provider market, rapid consolidation will lead to fewer customers, with the effect that loss of a major customer could have a material impact on results not anticipated in a customer marketplace composed of more numerous participants. In order to reduce financial risks, in particular, volume and price risks, the Group engages in active portfolio management. New products and services are developed and existing products and services are adapted or eliminated. This process is aimed at achieving greater customer loyalty. In addition, we intend to invest continuously in the development of new technologies in order to meet the constantly changing technological demands of the market participants. The ongoing global economic crisis provided additional market risks attributable to the postponement or even the cancellation of orders. There were no significant concentrations of market risk as of September 30, Risk from reliance on core customers The Group s business is still dependent on a number of core customers and multi-year contracts. Unfavourable developments under such contracts or in relation to a major customer may adversely and materially affect sales, results of operations and financial position. Risks from the processing of orders The communications product and service business can be exposed to quality risks, the risks of cost overruns or contractual penalties attributable to unexpected technical problems, unforeseeable developments at the project locations, performance fulfilment problems at subcontractors or other logistical difficulties. Moreover, components, input materials, and services are procured in part from outside suppliers, and supply bottlenecks could arise in the event of delays within the supply chain or, in the case of components sourced from a single or limited number of suppliers, from any events which might interrupt those sources of supply. Management seeks to mitigate these risks by improving order forecasting, logistics and supply chain management processes. Staffing risks Facing a technological changeover in favour of IP-based communication technology, the Group is dependent on highly qualified and specialised staff with profound knowledge of IT, especially in the development and sales areas. In order to remain competitive in the future, management believes that modification of the existing staff qualifications associated with the identified risks will be necessary. However, the ability to hire new staff is limited given the overall need for tight personnel cost management. 16 p. 116

114 Cost Control and Cost Saving Initiative. The Group has implemented multiple strategic and other initiatives designed to improve operating performance, grow EN s business and generate savings and improvement in the results of operations. The Business Transformation program is in place and management continues to consider the implementation of additional initiatives, including a possible relocation of certain of our employees in research and development to facilities in countries in which the cost of production is lower than in the countries of our existing locations. The aim is to become industry best practice in operational processes and cost management. Information technology risks Operations and administration processes rely on complex and centralised information technology systems and networks. This reliance could have an adverse impact on our business and results of operations for a short period of time. Risk from changes in regulations Changes in various types of regulation and trade policies in countries around the world could have an adverse effect on the Group s business. Financial Risks Foreign currency exchange rate risk Transaction risk and foreign currency management The Group is exposed to foreign currency exchange risks. Foreign currency fluctuations may affect EN s revenue and costs of goods sold and services provided, and other expenses, and significantly affect operating results. The majority of the Group s revenue and expenses are denominated in Euros, but EN also earns revenue and incurs expenses and satisfies the payment of obligations in other currencies, primarily the British Pound, U.S. Dollar and Brazilian Real. As a result, the Group bears the risk that fluctuations in the exchange rates of these currencies in relation to each other could decrease total revenue, increase costs of goods sold and services provided, and other expenses, and as a result have a negative effect on future operating results. The Group employs various strategies involving the use of derivative financial instruments to mitigate certain foreign currency exposure. In particular, by executing most types of business transactions (sales and procurement of products and services as well as investment and financing activities) mainly in the functional currency. In addition, foreign currency exposure is, in part, balanced by purchasing of goods, commodities and services in the respective currencies as well as production activities and other contributions along the value chain in the local markets. Financing transactions or investments by operating units are preferably done in their functional currency or on a hedged basis. 17 p. 117

115 Each Group entity is responsible for recording, assessing, monitoring, reporting and hedging its foreign currency transaction exposure under the supervision of the central treasury function. Some Group entities hedge with Enterprise Communications Funding GmbH in order to minimise the foreign currency risks and Enterprise Communications Funding GmbH will hedge externally if it is considered appropriate. Effects of currency translation Many subsidiaries are located outside the Euro zone. Since the financial reporting currency of the Group is the Euro, the financial statements of these subsidiaries are translated into Euros during consolidation. In order to determine the total impact of foreign exchange translation risk, investments in foreign based operations are permanent and continuously reinvested. Liquidity risk Liquidity risk results from the Group s potential inability to meet its financial liabilities, e.g. settlement of its financial debt, payment of suppliers and settlement of finance lease obligations. The Group has implemented liquidity forecasts and performs net working capital management on a frequent basis. In 2012 the Group had significant cash outflows mainly due to operating losses. Based on the Group s current sources of liquidity, management believes EN has sufficient working capital and sources of liquidity to finance operating activities and budgeted capital expenditures for the next 12 months. The Group s mid-term ability to finance operations, capital expenditures, and other cash needs, and execute on growth strategy will depend primarily on EN s ability to attain positive cash flow and profitability through the restructuring efforts and on its ability to raise new credit. Risks regarding Senior Secured Notes and Revolving Credit Facility The Group issued senior secured notes of million in 2010 and entered into a revolving credit facility in November In June 2012 EN Group used the revolving credit facility. The indenture with respect to the senior secured notes and the credit agreement with regard to the revolving credit facility imply some risks for the future development of the Group and the Group companies: Debt Service Risk The existing financing creates significant debt service obligations for the Group, which might make it more difficult for the Group to satisfy existing and future debt obligations. In addition, the dedication of a substantial portion of the Group s cash flow from operations to the payment of debt service costs limits funds available for the Group s future operations, product development, capital expenditures and other corporate purposes. Interest Rate Risk The borrowings under the revolving credit facility would bear interest at a variable rate that is based on LIBOR or EURIBOR respectively plus an agreed margin and certain additional costs. Fluctuations in LIBOR or EURIBOR or the occurrence of a market disruption event could increase the Group s overall interest burden, reduce cash flow available for capital expenditures and have a material adverse effect on the Group s ability to service its debt obligations. 18 p. 118

116 Covenant Compliance Risk The Group s revolving credit facility and the indenture governing the senior secured notes each contain covenants that impose significant restrictions on the way the Group operates. These covenants could limit the Group s ability to finance future operations and capital needs and its ability to pursue acquisitions and other business activities. In addition, the Group s revolving credit facility requires the Group to maintain certain financial ratios, to satisfy specified financial tests and to comply with other terms that are customary for comparable financings. A breach of covenants constitutes an event of default and could cause the lenders to terminate their commitments and declare all amounts owed to them to be due and payable. Credit risk The Group is exposed to credit and default risk, especially in connection with its project business, where direct or indirect financing may be provided to customers, and with our leasing activities. Management seeks to mitigate these risks through active receivables management and valuation processes and by a defined procedure to monitor customer credit compliance at the contract procurement stage. Customers are classified based on possible default risks and decisions are made based on this classification prior to the conclusion of orders. Management expects that new customer contracts requiring financing will in future be primarily financed by financial institutions thereby eliminating the credit risk for us for these new contracts. However, management may also be obliged in certain circumstances to provide customer financing or extended payment terms to customers which could have a material adverse effect on our results of operations and financial condition. The effective monitoring and controlling of credit risk is part of the Group s risk management system. Credit evaluations and ratings are performed for all customers on an individual basis. Customer ratings and individual customer limits are based on generally accepted rating methodologies, input from external rating agencies and the Group s default experiences. Ratings and credit limits are considered in determining the conditions under which financing might still be offered on a case by case basis to customers. For further information on the Group s Financial Risks refer to Note 29 of the Consolidated Financial Statements. Subsequent events Management has not identified any material subsequent event after the reporting date. 19 p. 119

117 Business and Financial Outlook In the upcoming years, the market conditions for EN Group are expected to remain challenging. While demand in legacy markets will further decline according to independent market research, high competition among the players will put further pressure on prices. Facing these conditions, EN will intensify its efforts to improve gross profits and to further reduce costs. The Group s management has committed itself to an ambitious 3-year business plan that is underpinned by sustainable improvement measures, particularly focussing on higher sales effectiveness, improved pricing, enhanced contract management (e.g. automation) and on workforce reduction throughout the entire Group. The streamlined organisation is planned to reach its full growth and profitability potential from fiscal year 2014 on. Despite the impact of restructuring expenses, investments in sales capabilities and increased cost of labour, a noticeable improvement of revenue and gross profit is expected for fiscal year 2013 already. The execution of the measures has become a top management priority across all regions and all functions. Executive compensation is strongly linked to the achievement of financial targets imposed by the plan. Amsterdam, December 17, 2012 The Management Board Mark Stone Steven Yager Saad Hassan Hammad Karl-Heinz Seibert Nathalie von Siemens 20 p. 120

118 Enterprise Networks Holdings B.V. Consolidated Statement of Financial Position as of September 30, 2012 and September 30, 2011 (in thousand of ) Note September 30, 2012 September 30, 2011 Assets Non-Current Assets Goodwill ,898 98,786 Other intangible assets , ,733 Property, plant and equipment 17 90, ,762 Other financial assets , ,552 Deferred tax assets 11 48,531 22,985 Other assets 21,894 33,553 Total non-current assets 635, ,371 Current Assets Cash and cash equivalents 177, ,300 Trade and other receivables , ,233 Other current financial assets 13 39,712 34,697 Inventories , ,107 Income tax receivables 19,616 21,085 Other current assets 15 54,479 56,208 Total current assets 881,823 1,011,630 Total assets 1,517,565 1,664,001 Equity and liabilities Equity Share capital Share premium 514, ,852 Retained earnings (50,677) 92,601 Income and expense recognised directly in equity (76,415) (61,136) Equity attributable to owners of the Company 387, ,417 Non-controlling interests Total equity 388, ,225 Non-Current liabilities Long-term debt , ,751 Pension plans and similar commitments ,309 95,939 Deferred tax liabilities 11 40,594 12,560 Provisions 23 8,537 7,446 Other financial liabilities 1,793 7,104 Other liabilities 24 33,072 34,825 Total non-current liabilities 442, ,625 Current liabilities Short-term debt 21 63,827 45,432 Trade payables 288, ,206 Other current financial liabilities 19 20,686 34,378 Current provisions 23 34,411 51,986 Income tax payables 16,951 14,934 Other current liabilities , ,215 Total current liabilities 686, ,151 Total liabilities 1,128,910 1,116,776 Total equity and liabilities 1,517,565 1,664, p. 121

119 Enterprise Networks Holdings B.V. Consolidated statement of comprehensive income for the year ended September 30, 2012 and 2011 (in thousands of ) Year ended Note September 30, 2012 September 30, 2011 Revenue 7 2,076,529 2,133,654 Cost of goods sold and services rendered (1,379,329) (1,398,230) Gross profit 697, ,424 Research and development expenses (119,134) (139,954) Marketing, selling and general administrative expenses (705,809) (685,290) Other gains 8 21,011 6,701 Other losses 8 (5,371) (4,436) Finance income, net 10 (2,328) 1,849 Loss before income taxes (114,431) (85,706) Income taxes 11 (28,666) 6,245 Net loss for the period (143,097) (79,461) Attributable to : Owners of the Company (143,252) (79,619) Non-controlling interests Other comprehensive income (loss) Exchange differences arising on translation 5,017 (15,936) of foreign operations Financial instruments available-for-sale 17,842 (3,184) Cash flow hedges (420) 153 Actuarial gains and losses from defined benefit obligations (45,544) 18,850 Deferred taxes on income and expense recognised directly in equity 7,826 (5,071) Other comprehensive income (loss) for the period (net of tax) (15,279) (5,188) Total comprehensive income (loss) for the period (158,376) (84,649) Attributable to : Owners of the Company (158,531) (84,807) Non-controlling interests p

120 Enterprise Networks Holdings B.V. Consolidated Statement of Cash Flows for the year ended September 30, 2012 and 2011 (in thousands of ) October 1, September 30, 2012 October 1, September 30, 2011 Note Cash flows from operating activities Net loss (143,097) (79,461) Amortisation, depreciation and impairments 103, ,037 Income taxes 11 28,666 (6,245) Interest income (expense), net 10 7,555 2,091 Gain on sales and disposals of businesses, intangibles and property, plant and equipment, net (2,514) (3,468) Other non-cash income (expense) (6,730) 1,853 Decrease in inventories 19,068 23,240 Decrease in trade and other receivables 51,448 21,042 Increase in other current assets (2,334) (9,245) Increase (decrease) in trade payables (8,471) (226) Change in other current provisions and liabilities (88,466) (100,397) Change in other assets and liabilities 44,628 (2,639) Income taxes paid (10,522) (9,976) Dividends received 1,499 2,335 Interest received 22,655 28,401 Net cash provided by (used in) operating activities 16,639 (19,658) Cash flows from investing activities Additions to intangible assets and property, plant and equipment (100,749) (71,051) Purchases of investments (12) (17,417) Proceeds from disposals of businesses and sales of investments, intangibles and property, plant and equipment 9,925 15,320 Acquisition of subsidiaries, net of cash acquired (1,875) (5,000) Net cash provided by (used in) investing activities (92,711) (78,148) Cash flows from financing activities Proceeds from issuance and sale of senior secured notes, net of transaction cost 7, ,645 Proceeds from drawing of revolving credit facility 40,000 - Proceeds from issuance of long-term debt 11,669 - Repurchase of senior secured notes (31,429) (12,093) Repayment of short-term loans (11,384) (8,434) Changes in finance lease obligations and other financing activities 11,545 8,632 Dividends paid to non-controlling interest (158) - Interest paid (25,638) (22,744) Net cash provided by (used in) financing activities 2, ,006 Effect of exchange rates on cash and cash equivalents 5,097 (5,124) Net increase (decrease) in cash and cash equivalents (68,722) 40,076 Cash and cash equivalents at beginning of period 246, ,224 Cash and cash equivalents at end of period 177, ,300 p

121 p. 124 Enterprise Networks Holdings B.V. Consolidated Statement of Changes in Equity for the fiscal year 2012 and 2011 (in thousands of ) Share capital Share premium Retained earnings Income and expense recognised directly in equity Ordinary shares Preference shares Financial instruments available-for-sale Cashflow hedges Actuarial gains and losses Currency translation differences Balance at September 30, , , ,480 1,246 (78) (73,635) 16, , , ,852 (55,949) Non-controlling interest arising from settlement of Cycos litigation (260) (260) 76 (184) Change in fair value of financial instruments available for sale - - (3,184) (3,184) - (3,184) Change in fair value of financial instruments used for cashflow hedges Actuarial gains and losses from defined benefit obligations ,850-18,850-18,850 Currency translation differences (15,936) (15,936) - (15,936) Deferred taxes on income and expense recognised directly in equity (52) (5,903) - (5,071) - (5,071) Other comprehensive income (loss) for the period - (2,300) ,947 (15,936) (5,188) - (5,188) Net loss - (79,619) (79,619) 158 (79,461) Total comprehensive income (loss) for the period - (79,619) (2,300) ,947 (15,936) (84,807) 158 (84,649) Balance at September 30, , ,000 92,601 (1,054) 23 (60,688) , , ,852 (61,136) Balance at September 30, , ,000 92,601 (1,054) 23 (60,688) , , ,852 (61,136) Dividends paid to non-controlling interest *) - (26) (26) (168) (194) Change in fair value of financial instruments available for sale , ,842-17,842 Change in fair value of financial instruments used for cashflow hedges (420) - - (420) - (420) Actuarial gains and losses from defined benefit obligations (45,544) - (45,544) - (45,544) Currency translation differences ,017 5,017-5,017 Deferred taxes on income and expense recognised directly in equity - - (7,016) ,698-7,826-7,826 Other comprehensive income (loss) for the period ,826 (276) (30,846) 5,017 (15,279) - (15,279) Net loss - (143,252) (143,252) 155 (143,097) Total comprehensive income (loss) for the period - (143,252) 10,826 (276) (30,846) 5,017 (158,531) 155 (158,376) Balance at September 30, , ,000 *) 0,39 per share (Cycos AG) 514,852 (50,677) 9,772 (253) (91,534) 5, (76,415) Attributable to owners of the parent Non-controlling interests Total equity 387, ,655 State of Utah

122 N O T E S to the Enterprise Networks Holdings B.V. Consolidated financial statements as of and for the year ended September 30, 2012 in accordance with International Financial Reporting Standards as endorsed by the EU ( IFRS ) 25 p. 125

123 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 CONTENTS 1. Basis of presentation and description of business Adoption of IAS, IFRS and IFRIC Summary of significant accounting policies Management estimates and judgments Acquisitions and investments Assets/Liabilities classified as held for sale and liquidation Revenues Other gains and losses Goodwill impairment Finance (expense) / income, net Income taxes Trade and other receivables Other current financial assets Inventories Other current assets Goodwill and other intangible assets Property, plant and equipment Other financial assets Other current financial liabilities Other current liabilities Debt Pension plans and similar commitments Provisions Other liabilities Restructuring Equity Commitments and contingencies Financial instruments and hedging activities Financial risk management Related party disclosures Non-cash transactions Subsequent events Additional information to the IFRS Consolidated Financial Statements p. 126

124 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Basis of presentation and description of business The accompanying Consolidated Financial Statements present the operations of Enterprise Networks Holdings B.V. ( EN B.V. or the Company ) and its wholly owned and fully controlled subsidiaries ( EN or the Group ). They have been prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union (EU). EN B.V. is a private limited liability company and was incorporated in Amsterdam on July 25, 2008, with an office at Prins Bernhardplein 200, 1097 JB Amsterdam, and registered with the Trade Register of the Amsterdam Chamber of Commerce under number As part of a business combination, the entire enterprise communications business of Siemens AG ( SAG ), headquartered in Berlin and Munich, Germany, and its affiliates was acquired by the Company and some of its affiliates on September 30, 2008 under a Master Sales and Purchase Agreement ( MSPA ) dated July 29, The Company issued shares to two investors to finance the purchase, the Gores Entities (Gores I SF Luxembourg S.à r.l. (Gores I), Gores II SF Luxembourg S.à r.l. (Gores II) and Glendon SEN Holding, LLC, U.S.A., (Glendon)), which together hold approximately 51% of the Company s share capital and Siemens AG, which holds approximately 49% of the Company s share capital. Enterprise Networks Group prepares and reports its Consolidated Financial Statements in Euros ( ). Its financial year ends on September 30, The Group is a provider of communications-related products and services to enterprises, including businesses, government agencies and other organisations. EN provides its customers with critical communications products, such as voice telephony, Unified Communications ( UC ), contact center, data networking and security products, as well as cloud, professional and managed services to support and optimise these offerings. Consolidated Financial Statements and Management Report of Enterprise Networks Holdings B.V. as of September 30, 2012 and 2011 are being filed with and published at the Amsterdam/Netherlands Commercial Register under the file reference number as well as in the Electronic Federal Gazette in Germany (elektronischer Bundesanzeiger). The Consolidated Financial Statements were authorised for issue by the Managing Board on December 17, The Consolidated Financial Statements are generally prepared on the historical cost basis, except as explained in the accounting policies below. 27 p. 127

125 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Description of business The Group s offerings are organised into three product segments: Voice and UC Applications, Network Infrastructure and Security, and Services Voice and UC Applications Enterprise Networks provides a complete enterprise communications platform of products, devices and services to support pure IP (internet protocol) networks, TDM (time division multiplex) networks and converged hybrid IP-traditional networks using open technology standards. This segment has a range of offerings covering voice, phones, UC and other applications, contact center and speciality solutions for specific industries. Network Infrastructure and Security The Group designs, develops and markets network infrastructure and security solutions for EN s enterprise customers. The product portfolio indicates multilayer switches, core routers, WAN routers, WLAN and network management and security solutions. The Group s security solutions include in-network access control, intrusion prevention, security information and event management. EN s network solutions have built-in security features that can intelligently sense and automatically respond to application and user needs, as well as security threats to every wired and wireless connection. Based on open standards, the Group s integrated hardware and software products share an open architecture and provide embedded security with a common management interface. Services The Group delivers a comprehensive global offering of professional, managed and maintenance and installation services for sophisticated multi-vendor deployments through our OpenScale Services framework. EN s global services are an integral part of our strategy to provide communication infrastructure and application solutions focussed on assisting companies in transitioning their networks to IP, and on integrating UC and contact center applications while maintaining and improving security. 2. Adoption of IAS, IFRS and IFRIC 2.1 New standards and interpretations effective in the current period The most prominent of the recently adopted accounting pronouncements that the Group had to apply for the first time during its annual period beginning on October 1, 2011 none of which had a significant impact on the Group s Consolidated Financial Statements are as follows: 28 p. 128

126 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Standards/ Interpretations IAS 1 Presentation of Financial Statements: Amendments resulting from May 2010 Annual Improvements to IFRSs IAS 24 Related party disclosures: Revised definition of related parties IAS 34 Interim Financial Reporting: Amendments resulting from May 2010 Annual Improvements to IFRSs IFRS 1 First-time Adoption of International Financial Reporting Standards - Amendments resulting from May 2010 Annual Improvements to IFRSs - Replacement of fixed dates for certain exceptions with the date of transition to IFRSs - Additional exemption for entities ceasing to suffer from severe hyperinflation IFRS 7 Financial Instrument Disclosures - Amendments resulting from May 2010 Annual Improvements to IFRSs - Amendments enhancing disclosures about transfers of financial assets IFRIC 13 Customer Loyalty Programmes: Amendments resulting from May 2010 Annual Improvements to IFRSs IFRIC 14 IAS 19: The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction; November 2009 Amendments with respect to voluntary prepaid contributions 2.2 Early adoption of standards and interpretations The Group has not adopted any standard or interpretation prior to its effective date. 2.3 Standards and interpretations in issue not yet adopted The following standards and interpretations were issued and available for early application but have not yet been applied by the Group in these financial statements. The Group intends to apply these standards and interpretations when they become effective. Standards/ Interpretations IAS 1 Presentation of Financial Statements - Amendments to revise the way other comprehensive income is presented - Amendments resulting from Annual Improvements cycle (comparative information) IAS 12* Income taxes: Limited scope amendment (recovery of underlying assets) IAS 16 Property, plant and equipment: Amendments resulting from Annual Improvements cycle (classification of servicing equipment) IAS 19 Employee Benefits: Amended standard resulting from the post employment benefits and termination benefits projects IAS 27* Consolidated and Separate Financial Statements Reissued as IAS 27 Separate Financial Statements (as amended in 2011) - Original issue - Amendments for investing entities IAS 28* Investments in Associates Reissued as IAS 28 Investments in Associates and Joint Ventures (as amended in 2011) IAS 32 Financial Instruments Presentation - Amendments relating to the offsetting of assets and liabilities* - Amendments resulting from Annual Improvements cycle (tax effect of equity distributions) IAS 34 Interim Financial Reporting: Amendments resulting from Annual Improvements cycle (interim reporting of segment assets) 29 p. 129

127 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 IFRS 1 IFRS 7 IFRS 9* IFRS 10* IFRS 11* IFRS 12* IFRS 13* IFRIC 20* First-time Adoption of International Financial Reporting Standards - Amendments for government loan with a below market rate of interest when transitioning to IFRSs - Amendments resulting from Annual Improvements cycle (repeat application, borrowing costs) Financial Instrument Disclosures - Amendments related to the offsetting of assets and liabilities - Deferral of mandatory effective date of IFRS 9 and amendments to transition disclosures Financial Instruments: - Classification and measurement of financial assets - Reissue to include requirements for the classification and measurement of financial liabilities and incorporate existing derecognition requirements - Deferral of mandatory effective date of IFRS 9 and amendments to transition disclosures Consolidated financial statements - Original issue - Amendments to transitional guidance - Amendments for investment entities Joint Arrangements - Original issue - Amendments to transitional guidance Disclosure of Interests in Other Entities - Original issue - Amendments to transitional guidance - Amendments for investment entities Fair Value Measurement - Original issue Stripping Costs in the Production Phase of a Surface Mine * Are not yet endorsed by EU On June 16, 2011 the IASB published amendments to IAS 1 Presentation of Financial Statements. The amendments to IAS 1 retain the one or two statement approach at the option of the entity and only revise the way other comprehensive income is presented: requiring separate subtotals for those elements which may be recycled (e.g. cash-flow hedging, foreign currency translation), and those elements that will not (e.g. fair value through OCI items under IFRS 9). The amendments are effective for annual periods beginning on or after July 1, 2012, with earlier adoption permitted. In May 2012 the IASB made improvements to IFRSs as part of its program of annual improvements to its standards (Annual Improvements cycle). Subject of the changes to IAS 1 Presentation of Financial Statements were clarifications of the requirements for comparative information. Additional comparative information is not necessary for periods beyond the minimum comparative financial statement requirements of IAS 1. If additional comparative information is provided, the information should be presented in accordance with IFRSs, including disclosure of comparative information for any additional statements included beyond the minimum comparative financial statement requirements. Presenting additional comparative information voluntarily would not trigger a requirement to provide a complete set of financial statements. An entity that changes accounting policies retrospectively, or makes a retrospective restatement or reclassification which has a material effect on the information in the statement of financial position at the beginning of the preceding period would present the statement of financial position at the end of the current period and the beginning and end of the preceding period. Other than disclosure of certain specified information, related notes are not required to accompany the opening statement of financial position as at the beginning of the preceding period. 30 p. 130

128 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 An entity s first IFRS financial statement may include additional comparative information in accordance with previous GAAP to assist in explaining the effects of the transition to IFRS. The amendment must be applied retrospectively and is effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. The revised IAS 12 Income taxes requires an entity to measure the deferred tax relating to an asset depending on whether the entity expects to recover the carrying amount of the asset through use or sale. It can be difficult and subjective to assess whether recovery will be through use or through sale when the asset is measured using the fair value model in IAS 40 Investment Property. The amendment provides a practical solution to the problem by introducing a presumption that recovery of the carrying amount will, normally be, through sale. The amendments are effective for annual periods beginning on or after January 1, In May 2012 the IASB made improvements to IFRSs as part of its program of annual improvements to its standards (Annual Improvements cycle). Subject of the changes to IAS 16 Property, Plant and Equipment was the classification of servicing equipment. Spare parts, stand-by equipment and servicing equipment should be classified as property, plant and equipment when they meet the definition of property, plant and equipment in IAS 16 and as inventory otherwise. The amendment must be applied retrospectively and is effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. On June 16, 2011, the IASB published an amended IAS 19 Employee Benefits. An overview of the changes contains the following aspects: require recognition of changes in the net defined benefit liability (asset) including immediate recognition of defined benefit cost, disaggregation of defined benefit cost into components, recognition of remeasurements in other comprehensive income, plan amendments, curtailments and settlements; introduce enhanced disclosures about defined benefit plans; modify accounting for termination benefits, including distinguishing benefits provided in exchange for service and benefits provided in exchange for the termination of employment and affect the recognition and measurement of termination benefits; clarification of miscellaneous issues, including the classification of employee benefits, current estimates of mortality rates, tax and administration costs and risk-sharing and conditional indexation features; incorporate other matters submitted to IFRS Interpretations Committee; applicable on a modified retrospective basis to annual periods beginning on or after January 1, 2013, with earlier adoptions permitted. In May 2010 the IASB issued transition requirements for amendments arising as a result of IAS 27 which will become effective for annual periods beginning on or after January 1, Basically all stipulations for separate financial statements remain unchanged in IAS 27, whereas those stipulations relating to Consolidated Financial Statements are transferred to the new IFRS 10. The objective of IAS 28 (as amended in 2011) is to prescribe the accounting for investments in associates and to set out the requirements for the application of the equity method when accounting for investments in associates and joint ventures. IAS 28 applies to all entities that are investors with joint control of, or significant influence over, an investee (associate or joint venture). IAS 28 is applicable to annual reporting periods beginning on or after January 1, 2013 with earlier adoptions permitted. 31 p. 131

129 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 On December 16, 2011, the IASB issued the amendment Offsetting Financial Assets and Financial Liabilities (amendments to IAS 32 Financial Instruments: Presentation). These amendments clarify the meaning of currently has a legally enforceable right to set-off and also clarify the application of the IAS 32 offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. The amendments to IAS 32 are to be retrospectively applied for annual periods beginning on or after January 1, 2014 with earlier adoptions permitted. In May 2012 the IASB made improvements to IFRSs as part of its program of annual improvements to its standards (Annual Improvements cycle). Subject of the changes to IAS 32 Financial Instruments: Presentation were tax effects resulting from distribution to holders of equity instruments. Income tax relating to distributions to holders of an equity instrument and to transaction costs of an equity transaction should be accounted for in accordance with IAS 12 Income taxes. The amendments must be applied retrospectively and are effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. In May 2010 the IASB made amendments to IAS 34 Interim financial reporting clarifying in particular terminology as relates to significant events and transactions. These amendments emphasise the principle in IAS 34 that the disclosure about significant events and transactions in interim periods should update the relevant information presented in the most recent annual financial report. They will be effective for annual periods beginning on or after January 1, 2011 with earlier application permitted. In May 2012 the IASB made improvements to IFRSs as part of its program of annual improvements to its standards (Annual Improvements cycle). Subject of the changes to IAS 34 Interim Financial Reporting was Interim financial reporting and segment information for total assets and liabilities. The total assets and total liabilities for a particular reportable segment would be separately disclosed in interim financial reporting only when the amounts are regularly provided to the chief operating decision maker and there has been a material change from the amounts disclosed in the last annual financial statements for that reportable segment. The amendments must be applied retrospectively and are effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. On March 13, 2012, the IASB amended IFRS 1 First-time Adoption of International Financial Reporting Standards for government loans at below-market rates of interest. The amendments provide relief to first-time adopters of IFRSs by amending IFRS 1 to allow prospective application of IAS 39 or IFRS 9 and paragraph 10A of IAS 20 to government loans outstanding at the date of transition to IFRSs. The amendments are effective for annual periods beginning on or after January 1, 2013, with early application permitted. In May 2012 the IASB made improvements to IFRSs as part of its program of annual improvements to its standards (Annual Improvements cycle). Subject of the changes to IFRS 1 Firsttime Adoption of International Financial Reporting Standards were repeated application of IFRS 1 and borrowing costs. As regards the first topic, an entity may apply IFRS 1 if its most recent previous annual financial statements did not contain an explicit and unreserved statement of compliance with IFRSs, even if the entity applied IFRS 1 in the past. An entity that does not elect to apply IFRS 1 must apply IFRSs retrospectively as if there was no interruption. An entity should disclose a) the reason it stopped applying IFRSs, b) the reason it is resuming the application of IFRSs; and c) the reason it has elected not to apply IFRS 1, if applicable. 32 p. 132

130 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Borrowing costs capitalised under previous GAAP before the date of transition to IFRSs may be carried forward without adjustment to the amount previously capitalised at the transition date. Borrowing costs incurred on or after the date of transition to IFRSs that relate to qualifying assets under construction at the date of transition should be accounted for in accordance with IAS 23 Borrowing Costs. A first-time adopter can choose to apply IAS 23 at a date earlier than the transition date. The amendments must be applied retrospectively and are effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. On December 16, 2011, the IASB issued the amendment Disclosures Offsetting Financial Assets and Financial Liabilities (amendments to IFRS 7 Financial Instruments: Disclosures). These disclosures, which are similar to the new US GAAP requirements, would provide users with information that is useful in a) evaluating the effect or potential effect of netting arrangements on an entity s financial position and b) analysing and comparing financial statements prepared in accordance with IFRSs and US GAAP. The amendments to IFRS 7 are to be retrospectively applied for annual periods beginning on or after January 1, 2013 and interim periods within those annual periods. The IASB has issued amendments that will defer the mandatory effective date of IFRS 9 Financial Instruments (issued in November 2009 and October 2010) from January 1, 2013 to January 1, Early application of IFRS 9 is still permitted. The deferral will make it possible for all phases of the project to have the same mandatory effective date. The amendments will also provide entities with a relief from the requirement to restate comparative financial statements for the effect of applying IFRS 9. This relief was originally only available to entities that chose to apply IFRS 9 prior to As a result of these amendments, the IASB has amended IFRS 7 Financial Instruments: Disclosures, to require additional disclosures on transition from IAS 39 Financial Instruments: Recognition and Measurement, to IFRS 9. In terms of the amendments, entities who initially apply IFRS 9 in periods: - beginning before January 1, 2012 need not restate prior periods and are not required to provide the disclosures set out in paragraph 44s-44w of IFRS 7 - beginning on or after January 1, 2012 and before January 1, 2013 must elect either to provide the disclosures set out in paragraph 44s-44w of IFRS 7 or to restate prior periods - beginning on or after January 1, 2013 should provide the disclosures set out in paragraphs 44s-44w of IFRS7. However, the entity need not restate prior periods. In November 2009, the IASB published the first part of its three stage project to replace IAS 39, in the form of a new standard IFRS 9, Financial instruments. The IASB updated IFRS 9 in October 2009 to include guidance on classification and measurement of financial liabilities and on derecognition of financial instruments. This first phase deals with the classification and measurement of financial assets and financial liabilities. The second and third phases of IFRS 9 are concerned with accounting for the impairment and hedge accounting. On November 15, 2011, the IASB tentatively decided to consider making limited modifications to the requirements in IFRS 9 for classifying and measuring financial assets to deal with specific application issues and the interaction with the insurance project and to try to achieve convergence with proposals being developed by the FASB. An exposure draft on these modifications is expected to be issued in late 2012 and therefore these proposals are not currently included within IFRS 9. In December 2011, the Board amended IFRS 9 to defer the mandatory effective date from January 1, 2013 to annual periods beginning on or after January 1, Early application of IFRS 9 will continue to be permitted. The Board also amended the transitional provisions to provide relief from restating comparative information and introduced new disclosures to help users of financial statements understand the effect of moving to the IFRS 9 classification and measurement model. 33 p. 133

131 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 IFRS 9 replaces the multiple classification and measurement models for financial assets in IAS 39 with a single model that has only two classification categories: amortised cost and fair value. Classification under IFRS 9 is driven by the entity s business model for managing the financial assets and the contractual characteristics of the financial assets. A financial asset is measured at amortised cost if two criteria are met: a) the objective of the business model is to hold the financial asset for the collection of the contractual cash flows; and b) the contractual cash flows under the instrument solely represent payments of principal and interest. The new standard removes the requirement to separate embedded derivatives from financial asset hosts. It requires a hybrid contract to be classified in its entirety at either amortised cost or fair value. Two of the existing three fair value option criteria become obsolete under IFRS 9, as a fair value driven business model requires fair value accounting, and hybrid contracts are classified in their entirety at fair value. The remaining fair value option condition in IAS 39 is carried forward to the new standard that is, management may still designate a financial asset as a fair value through profit or loss on initial recognition if this significantly reduces an accounting mismatch. The designation at fair value through profit or loss will continue to be irrevocable. IFRS 9 prohibits reclassification except in rare circumstances when the entity s business model changes. There is specific guidance for contractually linked instruments that create concentrations of credit risk, which is often the case with investment tranches in a securitisation. IFRS 9 s classification principles indicate that all equity investments should be measures at fair value. However, management has an option to present in other comprehensive income unrealised and realised fair value gains and losses on equity investments that are not held-for-trading. IFRS 9 removes the cost exemption for unquoted equities and derivatives on unquoted equities, but provides guidance on when cost may be an appropriate estimate for fair value. The classification and measurement of financial liabilities under IFRS 9 remains the same as in IAS 39 except where an entity has chosen to measure a financial liability at fair value through profit and loss. For such liabilities, changes in fair value related to changes in own credit risk are presented separately in OCI. Amounts in OCI related to own credit risk are not recycled to the income statement even when the liability is derecognised and the amounts are realised. However, the standard does allow transfers within equity. Entities are still required to separate derivatives embedded in financial liabilities where they are not closely related to the host contract. For the second phase of the financial instruments project, a separate re-exposure draft Amortised cost and impairment of financial assets is expected on the expected-loss impairment model. The Board has tentatively decided to propose a three bucket approach that determines the amount and timing of credit losses to be recognised. This model is expected to replace the impairment methods in IAS 39 that arise from the different classification categories. For the third phase, in December 2010 the IASB published its exposure draft dealing with general hedge accounting that proposed relaxing the requirements for hedge effectiveness assessment and consequently the eligibility for hedge accounting. The proposed changes primarily remove restrictions that today prevent some economically rational hedging strategies from qualifying for hedge accounting. All entities that engage in risk management activities regardless of whether they use hedge accounting today will potentially be affected by the changes. The general hedging standard is expected in the fourth quarter of It is the IASB s intention that IFRS 9 will ultimately replace IAS 39 is its entirety. 34 p. 134

132 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 In May 2011, the IASB issued IFRS 10 Consolidated financial statements. Its objective is to establish principles for the presentation and preparation of Consolidated Financial Statements when an entity controls one or more entities. This standard requires a parent entity (an entity that controls one or more other entities) to present Consolidated Financial Statements. It defines the principal of control and establishes control as the basis for consolidation. In comparison to the definition in IAS 31 an investor controls an investee if and only if the investor has all of the following elements: a) power over the investee, i.e. the investor has existing rights that give it the ability to direct the relevant activities (the activities that significantly affect the investee s returns; b) exposure, or rights, to variable returns from its involvement with the investee; c) the ability to use its power over the investee to affect the amount of the investor s returns. Furthermore, IFRS 10 sets out how to apply the principle of control to identify whether an investor controls an investee and therefore must consolidate the investee. Finally, it sets out the accounting requirements for the preparation of Consolidated Financial Statements. The standard is effective for annual periods beginning on or after January 1, 2013 with earlier adoption permitted. On May 12, 2011 the IASB issued IFRS 11 Joint Arrangements. The standard provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form (as is currently the case). The standard addresses inconsistencies in the reporting of joint arrangements by requiring a single method to account for interests in jointly controlled entities. It is effective for annual periods beginning on or after January 1, 2013 with earlier adoption permitted. It replaces IAS 31 Interests in joint ventures and SIC-13 Joint controlled entities. On May 12, 2011 the IASB issued IFRS 12 Disclosure of Interests in Other Entities. This standard is a new and comprehensive standard on disclosure requirements for all forms of interests in other entities, including subsidiaries, joint arrangements, associates and unconsolidated structured entities. IFRS 12 is effective for annual periods beginning on or after 1 January Earlier application is permitted. On May 12, 2011 the IASB and the Financial Accounting Standards Board (FASB) issued new guidance on fair value measurement and disclosure requirements for International Financial Reporting Standards (IFRSs) and US generally accepted accounting principles (GAAP). The guidance, set out in IFRS 13 Fair Value Measurement and an update to Topic 820 in the FASB s Accounting Standards Codification (formerly referred to as SFAS 157), completes a major project of the boards joint work to improve IFRSs and US GAAP and to bring about their convergence. IFRS 13 is applicable to annual reporting periods beginning on or after January 1, 2013 with earlier adoption permitted. In June 2012, the IASB issued Consolidated Financial Statements, Joint Arrangements and Disclosure of Interests in Other Entities: Transition Guidance that clarifies the transitional guidance in IFRS 10, 11 and 12. The amendments are in response to constituent requests for clarification on certain aspects of the transition guidance in IFRS 10, 11 and 12. The amendments also provide additional transitional relief, limiting the requirement to provide adjusted comparative information to only the preceding comparative period. Furthermore, for disclosures related to unconsolidated structured entities, the amendments will remove the requirement to present comparative information for periods before IFRS 12 is first applied. The effective date of the amendments is annual periods beginning on or after January 1, 2013, which is aligned with effective date of IFRS 10, 11 and 12. On October 19, 2011 the IFRS Interpretations Committee published IFRIC Interpretation 20, Stripping Costs in the Production Phase of a Surface Mine. IFRIC 20 applies to all types of natural resources that are extracted using the surface mining activity process. The interpretation is effective for annual periods beginning on or after January 1, 2013, with earlier application permitted. 35 p. 135

133 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The IASB issued various other pronouncements. Management is currently assessing the impacts of their adoption on the Group s Consolidated Financial Statements. As of reporting date, management believes that the pronouncements not yet adopted do not have a material impact on the Group s Consolidated Financial Statements. 3. Summary of significant accounting policies 3.1 Basis of preparation The Consolidated Financial Statements have been prepared on a historical cost basis, except as explained in the accounting policies below. Management believes that the Group will have access to adequate resources to continue its operations for the foreseeable future. Accordingly, the financial statements continue to be prepared on the going concern basis. The following companies have made use of the stipulations available under 264b of the German Commercial Code (HGB): - Siemens Enterprise Communications GmbH & Co. KG, Munich, - Siemens Enterprise Communications Beteiligungen GmbH & Co. KG, Munich, It exempts these partnerships from the requirement to disclose separate audited financial statements, since they are included in the Consolidated Financial Statements of the ultimate parent company (EN BV) and such Consolidated Financial Statements are registered with the trade register of the particular partnership. 3.2 Basis of consolidation The Consolidated Financial Statements incorporate the financial statements of the Company and entities controlled by the Company. Control is achieved when the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Income and expenses of subsidiaries acquired or disposed of are included in the Consolidated Statement of Comprehensive Income from the effective date of acquisition and up to the effective date of disposal, as appropriate. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests. There are some wholly owned EN subsidiaries that have been accounted for at cost and have not been consolidated in the Consolidated Financial Statements due to immateriality, both individually and in the aggregate. Additionally there is a 25% investment in Electrocycling Anlagen GmbH, Goslar, Germany, which is accounted for at the cost method instead of the equity method of accounting due to immateriality. In fiscal years 2012 and 2011, total assets, revenues and profit and loss of these non-consolidated entities did not exceed 2% of the Group s consolidated balances. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by other members of the Group. 36 p. 136

134 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 All inter-group transactions, balances, income and expense are eliminated in consolidation. See Appendix 1 for a complete overview of the Group s consolidated entities as of September 30, Business combinations Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or loss as incurred. At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the acquisition date, except that: deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements are recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 Employee Benefits respectively; liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the Group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 Share-based Payment at the acquisition date; and assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Noncurrent Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard. Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain. When the consideration transferred by the Group in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the measurement period (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date. The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates in accordance with IAS 39, or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being recognised in profit or loss. 37 p. 137

135 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Subsequent to their initial recognition, these intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses. Intangible assets with finite useful lives are amortised on a straight-line basis over their respective estimated useful lives. 3.4 Foreign currency The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the entity operates (its functional currency). For the purpose of the Consolidated Financial Statements, the results and financial position of each group entity are expressed in Euro, which is the functional currency of the Company and the presentation currency for the Consolidated Financial Statements. In preparing the financial statements of the individual entities, transactions in currencies other than the entity s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at that closing date. Non-monetary items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated. Exchange rate differences are recognised in profit or loss in the period in which they arise except for: exchange rate differences on foreign currency borrowings relating to assets under construction for future productive use, which are included in the cost of those assets when they are regarded as an adjustment to interest costs on those foreign currency borrowings; and exchange rate differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur (therefore forming part of the net investment in the foreign operation), which are recognised initially directly in equity and reclassified from equity to profit or loss on disposal or partial disposal of the net investment. For the purpose of presenting Consolidated Financial Statements, the assets and liabilities of the Group s foreign operations are expressed in Euros using exchange rates prevailing at the end of the reporting period. Income and expense items are translated at the average exchange rates for each month. Exchange differences arising, if any, are recognised directly in other comprehensive income and accumulated in equity. On the disposal of a foreign operation (i.e. a disposal of the Group s entire interest in a foreign operation, or a disposal involving loss of control over a subsidiary that includes a foreign operation, or loss of significant influence over an associate that includes a foreign operation), all of the accumulated exchange differences in respect of that operation attributable to the Group are reclassified to profit or loss. Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the rate of exchange prevailing at the end of each reporting period. 38 p. 138

136 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The exchange rates of the significant currencies of non-euro countries used in the preparation of the Consolidated Financial Statements were as follows: Year-end exchange rate 1 EUR quoted into currencies specified below Annual average rate 1 EUR quoted into currencies specified below Currency ISO Code September 30, 2012 September 30, 2011 September 30, 2012 September 30, 2011 U.S. Dollar USD British Pound Sterling GBP Brazilian Real BRL Revenue recognition The Group recognises revenues for the sale, licensing and leasing of products and providing product related, managed, and solutions services in the communications market. Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates, discounts and other similar allowances. Sales of products and services sometimes involve multiple elements. In these cases, the Group determines whether the contract or arrangement contains more than one unit of accounting. An arrangement is separated if (1) the delivered element(s) has (have) value to the customer on a standalone basis, (2) there is reliable evidence of the fair value of the undelivered element(s) and (3), if the arrangement includes a general right of return relative to the delivered element(s), delivery or performance of the undelivered element(s) is (are) considered probable and substantially in the control of the Group. If all three criteria are fulfilled, the appropriate revenue recognition convention is then applied to each separate unit of accounting. Generally, the total arrangement consideration is allocated to the separate units of accounting based on their relative fair values, which are calculated based upon the fair value of each unit of accounting, compared to the total fair value of all units of accounting. The hierarchy of fair value evidence is as follows: (a) sales prices for the component when it is regularly sold on a stand-alone basis and (b) third party prices for similar components. Alternatively the Group refers to an adjusted market assessment approach. Hereby a market valuation takes place in which the entity sells goods and services and prices are estimated that customers in that market would be willing to pay for those goods and services Sale of products Revenue from the sale of products is recognised when all the following conditions are satisfied: the Group has transferred to the buyer the significant risks and rewards of ownership of the goods; the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; the amount of revenue can be measured reliably; it is probable that the economic benefits associated with the transaction will flow to the entity; and the costs incurred or to be incurred in respect of the transaction can be measured reliably. 39 p. 139

137 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Revenue for the sale of products is generally recognised as products are shipped, unless the revenue is considered unearned due to undelivered elements, e.g. installation that is deemed essential to the functionality of the product. In such instances, revenue is deferred to a later period when the outstanding criteria have been met Rendering of services Revenues for the rendering of services as determined by a contract are recognised by reference to the stage of completion of the contract. Installation fees are recognised upon completion of the installation. Servicing fees included in the price of products sold are recognised by reference to the proportion of the total cost of providing the servicing for the product sold, taking into account historical trends in the number of services actually provided on past goods sold. Revenues from long-term maintenance and managed services contracts are recognised rateably over the contract term. If the outcome cannot be reliably estimated, revenue recognition depends on whether the costs incurred are likely to be recovered. The Group s policy for recognition of revenue from construction contracts is described at below Royalties Royalty revenue is recognised on an accrual basis in accordance with the substance of the relevant agreement, provided that it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably. Royalties determined on a time basis are recognised on a straight-line basis over the period of the agreement. Royalty arrangements that are based on production, sales and other measures are recognised by reference to the underlying arrangement Rental and lease income The Group s policy for the recognition of revenue from leases is described in below Construction contracts Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the end of the reporting period, measured based on the completion of a physical proportion of the contract work and on the proportion of contract cost incurred for work performed to date relative to the estimated total contract costs, except where this would not be representative of the stage of completion. Variations in contract work, claims and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable. Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred that it is probable will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately. 40 p. 140

138 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 When contract costs incurred to date plus recognised profits less recognised losses exceed progress billings, the surplus is shown as work in progress. For contracts where progress billings exceed contract costs incurred to date plus recognised profits less recognised losses, the surplus is shown as the amounts due to customers for contract work. Amounts received before the related work is performed are included in the consolidated statement of financial position, as a current liability, as advances received. Amounts billed for work performed but not yet paid by the customer are included in the consolidated statement of financial position under trade and other receivables. 3.6 Borrowing costs All borrowing costs, except for those directly attributable to an acquisition, construction or production of qualifying assets, are recognised in profit or loss in the period in which they are incurred. 3.7 Government grants Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching to them and the grants will be received. Government grants are recognised in profit or loss on a systematic basis over the periods in which the Group recognises as expenses the related costs for which the grants are intended to compensate. Specifically, government grants whose primary condition is that the Group should purchase, construct or otherwise acquire non-current assets are recognised as deferred revenue in the consolidated statement of financial position and transferred to profit or loss on a systematic and rational basis over the useful lives of the related assets. Government grants that are receivable as compensation for expenses or losses already incurred or for the purpose of giving immediate financial support to the Group with no future related costs are recognised in profit or loss in the period in which they become receivable. In fiscal year 2012, the total of government grants and provisions related to the risk of repayment have been recognised in the statement of profit and loss at 1.2 million (2011: 2.3 million). German government grants in terms of short-time work remuneration reduced the personnel costs in the amount of 0.1 million in fiscal year In fiscal year 2012 there were no such government grants. Short-term work remuneration consisted of a 50% grant in social security contributions provided by the German Federal Employment Office. Furthermore, Austrian Federal Employment Office provided 53 thousand (2011: 0.1 million) grants for part time work prior to employee s retirement and training activities. In fiscal year 2012 Austrian tax authorities are applied for to grant research and development subsidies in the amount of 0.7 million (September 30, 2011: 0.8 million) with an income impact in the profit and loss statement of 0.7 million (2011: 0.6 million). Local authorities will verify compliance with legal conditions and subsequently administer payments during fiscal year In addition 0.5 million (2011: 1.0 million) relate to income generated by the net release of provisions originally relating to repayment risks in previous years. In fiscal year million were granted to a Turkish entity for funding technology development and innovation activities, but no grants in fiscal year Goodwill Goodwill is not amortised, but instead tested for impairment annually, as well as whenever there are events or changes in circumstances (triggering events) which suggest that the carrying amount may not be recoverable. Goodwill is carried at cost less accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to the (groups of) cash-generating unit(s) that are expected to benefit from the synergies of the combination. 41 p. 141

139 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period. On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal. 3.9 Intangible assets (other than goodwill) Other intangible assets consist of software and other internally generated intangible assets, patents, licenses and similar rights. The Group amortises intangible assets with finite useful lives on a straightline basis over their respective estimated useful lives to their estimated residual values Intangible assets acquired separately Intangible assets acquired separately are carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimated useful lives, which generally ranges from three to five years. The estimated useful life and amortisation method are reviewed at the end of each annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis Internally-generated intangible assets - research and development expenditures Expenditures on research activities undertaken with the prospect of gaining new scientific or technical knowledge and understanding is recognised as an expense in the period in which it is incurred. An internally-generated intangible asset arising from development (or from the development phase of an internal project), whereby research findings are applied to a plan or design for the production of new or substantially improved products and processes, is recognised if, and only if, all of the following have been demonstrated: the technical feasibility of completing the intangible asset so that it will be available for use or sale; the intention to complete the intangible asset and use or sell it; the ability to use or sell the intangible asset; how the intangible asset will generate probable future economic benefits; the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and the ability to measure reliably the expenditure attributable to the intangible asset during its development. The amount initially recognised for internally-generated intangible assets is the sum of the expenditure incurred from the date when the intangible asset first meets the recognition criteria listed above. The costs capitalised include the cost of materials, depreciation of long-lived assets, direct labour and directly attributable general overhead expenditures that serve to prepare the asset for use. Where no internally-generated intangible asset can be recognised, development expenditures are recognised in profit or loss in the period in which they are incurred. Subsequent to initial recognition, internally-generated intangible assets are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets that are acquired separately. Capitalised development costs are stated at cost less accumulated amortisation and impairment losses with an amortisation period of generally two years. 42 p. 142

140 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Intangible assets acquired in a business combination Intangible assets acquired in a business combination (see note 3.3) and recognised separately from goodwill are initially recognised at their fair value at the acquisition date (which is regarded as their cost). For intangible assets with indefinite useful lives see note 3.11 Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated impairment losses. Intangible assets with finite useful lives are amortised on a straight-line basis over their respective estimated useful lives to their estimated residual values. Based on the assumptions of the business combination, the estimated useful lives of other intangibles are as follows: Intangibles Trademarks Customer relations Order backlog Technologies, patents and IPR&D Software, patents, licenses and similar rights Estimated useful life up to 9 years up to 13 years up to 2 years 16 years from 3 to 5 years 3.10 Property, plant and equipment Property, plant and equipment is valued at cost less accumulated depreciation and impairment losses. Property, plant & equipment acquired in a business combination (see note 3.3) are initially recognised at fair value at the acquisition date. Properties in the course of construction for production, supply or administrative purposes, or for purposes not yet determined, are carried at cost, less any recognised impairment loss. Cost includes professional fees and, for qualifying assets, i.e. assets that require a substantial period of time to be ready for its intended use, borrowing costs capitalised in accordance with the Group s accounting policy. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use. Amortisation is recognised as a write off of the cost or valuation of assets, (other than freehold land and properties under construction) less their residual values over their useful lives, using the straightline method. The following useful lives are assumed: Property, Plant & Equipment Factory and office buildings Technical machinery & equipment Furniture & office equipment Equipment leased to others Estimated useful life 20 to 30 years 5 to 10 years 3 to 5 years generally 5 to 7 years The estimated useful lives, residual values and depreciation method are reviewed at each year end, with the effect of any changes in estimate accounted for on a prospective basis. Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or where shorter, the term of the relevant lease. The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss. 43 p. 143

141 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Impairment of tangible and intangible assets excluding goodwill At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cashgenerating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified. Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is an indication that the asset may be impaired. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss. Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss Inventories Inventories are stated at the lower of cost and net realisable value. Costs, including an appropriate portion of fixed and variable overhead expenses, are assigned to inventories by using either the weighted-average-cost method or the first-in-first-out method. Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale Income taxes Income tax expense represents the sum of the tax currently payable and deferred tax Current tax The current tax is based on taxable profit for the year. Taxable profit is the profit or loss for a period upon which income taxes are payable. The amount differs from accounting profit reported in the consolidated statement of comprehensive income for a number of reasons; e.g. tax-free income, nondeductible expenses and items arising from prior years. The Group s current tax liability is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period. 44 p. 144

142 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Deferred tax Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse in the foreseeable future. The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. In assessing the realisability of deferred tax assets, management considers to what extent it is probable that the deferred tax assets will be realised. The ultimate realisation of deferred tax assets is dependent upon the generation of future taxable profits during the periods in which the underlying temporary differences and tax loss carry-forwards become deductible. Management considers the expected reversal of deferred tax liabilities and projected future taxable income in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are expected to become deductible, management determined to what extent it is probable that the Group will realise the benefits of these deductible temporary differences and tax loss carry-forwards. Deferred tax assets will not be recognised if there are deductible temporary differences and tax loss carry-forwards that cannot be realised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis Current and deferred tax for the period Current and deferred tax are recognised as an expense or income in profit or loss, except when they relate to items that are recognised directly in equity, in which case the tax is also recognised outside profit or loss, or where they arise from the initial accounting for a business combination. In the case of a business combination, the tax effect is taken into account in the accounting for the business combination. 45 p. 145

143 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Pensions Contributions to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions. For defined benefit retirement benefit plans actuarial valuations are carried out at the end of each reporting period. Actuarial gains and losses resulting from experience adjustments (the effects of differences between the previous actuarial assumptions and what has currently occurred) and changes in actuarial assumptions used to measure pension plan obligations are recognised directly in equity in the period in which they occur based on the requirements of IAS 19 Employee Benefits, which determines the accounting for pension and other post employment benefits Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably Onerous contracts Present obligations arising under onerous contracts are recognised and measured as provisions. An onerous contract is considered to exist where the Group has a contract under which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received from the contract Restructuring A restructuring provision is recognised when the Group has developed a detailed formal plan for the restructuring and has raised a valid expectation in those affected that it will carry out the restructuring by starting to implement the plan or announcing its main features to those affected by it. The measurement of a restructuring provision includes only the direct expenditures arising from the restructuring, which are those amounts that are both necessarily entailed by the restructuring and not associated with the ongoing activities of the entity. See note 25 for further details Warranties Provisions for the expected cost for warranty obligations under local sale of goods legislation are recognised at the date of sale of the relevant products, at the Group s best estimate of the expenditure required to settle the Group s obligation. 46 p. 146

144 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Contingent liabilities acquired in a business combination Contingent liabilities acquired in a business combination are initially measured at fair value at the acquisition date. At the end of subsequent reporting periods, such contingent liabilities are measured at the higher of the amount that would be recognised in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets and the amount initially recognised less cumulative amortisation recognised in accordance with IAS 18 Revenue Financial instruments Financial assets and financial instruments are recognised when a group entity becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial asset or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss Financial assets Financial assets are classified into the following specified categories: financial assets at fair value through profit or loss (FVTPL), held-to-maturity investments, available-for-sale (AFS) financial assets and loans and receivables. The classification depends on the nature and purpose of the financial asset and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace Effective interest method The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period to the net carrying amount on initial recognition. Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at FVTPL Financial assets at FVTPL Financial assets are classified as at FVTPL when the financial asset is either held for trading or it is designated as at FVTPL. 47 p. 147

145 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 A financial asset is classified as held for trading if: it has been acquired principally for the purpose of selling it in the near term; or on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has a recent actual pattern of short-term profit-taking; or it is a derivative that is not designated and effective as a hedging instrument. A financial asset other than a financial asset held for trading may be designated as at FVTPL upon initial recognition if: such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or the financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Group's documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or it forms part of a contract containing one or more embedded derivatives, and IAS 39 Financial Instruments: Recognition and Measurement permits the entire combined contract (asset or liability) to be designated as at FVTPL. Financial assets at FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. Fair value is determined in the manner described in note Available-for-sale financial assets (AFS financial assets) AFS financial assets are non-derivatives that are either designated as AFS or are not classified as a) loans and receivables, b) held-to-maturity investments or c) financial assets at fair value through profit or loss. Listed shares held by the Group that are traded in an active market are classified as being AFS and are stated at fair value. The Group also has investments in unlisted shares that are not traded in an active market but are also classified as AFS financial assets and stated at fair value (because the Group consider that fair value can be reliably measured). Fair value is determined in the manner described in note 28. Gains and losses arising from changes in fair value are recognised directly in equity and accumulated in the investments revaluation reserve with the exception of impairment losses, interest calculated using the effective interest method, and foreign exchange gains and losses on monetary assets, which are recognised in profit or loss. Where the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss. Dividends on AFS equity instruments are recognised in profit or loss when the Group s right to receive the dividends is established. The fair value of AFS monetary assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate at the end of the reporting period. The foreign exchange gains and losses that are recognised in profit or loss are determined based on the amortised cost of the monetary asset. Other foreign exchange gains and losses are recognised directly in equity. 48 p. 148

146 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables (including trade and other receivables and cash and cash equivalents) are measured at amortised cost using the effective interest method, less any impairment. The Group considers all highly liquid investments with less than three months maturity from the date of acquisition to be cash equivalents. Loans and receivables are included in current assets, except for maturities greater than 12 months after the balance sheet date. These are classified as non-current assets. Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial Impairment of financial assets Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each reporting period. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected. For AFS equity investments, a significant or prolonged decline in the fair value of the security below its cost is considered to be objective evidence of impairment. For all other financial assets, objective evidence of impairment could include: significant financial difficulty of the issuer or counterparty; or breach of contract, such as a default or delinquency in interest or principal payments; or it is becoming probable that the borrower will enter bankruptcy or financial re-organisation or the disappearance of an active market for that financial asset because of financial difficulties. For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group s past experience of collecting payments as well as observable changes in national or local economic conditions that correlate with default on receivables. For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between the asset s carrying amount and the present value of estimated future cash flows, discounted at the financial asset s original effective interest rate. For financial assets carried at cost, the amount of the impairment loss is measured as the difference between the asset s carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods. The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss. 49 p. 149

147 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 When an AFS financial asset is considered to be impaired, cumulative gains or losses previously recognised in other comprehensive income are reclassified to profit or loss in the period. For financial assets measured at cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised. In respect of AFS equity securities, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive income and accumulated under the heading of investment revaluation reserve. In respect of AFS debt securities, impairment losses are subsequently reversed through profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss Derecognition of financial assets The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received Financial liabilities and equity instruments Classification as debt or equity Debt and equity instruments issued by a group entity are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by the Group are recognised at the proceeds received, net of direct issue costs Financial liabilities at FVTPL Financial liabilities are classified as FVTPL when the financial liability is either held for trading or it is designated as at FVTPL. 50 p. 150

148 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 A financial liability is classified as held for trading if: it has been acquired principally for the purpose of repurchasing it in the near term; or on initial recognition it is part of a portfolio of identified financial instruments that the Group manages together and has a recent actual pattern of short-term profit-taking; or it is a derivative that is not designated and effective as a hedging instrument. A financial liability other than a financial liability held for trading may be designated as at FVTPL upon initial recognition if: such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or the financial liability forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is evaluated on a fair value basis, in accordance with the Group's documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or it forms part of a contract containing one or more embedded derivatives, and IAS 39 Financial Instruments: Recognition and Measurement permits the entire combined contract (asset or liability) to be designated as at FVTPL. Financial liabilities classified as FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. Fair value is determined in the manner described in note Other financial liabilities Other financial liabilities (including borrowings) are subsequently measured at amortised cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition Financial guarantee contracts A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the terms of a debt instrument. Financial guarantee contracts issued by the Group are initially measured at their fair values and, if not designated as at FVTPL, are subsequently measured at the higher of: the amount of the obligation under the contract, as determined in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets; or the amount initially recognised less, where appropriate, cumulative amortisation recognised in accordance with the revenue recognition policies set out at note 3.5 above. 51 p. 151

149 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Derecognition of financial liabilities The Group derecognises financial liabilities when, and only when, the Group s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss Derivative financial instruments The Group enters into a variety of derivative financial instruments to manage its exposure to foreign exchange rate risk, including foreign exchange forward contracts. Further details of derivative financial instruments are disclosed in note 28. Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their fair value at the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately. A derivative with a positive fair value is recognised as a financial asset whereas a derivative with a negative fair value is recognised as a financial liability. A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities Embedded derivatives The Group issued senior secured notes in a private placement transaction (see Note 21). On or within 30 days following each June 30 and December 31, commencing June 30, 2011, the Group must make an offer to all holders of Notes to repurchase all or any part of such holders Notes up to a maximum of 12.5 million. This cash offer qualifies as an embedded derivative and is accounted for a noncurrent and current financial liability. Derivatives embedded in non-derivative host contracts are treated as separate derivatives when their risk and characteristics are not closely related to those of the host contracts and the host contracts are not measured at FVTPL Leasing Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases The Group as lessor Revenue out of finance leases is recognised based on the present value of the minimum lease payments at the inception of the lease. Amounts due from lessees under finance leases are recognised as receivables at the amount of the Group s net investment in the leases. Finance lease interest income is allocated to the accounting periods so as to reflect a constant periodic rate of return on the Group s net investment outstanding in respect of the leases. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term. 52 p. 152

150 The Group as lessee ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Assets held under finance leases are initially recognised as assets of the Group at their fair value at the inception of the lease or, if lower, at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred. 4. Management estimates and judgments Certain accounting policies require critical accounting estimates that involve complex and subjective judgments and the use of assumptions, some of which may be for matters that are inherently uncertain and susceptible to change. Such critical accounting estimates could change from period to period and have a material impact on financial condition or results of operations. Critical accounting estimates could also involve estimates where management reasonably could have used a different estimate in the current accounting period. Management cautions that future events often vary from forecasts and that estimates routinely require adjustment. Revenue recognition EN Group generally markets its products to a wide range of customers and distributors. Revenue is recognised when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the risks and rewards of ownership have been transferred to the customer, the amount of revenue can be measures reliably, and collection of the related receivable is reasonably assured. Reductions to revenue for estimated product returns and allowances for discounts, volume rebates and price protection are recorded, based on historical experience, at the time the related revenue is recognised. This process requires the exercise of substantial judgement in evaluating the above-mentioned factors and requires material estimates, including forecasted demand, returns and industry pricing assumptions. In future periods, the Group may be required to accrue additional provisions due to (1) deterioration in the communication enterprise pricing environment, (2) reductions in anticipated demand for enterprise products or (3) lack of market acceptance for new products. If these or other factors result in a significant adjustment to sales discount and price protection allowances, they could significantly impact the Group s future operating results. Recoverability of Non-Financial Assets Annually, as well as whenever there are events or changes in circumstances the Group reviews the carrying amounts of its goodwill, tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash generating units for which a reasonable and consistent allocation basis can be identified. 53 p. 153

151 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment annually, and whenever there is an indication that the asset may be impaired. For the purpose of impairment testing, the estimates included, and the methodology used, can have a material impact on the respective values and the ultimate amount of any impairment. The recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of an asset (or cash generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. Trade and other receivables The allowance for doubtful accounts involves management judgment and review of individual receivables based on individual customer creditworthiness, current economic trends and analysis of historical bad debts on a portfolio basis. Valuation of inventories Inventories are valued at the lower of acquisition or production cost or net realisable value, cost being generally determined on the basis of an average method. Production costs comprise direct material and labour and applicable manufacturing overhead, including depreciation charges. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. Realisation of Deferred Tax Assets Deferred tax assets are recognised to the extent that it is probable that future taxable income will be available against which the deductible temporary difference, unused tax losses and unused tax credits can be utilised. Pensions and Other Post-Employment Benefits Obligations for pension and other post-employment benefits and related net periodic benefit costs are determined in accordance with actuarial valuations. These valuations rely on key assumptions including discount rates, expected return on plan assets and reimbursement rights, expected salary increases, mortality rates and health care trend rates. The discount rate assumptions reflect the rates available on high-quality fixed-income investments of appropriate duration at the balance sheet date. The expected returns on plan assets assumptions are determined on a uniform basis, considering long-term historical returns and asset allocations. Due to changing market and economic conditions, the underlying key assumptions may differ from actual developments and may lead to significant changes in pension and other post-employment benefit obligations. Such differences are recognised in full directly in equity in the period in which they occur without affecting profit or loss. See note 22 Pension plans and similar commitments for further details on pensions and other post-employment benefits. Provisions Significant estimates are involved in the determination of provisions related to onerous contracts and warranty costs. A significant portion of the business is performed pursuant to long-term contracts, often for larger projects. The Group records a provision for onerous sales contracts when current estimates of total contract costs exceed expected contract revenue. Such estimates are subject to change based on new information as the projects progress towards completion. Onerous sales contracts are identified by monitoring the progress of the project and updating the estimate of total contract costs which also requires significant judgment relating to achieving certain performance standards and estimates involving warranty costs. Other - As a global operating business, the Group is exposed to numerous legal risks, particularly in the areas of product liability and tax assessments. Pending and future proceedings often involve complex legal issues and are subject to substantial uncertainties. The outcome of such proceedings cannot be predicted with certainty. Thus, an adverse decision in a lawsuit could result in additional costs and that could significantly impact the Group s business and results of operations. Accordingly, management exercises considerable judgment in determining whether it is more likely than not that such a proceeding will result in an outflow of resources and whether the amount of the obligation can be reliably estimated. 54 p. 154

152 5. Acquisitions and investments ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 In December 2010 the Group purchased all outstanding shares of FastViewer Holding GmbH and FastViewer GmbH & Co. KG, both Neumarkt, Germany, and in February 2011 FastViewer Software Development GmbH, Vienna, Austria for a cash consideration of 5.0 million. The purchase price could be increased by a contingent consideration based on the achievement of negotiated targets which were estimated at 2.1 million in total as of reporting date ( 4.9 million at acquisition date). The earn out criteria stipulated by the purchase agreement include revenue targets for the years ended December 31, 2011 and In addition, R&D targets are defined along an agreed R&D roadmap for calendar year 2011 and Thirdly, a certain headcount needs to be maintained from the acquisition date until December 31, In compliance with IFRS 3 and based on the initial total purchase price of 9.9 million, EN identified an intangible asset of 9.5 million as of the acquisition date. The two operating entities FastViewer GmbH & Co. KG and FastViewer Software Development GmbH were initially consolidated within EN Group in February FastViewer Holding GmbH was an immaterial entity and initially presented as other investment. In August 2011 FastViewer GmbH & Co. KG merged into FastViewer Holding GmbH operating thereafter under the new name of FastViewer GmbH. The Group s rationale for the acquisition was to expand its OpenScape Unified Communications and Collaboration product portfolio. EN expects further financial benefits from this transaction as web, video and mobile collaboration are considered to be critical components of enterprise communications infrastructure in order to achieve cost savings and employee productivity improvements. On June 14, 2011 Enterprise Networks Group acquired 7,188,442 common shares of incontact, Inc., Salt Lake City, USA, a leading provider of on-demand call center software and call center agent optimisation tools for 16.8 million (USD 24.3 million) and a discount of 3.2 million (USD 4.7 million) compared to the quoted value of the shares. As a result of this transaction, EN holds a 16.7% share of incontact. Under the terms of a commercial agreement entered into with incontact, EN is the exclusive master distributor for the incontact cloud contact center software portfolio in Europe, Middle East and Africa and has the ability to resell the incontact portfolio in North America, APAC and Latin America. In addition, according to the agreement, EN is committed to generate a minimum of 10.4 million (USD 15 million) of software revenue to incontact over a 2-year timeframe, with 3.5 million (USD 5 million) to be generated in calendar year 2012 and 6.9 million (USD 10 million) to be generated in calendar year incontact s stock is traded on the NASDAQ. 6. Assets/Liabilities classified as held for sale and liquidation As of September 30, 2011 and 2012 the Group accounted for one investment as asset held for sale with a carrying value of nil. Management is confident that it will be able to retire this business by the end of fiscal year p. 155

153 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Revenues Significant categories of revenue recognised during the period: In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Sale of products 1,003,529 1,004,935 Rendering of services 1,073,000 1,128,719 Total revenue 2,076,529 2,133,654 Total revenue contains revenue from long-term construction contracts. Contract revenue recognised as revenue in the period amounts to 12.9 million (2011: 21.1 million). The aggregate amount of costs incurred and recognised profits to date amounts to 24.7 million (2011: 29.9 million) reflecting accumulated revenues from the start of a project. Advance payments received for long-term contracts amount to 0.9 million (2011: 9.7 million). 8. Other gains and losses In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Other gains Gains on disposal of property, plant and equipment and other intangible assets 1, Other gains 19,121 5,792 Total other gains 21,011 6,701 Other losses Losses on disposal of property, plant and equipment and other intangible assets (688) (273) Losses from disposal of business - (1,303) Other losses (4,683) (2,860) Total other losses (5,371) (4,436) Total other gains and losses 15,640 2,265 Other gains mainly include 9.1 million due to the release of the provision for anniversary awards, 3.0 million for the realisation of a tax claim, 2.0 million for a social security credit and 0.8 million for the release of a provision for VAT risk. In fiscal year 2011 other gains included among others 2.4 million due to the release of a provision for risks previously related to an entity held-forsale and 0.4 million of income from sale of contracts to distributors. In 2011 other losses primarily included loss from sale of a previously fully consolidated entity of 1.3 million. 9. Goodwill impairment In fiscal year 2012 and 2011, management did not identify any impairment need for goodwill. See also Note 16 Goodwill and other intangibles for further information. 56 p. 156

154 10. Finance (expense) / income, net In thousands of ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Year ended September 30, 2012 Year ended September 30, 2011 Interest expense, net (7,555) (1,350) Expense from pension plans and similar commitments, net (1,061) (265) Income from assets classified as held for sale Other financial income, net 6,288 2,802 The total amounts of interest income and expense were as follows: In thousands of Year ended September 30, 2012 (2,328) 1,849 Year ended September 30, 2011 Interest income 22,655 28,401 Interest expense (30,210) (29,751) Interest expense, net (7,555) (1,350) The components of income from pension plans and similar commitments, net were as follows: In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Expected return on plan assets 24,030 23,913 Interest cost (25,091) (24,178) Expense from pension plans and similar commitments, net (1,061) (265) Service cost for pension plans and similar commitments are allocated among functional costs (cost of goods sold and services rendered, research and development expenses, marketing and administrative expenses). In fiscal year 2011 the income from assets classified as held for sale results mainly from the gains of re-consolidating the Morocco entity as of September 30, Other financial income, net mainly includes the realised and unrealised gains and losses on monetary balance sheet items denominated in a foreign currency, income from investments and losses from fair value changes of derivative financial instruments. 57 p. 157

155 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Income taxes Income tax (expense)/benefit consists of the following: Year ended Year ended In thousands of September 30, 2012 September 30, 2011 Current tax (16,892) (9,401) Deferred tax (11,774) 15,646 Income tax expense (2011: Income tax benefit) (28,666) 6,245 The current tax expense in 2012 includes adjustments recognised for current tax of prior periods of 3.9 million (2011: 1.6 million). A deferred tax benefit of 7.8 million (2011: 21.0 million) relates to the reversal of temporary differences in For the fiscal year ended September 30, 2012 the taxable income of the Dutch companies was subject to Dutch federal corporation income tax at a base rate of 25.00%. The differences between the income tax expenses computed at the rate 25.00% (2011: 25.13%) and those recognised in the Consolidated Statement of Income are reconciled as follows: In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Loss before tax (114,431) (85,706) Expected income tax benefit 28,608 21,538 (Increase) decrease in income tax resulting from: Non-deductible losses and expenses (7,349) (8,637) Goodwill impairment - Tax-free income 7,637 2,201 Taxes for prior years (3,665) 5,524 Change in recognition and measurement of deferred tax assets (58,597) (19,246) Effect from change in tax rate Foreign tax rate differential 6,443 4,084 Other, net (1,784) 446 Actual income tax expense (2011: Actual income tax benefit) (28,666) 6,245 The change in recognition and measurement of deferred tax assets includes a deferred tax expense of 20.3 million (2011: 5.0 million) from previously recognised tax loss carry-forwards due to continued operating losses and the uncertainty as to the Group s ability to utilise these tax loss carryforwards in the future. 58 p. 158

156 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Deferred income tax assets and liabilities, on a net basis are summarised as follows: In thousands of September 30, 2012 September 30, 2011 Assets: Financial assets 8 - Other intangible assets 14,197 20,317 Property, plant and equipment 18,986 20,893 Inventories 9,391 8,058 Receivables 8,343 9,833 Pension plans and similar commitments 32,826 13,758 Provisions 10,176 12,442 Liabilities 8,971 23,251 Tax losses and credit carry-forward 30,866 50,077 Other 8,229 9,622 Deferred tax assets 141, ,251 - Thereof current deferred tax assets 31.0 million (2011: 35.0 million) Netting (93,462) (145,266) Deferred tax assets as presented in the balance sheet 48,531 22,985 Liabilities: Other intangible assets (54,611) (54,648) Property, plant and equipment (2,212) (2,962) Inventories (501) (1,078) Receivables (52,570) (66,412) Pension plans and similar commitments (67) (9,046) Provisions (6,211) (11,626) Liabilities (15,218) (5,991) Other (2,666) (6,063) Deferred tax liabilities (134,056) (157,826) - Thereof current deferred tax liabilities 47.0 million ( million) Netting 93, ,266 Deferred tax liabilities as presented in the balance sheet (40,594) (12,560) Net deferred tax assets 7,937 10,425 The change in net deferred tax assets does not equal the deferred tax expense of the current period. This is due to deferred taxes that are recognised as income or expense directly in equity. As of September 30, 2012 the Group had million (2011: million) of gross tax loss carry-forwards for local income tax and million (2011: million) of gross tax loss carry-forwards for corporate income tax. Deferred tax assets have not been recognised in respect of the following items (gross amounts): In thousands of September 30, 2012 September 30, 2011 Deductible temporary differences 27,690 41,448 Tax loss and credit carry-forward (local income tax) 607, ,238 Tax loss and credit carry-forward (corporate income tax) 592, ,244 Additionally, deferred tax assets of 9.4 million (2011: 9.3 million) have not been recognised for tax credits. 59 p. 159

157 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The amount of unrecognised tax loss carry-forwards as of September 30, 2012 includes million (2011: million) which is related to tax loss carry-forwards for German trade tax purposes only. The corresponding tax effect amounts to 90.6 million (2011: 62.6 million). The following schedule shows the expiry periods of unrecognised tax loss carry-forwards: Unrecognised tax loss carry-forwards that expire in In thousands of September 30, 2012 September 30, years 36,887 21, years 13,260 6, years 19,433 14, years and later 75,002 83,789 Unrecognised tax loss carry-forwards (local income tax) that expire in In thousands of September 30, 2012 September 30, years 20,817 21, years 1,079 1, years years and later 15,213 12,708 Additionally, an amount of 0.9 million (2011: 0.7 million) of unrecognised tax credits will expire in 1-9 years and of 8.5 million (2011: 8.6 million) in 10 years and later. The Group provides for income taxes or foreign withholding taxes on the cumulative earnings of subsidiaries when it is determined that such earnings either will be subject to taxes or are intended to be repatriated. In fiscal year 2012, income taxes of subsidiaries have not been provided for because such earnings will either not be subject to any such taxes or are intended to be indefinitely reinvested in those operations. Including the items charged or credited directly to equity and the income taxes from operations, the total income tax benefit/(expense) consists of the following: In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Income tax (expense)/benefit (28,666) 6,245 Deferred taxes on income and expense recognised directly in equity 7,826 (5,071) Total (20,840) 1, p. 160

158 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Trade and other receivables In thousands of Note September 30, 2012 September 30, 2011 Trade receivables from the sale of goods and services , ,712 Allowance for doubtful debts 12.1 (26,645) (32,215) 318, ,497 Receivables from finance leases ,855 89,898 Receivables from related companies ,926 12, , , Trade receivables Trade receivables disclosed above are classified as loans and receivables and are therefore measured at amortised cost. As of September 30, 2012 and 2011 the analysis of the age of trade receivables that are past due but not impaired is as follows: In thousands of September 30, 2012 September 30, days 29,227 24, days 2,640 6, days 1,888 7,878 more than 90 days 6,488 17,072 Total 40,243 56,473 Information regarding the Group s exposure to credit and currency risks and impairment losses related to trade and other receivables are disclosed in note 29. Movement in the allowance for doubtful debts In thousands of September 30, 2012 September 30, 2011 Balance at beginning of the fiscal year (32,215) (42,564) Recovery of bad debt, net 5,642 9,665 Additions due to business combinations - (7) Changes due to consolidation Group - (181) Reduction due to divestures Foreign exchange translation differences (72) 633 Balance at end of the year (26,645) (32,215) 61 p. 161

159 12.2 Receivables from finance leases ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Present value of minimum finance leases receivable are presented in the balance sheet as follows: In thousands of September 30, 2012 September 30, 2011 Receivables from finance leases, current 84,855 89,898 Receivables from finance leases, long-term portion (see also note 18) 112, ,724 Gross amount of minimum future lease payments to be received is as follows: 197, ,622 In thousands of September 30, 2012 September 30, 2011 Within 1 year 100, ,673 Between 1 and 2 years 64,619 74,005 Between 2 and 3 years 40,165 47,161 Between 3 and 4 years 19,462 25,973 Between 4 and 5 years 6,397 12,478 After 5 years 2,205 5,028 Minimum future lease payments to be received 232, ,318 The following table shows a reconciliation of the minimum future lease payments to the gross and net investment in leases and to the present value of the minimum lease payments receivable: In thousands of September 30, 2012 September 30, 2011 Minimum future lease payments 232, ,318 Plus: Unguaranteed residual values - - Gross investment in leases 232, ,318 Less: Unearned finance income 35,388 41,767 Less: Allowance for doubtful accounts Net investment in leases 197, ,622 Present value of minimum lease payments receivable 197, ,622 The gross investment in leases and the present value of minimum lease payments receivable are due as follows: In thousands of September 30, 2012 September 30, 2011 Gross investment in leases 232, ,318 Within 1 year 100, ,673 1 to 5 years 130, ,617 Thereafter 2,205 5,028 Present value of minimum lease payments receivable 197, ,622 Within 1 year 84,855 89,898 1 to 5 years 110, ,702 Thereafter 1,922 4,022 The Group offers customer financing to assist customers in their acquisition of Group products. Customer financing qualifying as finance leases primarily relates to leases of IT telephony infrastructure products. These lease contracts typically last 5 to 7 years. Actual cash flows vary from contractual maturities due to future sales of finance receivables, prepayments and write-offs. 62 p. 162

160 12.3 Receivables from related companies ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Related companies are those companies or a group of companies which control EN BV or have a significant influence on EN BV Transfer of financial assets As of September 30, 2012 the Group transferred no trade receivables to an unrelated entity (September 30, 2011: 7.6 million). Pursuant to previously underlying agreements the Group was obligated to retain the credit risk of those receivables. Accordingly, the Group recognised the full carrying amount of these receivables and had recognised the cash received on the transfer as a financial liability. The carrying amount of the associated liability was 5.3 million as of September 30, 2011 ( nil million as of reporting date). 13. Other current financial assets In thousands of September 30, 2012 September 30, 2011 Restricted cash 17,685 19,195 Related party trade and other receivables - 1,219 Receivables from employees 2,448 2,825 Derivative financial instruments Debit balances of trade accounts payable Other 18,999 10,366 39,712 34,697 Restricted cash relates to collateral given to banks to support guarantees and other security provided by the banks on behalf of the Group. Other mainly include a receivable of 12.6 million against OTE (Greece) and 0.9 million (September 30, 2011: 2.3 million) from the sale of investments. 14. Inventories In thousands of September 30, 2012 September 30, 2011 Raw materials and supplies 23,589 25,837 Work in process and costs and earnings in excess of billings on uncompleted contracts 78,310 89,307 Finished goods and products held for resale 77,285 80,723 Advances to suppliers 1,348 1, , ,107 The methods used in the fiscal year 2012 to determine impairment were the same as in the prior year. The cost of inventories recognised as an expense in fiscal year 2012 was million (2011: million) including 2.1 million in respect of write-downs of inventory to net realisable value relating to one specific customer. 63 p. 163

161 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Work in process and costs and earnings in excess of billings on uncompleted contracts also includes construction contracts (accounted for using the percentage-of-completion method) with net asset balances, where the contract costs plus recognised profits less recognised losses exceed progress billings. Liabilities from contracts for which progress billings exceed costs and recognised profits less recognised losses are recognised in other current liabilities (see note 20). Cost and earnings in excess of billings on uncompleted contracts amount to 10.3 million (September 30, 2011: 16.0 million). 15. Other current assets In thousands of September 30, 2012 September 30, 2011 Prepaid expenses 30,881 32,542 Tax receivables 18,945 19,592 Other 4,653 4,074 54,479 56,208 Tax receivables include both VAT 10.5 million (September 30, 2011: 10.3 million) and other taxes 8.4 million (September 30, 2011: 9.3 million) which are levied in Germany nil million (September 30, 2011: nil million) and other countries 18.9 million (September 30, 2011: 19.6 million). 64 p. 164

162 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Goodwill and other intangible assets Patents, licenses and similar rights Total other intangibles Goodwill In thousands of Capitalised software costs Advances Cost as of September 30, , ,574 1, , ,615 Additions 25,104 5,261-30,365 2,381 Changes due to consolidation group (15) 10,113-10,098 - Reclassification - 1,206 (1,206) 0 - Elimination (11,061) Retirements (39,527) (23,286) - (62,813) - Translation differences (564) Cost as of September 30, , , , ,371 Additions 50,038 10,209-60,247 - Changes due to consolidation group Reclassification 3,819 (3,819) Elimination Retirements (31,126) (91) - (31,217) - Translation differences (32) 9,568-9,536 2,900 Cost as of September 30, , , , ,271 Accumulated amortisation as of October 1, 2010 (98,477) (160,253) - (258,730) (28,670) Additions and impairments (21,579) (40,631) - (62,210) - Changes due to consolidation group Elimination ,061 Retirements 39,516 23,868-63,385 - Translation differences (10) (1,127) - (1,138) 24 Accumulated amortisation as of September 30, 2011 (80,540) (178,143) 0 (258,683) (17,585) Additions and impairments (26,196) (31,148) - (57,344) - Changes due to consolidation group Reclassification (82) Retirements 31, ,217 - Translation differences (115) (5,872) - (5,987) (788) Accumulated amortisation as of September 30, 2012 (75,807) (214,990) 0 (290,797) (18,373) Net book value as of September 30, , , ,733 98,786 Net book value as of September 30, , , , , p. 165

163 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Elimination of goodwill in fiscal year 2011 refers to the release of goodwill items fully written down prior to the acquisition of the SER business in fiscal year This transaction is deemed a non-cash set off from the goodwill ledgers. In fiscal year 2012 impairment testing was performed as of June 30, 2012 with no further impact on net book value of goodwill. The recoverable amounts of two separate cash-generating units (Siemens Enterprise Communications Inc., US with a goodwill net book value of 8.8 million and Enterasys Group with a goodwill net book value of 89.8 million) were based on a value in use calculation adopting discounted cash flow projections (a five year cash flow projection for both Enterasys Group and Siemens Enterprise Communications Inc., US) with reference to a WACC in a range between 15 and 19 percent. The long term growth rate assumption is about 3% per year. Management did not identify any further impairment need since the marketable equity value exceeds significantly the net book equity values of the respective CGUs. As of September 30, 2012 goodwill amounts to million (September 30, 2011: 98.8 million). The Group has identified only minor impairment needs: in fiscal year million for the residual value of the SER trade name and in fiscal year million relating to capitalised software costs since the corresponding product sales were terminated. Patents, licenses and similar rights include trademarks, customer relations, technology, patents, other patents, licenses and similar rights. The amortisation and impairment expenses have been included in various functional cost areas of the income statement. The intangible assets include the following significant assets: In thousands of September 30, 2012 September 30, 2011 Patents, licenses and similar rights Customer relationships 92, ,667 Technologies 17,106 25,268 Trademark 7,790 9,499 Other 15,863 8, , ,592 Software Software for internal use 4,610 6,084 Software to be marketed 28,210 8,926 Software under development 24,753 15,131 57,573 30,141 The net book value as of September 30, 2012 and 2011 of those intangible assets which had been recognised in the acquisition of the enterprise communications business from SAG is as follows: In thousands of September 30, 2012 September 30, 2011 Customer relationships 82,304 96,572 Technologies 11,079 12,105 Trademarks , , p. 166

164 17. Property, plant and equipment ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Land and buildings Technical machinery and equipment Other and Office equipment Equipment leased to others Advances to suppliers and construction in progress In thousands of Total Cost as of October 1, ,058 41, , ,165 14, ,330 Additions ,270 24,150 3,796 40,166 Changes due to consolidation group 93 (7) ,143 Disposal and reclassifications (352) (2,691) (16,140) (32,072) (12,256) (63,511) Translation differences (236) (1,644) (2,110) (13,168) 312 (16,846) Cost as of September 30, ,126 37, , ,680 5, ,282 Additions 1, ,743 18,380 6,932 40,502 Changes due to consolidation group Disposal and reclassifications (1,175) (2,912) (10,913) (49,679) (3,793) (68,472) Translation differences 159 (602) 2,513 2,995 (11) 5,054 Cost as of September 30, ,326 34, , ,376 9, ,366 Accumulated depreciation as of October 1, 2010 (10,015) (30,347) (179,075) (304,131) (13,375) (536,943) Depreciation (1,975) (5,165) (17,117) (26,078) - (50,335) Impairments Changes due to consolidation group (76) 34 (310) (475) - (827) Disposal and reclassifications 822 2,672 17,224 18,533 10,318 49,569 Translation differences 152 1,253 1,765 10,729 (342) 13,557 Accumulated depreciation as of September 30, 2011 (11,092) (31,553) (177,513) (300,963) (3,399) (524,520) Depreciation (1,953) (2,923) (16,111) (24,257) - (45,244) Impairments (665) - (665) Changes due to consolidation group Disposal and reclassifications 1,302 2,402 14,603 41,474-59,781 Translation differences (114) 657 (2,104) (2,719) - (4,280) Accumulated depreciation as of September 30, 2012 (11,857) (31,417) (181,125) (287,130) (3,399) (514,928) Net book value as of September 30, ,034 5,887 29,651 53,717 2, ,762 Net book value as of September 30, ,469 2,740 31,382 39,246 5,601 90,438 Property, plant and equipment acquired in the business combination for which the fair value based on the purchase price allocation is approximated by the net book value at September 30, 2008 are presented at historical acquisition cost reduced by historical depreciation. 67 p. 167

165 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 In connection with the Equipment leased to others the future minimum lease payments under noncancellable operating leases as of September 30, 2012 and 2011 are as follows: In thousands of September 30, 2012 September 30, 2011 Within 1 year 30,675 32,891 1 to 5 years 42,644 65,346 Thereafter ,808 99,063 See note 3.17 for a general description of the Group s accounting treatment of leasing arrangements. 18. Other financial assets In thousands of September 30, 2012 September 30, 2011 Receivables from finance leases (see also note 12.2) 112, ,724 Long-term pension fund 13,183 15,780 Restricted cash 4,079 6,416 Trade receivables from sale of goods and services 6,440 7,174 Other 46,931 42, , ,552 Long-term pension fund relates to assets in relation to defined contribution plans in the US. Restricted cash includes collateral given to banks to secure guarantees and other obligations incurred by those banks on behalf of the Group. Other include in financial year 2012 mainly the investment value in incontact ( 36.1 million; September 30, 2011: 18.4 million), other receivables which relate to the sale of investments of 3.3 million (September 30, 2011: 4.1 million) and a financial asset which is held in Austria of 5.8 million (September 30, 2011: 5.4 million). 19. Other current financial liabilities In thousands of September 30, 2012 September 30, 2011 Credit balances of trade accounts receivable 8,014 7,455 Derivative financial instruments (see note 28) Liabilities to related companies 1, Other 11,235 25,614 20,686 34,378 Other represent mainly accrued interest of 6.8 million (therein relating to senior secured notes at 6.7 million and credit facility at 0.1 million; September 30, 2011: 7.3 million). In addition, the Group has a 2.1 million (September 30, 2011: 1.6 million) current financial liability due to outstanding earn out criteria in course of the acquisition of FastViewer Group. 68 p. 168

166 20. Other current liabilities ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 In thousands of September 30, 2012 September 30, 2011 Other employee related costs 40,782 53,055 Payroll and payroll related expenses 48,925 67,329 Bonus obligations, GMIP 19,842 33,143 Total liabilities for employee related costs 109, ,527 Deferred income 71,858 80,266 Advance payments received 30,370 35,610 Sales tax and other tax liabilities 33,917 36,953 Billings in excess of costs and estimated earnings 3,898 3,299 Other liabilities 12,455 12,560 Total other 152, ,688 Total 262, ,215 Other employee related costs primarily include vacation payments, accrued overtime and service anniversary awards, as well as severance payments. The severance payments result from the ongoing reorganisation of the EN business. Bonus obligations exclusively include extra payments based on the Group-wide global management incentive programme (GMIP). Deferred income mainly results from managed service and maintenance contracts. Advance payments received mainly relate to inventories which amount to 30.4 million (September 30, 2011: 35.6 million). Other liabilities mainly represent liabilities for outstanding invoices and expenses. 21. Debt In thousands of September 30, 2012 September 30, 2011 Short-term Senior secured notes, 10.75% 22,351 21,640 Loans from banks 9,433 11,548 Obligations under finance leases 19,396 11,384 Other financial indebtedness 12, Short-term debt and current maturities of long-term debt 63,827 45,432 Long-term Senior secured notes, 10.75%, due , ,724 Revolving credit facility, 5.5%, due ,000 - Loans from banks 14,555 13,169 Obligations under finance leases 34,351 29,251 Other financial indebtedness 0 12,527 Face value of notes and bonds Long-term debt 218, , p. 169

167 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 As of September 30, 2012, the total weighted-average interest rate of short-term loans from banks was 4.14% (September 30, 2011: 4.2%) and for long-term loans from banks 6.44% (September 30, 2011: 3.4%). Obligations under finance leases As of September 30, 2012 and 2011, the finance lease liabilities are as follows: Due, in thousands of Minimum lease payment obligation September 30, 2012 Unamortised interest expense Present value of minimum lease payment obligation Within 1 year 22,241 (2,845) 19,396 1 to 5 or more years 37,042 (2,691) 34,351 Total 59,283 (5,536) 53,747 Due, in thousands of Minimum lease payment obligation September 30, 2011 Unamortised interest expense Present value of minimum lease payment obligation Within 1 year 13,836 (2,452) 11,384 1 to 5 or more years 32,757 (3,506) 29,251 Total 46,593 (5,958) 40,635 The Group s obligations under finance leases primarily relate to arrangements with Siemens Finance & Lease GmbH, Munich (in the following SF&L ), a subsidiary of SAG to which the Group has sold and leased back certain telecommunications platform equipment. Specific details of the lease agreements are assessed on a case by case basis. The agreements in place between the Group and SF&L do however provide that in circumstances where equipment is leased to an end customer from the Group, the insolvency risk from the end customer is borne by S F&L. Senior Secured Notes In November 2010, the Group through its subsidiary EN Germany Holdings B.V. ( Issuer ) issued senior secured notes in a private placement transaction with an aggregate principal balance of million that are scheduled to mature in November The senior secured notes require semi-annual interest payments each May and November based on a contractual annual interest rate of 10.75%. The senior secured notes were issued with an initial issuance discount equal to 5.6 million. The senior secured notes are guaranteed by Enterprise Networks Holdings B.V., the parent of EN Germany Holdings B.V., and by certain of the direct and indirect subsidiaries of Enterprise Networks Holdings B.V. The Indenture contains covenants that restrict the ability of the Enterprise Networks Holdings B.V. and certain of its subsidiaries, including EN Germany Holdings B.V., to incur more debt, pay dividends, repurchase stock, and make distributions and certain other payments and investments; create liens, enter into sale and leaseback transactions, enter into transactions with affiliates, transfer or sell assets, engage in certain activities, impair security interests, provide guarantees of other debt, agree to restrictions on dividends by subsidiaries, and merge or consolidate. 70 p. 170

168 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 On or within 30 days following each June 30 and December 31, commencing June 30, 2011, EN Germany Holdings B.V. must make an offer to all holders of Notes to repurchase all or any part of such holders Notes at a cash price equal to 101% of the principal amount, up to a maximum of 12.5 million, including accrued and unpaid interest and any amounts required for taxes or withholdings, if any, to the date of repurchase. Based on its amortised cost, 22.4 million of the total notes are recognised as short-term debt as of reporting date since this amount plus future accrued interest may become payable to the note holders within the coming 12 months. Revolving Credit Facility In November 2010, EN Germany Holdings B.V. entered into a revolving credit facility to provide for 40.0 million (or its equivalent in United States dollars ( USD )) of committed financing. As of June 21, 2012, 40.0 million out of the credit facility have been drawn. The revolving credit facility will terminate on November 9, Subject to the terms of the revolving credit facility, amounts outstanding may be repaid and reborrowed until the maturity date. The revolving credit facility is guaranteed by Enterprise Networks Holdings B.V., the parent of EN Germany Holdings B.V., and by certain of the direct and indirect subsidiaries of Enterprise Networks Holdings B.V. The revolving credit facility bears interest at a variable rate per annum equal to, at the option of the Borrower, LIBOR or EURIBOR (but not less than 1.50%), respectively plus a margin of 4.0% per annum and certain additional costs. As of reporting date, management opted for a EURIBOR Rate Loan denominated in Euro which currently bears 5.50% interest p.a. The revolving credit facility contains customary negative covenants and requires EN Germany Holdings B.V. and each guarantor to observe certain customary affirmative covenants. Further, the revolving credit facility includes financial covenants that require EN Group to meet certain financial covenant thresholds. 22. Pension plans and similar commitments Defined benefit plans All German and several other Group entities provide defined retirement benefits to their employees based on collective or individual contractual agreements, voluntary commitment by the employers or statutory regulations. Retirement benefits also include retiree medical or health care coverage in a few countries. The plans are post-employment benefit plans under IAS 19. Many employees are also entitled to country specific other long-term benefits under defined benefit plans which are not post-employment benefits under IAS 19 and as such not covered by pension or retirement benefit provisions but recognised in other balance sheet provisions. 71 p. 171

169 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Defined contribution plans The Group provides defined contribution plans for pensions and other post-employment benefits or makes contributions to social pension funds based on legal regulations. These plans create no balance sheet liabilities because the only obligation of the Group is to pay contributions to the plans throughout the year. The total expense recognised in the income statement of 10.4 million (2011: 11.2 million) represents contributions payable to these plans by the Group at rates specified by the regulations of the plans. As of September 30, 2012, contributions of 1.2 million (September, : 1.0 million) were due for the 2012 reporting period but had not been paid to the plans. Balance sheet Certain of the Group's retirement benefit plans are funded through legally separate and independent pension funds. Balance sheet provisions are recorded of unfunded plans and for deficits in the funded status of funded plans. Retirement benefits are normally based on the remuneration and years of service of the employees. They are payable in the form of lifelong annuities (pensions), lump sum cash, combinations of lump sums and pensions or in the form of reimbursements of retiree healthcare costs. Retirement plans often include death benefits to surviving beneficiaries, long-term disability benefits or cash payments on earlier termination of employments. Provisions for pensions and other post employment benefits recognised on the balance sheet are equal to the excess of the actuarial present value of the defined benefit obligation (DBO) over the fair value of plan assets as of the reporting date adjusted for (a) unrecognised past service cost and (b) surplus plan assets without a realisable economic benefit for the Group. The DBO is determined using the projected unit credit actuarial method and actuarial valuation assumptions to account for uncertain future developments such as, e.g. price inflation or salary increases. The interest rates used to discount expected future benefit payments in the DBO calculation reflect yields on high quality corporate bonds with maturities matching the durations of the obligations. In countries without a deep corporate bond market government bond yields were used to determine the discount rates. Actuarial valuations are undertaken annually. 72 p. 172

170 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The table below shows the reconciliation of existing obligations and plan assets to the amount recognised on the balance sheet: September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Reconciliation of funded status to balance sheet Fair value of plan assets 475, , , , , ,173 Present value of funded defined benefit obligation (577,858) (306,923) (270,935) (462,446) (220,004) (242,442) Funded status (102,472) (102,324) (148) (61,640) (49,371) (12,269) Present value of unfunded defined benefit obligation (27,139) (14,912) (12,227) (23,106) (12,486) (10,621) Past service cost not yet recognised in balance sheet (163) 0 (163) (170) 0 (170) Unrecognised asset due to IAS 19.58b (8,114) 0 (8,114) (7,740) 0 (7,740) Liability recognised on the balance sheet (137,888) (117,236) (20,652) (92,656) (61,857) (30,799) Pension asset 2,421 2, ,282 3, Pension liability (140,309) (119,582) (20,727) (95,939) (65,100) (30,839) The reconciliation above is split between existing obligations and plan assets in Germany and Other. Other represents all non-german countries within the Group. Statement of income The components of the periodic benefit expense are recognised as follows: the service cost component and where applicable the past service cost (amortisation) component are reported in the operating result. The interest cost component and the expected return on plan assets component of the period are recognised in the finance income, see note 10. The Group has adopted the option under IAS 19 for recognising actuarial gains or losses as well as asset gains or losses. Under this option these gains and losses are recognised immediately in the year they arise in equity (retained earnings) rather than the income statement. As a consequence of electing the option, effects of the asset ceiling in accordance with IAS 19.58(b) had to be recognised in the same way as actuarial gains and losses. 73 p. 173

171 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The table below includes the periodic profit and loss effects for the fiscal years ended September 30, 2012 and 2011: September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Analysis of amounts recognised in the income statement Current service cost 10,940 9,569 1,371 12,291 10,717 1,574 Interest cost 25,091 12,495 12,596 24,178 12,432 11,746 Expected return on plan assets (24,030) (10,266) (13,764) (23,913) (11,321) (12,592) Recognition of past service cost (52) 0 (52) (Gains)/losses due to settlements, curtailments, terminations and divestures (6) 0 (6) (1,026) (1,052) 25 Total (gains)/expenses recognised in profit and loss 11,943 11, ,417 10,777 1,640 September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other History of asset values and DBO, surplus/deficit Fair value of plan assets 475, , , , , ,173 Present value of defined benefit obligation (604,997) (321,835) (283,162) (485,552) (232,490) (253,063) Deficit in the plans (129,611) (117,236) (12,375) (84,746) (61,857) (22,889) The fair value of plan assets and DBO as of September 30, 2010 amounted to million and (501.0) million, respectively. As of September 30, 2009, the fair value of plan assets and DBO were million and (415.4) million. As of September 30, 2008, the fair value of plan assets and DBO were million and (370.4) million. Actuarial gains and losses reflect changes in actuarial assumptions and experience adjustments for the fiscal years ended September 30, 2012 and 2011 as described below: September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other History of gains and losses (Gains)/losses due to changes in assumptions 81,882 62,677 19,205 (34,701) (38,054) 3,353 Experience (gains)/losses on plan liabilities 4,402 6,428 (2,026) (5,381) (9,206) 3,825 Experience (gains)/losses on plan assets (41,454) (17,678) (23,776) 21,307 18,940 2,367 Total (gains)/losses 44,830 51,427 (6,597) (18,775) (28,320) 9,545 In fiscal year 2010 total losses amounted to 44.5 million including 63.3 million of losses due to changes in assumptions, 16.5 million of experience gains on plan assets and 2.3 million of experience gains on plan liabilities. In fiscal year 2009 total losses amounted to 54.8 million including 64.3 million of losses due to changes in assumptions, 1.0 million of experience gains on plan assets and 8.5 million of experience gains on plan liabilities. 74 p. 174

172 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The table below presents the amounts recognised directly in equity through other comprehensive income for the fiscal years ending September 30, 2012 and 2011: September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Cumulative amount of gains and losses recognised directly in equity (Gains)/losses due to changes in assumptions 81,882 62,677 19,205 (34,701) (38,054) 3,353 Experience (gains)/losses on plan liabilities 4,402 6,428 (2,026) (5,381) (9,206) 3,825 Experience (gains)/losses on plan assets (41,454) (17,678) (23,776) 21,307 18,940 2,367 Change in unrecognised assets due to paragraph IAS 19.58b (75) 0 (75) Total (gain)/loss recognised directly in equity 45,550 51,427 (5,877) (18,850) (28,320) 9,470 Cumulative amount of losses recognised directly in equity 130,287 96,841 33,447 81,684 45,414 36,270 The cumulative amount of gains and losses recognised directly in equity does not include the effect of the change in the asset-ceiling amount according to IAS 19 paragraph 58(b) (2012: 0.7 million (loss); 2011: 0.1 million (gain)). 75 p. 175

173 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The defined benefit obligation and plan assets changed for the fiscal years ending September 30, 2012 and 2011 as follows: September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Change in defined benefit obligation Defined benefit obligation Beginning of year 485, , , , , ,916 Current service cost 10,940 9,569 1,371 12,291 10,717 1,574 Interest cost 25,091 12,495 12,596 24,178 12,432 11,746 Actual plan participants' contributions Past service cost (45) 0 (45) Curtailments (6) 0 (6) (1,064) (1,052) (12) Settlements Termination benefits Net increase in liabilities from acquisitions/disposals (58) (58) 0 (395) (70) (325) Actual net benefits paid from fund (10,018) 0 (10,018) (11,789) 0 (11,789) Actual net benefits paid by employer (2,278) (1,765) (513) (2,544) (1,353) (1,191) Actual expenses/taxes and premiums paid (Gains)/losses due to changes in assumptions 81,882 62,677 19,205 (34,701) (38,054) 3,353 Experience (gains)/losses 4,402 6,428 (2,026) (5,381) (9,206) 3,825 Exchange rate (gains)/losses 9, ,262 2, ,726 Defined benefit obligation at end of year 604, , , , , ,063 September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Change in fair value of plan assets Fair value of plan assets as of beginning of year 400, , , , , ,397 Expected return on plan assets 24,030 10,266 13,764 23,913 11,321 12,592 Actuarial gains/(losses) on plan assets 41,454 17,678 23,776 (21,307) (18,941) (2,367) Actual employer contributions 10,894 6,022 4,872 14,060 10,674 3,386 Actual plan participants' contributions Actual net benefits paid from fund (10,018) 0 (10,018) (11,789) 0 (11,789) Settlements Net increase in assets from acquisitions/disposals Exchange rate gains/(losses) 7, ,947 1, ,640 Fair value of plan assets at end of year 475, , , , , , p. 176

174 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 September 30, 2012 September 30, 2011 In thousands of Total Germany Other Total Germany Other Actual return on plan assets Expected return on plan assets 24,030 10,266 13,764 23,913 11,321 12,592 Actuarial gains/(losses) on plan assets 41,454 17,678 23,776 (21,307) (18,941) (2,367) Actual return on plan assets 65,484 27,944 37,540 2,605 (7,620) 10,225 The table below sets out weighted averages of key actuarial assumptions used in the calculation of existing benefit obligations and the periodic benefit expense for the fiscal years ended September 30, 2012 and 2011: Main financial assumptions at the balance sheet date September 30, 2012 September 30, 2011 Total German Other Total German Other Discount rate (%) 4,04 3,75 4,36 5,08 5,25 4,93 Price inflation (%) 2,11 2,00 2,87 2,71-2,71 Rate of increases in pensionable salaries (%) 2,98 2,75 4,66 2,99 2,75 4,48 Rate of increases to pensions in payment (%) 1,05 1,75 0,21 0,96 1,75 0,18 Healthcare cost trend rate - initial (%) 8,80-8,80 5,84-5,84 Healthcare cost trend rate - ultimate (%) 8,80-8,80 5,84-5,84 In measuring the defined benefit obligations, the Group s actuaries used the current biometric decrement tables of the regions or countries (e.g., Heubeck mortality tables 2005 G in Germany). The employee turnover rates reflect the relevant experience of Group companies. The discount rate assumptions reflect country or region specific yield rates of high quality corporate bonds (government bonds in those countries where no deep market in such bonds exists) available at the end of the fiscal year with durations corresponding to the average duration of the cash flows. Since the beginning of the fiscal year discount rates have decreased in, as well as outside the Euro Zone, leading to the corresponding actuarial losses due to assumption changes. A discount rate decrease of 25 basis points would increase the defined benefit obligation as of September 30, 2012 by 22.1 million while an increase of 25 basis points would lead to a decrease of the obligations by 20.9 million. No assumption was made, that the long-term medical cost increase rate would decrease for a certain period of time, i.e., the medical cost increase was assumed to remain at its current level. A 100 basis points increase or decrease in the assumed long-term medical cost trend rate would increase or decrease the defined benefit obligation as of September 30, 2012 at about 0.2 million respectively 0.1 million. The pension expense for medical plans would increase or decrease by approximately 0.01 million. 77 p. 177

175 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Plan assets of funded post-employment plans are invested in asset classes for the fiscal years ending September 30, 2012 and 2011 as follows: September 30, 2012 September 30, 2011 Total German Other Total German Other Fair value of plan assets at year end and split by major asset class Equities 37% 47% 29% 34% 44% 26% Government bonds 11% 26% 0% 12% 29% 0% Corporate bonds 41% 26% 53% 41% 27% 52% Property 0% 0% 0% 0% 0% 0% Insurance contracts 5% 0% 8% 5% 0% 9% Other 6% 1% 10% 8% 1% 13% Total 100% 100% 100% 100% 100% 100% The long-term rate of expected return on plan assets was determined on the basis of public and internal capital market reports and forecasts. These assumptions are set as long-term rates and should only be changed in case of significant changes in the underlying portfolios. Employer contributions consist of contributions to funded plan assets and benefits paid directly by the employer. The total amount of employer contributions was about 13.2 million in fiscal year 2012 ( 16.6 million in fiscal year 2011). Expected contributions in fiscal year 2013 are approximately estimated at 11 million. 78 p. 178

176 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Provisions The movement on provisions during the year 2011 and 2012 was as follows: In thousands of Warranties Order related losses and risks Other Total Balance as of September 30, ,018 16,565 25,392 63,975 Additions 9,331 6,993 7,384 23,708 Usage (7,078) (3,110) (6,708) (16,896) Reversals (3,671) (3,194) (2,944) (9,809) (Reduction) due to deconsolidation 52 (4) - 48 Translation differences (84) (175) (175) (434) Other changes 7 - (1,167) (1,160) Balance as of September 30, ,575 17,075 21,782 59,432 Thereof Warranties Order related losses and risks Other Total Short-term 17,674 16,680 17,632 51,986 Long-term 2, ,150 7,446 20,575 17,075 21,782 59,432 In thousands of Warranties Order related losses and risks Other Total Balance as of September 30, ,575 17,075 21,782 59,432 Additions 7,693 2,441 4,041 14,175 Usage (7,903) (8,642) (3,089) (19,634) Reversals (3,218) (5,155) (2,802) (11,175) (Reduction) due to deconsolidation Translation differences 330 (10) Other changes - - (457) (457) Balance as of September 30, ,477 5,709 19,762 42,948 Thereof Warranties Order related losses and risks Other Total Short-term 14,232 4,307 15,872 34,411 Long-term 3,245 1,402 3,890 8,537 17,477 5,709 19,762 42,948 All short term provisions are expected to lead to cash outflows within the next year. More than 90% of the long term provisions are expected to become payable within 5 years after the reporting date. The remainder is due thereafter, assuming that all other factors remain constant. 79 p. 179

177 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Warranties Warranties mainly relate to products sold. See note for further information concerning the Group s policy for estimating warranty provisions. Order related losses and risks Provisions for order related losses and risks are recognised for anticipated losses and risks on uncompleted construction, sales and leasing contracts. Other Other provisions include 3.0 million (September 30, 2011: 2.8 million) for the obligations to preserve business documents; 0.4 million (September 30, 2011: 0.7 million) related to the cancellation of a car scheme previously adopted under SAG ownership, 1.7 million (September 30, 2011: 1.6 million) for royalties and licences, litigations 2.3 million (September 30, 2011: 3.7 million) and 2.9 million for the year-end closing, tax and audit fee (September 30, 2011: 2.3 million). 24. Other liabilities In thousands of September 30, 2012 September 30, 2011 Service anniversary awards - 8,418 Severance payments 2,374 1,529 Other 4,493 3,571 Total liabilities for employee related costs 6,867 13,518 Prepayments of operating leases 11,494 10,408 Other 3,157 3,526 Total deferred income 14,651 13,934 Other 11,554 7,373 Total other 11,554 7,373 Total 33,072 34,825 Other include mainly liabilities related to non-qualified benefit plans at one Group entity in the U.S. ( 5.6 million; September 30, 2011: 5.2 million). 25. Restructuring As a result of the economic environment the Group took significant restructuring actions that included headcount reductions and other cost saving measures. In fiscal year 2012 a total 20.3 million were expensed (2011: 45.0 million), which was allocated to research and development, marketing and selling and general administrative expenses. 80 p. 180

178 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 As of September, 2011 liabilities relating to headcount reduction amount to 34.5 million of which 33.0 million are shown in other current liabilities and 1.5 million are shown in other liabilities. As of September, 2012 liabilities relating to headcount reduction amount to 12.7 million of which 10.3 million are shown in other current liabilities and 2.4 million are shown in other liabilities. Approximately 44.0 million of restructuring costs were paid out in the current fiscal year (2011: million). 26. Equity 26.1 Authorised capital The authorised capital remained unchanged in fiscal year 2011 and 2012 and is shown in the following table: Authorised capital Nominal value of 0.01 each Category Ordinary shares A Ordinary shares B Ordinary shares C Ordinary shares D Cum. pref. shares A Preference shares B Cum. pref. shares C Number of shares 5,100,000 4,900, ,000, ,000,759 Totals Total value in 51, , , , Issued capital As of September 30, 2011 and 2012, the distribution of issued capital was as follows: Issued capital as of September 30, 2011 Number of shares held by Category Ordinary shares A Ordinary shares B Ordinary shares C Ordinary shares D Cumulative preference shares A Cumulative preference shares C Gores I and Gores II 5,100, ,100,259 SAG - 4,900, ,900,259 Glendon Management and EN BV Totals 5,100,000 4,900, ,000,693 Total value in accounted for as Equity Share capital 51, , , Share premium 186,249, ,603, ,999, ,999, ,851, Totals 186,300, ,652, ,000, ,000, ,952, Totals 81 p. 181

179 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Issued capital as of September 30, 2012 Number of shares held by Category Ordinary shares A Ordinary shares B Ordinary shares C Ordinary shares D Cumulative preference shares A Cumulative preference shares C Gores I and Gores II 5,100, ,100,259 SAG - 4,900, ,900,259 Glendon Management and EN BV Totals 5,100,000 4,900, ,000,733 Total value in accounted for as Equity Share capital 51, , , Share premium 186,249, ,603, ,999, ,999, ,851, Totals 186,300, ,652, ,000, ,000, ,952, Pursuant to Art. 23 of the Deed of Amendment to the Articles of Association of EN BV, each share shall grant the right to cast one vote. However, it is highlighted that all resolutions shall be adopted by a majority of votes cast in a meeting where all managing directors of ordinary shares A and ordinary shares B are present or represented, unless otherwise specified in the Articles of Association Fully paid ordinary shares Totals Share capital Share premium Number of shares Balance as of September 30, , ,852, ,000,001 Share issuance Management , Balance as of September 30, , ,852, ,000,141 Share issuance - Management ,00 34 Balance as of September 30, , ,852, ,000,175 Share issuance - Management ,00 40 Balance as of September 30, , ,852, ,000,215 Share issuance Management On May 6, 2010 five members of top management subscribed to a total of 140 Ordinary shares D at a nominal value of 0.01 each. No share premium was agreed and paid. On February 2, 2011 EN BV acquired 31 Ordinary shares D previously issued to management. On August 12, 17 and 19, 2011 the holders of all issued shares resolved to issue 34 Ordinary shares D. Prior to this resolution the Company had entered into individual subscription agreements with each of the staff. No share premium was agreed and paid. 82 p. 182

180 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 On October 13, 2011, November 16, 2011, November 18, 2011 and December 29, 2011 the holders of all issued shares resolved to issue a total of 40 Ordinary shares D. Prior to this resolution the Company had entered into individual subscription agreements with each of the staff. No share premium was agreed and paid Fully paid preference shares Share Share capital premium Number of share Balance as of September 30, ,999,994, No share issuance Balance as of September 30, ,999,994, No share issuance Balance as of September 30, ,999,994, No share issuance Balance as of September 30, ,999,994, The Company has not issued any preference shares in fiscal year 2011 and The preference shares C shall be subordinated to, and rank second in priority, behind the preference shares A, but rank higher than any other shares in the Company that have been issued as of April 24, The preference shares C shall bear interest of 8% per annum on a compounded basis, which will accrue as of April 24, 2009, irrespective of the actual date of issuance of the shares. The preference shares C shall be repayable to SAG either (i) upon unanimous approval by the shareholders or (ii) from earnings of the Company in accordance with the Joint Venture Agreement. The preference shares, which have a par value of 0.01 carry one vote each Retained earnings Other effects in connection with contributions In fiscal year 2011 and 2012, no other equity transactions occurred apart from the issuance of Ordinary shares D (see note ) Profit appropriation The shareholders follow the stipulations for the appropriation of results as rules by Art. 28 of the Articles of Association. For details see note 33. Since the Company incurred a loss for the financial year 2012, the Company was not obligated to record an accrual for an 8% interest in the preferred A and C share profit reserve. 83 p. 183

181 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Commitments and contingencies Senior Secured Notes Future interest payments The senior secured notes require semi-annual interest payments each May and November based on a contractual annual interest rate of 10.75%. In fiscal year 2012 the Group incurred 18.9 million (2011: 19.0 million) nominal interest expenses and anticipates interest payments of 17.6 million per fiscal year in 2013 through 2015 (a total of 61.6 million from October 2012 until maturity in November 2015). The revolving credit facility requires quarterly interest payments each based on a variable annual interest rate of currently 5.5%. The Group incurred nominal interest expense of 0.6 million in fiscal year Based on the current interest rate the Group anticipates interest payments of 0.6 million in the first quarter of fiscal year Due to variable interest terms and potential loan repayments prior to the contractual maturity date (in November 2014), a reliable estimation of further interest payments is not possible. Pledges The obligations under the senior secured notes and the revolving credit facility are jointly and severally guaranteed by the Company, the Issuer and certain subsidiaries of the Company (subsidiary guarantors). Subsidiary guarantors are: Enterprise Communications Funding GmbH, Germany; Siemens Enterprise Communications GmbH & Co. KG, Germany; Leesys Leipzig Electronic Systems GmbH, Germany (previously named: Siemens Enterprise Communications Manufacturing GmbH, Germany); Siemens Enterprise Communications Beteiligungen GmbH & Co. KG, Germany; Enterprise Networks Holdings, Inc., USA; Siemens Enterprise Communications, Inc., USA; Enterasys Networks, Inc., USA (in fiscal year 2012 merged with Gores ENT Holdings, Inc., USA); Siemens Enterprise Communications Ltd., UK; Siemens Enterprise Communications Tecnologia da Informação e Comunicações Corporativas Ltda., Brasil; Siemens Enterprise Communications GmbH, Austria; Siemens Enterprise Communications S.A./N.V., Belgium; Siemens Enterprise Communications S.A., Spain; Siemens Enterprise Communications S.A. de C.V., Mexico; Siemens Enterprise Communications S.p.A., Italy; and Enterasys Networks Distribution Ltd., Ireland. Subject to certain limitations, the senior secured notes, the revolving credit facility and the guarantees are secured by first-ranking Liens over the Collateral. The Collateral consists substantially of the following properties and assets, which, subject to applicable agreed security principles, are pledged on a first ranking basis: 84 p. 184

182 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 A first priority pledge over the shares of the Issuer and the shares of the subsidiary guarantors and certain other subsidiaries of the Parent; A first priority assignment of certain intra-group loans among the Issuer and the guarantors; A land charge over a manufacturing facility, A first priority pledge of certain bank accounts of; and A first priority lien over certain assets of the Issuer and the subsidiary guarantors. The total pledged assets of the Issuer and the subsidiary guarantors constitute the majority of the total unconsolidated group assets of the Company as of September 30, As of September 30, 2012, the commitments under the senior secured notes and the revolving credit facility amount to million plus accrued interest. EN Group management expects that the Issuer is in the financial condition to meet its future obligations under the Indenture and the Revolving Credit Facility. Furthermore, management does not expect the occurrence of any events of default under the Indenture or Revolving Credit Facility. As a consequence, management assumes that an outflow of resources under the guarantees or Collateral is not probable. Commitments for expenditure In thousands of September 30, 2012 September 30, 2011 Commitments for the acquisition of property, plant and equipment Commitments for the acquisition of intangible assets Guarantees and other commitments As of September 30, 2012 and 2011, future payment obligations under non-cancellable operating leases are as follows: In thousands of September 30, 2012 September 30, 2011 Within 1 year 39,104 35,047 1 to 5 years 54,748 59,318 Thereafter 20,860 11,292 Total 114, ,657 Total operating lease expense for the year ended September 30, 2012 was 51.3 million (2011: 50.3 million). Operating rental expense and future obligations primarily relate to buildings rented from SAG group companies. 85 p. 185

183 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Civil litigation On January 12, 2011, VirnetX, Inc. filed a lawsuit against Siemens Enterprise Communications GmbH & Co. KG ( SEN KG ) and Siemens Enterprise Communications, Inc. ( SEN Inc. ) in the U.S. District Court for the Eastern District of Texas, alleging that certain Enterprise Networks products infringe three of its patents. Those patents are alleged to cover a method and system of transparently creating a virtual private network and a method, system and software for providing a domain name service for establishing a secure communication link. After some adjustments by the court, this matter has been scheduled for trial in April In the interim, we will continue to defend, while also continuing to evaluate potential resolution prior to trial, if appropriate. We have exchanged settlement proposals with VirnetX but the parties remain very far apart on the terms, so it is unclear whether we will be able to find mutually agreeable settlement terms prior to trial. VirnetX s most recent offer demands approximately USD 2.0 million for alleged past damages, plus a 1.95% royalty on future sales of the allegedly infringing products through Based on information currently available to EN Group, we believe that demand is excessive, and we intend to continue to defend while also pursuing potential settlement. On November 23, 2011, Cyberphone Systems, LLC filed a lawsuit against SEN Inc. in the U.S. District Court for the District of Delaware, alleging that certain Enterprise Networks products infringe four of its patents. Generally, those patents are alleged to cover certain aspects of VoIP technology. SEN Inc. has raised certain technical defenses and is waiting for the court to rule on those issues. In the meantime, management continues to evaluate the allegations. Trial has tentatively been set for early calendar year At the present time, management has insufficient information to predict the outcome of this litigation. On February 10, 2012, Beth Israel Medical Center, Continuum Health Partners, Inc. and St. Luke s Roosevelt Hospital Center (collectively, Continuum ) filed a lawsuit against SEN Inc. in the U.S. District Court for the Southern District of New York. Continuum alleges that SEN Inc. breached its contract, pursuant to which SEN Inc. was required to provide certain services to Continuum, including managing telecommunications billing from a particular service provider, which alleged breach resulted in Continuum being overbilled for these services in an amount exceeding USD 2.2 million. Although Continuum is separately suing the service provider to recover these overbilled amounts, Continuum is also seeking recovery of these amounts from SEN Inc., as well as interest, legal costs of recovery and disgorgement of amounts paid to SEN Inc. under the contract. These same claims were also the subject of a mediation initiated by Continuum in 2011, which ended unsuccessfully. We are continuing to review these claims. There are several preliminary motions before the court at the present time, which, if successfully determined, could limit the scope of the case against EN Group. At the present time, management has insufficient information to predict the outcome of this litigation. On May 23, 2012, Telecomp Inc. filed a lawsuit in the Supreme Court of the State of New York, Monroe County, alleging that SER and EN Group, as successor in interest to SER and in its own right, failed to meet certain obligations under a professional services agreement. Telecomp is claiming damages in the amount of at least USD 650 thousand. At the present time, we are reviewing the information available to us and we believe that the claims are largely without merit. Notwithstanding that preliminary assessment, management has insufficient information to predict the outcome of this litigation. 86 p. 186

184 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Tax proceedings The Group has been subject to an ongoing tax audit at one of its Brazilian entities by the state of Sao Paulo for the periods 2002 through The audit assessments received are currently investigated by management and outside consul in order to successfully settle the legal proceedings. While the ultimate resolution of these matters is subject to many uncertainties, management expects that it will be able to prevail in these matters with no material impact to the Group s financial statements. Local tax authorities in Chile ( Servicio de Impuestos Internos ) filed a tax claim against two Group entities (in Chile and the Netherlands) alleging that the Chilean entity had understated its taxable income in calendar year Management is currently assessing this claim and expects a potential maximum payment need of approximately 22.1 million including tax liability, fines, penalty interest and inflation adjustments, provided that the alleged change of the tax base will be legally enforced. 28. Financial instruments and hedging activities This note gives an overview of the significance of financial instruments and hedging activities for the Group. The following tables present the carrying amount of financial assets and liabilities by category of financial instrument: September 30, 2011 In thousands of Loans and receivables Assets at fair value through profit or loss Total Cash and cash equivalents 246, ,300 Trade and other receivables 456, ,233 Other current financial assets 33, ,697 Other non-current financial assets 208, ,552 Total 945, ,782 September 30, 2011 In thousands of Derivatives used for hedging Other financial liabilities at amortised cost Total Short-term debt and current maturities of long term debt - 45,432 45,432 Trade payables - 294, ,206 Other current financial liabilities ,814 34,378 Long-term debt - 195, ,751 Other non-current financial liabilities - 7,104 7,104 Total , , p. 187

185 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 September 30, 2012 In thousands of Loans and receivables Assets at fair value through profit or loss Total Cash and cash equivalents 177, ,578 Trade and other receivables 409, ,906 Other current financial assets 39, ,712 Other non-current financial assets 182, ,796 Total 809, ,992 September 30, 2012 In thousands of Derivatives used for hedging Other financial liabilities at amortised cost Total Short-term debt and current maturities of long term debt - 63,827 63,827 Trade payables - 288, ,675 Other current financial liabilities ,402 20,686 Long-term debt - 218, ,008 Other non-current financial liabilities - 1,793 1,793 Total , ,989 Included in the cash and cash equivalents is million (September 30, 2011: million) cash in banks, as well as outstanding cheques and cash in hand. Financial assets and financial liabilities at fair value through profit or loss are all designated as held for trading and done as such upon recognition. Derivatives used for hedging have all been designated as cash flow hedges. The fair values of cash and cash equivalents, current receivables, trade payables, other current financial liabilities and borrowings under revolving credit facilities approximate their carrying amount largely due to the short-term maturities of these instruments. Long-term receivables, including receivables from finance leases, are evaluated by the Group based on parameters such as interest rates, aging structure and management s assessment. Based on this evaluation, allowances are taken to account for the expected losses of these receivables. As of September 30, 2012 and 2011, the carrying amounts of such receivables, net of allowances, approximate their fair values. The fair value of trade payables, loans from banks, obligations under finance leases as well as other non-current financial liabilities is estimated by discounting future cash flows using rates currently available for debt of similar terms and remaining maturities. Again this approximates the carrying amounts. 88 p. 188

186 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Other current financial liabilities include liabilities to related parties amounting to 1.2 million (September 30, 2011: 0.7 million). Trade payables contain liabilities to related parties in the amount of 28.0 million (September 30, 2011: 10.7 million). Net gains/(losses) of the following financial instruments are recognised in the statement of income are as follows: In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Loans and receivables/financial liabilities at amortized cost 1,103 9,258 Financial assets and liabilities at fair value through profit or loss 4,252 (4,996) Net gains and losses on financial assets and liabilities (i.e. trade and loan receivables and payables, other current financial assets and liabilities) include changes in valuation allowances, foreign exchange valuation, gains or losses on de-recognition, recoveries of amounts previously written-off and fees incurred by various financial transactions. Valuation allowances made during the year are a result of management s judgments and assumptions regarding specific risk factors within the respective operating environments. For the development of valuation allowances see note Net gains on financial assets measured at fair value are comprised of gains or losses from derecognition, hedging of currency positions and the ineffective portion of cash flow hedges and intergroup hedging activities. Net gains on financial liabilities measured at fair value relate to both the cash flow hedge derivative and the embedded derivative of senior secured notes (i.e. bond option). Derivatives and hedging activities The Group manages its risks associated with fluctuations in foreign-currency-denominated receivables and payables primarily by adopting natural hedges between its fully consolidated entities. In general, hedge accounting treatment under IAS 39 is not applied and such derivative financial instruments are recorded at fair value on the balance sheet. Since intergroup hedges consolidate at Group level, only changes in fair values show as either net income or loss. Specifically, one fully consolidated entity (outside the EURO area) entered into foreign exchange contracts to reduce the risk of variability of future cash flows resulting from forecasted sales and purchases of standard product business denominated in EURO and USD. All such hedging activities have been designated as cash flow hedges. The fair values of this type of derivative financial instruments are as follows: September 30, 2012 September 30, 2011 In thousands of Assets Liabilities Assets Liabilities Foreign currency exchange contracts p. 189

187 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Changes in fair value of the effective portion of forward exchange contracts that were designated as foreign-currency cash flow hedges are recorded in Other components of equity to the extent that the hedge remains effective. Ineffective elements are recognised in the profit and loss immediately and accounted for as financial instruments through profit or loss. The amount recorded in equity is released when the forecast transaction occurs or when the requirements for hedge accounting are no longer fulfilled. In connection with cash flow hedges the following amounts were recognised directly in equity during the period: In thousands of September 30, 2012 September 30, 2011 (Losses)/gains recognised directly in equity (420) 153 As of September 30, 2012 and 2011, the maximum length of time over which the Group is hedging its future cash flows associated with foreign-currency forecasted transactions is 12 months. 29. Financial risk management Market risk Market fluctuations may result in cash-flow and profit volatility risk for EN. Its worldwide operating business as well as its investment and financing activities are affected by changes in foreign exchange rates and interest rates. The Group seeks to manage and control these risks primarily through its regular operating activities and uses derivative instruments when deemed appropriate. In order to reduce financial risks, in particular, volume and price risks, the Group engages in active portfolio management. New products and services are developed and improvements to existing products and services are sought in order to achieve greater customer loyalty. In addition, management invests in the development of new technologies in order to meet the high technological demands of the market participants. There were no significant concentrations of market risk as of September 30, Foreign currency exchange rate risk Transaction risk and foreign currency management EN s international operations expose the Group to foreign currency exchange rate risks in the ordinary course of business. The Group employs various strategies, as discussed below, involving the use of derivative financial instruments to mitigate certain foreign currency exposures. 90 p. 190

188 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Foreign exchange rate fluctuations may influence earnings and cash flow volatility. Each EN entity conducting business with international counterparties that leads to future cash flows denominated in a currency other than its functional currency is exposed to the risk from changes in foreign exchange rates. The risk is in part mitigated by executing most types of business transactions (sales and procurement of products and services as well as investment and financing activities) mainly in the functional currency. In addition, foreign currency exposure is, in part, balanced by purchasing of goods, commodities and services in the respective currencies as well as production activities and other contributions along the value chain in the local markets. Financing transactions or investments by operating units are preferably done in their functional currency or on a hedged basis. Each EN entity is responsible for recording, assessing, monitoring, reporting and hedging its foreign currency transaction exposure. Some EN entities hedge with Enterprise Communications Funding GmbH in order to minimise the foreign currency risks and Enterprise Communications Funding GmbH will hedge externally if it is considered appropriate. The table below shows the foreign currency exchange rate exposure as of September 30, 2011 and 2012 based on the cash flows in foreign currencies for the next business year. Hedges at year end have also been taken into account. The potential impact on net income (loss) and equity measured as of September 30, 2011 and 2012 respectively is computed assuming a 10% increase or decrease of the Euro against all other currencies. September 30, 2011 In thousands of EUR/USD EUR/GBP BRL/EUR Foreign currency exchange rate exposure 86,321 (18,936) (15,069) Impact resulting from a 10% increase Net income (loss)/equity (7,847) 1,721 1,370 Impact resulting from a 10% decrease Net income (loss)/equity 9,591 (2,104) (1,674) September 30, 2012 In thousands of EUR/USD EUR/GBP BRL/EUR Foreign currency exchange rate exposure 47,833 (4,480) (5,403) Impact resulting from a 10% increase Net income (loss)/equity (4,348) Impact resulting from a 10% decrease Net income (loss)/equity 5,315 (498) (600) As of September 30, 2012 and 2011 the result of the sensitivity analysis is based on actual balances and open hedge positions. The analysis does not consider any other foreign currency risks which do not exceed 1 million Euro based on a 10% fluctuation rate. 91 p. 191

189 Effects of currency translation ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Many EN subsidiaries are located outside the Euro zone. Since the financial reporting currency of EN is the Euro, the financial statements of these subsidiaries are translated into Euro in course of the consolidation process. In order to determine the total impact of foreign exchange translation risk, investments in foreign based operations are permanent and continuously reinvested. In fiscal year 2012 the overall effect of foreign currency transactions on profit and loss was a gain of 5.2 million (2011: loss of 2.1 million). There were no significant concentrations of foreign currency exchange rate risk as of September 30, Interest rate risk The Group s exposure to the risk of changing interest rates relates primarily to short-term bank loans with variable interest rates, in particular it relates to the 40 million of the revolving credit facility. Unless it is prohibited by country-specific regulations, all entities have established intercompany clearing accounts. The Group measures interest rate risk by cash flow sensitivity since the instruments have a variable interest rate. The following analysis shows the impact on net income/(loss) and equity for the fiscal year 2011 and 2012 of a 1% base point increase or decrease in interest rates on interest bearing debt: September 30, % point increase 1% point decrease In thousands of Carrying amount Average rate Net income and (loss)/equity Net income and (loss)/equity Cash and cash equivalents 246,300 2,463 (2,463) September 30, % point increase 1% point decrease In thousands of Carrying amount Average rate Net income and (loss)/equity Net income and (loss)/equity Cash and cash equivalents 177,578 1,776 (1,776) Revolving credit facility 40,000 5,5% (400) 400 There were no significant concentrations of interest rate risk as of September 30, Liquidity risk Liquidity risk results from the Group s potential inability to meet its financial liabilities, e.g. settlement of its financial debt, payment of suppliers and settlement of finance lease obligations. The Group has implemented liquidity forecasts and performs net working capital management. 92 p. 192

190 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The following tables reflects all payment obligations from maturities including interest resulting from recognised financial liabilities, including derivative financial instruments with a negative market value as of September 30, 2011 and September 30, 2011 In thousands of Less than 1 year Between 1 and 2 years Between 2 and 5 years After 5 years Non-derivative financial liabilities Bonds Senior secured notes 24,186 24, ,535 - Loans from banks 11,548 9,860 3,309 - Obligations under finance leases 13,836 12,430 20, Other financial indebtedness , Trade payables 294, Other financial liabilities 33,814 5,053 1,930 - Derivative financial liabilities Total 379,015 64, , September 30, 2012 In thousands of Less than 1 year Between 1 and 2 years Between 2 and 5 years After 5 years Non-derivative financial liabilities Bonds Senior secured notes 24,186 24, ,426 Revolving credit facility ,000 - Loans from banks 9,433 11,246 3,309 - Obligations under finance leases 22,241 17,735 19,298 9 Other financial indebtedness 12, Trade payables 288, Other financial liabilities 20, Derivative financial liabilities Total 377,868 54, ,756 9 There were no significant concentrations of liquidity risk as of September 30, Capital risk The overriding aim of the Group s capital management is to ensure that it will continue to be able to repay its liabilities and remain financially sound. A key ratio for managing the Group s capital is the relationship between equity and debts. As of September 30, 2012 and 2011, the capital structure of the Group was as follows: In thousands of September 30, 2012 September 30, 2011 Total equity 388, ,226 As a % of total capital (see below) 58% 69% Short-term debt 63,827 45,432 Long-term debt 218, ,751 Total debt 281, ,183 As a % of total capital 42% 31% Total capital (total equity and total debt) 670, ,409 There were no significant concentrations of capital risk as of September 30, p. 193

191 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Credit risk The Group is exposed to credit risk, especially in connection with its project business, where direct or indirect financing may be provided to customers, and with its leasing activities. Credit risk is defined as an unexpected loss in cash and earnings if the customer is unable to pay its obligations in due time or if the value of property that serves as collateral declines. The effective monitoring and controlling of credit risk is part of the Group s risk management system. Credit evaluations and ratings are performed for all customers on an individual basis. In fiscal year 2010 the Group decided that where possible the lease financing for customers as previously provided in Germany and other countries (resulting in significant lease receivables on the Group s balance sheet) would be replaced by financing from third party financial institutions. It is expected that new customer contracts requiring financing will in future be primarily financed by financial institutions thereby eliminating the credit risk for the Group for these new contracts. Customer ratings and individual customer limits are based on generally accepted rating methodologies, input from external rating agencies and the Group s default experiences. Ratings and credit limits are considered in determining the conditions under which financing might still be offered on a case by case basis to customers. The Group s maximum exposure to credit risk, without taking into account any collateral held or other credit enhancements amounts to: In thousands of September 30, 2012 September 30, 2011 Cash and cash equivalents 177, ,300 Trade and other receivables 409, ,234 Other current financial assets 39,712 34,697 Other current assets 54,479 56,208 Other non-current financial assets 182, ,552 Other non-current assets 21,894 33,553 Total 886,365 1,035,544 Trade and other receivables and other current financial assets include receivables from SAG at 6.2 million and nil million respectively. (September 30, 2011: 14.1 million and 1.2 million). For some financial assets the Group holds collateral or other enhancements. This is in the form of finance lease receivable whereby underlying title to the leased assets is held by the Group should the lessee fail to meet its payment obligations. Trade receivables disclosed above include amounts which are past due at the end of the reporting period but against which the Group has not recognised an allowance for doubtful receivables. See note 12.1 for an analysis of the Group s aging structure and valuation allowance against trade receivables. There were no significant concentrations of credit risk as of September 30, There were no indications as of September 30, 2012, that defaults in payment obligations of customers will occur related to trade and other receivables, as well as other loans or receivables included in other financial assets that are neither impaired nor past due. For further information regarding the concept for the determination of allowances on receivables see note p. 194

192 30. Related party disclosures ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The Group has a related party relationship with Gores. In addition, SAG and its fully consolidated subsidiaries are related parties due to their continuing significant influence, owning 49% of the ordinary shares of the Company at the reporting date. In the course of these activities, management believes that transactions for the provisions of goods and services were conducted on an arm s length basis at standard market terms and conditions. Furthermore the Group has also a related party relationship with its non consolidated companies (September 30, 2012 and 2011 included in other current financial assets, see note 13 and other current financial liabilities, see note 19). The following tables show the transactions with SAG and Gores related parties: Sales and purchases of goods and services to and from SAG and fully consolidated entities of SAG In thousands of September 30, 2012 September 30, 2011 Sales of goods and services 28,583 64,763 Purchases of goods and services 94, ,161 Receivables and payables from and to SAG and fully consolidated entities of SAG In thousands of September 30, 2012 September 30, 2011 Receivables Trade receivables and other assets 6,235 14,126 thereof from operating activities 4,502 9,722 thereof from financing activities 1,733 4,404 Payables Trade payables and other liabilities 89,725 56,523 thereof from operating activities 26,802 6,152 thereof from financing activities 62,923 50,371 Operating activities mainly relate to transactions with SAG resulting from sales to and purchases from SAG group companies. Payables from financing activities include finance lease obligations to Siemens Finance & Leasing GmbH at 47.2 million (2011: 37.8 million) in course of a headlease arrangement in Germany. In addition the Group credits a loan payable at 12.6 million (2011: 12.5 million) against Siemens Financial Service in the Netherlands. In addition to the rental of buildings, SAG and fully consolidated entities of SAG also provided administrative services to Group entities, including accounting support, payroll and personnel, logistics, marketing, and IT services, such as desktop services, data centre and network support. These services were generally based on service level agreements. In the opinion of management, the terms of these transactions were reasonable and represented arm s length terms. The need for such services remained after the legal separation of the EN business although at reducing levels over time. Agreements remain in place with SAG which provide for continuing support by the SAG upon request for at arm s length price. 95 p. 195

193 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Related party transactions with Gores Group In the first quarter of fiscal year 2011 the Group made payments of 24.0 million to Gores to retire the annual management fee obligation (Siemens 16.0 million). The total amount ( 40.0 million) is recognised as expense over a five year period, management s best estimate of the period over which the annual management fees would have been paid. These prepaid expenses are shown within other current assets ( 8.0 million) and other non-current assets ( 16.0 million) as of balance sheet date. In addition to the periodic management fee incurred ( 4.8 million; Siemens: 3.2 million), EN Group mainly expensed 1.9 million (2011: 1.1 million) due to consultancy and other services rendered from Gores Group and Glendon Partners, Inc. There are no further material related party balances since Vincotech GmbH and Lineage Power Corporation have ceased to qualify as related parties since the second quarter of fiscal year As of September 30, 2012 the Group has other payables to Gores Group of 1.2 million (September 30, 2011: 0.2 million). Management remuneration Management remuneration which was charged to the Group companies for key management personnel, amounted to 9.8 million (September 30, 2011: 7.9 million for comparable personnel). Thereof 5.1 million (2011: 4.3 million) reflect annual salaries, 1.0 million (2011: 0.8 million) termination benefit and 3.7 million (2011: 2.8 million) annual bonuses. Neither the Company nor its subsidiaries paid any compensation or made any loans to its managing directors in fiscal year 2012 or Non-cash transactions In fiscal year 2011 and 2012 the Group did not encounter any material non-cash transactions. 32. Subsequent events Management has not identified any material subsequent event after the reporting date. 96 p. 196

194 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, Additional information to the IFRS Consolidated Financial Statements Statutory rules of appropriation of results pursuant to article 392 (Chapter 8 Dutch GAAP) Title 9 of Book 2 of the Netherlands Civil Code. Based on Art. 28 of the Articles of Association, the Company may only make distributions of profits to shareholders and other persons entitled thereto, to the extent that the shareholders equity exceeds the paid and called up part of its capital plus the reserves which are required to be maintained by law. A deficit may only be offset against the reserves prescribed by law insofar as this is allowed by law. The Company shall maintain a) a joint share premium reserve for the Ordinary Class A and Ordinary Class B Shares ( Ordinary A&B Share Premium Reserve ) b) a share premium reserve for the Cumulative Preference Shares A ( Preference A Share Premium Reserve ) c) a share premium reserve for the Cumulative Preference Shares C ( Preferred C Share Premium Reserve ) d) a share premium reserve for the Preference B Shares ( Preferred B Share Premium Reserve ) for the exclusive benefit of the holders of shares of the applicable class(es). The Company shall also maintain a profit reserve for the Cumulative Preference Shares A ( Preferred A Share Profit Reserve ) and for the Cumulative Preference Shares C ( Preferred C Share Profit Reserve ). From the profits accrued in any financial year first of all any potential amounts shall be added to the Preferred A Share Profit Reserve and ranking secondly to the Preferred C Share Profit Reserve. From the profits accrued in any financial year first of all and insofar possible the following amounts shall be added to the Preferred A Share Profit Reserve a) in as far as the profits earned in previous financial years were insufficient to allow the allocation provided for in subparagraph (b) below, the amount of such deficit increased with eight percent (8%) per annum over such deficit on a compounded basis ( the Preferred A Share Deficit ), plus b) an amount equal to eight percent (8%) per annum over the sum of the amount of the nominal value, the Preferred A Share Premium Reserve and the Preferred A Share Profit Reserve. If the amount of the Preferred A Share Premium Reserve or the Preferred A Share Profit Reserve has changed during the applicable financial year, the weighted average of such amounts during the financial year shall be the basis. If the accrual to the Preferred A Share Profit Reserve as referred to under (a) and (b) above for any financial year cannot be made or cannot be made in full because the profits do not permit it, the deficit shall first of all be accrued from the profit made in the following years. The allocation of profits in the Preferred A Share Profit Reserve as provided for in this paragraph, in respect of a financial year, shall be deemed allocated as of the last day of the financial year to which such allocation relates. The allocation of profits to the Preferred C Share Profit Reserve follows the same methodology as for the Preferred A Share Profit Reserve as stated above. Both reserves shall be accrued individually equally to 8% if possible of the total nominal value, including the share premium and profit reserve. 97 p. 197

195 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Any remaining profits shall be automatically contributed to the profit reserves of the Company and shall not be distributed until: a) the Preferred A Share Premium Reserve, the Preferred A Share Profit Reserve and the Preferred A Share Deficit (if any) have been fully (re)paid to the holders of the Cumulative Preference A Shares b) the Preferred C Share Premium Reserve, the Preferred C Share Profit Reserve and the Preferred C Share Deficit (if any) have been fully (re)paid to the holders of the Cumulative Preference C Shares c) the Preferred B Share Premium Reserve has been fully repaid to the holders of the Preferred Shares B d) in aggregate an amount of million out of the Ordinary Share A & B Share Premium Reserve has been repaid to the holders of the Ordinary Shares A and the holders of the Ordinary Shares B. Distributions must take place in order from a) to d) requiring full (re)payment of the previous subsections. Unless otherwise resolved by the general meeting of the shareholders, by a resolution which requires the approval of all holders of ordinary shares A and all holders of ordinary shares B, until September 30, 2010 and in the subsequent financial year, the Company shall not make any distributions (whether as dividend or as payment of reserves or otherwise) in excess of fifty percent (50%) of any profits accrued by the Company in such financial year. In the event of a cancellation of the preferred A and C shares, the Company shall be obliged to pay to its shareholders a total of the nominal value of the preference share A and C, together with the respective preferred share premium reserve, preferred share profit reserve and preferred share deficit. The latter shall be calculated based on 8 % interest on compounded basis. Proposed appropriation of results Based on Art. 28 of the Articles of Association the allocation of profit to the preferred A and C share profit reserve in respect of a financial year, shall be deemed allocated as of the last day of the financial year to which such allocation relates. Since the Company incurred losses since its establishment in July 2008, the Company was not obligated to record an accrual for an 8% interest in the preferred A and C share profit reserve. As of September 30, 2012, the interest calculation as relates to the preferred share A deficit amounts to 26.3 million (September 30, million). The preferred share C deficit amounts to 22.1 million (September 30, million). Statutory voting rights Pursuant to Art. 23 of the Articles of the Association each share shall confer the right to cast one vote. Unless otherwise specified in these Articles, all resolutions shall be adopted by a majority of votes cast in a meeting where all ordinary shares A and all ordinary shares B are present or represented. 98 p. 198

196 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The Joint Venture Agreement signed September 30, 2008 between SAG, Gores I SF Luxembourg, S.à r.l. and Gores II SF Luxembourg S.à r.l. stipulates in Sec a list of clauses which require unanimous approval of all of the votes attached to the shares held by the shareholders for: - Any change to the Articles, unless the exception below in respect of capital measures applies. - Changes of EN BV s capital structure, including in particular the issuance of shares to any strategic investor, unless certain exceptions apply, e.g. (i) the issuance of shares in the amount of less than 20% of EN BV s share capital to a third party financial investor; (ii) the issuance of shares to management; (iii) the issuance of shares to SAG and Gores at a total subscription price of less than 300,000,000 EUR. - Any arrangement for the disposal (directly or indirectly) of (substantially) the entire assets and undertaking of EN BV, except where substantially similar to a sale of shares in which case such disposal of the asset or undertaking shall be permitted in parallel to a share transfer subject to the terms and conditions set forth for a share transfer; if such a measure is taken at a subsidiary of EN BV, unanimous consent of the Board is required. - The liquidation of EN BV or its merger into or consolidation with any other person, if such liquidation, merger or consolidation has the effect that less than 50% of the shares or voting rights in EN BV are held by the shareholders, or EN BV is otherwise controlled by a third party, subject to certain exceptions. - The conclusion of control arrangements and profit and loss transfer arrangements of EN BV, if the respective agreement is concluded by EN BV as dominated entity; if such measure is taken at a subsidiary of EN BV, unanimous consent of the Board is required if the dominating entity is not under control of EN BV. - Any joint venture or partnership, if it has the same economic impact as a transaction which otherwise qualifies as a supermajority matter; if such measure is taken at a subsidiary of EN BV, unanimous consent of the Board is required. - The time and terms of an IPO for a period of two years after the closing date which was on September 30, 2008; if such measure is taken at a subsidiary of EN BV, unanimous consent of the Board is required. - Any supermajority matters submitted to the shareholders meeting. Audit fees Deloitte Accountants B.V. September 30, 2012 September 30, 2011 Deloitte Network Total Deloitte Accountants B.V. Deloitte Network Fees for Group Financial Statements 32,000 1,627,791 1,659,791 30,000 1,596,876 1,626,876 Other audit fees 35, , ,313 33, , ,592 Audit related fees 0 450, ,208 62, , ,149 Non audit fees 0 49,550 49, ,550 67,550 Total 67,000 2,953,862 3,020, ,593 3,051,574 3,177, p. 199

197 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Personnel costs In thousands of September 30, 2012 September 30, 2011 Wages and salaries 711, ,958 Statutory social welfare contributions and expenses for other support payments 115, ,756 Expenses relating to pension plan and employee benefits 20,885 24, , ,090 Expenses relating to pension plans and employee benefits include service costs for the period. The expected return on plan assets and interest cost are included in financial income, net. The average number of employees during the reporting period was 10,819 (September 30, 2011: 10,992). The employees by functions as of September 30, 2012 and 2011 are as follows: September 30, 2012 September 30, 2011 Sales 1,942 2,080 Service 4,517 4,659 Corporate Functions Operations 1,107 1,120 Business Units 2,102 2,134 Total employees 10,569 10,886 With reference to Section 2:383(1) of the Netherlands Civil Code, the Company did not grant any loans to its managing directors. No management compensation has been accrued and paid out to the members of the board of directors during fiscal year 2012 and 2011 by the Company or its subsidiaries. 100 p. 200

198 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Appendix 1 The subsidiaries listed below are fully consolidated and wholly owned entities to EN BV as of September 30, 2012 except Cycos AG (No. 7) which has a non-controlling interest of 5.10% (September 30, 2011: 5.18%). No. Name Country Registered Office 1 Siemens Enterprise Communications A.E. Greece Athens 2 Siemens Enterprise Communications Tecnologia da informação e comunicações corporativas Ltda. Brazil Curitiba 3 Siemens Business Communication Systems Ltd. China Shanghai 4 CHG Communications Holding GmbH Germany Munich 5 Leesys Leipzig Electronic Systems GmbH Germany Leipzig 6 Siemens Enterprise Communications GmbH & Co. KG Germany Munich 7 Cycos AG Germany Alsdorf 8 Siemens Enterprise Communications Beteiligungen GmbH & Co. KG Germany Munich 9 Enterprise Communications Funding GmbH Germany Munich 10 Siemens Enterprise Communications N.V. Belgium Beersel 11 OOO Siemens Enterprise Communications Russian Federation Moscow 12 Siemens Enterprise Communications S.p.A. Italy Milan 13 Siemens Enterprise Communications S.A. Spain Madrid 14 Siemens EC Kurumsal Đletişim Hizmetleri Sanayi ve Ticaret Anonim Şirketi Turkey Ankara 15 Siemens Enterprise Communications B.V. Netherlands Den Haag 16 Siemens Enterprise Communications Servicios S.A. de C.V. Mexico México City 17 Siemens Enterprise Communications GmbH Austria Vienna 18 Siemens Enterprise Communications S.A.S. France Boulogne Billancourt 19 Siemens Enterprise Communications Sp. z o.o. Poland Warsaw 20 Siemens Enterprise Communications Limited United Kingdom Milton Keynes 21 Siemens Enterprise Communications A/S Denmark Albertslund 22 Siemens Enterprise Communications AG Switzerland Zurich 23 Siemens Enterprise Communications Oy Finland Espoo 24 Siemens Enterprise Communications s.r.o. Czech Republic Prague 25 Siemens Enterprise Communications, S.A. Argentina Buenos Aires 26 Siemens Enterprise Communications Limitada Colombia Bogotá 27 Siemens Enterprise Communications S.A. de C.V. Mexico México City 28 Siemens Enterprise Communications Sociedad Anónima Venezuela Caracas 29 Siemens Enterprise Communications AB Sweden Solna 30 Siemens Enterprise Communications Ltda. Chile Santiago de Chile 31 Siemens Enterprise Communications Ltd. Hong Kong Hong Kong 32 Siemens Enterprise Communications S.A. Morocco Casablanca 33 Siemens Enterprise Communications S.A.C. Peru Lima 34 Siemens Enterprise Communications, Inc USA Wilmington 35 Siemens Enterprise Communications Pvt. Ltd. India Mumbai 36 EN Germany Holdings B.V. Netherlands Amsterdam 101 p. 201

199 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS as of and for the year ended September 30, EN Overseas Holdings B.V. Netherlands Amsterdam 38 Enterprise Networks UK Holdings Ltd. United Kingdom Milton Keynes 39 Enterprise Networks Austria Holding GmbH Austria Vienna 40 Enterprise Networks Holdings, Inc. USA Wilmington 41 Enterasys Networks, Inc. USA Wilmington 42 Enterprise Communications Service Centre EOOD Bulgaria Sofia 43 Enterprise Communications Service Centre S.r.l. Romania Brasov 44 FastViewer GmbH Germany Neumarkt 45 FastViewer Software Development GmbH Austria Vienna 46 Siemens Enterprise Communications, Inc. Canada Thornhill 47 Siemens Enterprise Communications S.A. Luxembourg Luxembourg 48 Enterasys Networks Government Sales, Inc. USA Wilmington 49 Enterasys de Mexico, S.A. de C.V. Mexico México City 50 Enterasys Networks Mexico, S.A. de C.V. Mexico México City 51 Enterasys Networks do Brasil Ltda. Brazil São Paulo 52 Enterasys Networks de Argentina S.A. Argentina Buenos Aires 53 Enterasys Networks S.à r.l. Luxembourg Luxembourg 54 Enterasys Networks Distribution Limited Ireland Shannon 55 Enterasys Networks Switzerland AG Switzerland Zurich 56 Enterasys Networks Netherlands B.V. Netherlands Amsterdam 57 Enterasys Networks Germany GmbH Germany Frankfurt 58 Enterasys Networks S.A. France Boulogne Billancourt 59 Enterasys Networks S.r.l. Italy Cinisello Balsamo 60 Enterasys Networks, S.L. Spain Madrid 61 Enterasys Networks U.K. Limited U.K. Newbury 62 Enterasys Networks (M) Sdn. Bhd. Malaysia Kuala Lumpur 63 Enterasys Networks Pty. Limited Australia Belrose 64 Enterasys Networks, K.K. Japan Tokyo 65 Enterasys Networks Singapore Pte. Ltd. Singapore Singapore 102 p. 202

200 Enterprise Networks Holdings B.V., Amsterdam Company statement of financial position (before appropriation of result) at September 30, 2012 and 2011 (in thousands of ) Note September 30, 2012 September 30, 2011 Assets Current Assets Cash and cash equivalents - 41 Trade and other receivables Receivables from group entities 7-72,476 Total current assets - 72,517 Non-current Assets Other financial assets Interest in group entities 6 514, ,970 Deferred tax assets Total non-current assets 515, ,153 Total assets 515, ,670 Liabilities and equity Current liabilities Trade and other payables Current provisions Total current liabilities Equity 10 Share capital Share premium 514, ,852 Accumulated retained deficit (534) (399) Total equity 514, ,553 Total equity and liabilities 515, , p. 203

201 Enterprise Networks Holdings B.V., Amsterdam Company statement of comprehensive income for the year ended September 30, 2012 and 2011 (in thousands of ) Year ended Note September 30, 2012 September 30, 2011 Other operating expenses 5 (135) (131) Loss for the year (135) (131) Other comprehensive income - - Total comprehensive income for the year (135) (131) 104 p. 204

202 p. 205 Enterprise Networks Holdings B.V., Amsterdam Company statement of changes in equity for the year ended September 30, 2012 and 2011 (in thousands of ) Share capital Share premium Accumulated retained deficits Total equity Balance as of October 1, ,852 (268) 514,684 Loss of the year (131) (131) Other comprehensive income - - Balance as of September 30, ,852 (399) 514,553 Loss of the year (135) (135) Other comprehensive income - - Balance as of September 30, ,852 (534) 514, State of Utah

203 Enterprise Networks Holdings B.V., Amsterdam Company statement of cash flows for the year ended September 30, 2012 and 2011 (in thousands of ) No cash flow statement has been presented since the company has no material cash flows in fiscal year 2012 and p. 206

204 N O T E S to the Enterprise Networks Holdings B.V. Company financial statements as of and for the year ended September 30, 2012 in accordance with International Financial Reporting Standards as endorsed by the EU ( IFRS ) 107 p. 207

205 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 CONTENTS 1. General information Adoption of IAS, IFRS and IFRIC Summary of significant accounting policies Management estimates and judgements Other operating expenses Other financial assets Receivables from group entities Trade and other payables Current provisions Equity Non cash transactions Related party disclosures Financial instruments Financial risk management Approval of financial statements Other disclosures Additional information to the company financial statements p. 208

206 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 General information Reporting entity The Company was incorporated as a limited liability company under the laws of the Netherlands on July 25, 2008 and has its statutory seat in Amsterdam. The principal activity of the Company is to act as a holding company. The articles of association were amended on February 21, 2011 with regard to the profit distribution. See Note 1 General information and Note 33 Additional information to the IFRS Consolidated Financial Statements of the Consolidated Financial Statements for details on the incorporation and amendment of the articles of association of the Company. Basis of presentation The Company s Financial Statements have been prepared in accordance with the provisions of Title 9 of Book 2 of the Dutch Civil Code and are in accordance with (IFRS) as endorsed by the EU. Adoption of IAS, IFRS and IFRIC We refer to Note 2 Adoption of IAS, IFRS and IFRIC of the Consolidated Financial Statements. As of the reporting date, management believes that the pronouncements not yet adopted do not have a material impact on the Company s Financial Statements. Summary of significant accounting policies We refer to Note 3 Summary of significant accounting policies of the Consolidated Financial Statements for the accounting principles applied and assumptions made during the preparation of the financial statements. Investments in group entities are valued at historical costs. Profits and losses of these entities recognised after the acquisition are included in the Consolidated Financial Statements. If losses are other than temporary, the investment is deemed to be impaired. Management estimates and judgements Recoverability of Financial Assets investments in group entities are tested for impairment annually, and whenever there is an indication that the asset may be impaired. For the purpose of impairment testing, the estimates included, and the methodology used, can have a material impact on the respective values and the ultimate amount of any impairment. Trade and other receivables the allowance for doubtful accounts involves management judgment and review of individual receivables based on individual creditworthiness, current economic trends and analysis of historical bad debts on a portfolio basis. 109 p. 209

207 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Realisation of Deferred tax assets Deferred tax assets are recognised to the extent that it is probable that future taxable income will be available against which the deductible temporary difference, unused tax losses and unused tax credits can be utilised. Other operating expenses In thousands of Year ended September 30, 2012 Year ended September 30, 2011 Audit fees Administration fees Advisory fees 9 38 General expenses 2 7 Total other operating expenses The audit fees for the whole group are disclosed under Note 33 Additional information to the IFRS Consolidated Financial Statements of the Consolidated Financial Statements. Other financial assets Other financial assets relate to investments in subsidiaries only. The interest in group entities is as follows: In thousands of Ownership in % September 30, 2012 September 30, 2011 EN Germany Holdings B.V , ,120 Enterprise Networks Holdings Inc , ,850 Total other financial assets 514, ,970 Receivables from group entities In thousands of September 30, 2012 September 30, 2011 EN Germany Holdings B.V. - 72,475 Enterprise Networks Belgium Holdings BVBA - 1 Total receivables from group entities - 72,476 As of September 30, 2011 the receivable from EN Germany Holdings B.V. (in the following called Settlement obligation ) resulted from the issuance of the preference C shares by the Company at 73.0 million in lieu of payment of the outstanding purchase price liability for the acquired interests in Siemens Enterprise Communications Beteiligungen GmbH & Co. KG by EN Germany Holdings B.V., as agreed in the Settlement Agreement dated April 24, As of March 20, 2012 the Company and EN Germany Holdings B.V. (which is a 100% subsidiary of the Company) entered into a share premium contribution agreement whereby the Company is obligated to contribute an amount of 73.0 million as a contribution on the share premium of the existing shares in its subsidiary (in the following called Contribution obligation ). The Company and 110 p. 210

208 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 EN Germany Holdings B.V. agreed to settling the Contribution Obligation and Settlement Obligation by setting off these amounts against each other. Trade and other payables In thousands of September 30, 2012 September 30, 2011 The Gores Group LLC EN Germany Holdings B.V Total trade and other payables These liabilities are the result of various payments which have been made on behalf of Enterprise Networks Holdings B.V. Current provisions In thousands of September 30, 2012 September 30, 2011 Audit fees payable Administration fees payable 5 12 Tax advisor fees payable - 10 Law firm fees payable 2 - Total current provisions p. 211

209 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Equity Share capital Share premium Accumulated retained deficit Income and expense recognised directly in consolidated equity In thousands of Total Balance as of September 30, 2012 (company only) ,852 (534) - 514,418 Reconciliation to the Consolidated Financial Statement balances Prior year retained earnings of subsidiaries 201, ,334 Loss for the year of the subsidiaries (143,117) - (143,117) Prior year contributions (113,767) - (113,767) Income and expense recognised directly in consolidated equity Prior years (61,136) (61,136) Current year (15,279) (15,279) Other changes - Prior years 6,242-6,242 Current year (40) - (40) Balance as of September 30, 2012 (consolidated) ,852 (49,882) (76,415) 388,655 By deeds of issue of ordinary shares D in the capital of the Company dated October 13, 2011, November 16, 2011, November 18, 2011 and December 29, 2011 the holders of Ordinary shares A resolved to issue a total of 40 Ordinary shares D of Euro Prior to this resolution the Company had entered into individual subscription agreements with each of the staff. No share premium was agreed and paid. All these shares have been fully paid up. See also note of the Consolidated Financial Statements. In the annual general meeting of shareholders held on January 20, 2012 it was decided to add the balance of the result for the year ended September 30, 2011 to the other reserves. The shareholders follow the stipulations for the appropriation of results as ruled by Art. 28 of the Articles of Association. For details see Note 33 Additional information to the IFRS Consolidated Financial Statements of the Consolidated Financial Statements. Non cash transactions The Company did not encounter any material non-cash transactions in fiscal year According to Article 3 of the Share premium contribution agreement between the Company and its subsidiary EN Germany Holdings B.V. as of March 20, 2012 both parties agreed to set-off obligations against each other at 73.0 million and granted each other discharge for payment of both the Contribution and Settlement obligation. See note 7 for further details. 112 p. 212

210 Related party disclosures ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 The Company did not encounter any material related party transactions in fiscal year 2011 and 2012 with the exception highlighted in Note 7. Financial instruments The following tables present the carrying amount of financial assets and liabilities by category of financial instruments: Loans and receivables In thousands of September 30, 2012 September 30, 2011 Cash and cash equivalents - 41 Trade and other receivables - 72,476 Other financial assets 515, ,970 Total 515, ,487 Other financial liabilities at amortised cost In thousands of September 30, 2012 September 30, 2011 Trade payables Total There are no material net gains or losses recognised in the Company Financial Statements in fiscal year 2011 and Financial risk management Market risk We refer to Note 29 Financial Risk management of the Consolidated Financial Statements. Foreign exchange rate risk There are no material foreign exchange rate risks recognised in the Company Financial Statements in fiscal year 2011 and p. 213

211 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Interest rate risk There are no material interest rate risks recognised in the Company Financial Statements in fiscal year 2011 and Liquidity risk / capital risk We refer to the Note 29 Financial Risk Management of the Consolidated Financial Statements in fiscal year 2011 and Credit risk There are no material credit risks recognised in the Company Financial Statements in fiscal year 2011 and Approval of financial statements Statutory rules concerning appropriation of result We refer to Note 33 of the Consolidated Financial Statements in fiscal year 2011 and Appropriation of result for the fiscal year 2011 The annual report 2011 is determined in the general meeting of shareholders held on January 20, The general meeting of shareholders has determined the appropriation of results in accordance with the proposal being made to that end. Proposed appropriation of result for the fiscal year 2012 The board of directors proposes that the result of the fiscal year 2012 amounting to a loss of 135 thousands should be transferred to reserves without payment of dividend. Other disclosures Staff numbers and employment cost The Company does not have any employees and hence no personnel expenses were incurred in fiscal year 2011 and p. 214

212 ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Directors remuneration Neither the Company nor its subsidiaries paid any compensation or made any loans to its managing directors in fiscal year 2011 or Additional information to the company financial statements We refer to the Note 33 Additional Information to the IFRS Consolidated Financial Statements of the Consolidated Financial Statements. Amsterdam, December 17, 2012 The Management Board Mark Stone Steven Yager Saad Hassan Hammad Karl-Heinz Seibert Nathalie von Siemens 115 p. 215

213 Other information ENTERPRISE NETWORKS HOLDINGS B.V. NOTES TO THE COMPANY FINANCIAL STATEMENTS as of and for the year ended September 30, 2012 Auditors report Reference is made to the auditors report as included hereinafter. Subsequent events For reference see note 32 Subsequent events of the Consolidated Financial Statements. Appropriation of results Subject to the provisions under Dutch law that no dividends can be declared until all losses have been recovered, other reserves and unappropriated results are at the disposal of the shareholder in accordance with the Company s articles of Association. See for more details note 33 Additional information to the IFRS Consolidated Financial Statements of the Consolidated Financial Statements. 116 p. 216

214 p. 217 State of Utah

215 p. 218 State of Utah

216 ENTERASYS NETWORKS, INC. CONSOLIDATED BALANCE SHEET (In 000's, Unaudited) ASSETS 9/30/2012 Cash and cash equivalents $ 23,266 Accounts receivable, net 36,965 Affiliate trade receivables, net 10,732 Inventory 31,832 Affiliate notes receivable 31,111 Prepaid expenses and other curren assets 9,769 Income tax receivable 366 Short term deferred tax assets 7,790 Total current assets 151,831 Restricted cash 962 Property, plant and equipment, net 13,724 Goodwill 116,050 Intangible assets, net 36,498 Deferred tax assets 3,262 Total assets $ 322,327 LIABILITIES AND STOCKHOLDER'S EQUITY Accounts payable & customer advances $ 29,905 Accrued expenses 35,069 Deferred revenue 41,525 Income taxes payable - Deferred tax liabilities 2,679 Total current liabilities 109,178 Long term affiliate debt 92,603 Long term deferred revenue 13,090 Long term deferred tax liabilities 4,134 TOTAL LIABILITIES 219,005 Stockholders' equity 103,322 TOTAL LIABILITY & EQUITY $ 322,327 p. 219

217 ENTERASYS NETWORKS, INC. STATEMENT OF OPERATIONS (in 000's, Unaudited) Net Revenue: Month Ended 3 Months Ended 12 Months Ended 9/30/2012 9/30/2012 9/30/2012 Product $ 42,562 $ 73,465 $ 266,625 Service 8,368 21,245 84,360 Total revenue 50,930 94, ,985 Cost of revenue: Product 19,744 34, ,465 Service 3,902 7,910 33,254 Total cost of revenue 23,646 42, ,719 Gross margin 27,284 51, ,266 Operating expenses: Research and development (2,501) 8,271 43,288 Selling, general and administrative 10,792 26, ,654 Amortization of intangible assets 655 1,964 9,593 Restructuring charges 246 1,363 1,649 Total operating expenses 9,192 38, ,184 Income from operations 18,092 13,512 25,082 Interest expense, net (676) (2,136) (8,562) Other income, net (4) Gain/(loss) on currency (728) (532) (2,542) Total non-operating expenses (1,408) (2,611) (10,862) Income before income taxes 16,684 10,901 14,220 Income tax benefit/(expense) (8) 29 (791) Net income $ 16,676 $ 10,930 $ 13,429 p. 220

218 ENTERASYS NETWORKS INC. STATEMENT OF CASH FLOWS (in 000's, Unaudited) 12 Months Ended 9/30/2012 CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 13,429 Adjustments to reconcile net income to net cash Depreciation of property, plant & equipment 3,958 Amortization of intangible assets 10,204 Provision for gains on accounts receivable (85) Provision for excess and obsolescence (1,358) Unsettled loss on foreign currency transactions 862 Deferred tax expense 791 Capitalization of R&D costs (15,651) Changes in assets & liabilities Accounts receivable, trade (6,168) Accounts receivable, related party (5,570) Inventories 10,160 Prepaids and other current assets (300) Accounts payable and accrued liabilities (6,224) Deferred revenue (822) Income taxes 6,744 Long term liabilities 1,848 Net cash provided by operating activities 11,818 CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (6,256) Decrease in restricted cash 688 Net cash used in investing activities (5,568) CASH FLOWS FROM FINANCING ACTIVITIES Affiliate notes receivable issued (32,000) Payments received on notes receivable 15,000 Interest accrued 8,669 Interest paid (8,275) Net cash used in financing activities (16,606) EFFECT OF EXCHANGE RATES CHANGES ON CASH (2,536) NET CHANGE IN CASH $ (12,892) CASH & CASH EQUIVALENTS - BEGINNING OF PERIOD $ 36,158 CASH & CASH EQUIVALENTS - END OF PERIOD $ 23,266 p. 221

219 GORES ENT HOLDINGS, INC CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) ASSETS 30-Sep-11 Current assets: Cash and cash equivalents $ 36,158 Accounts receivable, net 32,170 Accounts receivable, SEN 4,232 Inventories 40,774 Income tax receivable 248 Prepaid expenses and other current assets 9,528 Short term deferred tax asset 13,660 Short Term Notes Receivable 14,001 Total current assets 150,771 Restricted cash, cash equivalents and marketable securities 1,650 Property, plant and equipment, net 7,491 Goodwill 118,832 Intangible assets, net 31,052 Deferred tax asset 5,619 Total assets $ 315,415 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 30,957 Accrued compensation and benefits 18,911 Other accrued expenses 18,348 Deferred revenue 42,180 Customer advances and billings in excess of revenues 1,573 Short-term debt - Income taxes payable 285 Deferred Tax Liability 4,591 Total current liabilities 116,845 Long-term deferred revenue 12,045 Long-term liabilities other 2,276 Long-term deferred taxes - Long-term debt 93,049 Total liabilities 224,215 Stockholders' equity 91,200 Total liabilities and stockholders' equity $ 315,415 p. 222

220 GORES ENT HOLDINGS, INC CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands) (Unaudited) Year To Date 30-Sep-11 Net revenue: Product $ 257,999 Services 81,727 Total revenue 339,726 Cost of revenue: Product 128,384 Services 31,733 Total cost of revenue 160,117 Gross margin 179,609 Operating expenses: Research and development 55,369 Selling, general and administrative 104,946 Amortization of intangible assets 14,923 Acquisition related costs - Restructuring charges 100 Total operating expenses 175,338 Income from operations 4,271 Interest income, net 77 Interest expense (14,684) Other income (expense), net 436 Gain/(loss) on currency 1,731 Income from continuing operations before income taxes (8,169) Income tax benefit (expense) 19,562 Net Income (Loss) $ 11,393 p. 223

221 GORES ENT HOLDINGS, INC CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Year (Unaudited) To Date 30-Sep-11 CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 11,393 Adjustments to reconcile net loss to net cash: Depreciation and amortization 19,079 Provision for gains on accounts receivable (5,823) Provision for excess and obsolescence 1,316 (Gains)/losses on investments (100) Unsettled loss on foreign currency transactions 486 Deferred taxes provision (681) Changes in assets & liabilities: Accounts receivable 12,346 Inventories (9,602) Prepaids and other current assets 876 Intangible Assets (4,654) Accounts payable and accrued liabilities 22,515 Customer advances and billings in excess of revenues (1,657) Deferred revenue 906 Income taxes (8,798) Net cash provided by operating activities 37,602 CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (3,058) Contribution of CANA to Gores EN (940) Increase/(decrease) in restricted cash 480 Net cash used in investing activities (3,518) CASH FLOWS FROM FINANCING ACTIVITIES Borrowings from revolver 82,508 Repayments on revolver (82,508) Repayment of Wells Fargo debt (10,000) Short term affiliate debt raise 7,500 Short term affiliate loan issuance (14,000) Repayment of affiliate debt (11,784) Net cash used in financing activities (28,284) EFFECT OF EXCHANGE RATE CHANGES ON CASH (2,102) NET CHANGE IN CASH $ 3,698 CASH & CASH EQUIVALENTS - BEGINNING OF PERIOD $ 32,460 CASH & CASH EQUIVALENTS - END OF PERIOD $ 36,158 p. 224

222 p. 225

223 p. 226 State of Utah

224 p. 383 State of Utah

225 WSCA-NASPO Data Communications Solicitation # JP14001 September 11, 2013 State of Utah Jennifer Porter Purchasing Agent / Contract Analyst 1 State Office Building Suite 3150 Salt Lake City, Utah RE: Enterasys Networks Response to Data Communications Products & Services Solicitation JP14001 Dear Ms. Porter, Thank you for providing Enterasys Networks, Inc. (Enterasys) with the opportunity to submit a response to the State of Utah s Data Communications Products & Services Solicitation JP Enterasys is a premier global provider of wired and wireless network infrastructure and security solutions. Enterasys was the FASTEST growing networking company in We have been successfully deploying network and security solutions for almost three decades and remain true to our customer-centric philosophy that There is nothing more important than our customers. As a current WSCA contract holder, Enterasys provides products and services to a number of state entities and political subdivisions in participating states across North America. Enterasys has experienced increased demand from new customers and state purchasing departments seeking to participate in WSCA and looks forward to the opportunity of continuing to provide products and world-class services through the contract. Enterasys proposal contains responses the Mandatory Requirements, Equipment and Service Offerings in sections , Financial Statements, References, Attachment C-Cost Schedule as well as one Attachment labeled Exception. Enterasys has taken no exceptions to the mandatory requirements in the RFP. Enterasys has entered a Claim of Business Confidentiality for non-public financial information included in our proposal response. We are confident our proposal meets the State of Utah s requirements. Should any questions arise as a result of our submission, please feel free to contact the dedicated Contract Administrator, Michael Swierk, at Again, thank you for the opportunity to participate in this RFP. Sincerely, Enterasys Networks, Inc. Julie Hale Director, Sales Operations Page 1 of 94 p. 384

226 WSCA-NASPO Data Communications Services Solicitation # JP14001 The State of Utah Division of Purchasing and General Services In conjunction with Request for Proposals JP14001 WSCA-NASPO Master Agreement for DATA COMMUNICATIONS PRODUCTS & SERVICES July 1, 2013 Page 2 of 94 p. 385

227 WSCA-NASPO Data Communications Solicitation # JP14001 Table of Contents Section 1: WSCA-NASPO Solicitation General Information 3 Section 2: General Proposal Requirements and Information 12 Section 3: Data Communications Provider Mandatory Minimum Requirements 13 Section 4: Data Communications Provider Qualifications 14 Section 5: Service Offering Qualifications Data Communications Services Requirements DATA CENTER APPLICATION SERVICES NETWORKING SOFTWARE NETWORK OPTIMIZATION AND ACCELERATION OPTICAL NETWORKING ROUTERS SECURITY STORAGE NETWORKING SWITCHES WIRELESS UNIFIED COMMUNICATIONS (UC) SERVICES 27 Section 6: Evaluation 29 Section 7: Master Agreement Terms and Conditions/Exceptions 32 Attachment B Reference Form 35 Attachment C Cost Schedule 38 Page 3 of 94 p. 386

228 WSCA-NASPO Data Communications Services Solicitation # JP14001 REQUEST FOR PROPOSAL DATA COMMUNICATIONS PRODUCTS AND SERVICES CONTRACT Solicitation # JP14001 Revised 5/30/2013 Section 1: WSCA-NASPO Solicitation General Information 1.1 Purpose of Request for Proposal (RFP) The State of Utah, Division of Purchasing is requesting proposals in conjunction with WSCA- NASPO Cooperative Purchasing Organization, LLC (WSCA-NASPO). The purpose of this request for proposal is to establish master agreements with qualified manufacturers to provide Data Communications products and services outlined in the specifications for all participating States. The services resulting from the award of this solicitation are to be available to all state entities, cities, counties, higher education, school districts and other political subdivisions on an as needed basis under the same pricing and terms and conditions agreed to in the Master Agreement. It is anticipated that this RFP may result in Master Agreement awards to multiple contractors. While the primary purpose of this solicitation is to select a proposer(s) who can offer the Products or Services for all Participating States, proposers are permitted to submit a proposal on more limited geographical areas, but not less than one entire Participating State. Proposers must clearly describe the geographical limits (e.g. by State name) if proposing a geographical area less than that of all Participating States. However, if a proposer elects to submit a Proposal for a single State then the proposer must be willing to supply the entire State and will not be allowed to add additional States following award or at any time during the term of the contract or any renewals. A Participating State may evaluate and select a proposer for award in more limited geographical areas (e.g. A single state) where judged to be in the best interests of the State or States involved. Each participating entity shall select the authorized contractor(s) they choose to do business with during the participating addendum process. A participating entity may require the authorized contractor(s) to submit additional information regarding their firm as part of the selection process during the execution of a participating addendum. This information could include, but is not limited to; partners or resellers approved under their PA, business references, number of years in business, technical capabilities, and the experience of both their sales and installation personnel. Each participating entity has the option to select one or more product categories or services from the resulting Master Agreement(s) during the execution of the participating addendum process. Each participating entity has the option to negotiate an expanded product line within the product category offering and within the scope of this RFP during the Participating Addendum process. Any additional incremental discounts available to a Participating Entity, if offered, may be provided at the discretion and as the sole legal obligation of the Contract provider or their Authorized Sub-Contractor to the Participating Entity and negotiated during the Participating Addendum process. All Participating entities have the right to put dollar limits and certain line item, parts or on the total amount purchased per occasion on their individual PA s as they deem appropriate. The resulting Master Agreement will be awarded with the understanding and agreement that it is for the sole convenience of the participating entities. The participating entities reserve the right to obtain like goods or services from other sources when necessary. This RFP is designed to provide interested proposers with sufficient basic information to submit Page 4 of 94 p. 387

229 WSCA-NASPO Data Communications Solicitation # JP14001 proposals meeting minimum requirements, but is not intended to limit a proposal's content or exclude any relevant or essential data. Suppliers are encouraged to expand upon the specifications to evidence service and capability. Response: Read and understood. 1.2 WSCA-NASPO Background Information WSCA-NASPO is a cooperative purchasing organization of all 50 states, the District of Columbia and the organized US territories. WSCA-NASPO is a subsidiary of the National Association of State Procurement Officials (NASPO). NASPO is a non-profit association dedicated to strengthening the procurement community through education, research, and communication. It is made up of the directors of the central purchasing offices in each of the 50 states, the District of Columbia and the territories of the United States. For more information consult the following websites and Obligations under master agreements that result from this cooperative procurement are limited to those states and other eligible entities that execute a Participating Addendum: 63G-6a Participation of a public entity or a procurement unit in agreements or contracts of procurement units -- Cooperative purchasing -- State cooperative contracts. (2) A public entity may obtain a procurement item from a state cooperative contract or a contract awarded by the chief procurement officer under Subsection (1), without signing a participating addendum if the quote, invitation for bids, or request for proposals used to obtain the contract includes a statement indicating that the resulting contract will be issued on behalf of a public entity in Utah. Financial obligations of Participating States (Entities) are limited to the orders placed by the departments, agencies and institutions of that Participating State (Entity) having legally available funds. Participating States incur no financial obligations on behalf of its political subdivisions, other governmental entities or other eligible entities. Unless otherwise specified in the solicitation or a Participating Addendum, the resulting master price agreement(s) will be permissive. This RFP is designed to provide interested Offerors with sufficient basic information to submit proposals meeting minimum requirements, but is not intended to limit a proposal's content or exclude any relevant or essential data. Proposals must be succinct, concise, and as short as possible to allow for efficient evaluation. Blanket marketing material and unnecessary elaborate brochures or representations beyond what is sufficient to present a complete and effective proposal are not acceptable. Offerors must respond to any or all of the 11 categories that follow. The following product and service categories are included in this RFP: 1. Data Center Application Services 2. Networking Software 3. Network Optimization and Acceleration 4. Optical Networking 5. Routers 6. Security 7. Storage Networking 8. Switches 9. Wireless Page 5 of 94 p. 388

230 WSCA-NASPO Data Communications Services Solicitation # JP Unified Communications 11. Services Response: Read and understood. 1.3 Objective The objective of this RFP is to obtain deeper volume price discounts than are obtainable by an individual state or local government entity. This discount is based on the collective volume of potential purchases by the numerous state and local government entities. The savings realized by the contractor in managing one comprehensive WSCA-NASPO Master Agreement rather than numerous state and local contracts should result in the most attractive service level and discounts available in the marketplace. The Master Agreement(s) resulting from this procurement may be used by state governments (including departments, agencies, institutions), institutions of higher education, political subdivisions (i.e., colleges, school districts, counties, cities, etc.), and other eligible entities subject to approval of the individual state procurement director and local statutory provisions. Participation by political subdivisions, other government entities and other eligible participants is with the authorization or acknowledgement of the specific state chief procurement official, and the execution of a Participating Addendum. Response: Read and understood. 1.4 Solicitation Background This is a rebid for the current for the WSCA-NASPO Data Communications Equipment, Supplies and Services contracts. Eight (8) Manufacturers currently have Master Contracts to provide Data Communications Equipments, Supplies and Services. They are as follows: Alcatel-Lucent AR1466 Brocade Communications AR214 Cisco Systems AR233 Enterasys Networks, Inc. AR1471 Extreme Networks AR1471 Hewlett-Packard - AR1464 Juniper Networks AR229 Meru Networks AR218 Although the State of Utah and WSCA-NASPO does not guarantee any usage or spend under these contracts, for bid purposes only, the total combined spend on these contracts for 2012 was $204 million dollars. Response: Read and understood. 1.5 Issuing Office and Solicitation Number The State of Utah, Division of Purchasing is the issuing office for this document and all subsequent addenda relating to it. The reference number for the transaction is Solicitation # JP This number must be referred to on all proposals, correspondence, and documentation relating to the RFP. Response: Read and understood. 1.6 WSCA-NASPO Contract Administrator The WSCA-NASPO Contract Administrator designated by WSCA-NASPO and the State of Utah, Division of Purchasing and General Services is: Page 6 of 94 p. 389

231 WSCA-NASPO Data Communications Solicitation # JP14001 Name: Jennifer Porter State of Utah Division of Purchasing and General Services State Office Building, Capitol Hill Room 3150 Salt Lake City, UT jenniferporter@utah.gov Phone: Fax: Response: Read and understood. 1.7 Proposal Submittal Offers must be received, according to instructions, by the posted due date and time. Offers received after the deadline will be non-responsive. Proposals are due August 30, 2013 at 11:00 am MST Questions will be accepted until July 26, 2013 at 11:00 am MST Data Communication RFP Release Webinar is scheduled for July 11, Webinar details will be posted on the WSCA-NASPO website ( The preferred method of submitting your original master proposal packet is electronically in Microsoft Word and Excel through BidSync, ( or you may mail or drop off your hard copies to the address noted in Section 1.6 of this RFP on or before the due date and time. The original master proposal packet shall include a separate document or sealed envelope labeled SOLICITATION # JP14001 Cost Schedule that contains the pricing document. Please note that the State of Utah Division of Purchasing office is closed on Saturday and Sunday and therefore does not accept deliveries on those days. When submitting an offer electronically through BidSync, please allow sufficient time to complete the online forms and upload documents. The solicitation will end at the closing time listed in the offer. If you are in the middle of uploading your documents at the closing time, the system will stop the process and your offer will not be received by the system. It is recommended that the submission process be completed the day prior to the due date, with the knowledge that any changes/updates will be accepted through the due date and time. Electronic offers may require the uploading of electronic attachments. BidSync s site will accept a wide variety of document types as attachments. However, the submission of documents containing embedded documents (zip files), mov, wmp, and mp3 files are prohibited. All documents should be attached as separate files. BidSync customer support may be contacted at (800) for guidance on the BidSync site. Respondents are responsible for ensuring that their BidSync registration information is current and correct. The State of Utah accepts no responsibility for missing or incorrect information contained in the vendor registration in BidSync. Incorrect or missing vendor registration information may result in failure to receive notification from BidSync regarding this procurement. In addition to the original master proposal packet submission, Respondents are required to send one (1) hard copy and one (1) electronic version (Microsoft Word and Excel) of the complete proposal, excluding pricing information, to each of the evaluation team members listed below. Each proposal packet shall be marked with the solicitation number and be in accordance with the Page 7 of 94 p. 390

232 WSCA-NASPO Data Communications Services Solicitation # JP14001 submittal requirements. The original master sent to the WSCA-NASPO Master Agreement Administrator identified in Section 1.6 of this RFP will prevail in resolving any discrepancies. Alaska Ted Fawcett Contracting Officer ted.fosket@alsaka.gov California - Bonnie Bahnsen bonnie.bahnsen@dgs.ca.gov Nevada Marti Marsh Purchasing Officer mmarsh@admin.nv.gov New Jersey Vicente Azarcon Procurement Specialist vicente.azarcon@treas.state.nj.us Utah Jennifer Porter Purchasing Agent State of Utah jenniferporter@utah.gov Response: Read and understood. 1.8 Current State Participants The States currently participating in the existing contracts are: Alaska, Arkansas, California, Colorado, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kentucky, Louisiana, Minnesota, Missouri, Montana, Nevada, New Jersey, Oklahoma (Grand River Dam Authority), Oregon, South Dakota, Utah, Washington, Wisconsin and Wyoming. States with Intent to Participate The following states have executed an Intent to Participate thru WSCA-NASPO, which simply indicates that they want to be formally listed in the published Request for Proposal as participating in the solicitation process: California, Hawaii, Minnesota, Missouri, Montana, Nevada, New Jersey, South Carolina, South Dakota, Utah, Vermont and Washington. All 56 NASPO members are eligible to participate in all WSCA-NASPO contracts when and if they decide they want to, in accordance with their individual statutory requirements. Response: Read and understood. 1.9 Governing Laws and Regulations This procurement is conducted by the State of Utah, Division of Purchasing & General Services, in accordance with the Utah Procurement Code. These are available at the Internet website for the State of Utah s Division of Purchasing & General Services. The laws of the State of Utah will govern all Master Agreements that result from this procurement unless the Data Communications Products and Services Provider and participating entity agree in a Participating Addendum that the laws of another jurisdiction will govern purchases made by purchasing entities within the jurisdiction of the participating entity. Response: Read, understood and will comply. Page 8 of 94 p. 391

233 WSCA-NASPO Data Communications Solicitation # JP Length of Contract The Master Agreement(s) resulting from this RFP will be for a period of five years (initial term). The Master Agreement(s) may be extended beyond the original Master Agreement period for a two (2) year period, by mutual agreement. Response: Read and understood Pricing Structure Pricing Structure: Pricing for the WSCA-NASPO Master Agreements shall be based on the Percent Discount off the current global MSRP Schedule applicable to United States customers. Response: Read and understood Price Guarantee Period Price Guarantee Period: The Data Communication Provider s Discount rate shall remain in effect for the term of the WSCA-NASPO Master Price Agreement. Response: Read and understood Price Escalation Equipment, Supplies and Services: Data Communications provider may update the pricing on their MSRP price list one time every year after the first year of the original contract term. The WSCA-NASPO Contract Administrator will review a documented request for a Price Schedule price list adjustment only after the Price Guarantee Period. Response: Read, understood and will comply Price Reductions In the event of a price decrease in any category of product at any time during the contract in a Provider s Price Schedule, including renewal options, the WSCA-NASPO Contract Administrator shall be notified immediately. All Price Schedule price reductions shall be effective upon the notification provided to the WSCA-NASPO Master Agreement Administrator. Response: Read, understood and will comply Usage Reporting Requirement All Data Communication Provider s will be required to provide quarterly usage reports to the WSCA- NASPO Contract Administrator or designee. The initiation and submission of the quarterly reports are the responsibility of the Data Communication Contract Provider. You are responsible to collect and report all sales data including your resellers and partners sales associated with your Master Agreement. There will be no prompting or notification provided by the WSCA-NASPO Contract Administrator. Quarterly reports must coincide with the quarters in the fiscal year as outlined below: Quarter #1: July 1 through September 30, due annually by October 30. Quarter #2: October 1 through December 31, due annually by January 30. Quarter #3: January 1 through March 31, due annually by April 30. Quarter #4: April 1 through June 30, due annually by July 30. Respondents must identify the person responsible for providing the mandatory usage reports. This contact information must be kept current during the Master Agreement period. The WSCA- Page 9 of 94 p. 392

234 WSCA-NASPO Data Communications Services Solicitation # JP14001 NASPO Contract Administrator must be notified if the contact information changes. The contact information for the person responsible for the mandatory quarterly usage reporting must be specified per Section The purpose of the Master Agreement usage-reporting requirement is to aid in Master Agreement management. The specific report content, scope, and format requirements will be provided to the awarded Data Communications Products and Services Provider s during Master Agreement execution. Some WSCA-NASPO States may require additional reporting requirements. Those requirements will be addressed through the individual participating entity s Participating Addendum process. Failure to comply with this requirement may result in Master Agreement cancellation. Response: Read, understood and will comply Standard Contract Terms and Conditions Any Master Agreement resulting from this RFP will include, but will not be limited to, the WSCA- NASPO Standard Master Agreement Terms and Conditions, the State of Utah Additional Terms and Conditions (Appendix A) and any additional terms and conditions specific to WSCA-NASPO participating addendums for participating entities. The WSCA-NASPO Master Agreement Terms and Conditions and State of Utah Additional Terms and Conditions will take highest precedence in any contract resulting from this solicitation. Vendors must clearly identify exceptions to the WSCA-NASPO Standard Master Agreement Terms and Conditions and the State of Utah Additional Terms and Conditions in the bid submission. Vendor exceptions must include proposed solution language. Failure to submit exceptions and/or solution language will constitute vendor acceptance of WSCA-NASPO and State of Utah Additional Terms and Conditions. No third party terms and conditions will be allowed in resulting contracts awarded under this solicitation. Additional vendor terms and conditions must be submitted with the solicitation bid response for legal review and contract applicability. Submission of vendor terms and conditions with a bid response does not guarantee acceptance. Vendor terms and condition will not include any reference to website URLs that house additional terms and conditions. All terms and conditions associated with resulting contracts will be identified and attached to the WSCA- NASPO Master Agreement. The State of Utah reserves the right to accept, reject, and/or negotiate vendor terms and conditions after the award(s) have been made if it is in the best interest of the State of Utah. Participating States reserve the right to negotiate vendor terms and conditions during the Participating Addendum process. Vendor terms and conditions included with a bid response are limited to a maximum of 10 pages (8 1/2 x 11 inch paper, 10 pt Arial font, and single sided). Failure to adhere to these terms and conditions requirements may result in vendor disqualification. Response: Read and understood. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer. Page 10 of 94 p. 393

235 WSCA-NASPO Data Communications Solicitation # JP Questions All questions must be submitted through BidSync. Answers will be given via the BidSync website. Questions received after the Question/Answer period will not be answered. No agency employee, board member, or evaluation committee member should be contacted concerning this solicitation during the solicitation posting and selection process. Failure to comply with this requirement may result in vendor disqualification. Response: Read, understood and comply Discussions with Respondents (Oral Presentation) An oral presentation by a Respondent to clarify a proposal may be required at the sole discretion of the WSCA-NASPO Master Agreement Administrator. However, the WSCA-NASPO Contract Administrator may award a Master Agreement based on the initial proposals received without discussion with the Respondent. If oral presentations are required, they will be scheduled after the submission of proposals. Oral presentations will be made at the Respondents expense. Response: Read and understood Protected Information The Government Records Access and Management Act (GRAMA), Utah Code Ann., Subsection , provides in part that: the following records are protected if properly classified by a government entity: (1) trade secrets as defined in Section if the person submitting the trade secret has provided the governmental entity with the information specified in Section (Business Confidentiality Claims); (2) commercial information or non-individual financial information obtained from a person if: (a) disclosure of the information could reasonably be expected to result in unfair competitive injury to the person submitting the information or would impair the ability of the governmental entity to obtain necessary information in the future; (b) the person submitting the information has a greater interest in prohibiting access than the public in obtaining access; and (c) the person submitting the information has provided the governmental entity with the information specified in Section ; * * * * * (6) records the disclosure of which would impair governmental procurement proceedings or give an unfair advantage to any person proposing to enter into a contract or agreement with a governmental entity, except that this Subsection (6) does not restrict the right of a person to see bids submitted to or by a governmental entity after bidding has closed;... GRAMA provides that trade secrets, commercial information or non-individual financial information may be protected by submitting a Claim of Business Confidentiality. To protect information under a Claim of Business Confidentiality, the Respondent must: 1. provide a written Claim of Business Confidentiality at the time the information (proposal) is provided to the State, and 2. include a concise statement of reasons supporting the claim of business confidentiality (Subsection (1)). Page 11 of 94 p. 394

236 WSCA-NASPO Data Communications Services Solicitation # JP submit an electronic redacted (excluding protected information) copy of your proposal response. Copy must clearly be marked Redacted Version. Failure to submit a redacted version may result in release of your entire proposal. A Claim of Business Confidentiality may be appropriate for information such as client lists and non-public financial statements. Pricing and service elements cannot be protected. An entire proposal cannot be protected under a Claim of Business Confidentiality or Proprietary. Failure to comply with this requirement many result in your proposal being ruled Non-Responsive and no longer considered. The claim of business confidentiality must be submitted with your proposal on the form which may be accessed at: To ensure the information is protected, the Division of Purchasing asks the Respondent to clearly identify in the Executive Summary and in the body of the proposal any specific information for which a Respondent claims business confidentiality protection as "PROTECTED". All materials submitted become the property of the State of Utah. Materials may be evaluated by anyone designated by the State as part of the sourcing team. Materials submitted may be returned only at the State's option. Response: Read and understood. Enterasys has entered a Claim of Business Confidentiality for the non-public financial information included in our proposal response. The following proposal attachments are submitted as PROTECTED information: UAe_2012 Enterprise Networks Holdings BV Amsterdam.pdf Gores ENT Holdings Consolidated Financial Statements SEPT 2011 Revised.xls Enterasys Networks Inc. Financial Statements P12 September 2012 Revised.xls 1.20 WSCA Administrative Fee The Contracted Supplier must pay a WSCA-NASPO administrative fee of one quarter of one percent (.025%) in accordance with the terms and conditions of the contract. The WSCA-NASPO administrative fee shall be submitted quarterly and is based on the actual sales of all products and services in conjunction with your quarterly reports. The WSCA-NASPO administrative fee must be included when determining the pricing offered. The WSCA-NASPO administrative fee is not negotiable and shall not be added as a separate line item on an invoice. Additionally, some WSCA-NASPO participating entities may require that an administrative fee be paid directly to the WSCA-NASPO participating entity on purchases made by purchasing entities within that State. For all such requests, the fee percentage, payment method and payment schedule for the participating entity s administrative fee will be incorporated in the Participating Addendum. Data Communications Provider will be held harmless, and may adjust (increase) the WSCA-NASPO Master Agreement pricing by the fee percentage for that participating entity accordingly for purchases made by purchasing entities within the jurisdiction of the State. All such agreements may not affect the WSCA-NASPO fee or the prices paid by the purchasing entities outside the jurisdiction of the participating entities requesting the additional fee. Response: Read, understood and will comply. Page 12 of 94 p. 395

237 WSCA-NASPO Data Communications Solicitation # JP Interest Any payments that a Contracted Supplier makes or causes to be made to WSCA-NASPO after the due date as indicated on the Quarterly Report schedule shall accrue interest at a rate of 18% per annum or the maximum rate permitted by law, whichever is less, until such overdue amount shall have been paid in full. The right to interest on late payments shall not preclude WSCA-NASPO from exercising any of its other rights or remedies pursuant to this agreement or otherwise with regards to Data Communication Provider s failure to make timely remittances. Response: Read, understood and will comply Proposal Offer Firm Responses to this RFP, including proposed discounts offered will be considered firm for one hundred and sixty (160) days after the proposal due date. By signature (electronic or otherwise) and submission of a proposal, the person signing verifies that they are authorized to submit the proposal and bind the firm to provide the products/services in the proposal and potential Master Agreement. Response: Read, understood and will comply Cancellation of Procurement This RFP may be canceled at any time and any and all proposals may be rejected in whole or in part when the State of Utah, Division of Purchasing and General Services determines such action to be in the best interest of the State of Utah. Response: Read and understood Right to Waive The sourcing team reserves the right to waive minor irregularities at its sole discretion. Response: Read and understood Right to Accept All or Portion It is our intent to accept the entire line of Data Communications Equipment and Services (included in the scope) from the awarded Data Communications Providers, however we reserve the right to accept all or a portion of a Respondents proposal. Response: Read and understood Service Line Additions and Updates During the term of the contract, Data Communications Providers may submit a request to update the awarded items (within the scope listed in IDENTIFY SECTION) as new technology is introduced, updated or removed from the market. The Master Agreement Administrator will evaluate requests and update the contract offering via written amendment as appropriate. The Data Communications Service Provider shall update the dedicated website, price lists, and catalogs to reflect approved changes. Pricing must utilize the same pricing structure as was used for services falling into the same service category. Response: Read, understood and will comply Right to Publish Throughout the duration of this procurement process and Master Agreement term, Respondents, Data Communications Providers and their authorized contractors must secure from the WSCA- Page 13 of 94 p. 396

238 WSCA-NASPO Data Communications Services Solicitation # JP14001 NASPO Contract Administrator prior approval for the release of any information that pertains to the potential work or activities covered by this procurement or the Master Agreement. The Data Communications Provider shall not make any representations of WSCA-NASPO s opinion or position as to the quality or effectiveness of the services that are the subject of this Master Agreement without prior written consent of the WSCA-NASPO Contract Administrator. Failure to adhere to this requirement may result in disqualification of the Respondents proposal or termination of the Master Agreement for cause Response: Read, understood and will comply Changes in Representation The Contracted Supplier must notify the WSCA-NASPO Contract Administrator of changes in the Contracted Supplier s key administrative personnel, to the extent that there may be adverse impacts to the contract. The WSCA-NASPO Contact Administrator reserves the right to require a change in Contracted Supplier(s) representatives if the assigned representative(s) is not, in the opinion of the WSCA-NASPO Contract Administrator, meeting the terms and conditions of the contract. Response: Read, understood and will comply E-Rate Requirement All award contractors must commit to participation in the Federal Communication Commission's E-rate discount program established under authority of the Federal Telecommunications Commission Act of Participation in, and implementation of, this program must be provided without the addition of any service or administration fee by the contractor. Response: Read, understood and will comply. Enterasys is an E-Rate Service Provider in good standing with the FCC and maintains an up-to-date SPAC and SPIN Section 508 Compliant Respondents must meet all Federal and State regulations required to these type of products including but limited to accessible products by describing their support of the applicable provisions of the Workforce Investment Act of 1998, Section 508. Response: Read, understood and comply Glossary Authorized Contractor: The Prime Contractor as listed as Contractor under the resulting Master Agreement(s) as a result of this RFP. Authorized Sub Contractor: sub Contractor, Reseller, Partner, etc. Authorized by the Contractor (Prime) to sell only the products and services listed under the Master Agreement (s) established as a result of this RFP. This authorized sub contractor must have the authority and ability to accurately reflect the ability of the Respondent to meet the requirements detailed in this RFP. WSCA-NASPO Contract Administrator: A dedicated person with the authority and ability to manage compliance with the scope and terms and conditions for this contract. Mandatory Minimum Requirements: Requirements that must be met in order to be considered for further evaluation. Mandatory minimum requirements are non-negotiable. An offer that does not meet the mandatory minimum requirements will be disqualified from further consideration. Participating Addendum: A Participating Addendum must be executed by any State that decides to adopt a WSCA-NASPO Master Agreement. Page 14 of 94 p. 397

239 WSCA-NASPO Data Communications Solicitation # JP14001 A Participating Addendum shall be executed for each contractor by the individual State desiring to use their contract. Additional States may be added with the consent of the contractor and the Lead State (on behalf of WSCA-NASPO) through execution of Participating Addendums. A Participating Addendum allows for each Participating State to add terms and conditions that may be unique to their State. The Participating State and the Contractor shall negotiate and agree upon any additional terms and conditions prior to the signing and execution of the Participating Addendum. States are not mandated to sign a Participating Addendum with all awarded vendors. Participating Entity: A State that has indicated intent to participate in the solicitation process, or after award, a State that has executed a participating addendum. Purchasing Entity: Any end-user in a participating State that is eligible to use the Master Agreement(s) through the participating addendum, including but not limited to State Agencies, Counties, Cities, Education, and other entities. Qualified Entity: An entity that is eligible to use the Master Agreement(s). Usage Report Administrator: A contractors person responsible for the quarterly sales reporting and payments described in Section 1.15 Usage Reporting Requirement. Volume Discount: A percentage discount offered by the seller to the buyer for purchasing a stated dollar amount of Data Communications services and products to be delivered at one time or for a specified period. Sourcing Team: The technical and business team charged with setting requirements for the Data Communications procurement, and its subsequent evaluation. Response: Read and understood. Section 2: General Proposal Requirements and Information 2.1 Proposal Content and Format Requirements Proposals must be detailed and concise. Unless otherwise stated in your proposal as an exception, Respondents agree to comply with every section, subsection, attachment and addendum of this RFP. Each proposal must be submitted in Microsoft Word or Excel, labeled and organized in a manner that is congruent with the section number, headings, requirements, and terminology used in this RFP. Proposal documents must be Arial font size 10. Respondent responses that are limited to a specified number of pages are referring to single sided pages. As an example, a response that is limited to a document that is no more than two pages long may be submitted on one double sided page, but not two double sided pages. Response: Read, understood and comply. 2.2 RFP Revisions Revisions, if any, and all written questions and the State s answers, will be posted on the BidSync website. Solicitation documents will not be mailed to prospective Proposers. Respondents must register (free of charge) as a vendor with BidSync in order to have access to the RFP and related Page 15 of 94 p. 398

240 WSCA-NASPO Data Communications Services Solicitation # JP14001 documents. Respondents are responsible for ensuring that their registration information is current and correct. The State of Utah accepts no responsibility for missing or incorrect information contained in the supplier s registration information on BidSync. The State of Utah accepts no responsibility for a prospective Respondent not receiving solicitation documents and/or revisions to the solicitation. It is the responsibility of the prospective Respondent to obtain the information provided through BidSync. Response: Read, understood and comply. 2.3 Right to Waive The State of Utah reserves the right to waive any informality or technicality in any proposal. Response: Read and understood. 2.4 Proposals Become Property of the State of Utah All proposal contents become the property of the State of Utah. All proposal content is proprietary during the proposal evaluation process. Upon Master Agreement award, the successful Respondents proposals will be open to public inspection, by request, with the exception of any proposal content that is marked as proprietary or confidential by the Respondent. All content designated as proprietary or confidential must be supported by documentation as to the rationale for the proprietary nature of the information. Response: Read, understood and comply. 2.5 News Releases News releases or other public disclosure of information pertaining to this RFP or the statewide contracts may not be published without the prior written permission of the State of Utah. Response: Read, understood and will comply. 2.6 State Seal Use The Utah Great Seal Rule states, in section R Custody and Use, that no facsimile or reproduction of the Great Seal may be manufactured, used, displayed, or otherwise employed by anyone without the written approval of the Lieutenant Governor." Other participating States have similar rules that must be adhered to by Respondents or interested parties. Response: Read, understood and will comply. Section 3: Data Communications Provider Mandatory Minimum Requirements 3.1 General Information This section contains requirements that must be addressed in order for your proposal to be considered for the evaluation phase of this RFP. All of the items described in this section are non-negotiable. Respondents are required to complete: Mandatory Requirements (M) All Respondents must meet the (M) requirements listed in this section, and explain how the requirement is met. A no response on the acceptance document or omission of the required explanation will disqualify the service from further evaluation. Response: Read and understood. Page 16 of 94 p. 399

241 WSCA-NASPO Data Communications Solicitation # JP Equipment Offering (M) Identify Equipment Offering in sections Response: Read, understood and comply. Enterasys has proposed a broad range of equipment offerings in sections Proposed equipment includes switching and routing solutions featuring a variety of chassis, stackable and standalone-based options. A complete wireless offering that includes standalone wireless access points and controller-based solutions. Network Management solutions that deliver unified wired and wireless management for complete centralized visibility and control of both the network and third party systems as well as Security solutions such as Network Access Control. Detailed technical responses and equipment lists have been included for each proposed category below: Networking Software Enterasys has proposed our NetSight Management Software Suite offering under the Networking Software category. In addition, Enterasys has proposed services offerings for Network Management and Automation as well as Data Center Management and Automation as additional professional services categories Routers Network Edge Routers Core Routers Security Intrusion Detection/Protection and Firewall Appliances Secure Access Switches Campus LAN Access Switches Campus LAN Core Switches Campus Distribution Switches Data Center Switches Software Defined Networks (SDN) Virtualized Switches and Routers Software Defined Networks (SDN) Wireless Access Points Outdoor Wireless Access Point Wireless LAN Controllers Wireless LAN Network Services and Management Cloud-based services for Access Points Bring Your Own Device (BYOD) Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of equipment proposed in each category Service Offering (M) Identify Service Offerings for all products offered in Sections Response: Read, understood and comply. Enterasys has included a broad range of service offerings for the proposed equipment in sections Below is an overview Page 17 of 94 p. 400

242 WSCA-NASPO Data Communications Services Solicitation # JP14001 of the available service offerings; additional detail is included in section Services: Maintenance Services Express Parts Our maintenance services provide full access to the latest firmware updates, ensuring you get the most from your network equipment. Advance parts replacement options range from next business day to two hour response and are available with or without an onsite field engineer. On-site Enterasys On-site maintenance program allows you to have an Enterasys-certified expert on site to help diagnose and repair network faults and serve as a liaison with product engineers for problem escalation when necessary. Software and Appliance Services Enterasys Software and Application Services maintenance programs allow you to avoid the expense of purchasing different revision levels, protecting your software investments. Our Appliance Services will help support elements that are critical to most effectively configure, maintain, support, upgrade and manage these product-specific Application environments. Enterasys Professional and Partner Services Both Enterasys and its authorized partners offer a broad range of professional services to help customers assess, plan, design, implement, and optimize their technology solutions. Enterasys Professional Services provides access to highly skilled and experienced networking specialists for all implementation related activities including but not limited to: design review, staging, implementation and project management, as well as advanced integration and technical training services. These services deliver flexibility, efficiency and cost savings, so you can select the type and level of service for each implementation task. Training Enterasys believes that technical training is an important element of doing business and will allow you to unleash the full value of your Enterasys solution. We offer a modular approach to technical certification training focused on practical, hands-on learning that s relevant to supporting and optimizing your Enterasys solutions to meet your business requirements. Our knowledgeable instructors use multiple methods to meet our varying customer educational requirements, ensuring that you are equipped to more effectively manage and support your network. Enterasys makes it easy to fully leverage your technology investment by offering the flexibility to take advantage of our training classes wherever you are. Our wide variety of educational courses and technical certifications are offered at many global Authorized Training Centers or regional training events, at your location in a customized training session, or from the comfort of your home or office via our web-based live virtual classroom. Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of proposed services offerings in each category Insurance Requirement (M) This pertains to the State of Utah insurance requirements. Other Participating States may identify different insurance requirements during the participating addendum process. Data Communications Provider s and their authorized contractors shall procure and maintain insurance which shall protect the authorized contractor and The State and/or purchasing entity Page 18 of 94 p. 401

243 WSCA-NASPO Data Communications Solicitation # JP14001 (as an additional insured) from any claims from bodily injury, property damage, or personal injury covered by the indemnification obligations set forth herein. The Data Communications Provider s authorized contractor shall procure and maintain the insurance policies described below at their own expense and shall furnish to the procurement manager, upon award, an insurance certificate listing the participating State(s) as certificate holder and as an additional insured. The insurance certificate must document that the Commercial General Liability insurance coverage purchased by the authorized contractor to include contractual liability coverage applicable to this Master Agreement. In addition, the insurance certificate must provide the following information: the name and address of the insured; name, address, telephone number and signature of the authorized agent; name of the insurance company (authorized to operate in all States); a description of coverage in detailed standard terminology (including policy period, policy number, limits of liability, exclusions and endorsements) and an acknowledgment of notice of cancellation to the participating States. Authorized contractor is required to maintain the following insurance coverage s during the term of the WSCA-NASPO Master Agreement: 1) Workers Compensation Insurance The Data Communications Provider s authorized contractor must comply with Participating State s requirements and provide a certificate of insurance. 2) Commercial General Liability Policy per occurrence - $1,000,000. Coverage to include bodily injury and property damage combined single limit. 3) Business Automobile Policy to include but not limited to liability coverage on any owned, non-owned, or hired vehicle used by Data Communications Provider s authorized contractor personnel in the performance of this Master Agreement. The business automobile policy shall have the following limits of liability: Per Occurrence - $1,000,000, Annual Aggregate - $3,000,000, Annual Aggregate applying to products and services - $3,000,000. Coverage must include premises and operations, bodily injury and property damage, personal and advertising injury; blanket contractual, products and services, owner named as an additional insured. The State of Utah must be listed as an additional insured. Within 10 days of contract award, the Contracted Supplier and/or Authorized Contractor must submit proof of certificate of insurance that meets the above requirements or the Participating States requirements. Response: Read, understood and comply. Enterasys will submit proof of insurance that meets the above requirements within 10 days of contract award Delivery (M) The prices offered shall be the delivered price to any WSCA-NASPO purchasing entity. All deliveries shall be F.O.B. destination with all transportation and handling charges paid by the contractor. Responsibility and liability for loss or damage shall remain the Contractor until final inspection and acceptance (within 30 days after delivery for external damage and 30 days for any concealed damage) when responsibility shall pass to the Buyer except as to latent defects, fraud and Contractor s warranty obligations. The minimum shipment amount will be found in the special terms and conditions. Any order for less than the specified amount is to be shipped with the freight prepaid and added as a separate item on the invoice. Any portion of an order to be shipped without transportation charges that is back ordered shall be shipped without charge. Response: Read, understood and comply. Page 19 of 94 p. 402

244 WSCA-NASPO Data Communications Services Solicitation # JP Service Offering Documentation (M) Upon request, user and/or technical documentation should be supplied for all procured products and services. Manuals may be available via the Contracted Supplier s website. The manual shall contain user and technical instructions appropriate to the service. Response: Read, understood and comply. Enterasys product manuals are available in the Downloads section of the Enterasys Support Site Documentation includes: Configuration Guides, Installation Guides, CLI Reference Guides, Feature Guides and Release Notes. Customers will be required to create a user name and password to sign in to the Enterasys Support Site for access to documentation. User and/or technical documentation can be supplied in whatever manner is most convenient to the customer Data Communications Provider Contract Administrator and Usage Report Administrator (M) The Contracted Supplier shall provide a Contract Administrator to manage compliance with the scope and terms and conditions for this contract. The following Information, at a minimum, regarding the Contract Administrator shall be provided: Response: Read, understood and comply. a. Administrator s number of years experience in the Data Communications Services business. Response: Enterasys has assigned a Contract Administrator with 14 years of experience in the Data Communications Services business to manage the contract. b. Confirmation that the Data Communications Provider Contract Administrator has authority to enforce the scope of work and terms and conditions of the resulting contract. Response: Comply. The Contract Administrator has authority to enforce the scope of work and terms and conditions of the resulting contract. The Contracted Supplier shall also provide a Usage Report Administrator responsible for the quarterly sales reporting described in Section 1.15 Usage Reporting Requirement. Response: Comply. The assigned Contract Administrator will be responsible for providing quarterly sales reporting described in Section 1.15 Usage Reporting Requirement emarket Center Cooperation (M) To be eligible for contract award, the Contractor must agree to cooperate with WSCA-NASPO and SciQuest (and any authorized agent or successor entity to SciQuest) with uploading a hosted catalog or integrating a punchout site. The contract requirements are in section 7. Response: Comply. Enterasys agrees to cooperate with WSCA-NASPO and SCiQuest with uploading a hosted catalog into the emarket Center based on the requirements in section 7. Section 4: Data Communications Provider Qualifications 4.1 General Information: Provide any pertinent general information about the depth and breadth of the Offeror s product and service offerings and their overall use and acceptance in the Data Communications marketplace. Response: Enterasys Networks is one of the fastest growing companies in the networking industry, providing patented and differentiated wired and wireless network infrastructure as well as security and management solutions. Enterasys One Fabric is the industry's first fabric-based networking solution to extend visibility and control from virtual servers to mobile devices for cloud computing, software-defined networking, and data center Page 20 of 94 p. 403

245 WSCA-NASPO Data Communications Solicitation # JP14001 environments. OneFabric enables our customers to provision the network from the data center to the mobile edge with consistent performance to deliver a positive end user experience through enhanced application analytics, all managed from a single pane of glass. With over 20,000 customers and sales in over 90 countries, Enterasys addresses the complexities of today s megatrends around Mobile, Social, Cloud and Big Data, serving customers across major verticals including education (K-12 and higher education), healthcare, government, manufacturing and hospitality. Awards & Accolades The success of Enterasys solutions in the marketplace is well demonstrated by our ability to win awards as well by the accolades we continue to earn from major industry research firms and analysts. Enterasys was recently recognized as a top industry leader in the Dell Oro Group 2013 Enterprise Edge Report, ranking fourth in overall market share among leading Ethernet Edge Switch vendors. The full press release is available at In addition, Enterasys leadership was recognized by leading industry analyst firm Info- Tech in all of our major product categories of Switching, NAC and WLAN. The reports for each product category are listed below: Switching: Tech_Enterprise_LAN_Vendor_Landscape.pdf NAC: Vendor-Landscape.pdf WLAN: Landscape.pdf April 2012 Enterasys is among the distinguished list of winning recipients of the eighth annual Manufacturing Leadership 100 Awards, honored at the Manufacturing Leadership Summit in Palm Beach, FL, April 29 May 2, Enterasys was selected by Manufacturing Executive, the global community for manufacturing leadership and producer of the Manufacturing Leadership Summit and ML100 Awards program. Enterasys' VP of Engineering Operations & Quality Brad Martin received an individual award in the Next-Generation Leadership and Culture category, and the company also received honors in the Information Leadership category. "We are honored to be recognized in two separate categories by Manufacturing Executive and feel the award is strong validation of our commitment to customers. At Enterasys, we live by our motto 'there is nothing more important than our customers' and our culture of continuous improvement helps us provide the best quality and highest performing product," said Brad Martin, VP of Engineering Operations & Quality, Enterasys. "Our recently implemented quality initiative strengthened processes across the board in order to ensure product quality is a key competitive differentiator for us. March 2012 Enterasys received several award wins from the sixth annual Stevie Awards for Sales & Customer Service gala banquet at Caesars Palace in Las Vegas. Enterasys project isaac won the Gold Stevie Award for New Collaboration Solution. Enterasys also won a Silver Stevie Award for Contact Center of the Year (up to 100 seats), and a Bronze Stevie Award for Innovation in Customer Service. Page 21 of 94 p. 404

246 WSCA-NASPO Data Communications Services Solicitation # JP14001 The Stevie Awards for Sales & Customer Service are the world s top sales, contact center and customer service awards. The Stevie Awards organizes several of the world s leading business awards shows, including the prestigious American Business Awards SM and International Business Awards SM. Enterasys isaac is a patent-pending, first-of-its-kind technology that gives IT the ability to manage network devices via Twitter, SalesForce.com Chatter, and Facebook. Isaac provides a simple and intuitive social media interface to OneFabric Control Center. The technology enables customers to use familiar social media interfaces to manage their networks. With isaac, administrators can communicate directly with machines, both giving commands and receiving information. All conversations can be pulled together, and information can be shared in a group setting. Administrators can also service customers more effectively because configuration details can be easily viewed. Enterasys strives to create a competitive differentiator and improve customer loyalty by providing the best customer service experience in the networking industry through its Global Technical Assistance Center (GTAC). This is validated by Enterasys having recently achieved a high Net Promoter Score, or NPS, of +8.1 based on input from its global customers in a variety of industries. In support of this goal, Enterasys employs a fully in-sourced customer service organization with best practices via Salesforce.com s cloud-based CRM tool, which enables workforce optimization through automated workflows and balanced performance scoring, as well as internal and external crossfunctional collaboration and self-service capabilities, including access to knowledge base and incident reporting management. We re delighted to kick off our celebration of the 10 th year of the Stevie Awards movement with the 2012 Stevie Awards for Sales & Customer Service, which is the first program in which we conferred Silver and Bronze Stevie Awards, said Michael Gallagher, president and founder of the Stevie Awards. It s gratifying and inspiring to have received so many remarkable entries for this year s competition. More than 1,000 entries from organizations of all sizes and in virtually every industry were submitted to this year s competition, an increase of almost 30 percent over Finalists were determined by the average scores of 93 professionals worldwide, acting as preliminary judges. We are proud to be honored by the Stevie Awards for isaac as well as the world-class services and support provided by our GTAC, said Vala Afshar, Chief Customer Officer, Enterasys. We stand by our motto that there is nothing more important than our customers. We will continue to make our customers our number one priority, and offer them innovative products and stellar support to help them better manage their business. February 2012 Enterasys received the 2011 Product of the Year Award from Technology Marketing Corporation's (TMC ) Internet Telephony magazine. With social media quickly becoming the mainstay of online communications, Enterasys developed isaac to integrate the cloud and mobile infrastructure with the social network. This enables IT to provide real-time responses to business needs anytime, anywhere, said Vala Afshar, Chief Customer Officer at Enterasys Networks. Receiving the Internet Telephony product of the year award validates the power of isaac to leverage social media for secure, predictive management and control of their wireless and wired IP networks to improve the user experience. Enterasys isaac is a social media interface that securely enables networks to communicate with humans in the language of social networking. Enterasys isaac enables your IT network to communicate its status and receive your commands all from pervasive Page 22 of 94 p. 405

247 WSCA-NASPO Data Communications Solicitation # JP14001 social networks including Twitter, Facebook and Salesforce Chatter. Enterasys isaac is available with NetSight, a key component of Enterasys OneFabric TM Control Center delivering single-pane of glass management for end-to-end application delivery assurance. I am happy to grant Enterasys with a Product of the Year Award. The editors of Internet Telephony have verified that isaac displays quality and innovation plus provides real needs in the marketplace, stated Rich Tehrani, CEO, TMC. I would like to congratulate the entire team at Enterasys for their commitment to advancing IP communication technologies. January 2012 Enterasys isaac, the industry's first social media interface that connects the IT network to the social network, was selected for an eschool Media 2012 Readers Choice Award. Enterasys isaac has successfully enabled K-12 school districts and higher education institutions to leverage social media for secure, predictive management and control of their wireless and wired IP networks. "Educational institutions are under intense pressure to deploy technology that further enables the educational process, while keeping expenses down and staying within budget," said Ram Appalaraju, vice president of marketing at Enterasys Networks. "The fact that school administrators nominated isaac for this honor demonstrates that they've successfully harnessed social media innovation to have a direct impact on operational simplicity. This is the most disruptive technology that tangibly reduces open IT cases and improves the user experience." This prestigious acknowledgment is given annually to K-12 and higher education technology products. The winners were selected by the editors of eschool Media (eschoolnews.com, ecampusnews.com, and eclassroomnews.com) from 1,400 reader nominations. The winning products were determined by the quantity of nominations received per product, including how the products improve teaching, learning, or school administration and to what effect. "The eschool Media Readers Choice Awards program is designed to give educators an honest peer-reviewed assessment of the technology products that are making a difference in today's classrooms," said Dennis Pierce, Editor-in-Chief of eschool News. "The nominations for the isaac solution from Enterasys detailed how isaac helps administrators tap into their school's network via Twitter, Facebook or other social media platforms to make instant updates and improve operational efficiency a must for any ed-tech decision maker." November 2011 Enterasys Wireless was selected as a District Administration Readers Choice Top 100 Product of To date, more than 500 K-12 school districts rely on Enterasys Wireless solutions to provide reliable classroom access, enhanced learning and centralized management for streamlined visibility and monitoring for Bring Your Own Device (BYOD) programs. This prestigious acknowledgement is given annually to K-12 education products that have supported education innovation. The winners were selected by the editors of District Administration from hundreds of nominations submitted by readers, including school superintendents and district-level Page 23 of 94 p. 406

248 WSCA-NASPO Data Communications Services Solicitation # JP14001 directors in districts across the United States. The winning products were determined by the quantity of nominations received per product, as well as an evaluation of product quality based upon readers' nominations and explanations. "Enterasys is honored by this award as it demonstrates the impact our wireless solutions are having on educators across the country to make their jobs easier and create a better learning environment for students," said Chris Crowell, president and CEO at Enterasys Networks. "We are committed to helping our K-12 customers deploy and optimize networking solutions that are uniquely tuned to their environment and specific needs." June 2011 Enterasys Networks Global Technical Assistance Center was a recipient of a Customer Interaction Solutions magazine 2011 CRM Excellence Award. This marks the second customer service award for Enterasys in as many years, having also won the 2010 CRM Elite award from Destination CRM. Customer Interaction Solutions has been the premier publication in the CRM, contact center and teleservices industries since We have been using Enterasys products in our data center for many years, said Brent Herring, Associate Director of IT University of Central Arkansas. The responsiveness of the Enterasys GTAC support organization is the best we receive from all of our technology vendors. The GTAC truly is a valued member of the University of Central Arkansas support team. Through Salesforce CRM and Service Cloud 2 applications, including the streamlining of critical global sales and customer data in multiple languages and currencies, Enterasys Networks' Global Technical Assistance Center (GTAC) provides customers and partners with direct, high-touch access to GTAC personnel. As opposed to a one-hour call back, or call-coordinator strategy used by many other vendors in the networking marketplace, Enterasys combines the use of leading software technology with long-tenured support staff and an in-sourced support model. Through its Automated Call Distribution (ACD) system, the customer or partner is connected directly to GTAC Engineers and Technical Teams who are responsible for supporting specific product lines 24x7x Warranty Specify the Offeror s standard warranty offerings for the products and services proposed in the response to this RFP. Response: As a customer-centric company, Enterasys endeavors to provide the best possible workmanship and design to ensure a positive first impression for our clients. In the event that one of our products fails due to defects in one of these factors, we have developed a comprehensive warranty that protects customers and promises a simple way to get your products repaired as soon as possible. Below is a listing of the applicable warranties for all Enterasys products lines. Table 1 Product Warranty Warranty Duration¹ Hardware Replacement² Technical Support (8x5 Phone, Web & Knowledge Firmware Releases³ Page 24 of 94 p. 407

249 WSCA-NASPO Data Communications Solicitation # JP14001 Base) 800 Series Lifetime NBD Shipment 1 Year Lifetime Telephone, Lifetime Web & KB A, B, C, D, G-Series Lifetime NBD Shipment⁴ Lifetime Lifetime 7100 Series, N, S, X-Series, Common Uplink, XSR, C5210 Wireless Controller 1 Year Return to Factory Repair 1 Year 90 Days Appliances IPS/SIEM, NAC, NMS (NetSight), Mobile IAM C20/C20N, Accessories, Standalone and Outdoor Access Points AP2630, AP2640, AP3630, AP standalone AP s AP2650, AP2660, AP3660, AP3765e, AP3765i, AP3767e Outdoor AP s. All outdoor NEMAbased solutions, including associated indoor AP, enclosure, connectors, cables, antennas, mounting brackets and power supplies. Enterasys Wireless Indoor Access Point Models (fit mode) AP2605, AP2610, AP2620, AP3605, AP3610, AP3620, AP3705i, AP3710e, 1 Year Return to Factory Repair 1 Year Return to Factory Repair 1 Year 90 Days 1 Year No Lifetime⁵ NBD Shipment⁵ Lifetime⁵ 1 Year⁷ Page 25 of 94 p. 408

250 WSCA-NASPO Data Communications Services Solicitation # JP14001 AP3710i, AP3725e Enterasys Wireless Controllers (C4110, C5110 and C25) Lifetime⁶ 15 Business Day Return to Factory⁶ Lifetime⁶ 1 Year⁷ I-Series 5 Years Return to 5 Years 2 Years Factory Repair All Software 90 Days N/A 90 Days No 4.3 Website ¹Lifetime is defined as End of Sale plus 5 years, except in the case of Wireless Controllers, which have warranty duration of End of Sale plus 1year. ²Actual delivery times may vary depending on specific End User location. ³Warranty coverage for premium licenses on lifetime warranty products is limited to 1 year, except for Advance Routing and IPV6 Routing licenses for the B5/C5, previous B/C generations and G3 which have lifetime coverage. See section 2. II. C for more information about Enterasys Software/Firmware Version Schema. ⁴Advanced Replacement NBD Delivery applies to A2, B2/C2, B3/C3 in NA, Western Europe, Australia. ⁵For products sold prior to 6/1/2009, the warranty duration is 1 Year and hardware replacement is Return to Factory Repair. ⁶For products sold prior to 1/1/2011, the warranty duration is 1 Year and the hardware replacement is Return to Factory Repair. ⁷Maintenance releases only. Coverage for AP firmware maintenance releases begins on the initial purchase date of the associated wireless controller. A copy of Enterasys Standard Warranty is attached separately with our proposal response. Enterasys Standard Warranty is also available at Award contractors are required to establish and maintain a website applicable to the WSCA/NASPO contract which will allow Participating States to see applicable contract price list, discounts on said price list, approved resellers or partners for their state and any additional information that may be required to assist the participating states in obtaining information concerning the contract award. The State of Utah representing WSCA/NASPO reserves the right to require the award contractor to add additional items to assist in this process. Specify Websites used by the Offeror to facilitate customer ordering under awarded contracts. This is a mandatory requirement. Response: Comply. Enterasys will work to establish websites that meet all WSCA/NASPO and Participating State requirements. Today, Enterasys hosts several websites for customers ordering through our existing WSCA Master Agreement. Each website is designed to accommodate the specific requirements identified by Participating States and at a minimum includes contract price lists, contract discounts, approved resellers and general contact information. Page 26 of 94 p. 409

251 WSCA-NASPO Data Communications Solicitation # JP14001 Below is a current list of websites for the existing WSCA contract and Participating States: Utah - Master WSCA Contract Website: Alaska - Participating Addendum Website: aspx California - Participating Addendum Website: Colorado - Participating Addendum Website: Hawaii - Participating Addendum Website: Louisiana -Participating Addendum Website: Missouri - Participating Addendum Website: Nevada - Participating Addendum Website: New Jersey - Participating Addendum Website: Washington - Participating Addendum Website: Customer Service Specify the Offeror s standard customer service policies and detail the escalation process used to handle customer-generated issues. Response: Using a process driven and systematic approach, Enterasys ensures that all customer contact is managed in the most practical and efficient manner. Customers can rest assured knowing that one of the industry s best support organizations is behind your network. From Enterasys multiple award-winning Global Technical Support Center (GTAC) providing 24x7 access to reliable technical help, to the comprehensive Enterasys SupportNet offerings that let you choose the exact level of service ideal for your organization, to comprehensive downloads, Enterasys has you covered. All contact into GTAC is documented with appropriate context, including inquiry type, subject, owner, timelines, technology and product information, customer and partner contact, and other relevant data required for timely resolution delivery. Customer contact is fully managed by a state-of-the-art Customer Relationship Management (CRM) solution. GTAC is able to manage and prioritize the contact lifecycle using service level agreements (SLA) that guide the workflow, ownership, and required actions needed to resolve and close cases in a satisfactory manner. SLA conformance levels and adherence is automated with built-in workflow rules, notifications, and assignments and system visibility extends to engineering and management. Support Case Type Definitions The support case priority levels and definitions are as follows: Page 27 of 94 p. 410

252 WSCA-NASPO Data Communications Services Solicitation # JP14001 Case Priority 1 (P1) Customer's network segment or management application is down or experiencing a consistent, measurable performance impact with no immediate resolution available. Phone Support Technician notifies Technical Support Engineer immediately Technical Support Engineer engaged on call after 2 hours Development Engineering engaged after 4 hours until resolutions or workaround provided. Generally Available firmware provided within 90 calendar days. P2 Customer's network is experiencing intermittent failure or degradation of network or management application. Phone Support Technician notifies Technical Support Engineer after 1 day Technical Support Engineer engaged after 5 days Development Engineering engaged after 8 days. Workaround or internal code provided within 15 days. Generally Available firmware provided within 90 calendar days. P3 Customer has issues that do not affect normal network or management application operation and/or questions concerning product function or use. Phone Support Technician notifies Technical Support Engineer after 3 days Technical Support Engineer engaged after 10 days Development Engineering engaged after 15 days. Workaround or internal code provided within 30 days. Generally Available firmware provided within 90 calendar days. GTAC Priority and Escalation Management Enterasys sets a higher priority on problems and escalation management for customers with current service contracts. This ensures that the appropriate resources within Enterasys Networks are utilized to resolve outstanding technical problems as efficiently as possible. Table 1 below shows case severity definitions and escalation guidelines. These are guidelines only and are subject to change. Priority Management When a customer contacts the GTAC a Technical Support Engineer will work with the customer to assign a mutually agreeable priority level to your problem that will be reflected in the support case opened on the customer s behalf. Severity definitions are listed in Table-1. Table-1 Case Severity Definitions and Response Management Guidelines Case Priority Response Time Progress Time Case Priority Response Time Progress Time Restore Time (SW fix or Workaround) C1 1 Hour (7x24x365) 2 hours Enterasys engaged until provided Fault Correction Time (SW/FW) Update Frequency 90 days 4 hours C2 6 hours 5 days 15 days 90 days 1 day C3 2 business days 10 days 30 days 90 days 1 day C4 Immediate acknowledgement 60 days N/A N/A N/A Restore Time (Note: A (day) elapsed time is measured in terms of business days (Mon-Fri). Fault Correction Page 28 of 94 p. 411

253 WSCA-NASPO Data Communications Solicitation # JP14001 Escalation Management Response Times Our systematic escalation process is intended to notify and brief various levels of management throughout the life cycle of the case. Escalation timeframes are measured on a 24x7x365 basis. Table-2 below describes the Enterasys case escalation notification matrix. Table-2: Case Escalation Management Notification Matrix Notification Levels C1 - Critical C2 High Priority C3 Medium Priority Support Engineer Immediate Immediate Immediate GTAC Manager Immediate Immediate 10 days Director, Global Technical Immediate 48 hours 10 days Services Vice President, Global 2 hours 72 hours 20 days Technical Services Executive Management (CTO/EVP Eng) 4 hours None None Escalation Lifecycle The Escalation Lifecycle is defined by the following: Discovery: The GTAC Support Engineer is gathering and reviewing information. Once the data is reviewed, the GTAC Support Engineer will determine if additional information is required, corrective action is available or a recreation attempt is needed. Recreation: The GTAC Support Engineer is in the process of attempting to replicate the reported behavior. Once replicated, the GTAC support engineer will determine if the behavior is a bug and will document it in the bug tracking database. If the behavior is not a bug or is a result of misconfiguration, the customer and case note will be updated. If GTAC is unable to reproduce the reported behavior, additional information or debugging may be required at the customer site. Remediation: The GTAC Support Engineer has determined there is an anomaly and/or the development team s assistance is required. While in this status, updates from engineering will be used by the GTAC to keep the customer/partner updated on progress to resolution. Release Packaging: Once a resolution or enhancement has been tested and verified along with a firmware version and release date determined, the escalation moves into this status. Customers will receive updates every two weeks as to the official release status until the firmware/software is Generally Available (GA) and posted on our firmware download site. Generally Available: Once a resolution has been identified the escalation will be put into this status. If the resolution is a new firmware release, customers will receive automated notifications and the case will close within 15 days. If the resolution is a configuration change, or hardware replacement, the GTAC engineer will close the escalation after confirming the resolution with the customer. 4.5 Firm a. Provide a brief history of your firm including the following: 1. Number of years providing Data Communications Services being offered in response to this RFP. Response: Enterasys has been in the networking industry for over 30 years, having originated as part of the highly successful company known as Cabletron Systems, which was founded in Built upon strong Page 29 of 94 p. 412

254 WSCA-NASPO Data Communications Services Solicitation # JP14001 engineering principles, Cabletron Systems helped develop the networking industry with the continual introduction of new technologies. Enterasys was formed in March 2000 specifically to seize enterprise market opportunities and to better serve its customers. Enterasys was officially spun up into the parent company, Cabletron, on August 6th, 2001, and began trading under the symbol of ETS on the New York Stock Exchange. On October 1, 2008, Enterasys, SER Solutions, Inc. and Siemens Enterprise Communications merged to form a market-leading provider of voice and data products, services and solutions. As a multi-billion dollar provider of hardware, software, and services, the new company is delivering serviceoriented networks that enable voice, video, and data service-oriented applications in a mobile and secure manner. Today, Enterasys is part of Siemens Enterprise Communications, one of only three global providers of end-to-end enterprise communication solutions. We re a $3 Billion dollar a year company with a combined 10,000 employees, servicing over 90% of the Fortune 100 and 75% of the Fortune 500 customers in over 90 countries. We re number three in the world in Voice Over IP revenue, and we re the world s top revenue performer in the area of managed services from communications providers. 2. Number of separate services provided in each of the area categories described in this RFP. Response: Enterasys has responded with 31 separate product and service offerings. A breakdown of each category offering is outlined below Networking Software area category Routers category: Network Edge Routers Core Routers Security category: Intrusion Detection/Protection and Firewall Appliances Secure Access Switches category: Campus LAN - Access Switches Campus LAN - Core Switches Campus Distribution Switches Data Center Switches Wireless category: Access Points Outdoor Wireless Access Point Wireless LAN Controllers Page 30 of 94 p. 413

255 WSCA-NASPO Data Communications Solicitation # JP Wireless LAN Network Services and Management Bring Your Own Device (BYOD) Services category: Maintenance Services Express Parts On-site Software and Appliance Services Professional Services category. Survey/ Design Services Implementation Services Optimization Remote Management Services Consulting/Advisory Services Data Communications Architectural Design Services Statement of Work (SOW) Services Network Management and Automation Data Center Management and Automation Training category. Classroom Attendance via our Authorized Training Centers Onsite Training Regional Training Classroom Attendance via the Enterasys Virtual Classroom Technical Certifications b. Describe specifically what makes your firm a stable long term partner for WSCA-NASPO. Response: As a current contract holder, Enterasys is fully committed to a long term partnership with WSCA-NASPO. We have established operational procedures and dedicated resources to support a large base of customers who rely on the contract to procure product and services. At Enterasys, all aspects of our operations are built around the mantra that there is nothing more important than our customers. Our 96% customer satisfaction rating and award-winning support organization provide strong proof that we re on the right track. Leading companies worldwide are partnering with Enterasys to offer innovative solutions to solve business and IT challenges. Enterasys, together with our channel partners, has helped customers drive down IT costs while improving business productivity and efficiency. Enterasys was the FASTEST growing networking company in And 2012 proved to be another year of strong growth for Enterasys, as it was the third consecutive year of revenue growth for the company and we are proud to have a NetPromoter score of 81, higher than industry bellwethers such as Apple and Cisco. NetPromoter is the gold standard for companies who want to translate customer experience into profitable growth. In addition, Enterasys also has less Page 31 of 94 p. 414

256 WSCA-NASPO Data Communications Services Solicitation # JP14001 than five percent employee attrition much lower than industry average. The company s strong culture, executive team and product portfolio was also recognized by several leading publications and analyst firms. Enterasys has been in the networking industry for over 30 years and helped develop the networking industry with the continual introduction of new technologies. We have a strong history of technology leadership and product innovation. Our patent portfolio exemplifies our innovations in secure, intelligent, automated and integrated networking hardware and software solutions. We have assembled an experienced team of developers and engineers and have established a corporate culture that facilitates continuous product innovation and plan to continue investing in research and development to strengthen and increase the functionality of our technology solutions. Further, Enterasys R&D efforts are prioritized not by what we think everyone should be doing, but rather by the problems customers are asking us to solve. Some of our new product offerings include the OneFabric Edge architecture, a purpose-built architecture for edge networking to support mobile application delivery; Enterasys Mobile IAM (Mobile Identity and Access Manager), its BYOD network solution; and Enterasys IdentiFi, a new Wi-Fi solution encompassing access points, controllers and management software purpose-built to support hyper-dense wireless environments with advanced analytics. In addition, Enterasys recently announced several new awards that solidify its place as a leading provider of wired and wireless network infrastructure and security solutions. The new awards include: InformationWeek 500: Enterasys CIO Dan Petlon was recognized at #80 on the InformationWeek 500 list, which lists today s most innovative users of business technology. Internet Telephony Excellence Award: TMC listed Enterasys Mobile IAM among the winners of its Internet Telephony Award, which acknowledges excellence in the IP communications industry. Info-Tech WLAN Champion: In the Wireless LAN category, Enterasys was placed firmly within the Champion quadrant, recognized for excellence within the wireless landscape as the technology continues to evolve. Search Networking Network Innovation Award: Enterasys recently received the Network Innovation Award for Enterasys isaac, recognizing its contribution to remote network management strategy. Boston Globe Top Place to Work: Enterasys was named as one of the Top Places to Work in Boston, coming in 4th out of 35 in the large business category. Enterasys accepted the award during a ceremony held at the Revere Hotel in Boston. CCMA Ireland Contact Centre and Shared Services Award 2012: Enterasys won this award at the CCMA awards at the Burlington Hotel in Dublin Ireland for International Shared Services Centre of the Year. District Administration Reader s Choice Top 100 Products: Enterasys IdentiFi Wi-Fi solution was recognized by readers of District Administration for its exceptional performance and ease of management for K-12 school districts. These new honors are in addition to other awards the company has received throughout the year, including: Boston Business Journal: Best Places to Work and 2012 CIO of the Year Stevie Awards for Sales & Customer Service: Enterasys Isaac won the Gold Stevie Award for New Collaboration Solution, Enterasys won the Silver Stevie Page 32 of 94 p. 415

257 WSCA-NASPO Data Communications Solicitation # JP14001 Award for Contact Center of the Year, and a Bronze Stevie Award for Innovation in Customer Service. Our services, support and training offerings have been developed and are continuously improved based on customer feedback. Gartner says both new and existing customers cite our support as a differentiator. Enterasys prides itself on delivering on promises and being a vendor that customers want to do business with. One of the ways this is achieved is by providing quick, nohassle support. The quality of support Enterasys provides sets us apart from the competition and demonstrates our commitment to customers. There are three main ways that Enterasys support is differentiated: Enterasys support personnel are 100% in-sourced. Enterasys GTAC is staffed only by Enterasys employees, with an average tenure of 13+ years with the company. Enterasys personalizes the support customers receive you ll meet your support person via telephone so you know who you ll be working with before you make the final decision to invest with Enterasys. The innovative technology behind Enterasys support process enables Enterasys to manage multi-channel customer contact with total cross-functional visibility and response management. Having all of support employees in-house provides significant advantages including: Tight integration with R&D, which fosters group collaboration, accelerates on-thejob training, and enables problem-solving problems in real-time Low attrition rates achieved by recognizing and investing in support staff. 2-tier call center design, including support and engineering, allows them to meet customer s demand for faster results no need to wait through five tiers of escalation as with other vendors. Enterasys is known for having the industry s best service and support, receiving validation from customers, analysts and industry experts. Enterasys received Gold, Silver and Bronze awards from the 2013 & 2012 Stevie Awards for Sales & Customer Page 33 of 94 p. 416

258 WSCA-NASPO Data Communications Services Solicitation # JP14001 Service. Enterasys also won the 2011 CRM Excellence Award from Customer Interaction Solutions Magazine. For the second year in a row, Enterasys GTAC was honored for helping clients improve workflow. This marks the second customer service award for Enterasys in as many years, having also won the 2010 CRM Elite award from Destination CRM. c. Describe specifically what information the Data Communications Provider contract administrator would provide at annual meetings with an entity that has executed a participating addendum. Response: The contract administrator would discuss any issues experienced with use of the contract and corrective actions needed to ensure compliance. The contract administrator would review quarterly sales and general performance of the current list of resellers. We would also provide a roadmap for upcoming release of new products in the awarded product equipment categories. Additional discussion topics might also include marketing activities for upcoming product and service campaigns available to WSCA Participating States. d. Describe how you plan to implement the contract including having a single point of contact to perform and manage all aspects of this contract. Response: The designated contract administrator will serve as a single point of contact responsible for coordinating all contract related activities from Enterasys corporate headquarters in Salem, NH. Activities include but are no limited to processing of updates, usage reporting and addressing contract-related questions. The contract administer will be responsible for communicating contract use procedures to regional Account Management Teams and Authorized Partners to ensure performance is consistent across all WSCA Participating States. Upon award, regional training will be scheduled with the teams to ensure successful and consistent implementation of the contract. Follow-on quarterly and as needed information sessions will be scheduled to communicate contract developments and updates as well. e. Describe in detail your firm s escalation management plan including contact information. Response: The Enterasys escalation management team is comprised of the following departments dedicated to supporting WSCA customers. Contract Administration Support Michael Swierk Contract Analyst Salem, NH Phone: mswierk@enterasys.com Page 34 of 94 p. 417

259 WSCA-NASPO Data Communications Solicitation # JP14001 Mike Swierk is responsible for contract administration and will assist with processing of contract updates, extensions and addressing contract-related questions. Sales Management Peter Katavolos Director of Sales, North East Region Phone: pkatavol@enterasys.com James Harris Director of South Region Sales & Service Phone: (404) jharris@enterasys.com Paul Corning Director of Sales, North America Central Phone: (913) pcorning@enterasys.com Josh Baird Director of Sales, West Region Cell: (408) jbaird@enterasys.com Peter, Jamie, Paul and Josh are responsible for regional sales across North America. Each supports a specific region in the country with sales local Account Managers reporting directly to them. Specifically, Peter, Jamie, Paul and Josh are responsible for Enterasys sales and marketing related activities for Northeast, South, Central and West Coast regions. Charlie Van Pelt North America Director of Channels and Business Development Partner Management Phone: cvanpelt@enterasys.com As the North America Director of Channels and Business Development, Charlie is responsible for directing partner program activities and managing a full staff of Channel Partner Account Executives. Technical Support Steve Kelly Technical Support Management Escalation Phone: kelly@enterasys.com Page 35 of 94 p. 418

260 WSCA-NASPO Data Communications Services Solicitation # JP14001 Steve Kelly leads our technical support effort as managing director of our GTAC located at our corporate headquarters in Salem, NH. He helps ensure that service SLAs are met and can coordinate additional GTAC support resources both remote and on-site, as needed. Vala Afshar Chief Marketing Officer & Chief Customer Officer Phone: vafshar@enterasys.com Vala Afshar is our Chief Customer Officer and is responsible for helping Enterasys provide world-class service which consistently scores ahead of our competitors with respect to customer satisfaction and willingness of our customers to recommend Enterasys products and solutions to others. Vala is an innovator and customer advocate who is always looking for ways to enhance support processes and applications and has been instrumental in helping Enterasys garner numerous awards for customer satisfaction, service automation and program excellence. 4.6 Authorized Sub Contractor Relationships Respondents may propose the use of Servicing Subcontractors or partners however, the Contractor shall remain solely responsible for the performance under the terms and conditions of the Contract if Servicing Subcontractors are utilized. This includes sales report information. The Contractor will be responsible to collect, and report this information from all partners or resellers representing your contract. Response: Read, understood and comply. a. Briefly describe what your firm requires from potential contractors to become an Authorized Data Communications Reseller. Provide an Authorized Contractor List. Response: At a minimum Enterasys requires authorized channel partners to sign a Partner Program Agreement to establish a mutually beneficial business partnership. A list of authorized partners is provided below for consideration. Authorized Partner List Synergetics DCS Southwest Surveillance Solid IT Networks R & D Data Propducts Packet Fusion North River IT Services NE Systems Incorporated Siemens Enterprise Communications CDW-G CDW Black Box Corporation JT Tech Evolve Technologies Network Management Corporation IK Electric Howard Technology Solutions Accuvant All Phase Xtelesis Universal Data, Inc Structured Communication Systems, Inc. Starnet Data Design SkyRider Communications, Inc. New West Technologies M&S Communications Group Livewire LLC Kinetix Technologies Intervision Systems Page 36 of 94 p. 419

261 WSCA-NASPO Data Communications Solicitation # JP14001 Technologies EyeP Solutions Dynamic Systems, Inc. DMD Data Systems Cornerstone Technologies Communications, Cabling & Networking Carousel Industries Attain Technologies, LLC DBA High Touch b. Describe in detail how your firm currently measures an authorized contractors performance. Response: Enterasys utilizes a partner program model to measure the performance of authorized partners using technology from Salesforce.com, coupled with innovative best practices. There are four main authorized partner designations: Registered, Gold, Platinum and Diamond. Each designation requires partners to achieve annual revenue milestones as well as technical and sales certifications to maintain their status level. c. Describe in detail the process for revoking a designation as a sub contractor from an authorized contractor for issues related to customer service, or other authorized contractor performance related issues. Response: Enterasys conducts annual reviews to evaluate performance of all authorized partners based on reporting information from Salesforce.com. The reviews focus on performance criteria defined in partner designations. If partners underperform, Enterasys Channel Account Executives will take steps to help improve their position with additional sales and technical training modules or other means as needed. If the partner does not improve after implementation of corrective actions they may be moved down a level or removed from the program altogether. d. Describe in detail how your firm will support and assist an authorized contractor in improving their performance and the corrective action process. Response: Enterasys Sales Operations Management and Channel Account Executives will analyze reporting information from Salesforce and work with partners to make improvements in these areas. Enterasys may offer additional training modules, schedule regular strategy meetings and participate in sales calls to ensure partners have appropriate resources to succeed. If the partner does not improve after implementation of corrective actions they may be moved down a level or removed from the program altogether. e. Describe in detail the process that your firm uses to track and respond to issues and concerns from both your authorized contractors and from participating entities. Response: Enterasys utilizes a partner portal to manage issues raised by partners. In addition, each partner is assigned a Channel Account Executive who is responsible for managing the relationship and escalation of issues to upper management. Page 37 of 94 p. 420

262 WSCA-NASPO Data Communications Services Solicitation # JP14001 Additionally, Enterasys GTAC will provide participating entities with technical support, which is available 24 hours a day, 365 days a year. Through Enterasys Automated Call Distribution (ACD) system, participating entities will connect directly to GTAC Engineers and technical teams who are responsible for supporting specific product lines 24x7x365. Enterasys GTAC is staffed only by Enterasys employees, with an average tenure of 13+ years with the company. These experts work in locations around the globe to ensure coverage for all time zones in multiple languages. In addition, the GTAC maintains top-of-the-line technology labs for optimal issue re-creation and fast answers to complex questions. Enterasys offers priority setting of problems and escalation management. This ensures that the appropriate resources within Enterasys are utilized to resolve outstanding technical problems as efficiently as possible as described above in section 4.4 Customer Service. f. Describe in detail how your firm will track, report and verify sales from your designated Data Communication partners and authorized contractors. Response: Enterasys utilizes Salesforce.com to track sales from our designated partner base. In addition, the Enterasys contract administrator works directly with all authorized partners to collect contract sales for reporting purposes. Section 5: Service Offering Qualifications 5.1 General Information This section contains mandatory minimum requirements that must be met in order for your proposal to be considered for the evaluation phase of this RFP. All of the items described in this section are non-negotiable. Respondents are required to complete: Mandatory Requirements (M) All Respondents must meet the (M) requirements listed in this section, and explain how the requirement is met. A no response on the acceptance document or omission of the required explanation will disqualify the service from further evaluation General Business Requirements Each provider must meet the following mandatory general business requirements: Terms and Conditions (M) Respondents must indicate their acceptance of the State of Utah Standard Terms and Conditions in addition to the WSCA-NASPO Terms and Conditions attached to this RFP as Attachment A and Attachment B. Any exceptions to these terms and conditions must be clearly identified in bid response and during the question and answer period on BidSync. Significant exceptions may constitute grounds for rejecting Respondent proposals. Response: Read, understood and comply. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Page 38 of 94 p. 421

263 WSCA-NASPO Data Communications Solicitation # JP14001 Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer Experience (M) Respondents must be able to provide reference service contracts from a minimum of five government or commercial customers for their Data Communications Product and Services offerings. Government references are preferred. References must include environments and complexity that is similar in scope to those described within this RFP. Any proposals from Respondents that cannot meet these requirements will not be considered. The Respondent must provide specific contact information describing their reference service contracts, which may be verified. Response: Read, understood and comply. The following Enterasys customers have submitted Attachment B Reference Forms. Twin Rivers Unified School District 1333 Grand Avenue, Sacramento, CA Contact: Gene Smith, Director of IT Phone: (916) gene.smith@twinriversusd.org Nicholls State University Highway 1, Thibodaux, LA Contact: Slade Besson, Director of Telecommunications / Networking Information Technology Phone: (985) slade.besson@nicholls.edu Matanuska-Susitna Borough School District 501 North Gulkana, Palmer, AK Contact: Justin Michaud, Chief Information Officer (CIO) Phone: (907) Justin.Michaud@matsuk12.us University of Central Arkansas 201 Donaghey Ave, Conway, AR Contact: Brent Herring, Associate Director of Information Technology Phone: (501) brenth@uca.edu Monroe Township Board of Education 1629 Perrineville Road, Monroe Township, NJ Contact: Reggie Washington, Director of Information Systems Phone: (732) reggie.washington@monroe.k12.nj.us Page 39 of 94 p. 422

264 WSCA-NASPO Data Communications Services Solicitation # JP Financial Stability (M) The Data Communications Product and Services vendor must provide audited financial statements to the State and should meet a minimum Dun and Bradstreet (D&B) credit rating of 4A2 or better, or a recognized equivalent rating. Please provide the Respondent s D&B Number and the composite credit rating. The State reserves the right to verify this information. If a branch or wholly owned subsidiary is bidding on this RFP, please provide the D&B Number and score for the parent company that will be financially responsible for performance of the agreement. Prime contractors working on behalf of Respondents must submit financial statements that demonstrate financial stability, and adequate working capital, but do not need to meet 4A2 credit rating requirements. Response: Read, understood and comply. Enterasys Networks, Inc. is a wholly-owned subsidiary of Enterprise Networks Holdings, Inc., also a Delaware corporation. Enterprise Networks Holdings, Inc. is a wholly-owned subsidiary of Enterprise Networks Holdings B.V., ("ENHBV"). ENHBV is the joint venture entity between the investment funds managed by The Gores Group, LLC, a Delaware limited liability company ("Gores"), and Siemens Aktiengesellschaft, a German company ("Siemens AG"). Enterasys has entered a Claim of Business Confidentiality for the non-public financial information included in our proposal response. The following proposal attachments are submitted as PROTECTED information: UAe_2012 Enterprise Networks Holdings BV Amsterdam.pdf Gores ENT Holdings Consolidated Financial Statements SEPT 2011 Revised.xls Enterasys Networks Inc. Financial Statements P12 September 2012 Revised.xls Enterasys Networks Dun and Bradstreet number is: Enterasys Networks D&B rating is: ER Other General Responsibilities (M) The Respondent must provide the personnel, equipment, tools, and expertise to meet the requirements in this RFP. Response: Read, understood and will comply. Personnel and Expertise Enterasys will ensure the appropriate resources are available to meet the requirements in this RFP. Resources include a dedicated contract administrator, personnel from our direct Account Management and Channel Partner sales teams, GTAC Technical Support Engineers, Professional Services Engineers as well as members from Enterasys upper management team. Direct access is also available to product developers and experienced executives upon request. Enterasys supports a technical work force of certified technicians dedicated to providing sales, services and global support to customers across North America. Enterasys employees have a 13 year average tenure in engineering and support. All of Enterasys engineers go through internal training programs for a period of at least two weeks per year including one week of hands-on training of our latest technologies and solutions. The majority of our engineers and outside Account Executives are Enterasys Systems Engineer (ESE) or Enterasys Security Systems Engineer (ESSE) certified. In addition, all Enterasys authorized partners are required to achieve technical and sales certifications to maintain their partner level status. Page 40 of 94 p. 423

265 WSCA-NASPO Data Communications Solicitation # JP14001 Equipment Enterasys has responded with our complete range of products that include a variety of switching and routing solutions, a complete wireless offering that includes standalone wireless access points and controller-based solutions. Network Management solutions that deliver unified wired and wireless management for complete centralized visibility and control of both the network and third party systems as well as Security solutions such as Network Access Control to protect network infrastructures. The Supply of Enterasys products is supported by a network of major distribution channels and strategic depot centers. The primary distribution hubs are located in Elgin, IL (US) and Shannon Ireland with several major North American active forward stocking locations with rapid response parts exchange capability. In addition to the four GTAC technical support centers, there are numerous field offices with solutions and system engineering technical staff that are tightly integrated into the services and support function with strong partnerships with the GTAC. Enterasys also leverages partnerships with industry recognized leaders such as Lucent Technologies, Siemens and UPS for additional onsite field support. Tools Enterasys leverages Salesforce.com, a powerful customer relationship management tool, which enables workforce optimization through automated workflows. Saleforce provides a platform for internal and external cross-functional collaboration and self-service capabilities, including access to knowledge base and incident reporting management to help ensure we manage our business effectively and deliver great support to our customers. Enterasys also offers a variety of self service support tools and resources to customers that include: Knowledge Base for answers to your questions or issues: Product Documentation: Firmware and software downloads: Firmware and software new release notifications via Enterasys community forum to share ideas or ask questions of other Enterasys customers: In addition, multiple access methods to reach GTAC 24x7x365 are available with: Online case management:- Via Web: an expert: Phone: toll free in U.S. (M) Computer applications and Web sites must be accessible to people with disabilities, and must comply with Participating entity accessibility policies and the Americans with Disability Act. Response: Read, understood and comply. Page 41 of 94 p. 424

266 WSCA-NASPO Data Communications Services Solicitation # JP14001 (M) Applications and content delivered through Web browsers must be accessible using current released versions of multiple browser platforms (such as Internet Explorer, Firefox, Chrome, and Safari) at minimum. Response: Read, understood and comply. Enterasys websites are designed to function on all major browsers and recent versions. 5.2 Data Communications Services Requirements Offerors may respond to any of the sections where they have substantive product offerings that address the scope detailed in each Section from All Offerors must include a response to section 5.31 services, that addresses products proposed in Products may be used by the states in branch offices, main government offices and data centers, and by overall government data communications providers offering carrier class services. Responses should consider this breadth of use and users. The scope and context of this solicitation does not include endpoints such as cell/smart phones, other mobile devices or devices designed exclusively for use by individual users. It is focused on the equipment and software infrastructure required to support provisioning of a variety of network services within a modern digital network. The user context will vary from branch offices through enterprise and statewide data communication network installations. Respondents should offer a range of solutions that are appropriate for installations of varying size and complexity. Response: Read, understood and comply DATA CENTER APPLICATION SERVICES Application networking solutions and technologies that enable the successful and secure delivery of applications within data centers to local, remote, and branch-office users using technology to accelerate, secure, and increase availability of both application traffic and computing resources Virtualized Load Balancers Virtual devices that act like a reverse proxy to distribute network and/or application traffic across multiple servers to improve the concurrent user capacity and overall reliability of applications. Capabilities should include: SSL (Secure Sockets Layer) Off-loading Caching capabilities Layer 4 Load Balancing Layer 7 Load Balancing Detailed Reporting Supports multiple load balancers in the same system for multiple groups Supports TLS1.2 Response: No current offering available WAN Optimization An appliance utilizing a collection of techniques for increasing data-transfer efficiencies across wide-area networks (WAN). Capabilities should include: CIFS (Common Internet File System) acceleration Data Compression SSL encryption/decryption for acceleration (Optional) Layer 4-7 visibility Application Specific optimization Response: No current offering available NETWORKING SOFTWARE Software that runs on a server and enables the server to manage data, users, groups, security, applications, and other networking functions. The network operating system is designed to allow shared file and printer access among multiple Page 42 of 94 p. 425

267 WSCA-NASPO Data Communications Solicitation # JP14001 computers in a network, typically a local area network (LAN), a private network or to other networks. Networking software capabilities should include: Restartable Process High availability options Targeted operating systems, i.e. DC, campus, core, wan, etc. Operating System Efficiencies Response: Comply. Enterasys NetSight Management Suite delivers a rich set of integrated management capabilities providing centralized visibility and highly efficient anytime, anywhere control of enterprise wired and wireless network resources. The NetSight Suite includes: Console with Wireless Manager, Inventory Manager, Policy Manager, Automated Security Manager, NAC Manager, Mobile Management and OneView. Enterasys NetSight licenses are available to support an unlimited number of devices. With its distributed client/server architecture, NetSight is exceptionally convenient to use. A user with appropriate security credentials anywhere on the network can access a launch page and log into any of the NetSight capabilities. NetSight simplifies routine and one-time tasks such as reconfiguring switches and access points, monitoring network performance, and isolating faults. It takes advantage of advanced functionality in Enterasys switching, routing, and wireless products including topology maps, FlexViews (graphical depictions of a broad range of network parameters), VLAN management, device discovery, and event logging. Enterasys NetSight enables our customers to take full advantage of the enhanced features and functionality of the Enterasys products. Serving as the centralized command and control component, Enterasys NetSight manages all the infrastructure components as a total system. Enterasys NetSight is standards-based and can manage all network equipment that is SNMPv1, SNMPv2 or SNMPv3 capable. Vendor specific MIBs can be loaded for additional functionality. The following provides a brief overview of the capabilities and benefits of the Enterasys NetSight Suite. Capability NetSight Console, with Wireless Management Console the foundation for centrally monitoring and managing all the components in the infrastructure. Graphically displays aggregated wired and wireless network information for centralized and simplified management of all infrastructure components as a single system Policy Management Automates the definition and enforcement of network-wide policy rules controlling QoS, priority, bandwidth, and security. With an intuitive user interface, administrators can define policies once and then automatically enforce them on Enterasys policyenabled infrastructure devices. Benefits Combines WLAN/LAN management for greater IT operational efficiency Adds value to existing management platforms Reduces total cost of ownership Fully aligns the network infrastructure with business objectives Simplifies policy lifecycle management easing IT burden Reduces troubleshooting time Minimizes risk of disruptions Page 43 of 94 p. 426

268 WSCA-NASPO Data Communications Services Solicitation # JP14001 Automated Security Management Integrates with Enterasys IPS, NAC, SIEM, and other third party security appliances to respond automatically and remediate threats in real-time. Network Access Control (NAC) Management Manages the Mobile IAM and NAC solutions providing granular control over users and applications, and featuring a high-level dash-board view of the complete security posture Inventory Management Automates management of device configurations and provides tools to capture, modify, load, and verify configurations. OneView Unified web-based interface and fine-grained interactive search for network analysis, problem solving, help desk visibility and reporting. Mobile Management Optimizes network management and help desk troubleshooting with anywhere, anytime access to critical information using popular mobile devices. Protects corporate data and ensures network availability Ensures response actions are policybased and executed consistently Reduces IT staff burden and costs Ensures that only the right users have access to the right information from the right place and time Maintains guest/contractor and user productivity Simplifies end-system compliance monitoring and reporting Delivers quick time to value Provides network control and better efficiency Streamlines IT operations and enhances staff productivity Enables audit efficiency State-of-the-art graphics reporting and topology displays enable efficiency and more effective communications Simplifies troubleshooting, help desk support tasks, problem solving across wireless and wired networks Prevents loss of user productivity Most responsive network management Enterasys NetSight provides cost-efficient choices enabling enterprises to address their priorities, optimize their budget use and demonstrate quick time-to-value. NetSight models range from a cost-efficient entry solution to full functionality for device intensive enterprises. Flexible upgrade options support deployment growth. The three NetSight models are: NMS-BASE-XX which includes basic wired/wireless management features as well as inventory management, policy management and OneView Basic (device management, alarm management and administration). Three remote clients are included in addition to unrestricted OneView connections. NMS-XX which includes basic wired/wireless management features as well as inventory management, policy management, NAC management, automated security management, mobile management, and the full OneView interface. 25 remote clients are included in addition to unrestricted OneView connections. NMS-ADV-XX which includes basic wired/wireless management features as well as inventory management, policy management, NAC management, automated security management, mobile management, and the full OneView interface. In addition, NetSight Advanced includes advanced wireless management, the OneFabric Connect API, ability to install on a primary server, redundant server and lab server, and virtual NAC appliances for full NAC deployment flexibility (require end-system Page 44 of 94 p. 427

269 WSCA-NASPO Data Communications Solicitation # JP14001 licenses). 25 remote clients are included in addition to unrestricted OneView connections. NetSight sizing chart # Managed # Aps Model Numbers Devices 5 50 NMS-ADV- 5 NMS NMS-ADV- 10 NMS-10 NMS- BASE NMS-ADV- 25 NMS-25 NMS- BASE NMS-ADV- 50 NMS-50 NMS- BASE ,000 NMS-ADV- 100 NMS-100 NMS- BASE ,500 NMS-ADV- 250 NMS-250 NMS- BASE ,000 NMS-ADV- 500 NMS-500 NMS- BASE-500 Unrestricted Unrestricted NMS-ADV- U NMS-U NMS- BASE-U Network Management and Automation Software products and solutions for data center automation, cloud computing, and IT systems management. Response: Enterasys has included a professional service offering for this category in the services section of our response Data Center Management and Automation Software products and solutions that capture and automate manual tasks across servers, network, applications, and virtualized infrastructure. Response: Enterasys has included a professional service offering for this category in the services section of our response Cloud Portal and Automation Software products and solutions for cloud management with policy-based controls for provisioning virtual and physical resources. Response: No current offering available Branch Office Management and Automation Software products and solutions for management of branch offices. Capabilities include remote troubleshooting, device management, WAN performance monitoring. Response: No current offering available NETWORK OPTIMIZATION AND ACCELERATION Devices and tools for increasing data-transfer efficiencies across wide-area networks Dynamic Load Balancing An appliance that performs a series of checks and calculations to determine which server can best service each client request in order to select the server that can successfully fulfill the client request and do so in the shortest amount of time without overloading either the server or the server farm as a whole. Page 45 of 94 p. 428

270 WSCA-NASPO Data Communications Services Solicitation # JP WAN Acceleration Appliance that optimizes bandwidth to improve the end user's experience on a wide area network (WAN). Capabilities should include: CIFS acceleration Data Compression SSL encryption/decryption for acceleration (Optional) Layer 4-7 visibility Application Specific optimization High Availability and Redundancy Limits any disruption to network uptime should an appliance face unforeseen performance issues. Transparently redistributes workloads to surviving cluster appliances without impacting communication throughout the cluster. Response: No current offering available for category OPTICAL NETWORKING High capacity networks based on optical technology and components that provide routing, grooming, and restoration at the wavelength level as well as wavelength based services Core DWDM (Dense Wavelength Division Multiplexing) Switches Switches used in systems designed for long haul and ultra long-haul optical networking applications Edge Optical Switches Provide entry points into the enterprise or service provider core networks Optical Network Management Provides capabilities to manage the optical network and allows operators to execute end-to-end circuit creation IP over DWDM (IPoDWDM) A device utilized to integrate IP Routers and Switches in the OTN (Optical Transport Network). Response: No current offering available for category ROUTERS A device that forwards data packets along networks. A router is connected to at least two networks, commonly two LANs or WANs or a LAN and its ISP's network. Routers are located at gateways, the places where two or more networks connect, and are the critical device that keeps data flowing between networks and keep the networks connected to the Internet Branch Routers A multiservice router typically used in branch offices or locations with limited numbers of users and supports flexible configurations/feature. For example: security, VoIP, wan acceleration, etc. Response: No current offering available Network Edge Routers A specialized router residing at the edge or boundary of a network. This router ensures the connectivity of its network with external networks, a wide area network or the Internet. An edge router uses an External Border Gateway Protocol, which is used extensively over the Internet to provide connectivity with remote networks. Response: Comply. Enterasys provides chassis and standalone Network Edge Routers. The Enterasys S-Series provides Terabit-class modular switch routers for edge-to-core and data center deployments Core Routers - High performance, high speed, low latency routers that enable Enterprises to deliver a suite of data, voice, and video services to enable nextgeneration applications such as IPTV and Video on Demand (VoD), and Software as a Service (SaaS). Page 46 of 94 p. 429

271 WSCA-NASPO Data Communications Solicitation # JP14001 Response: Comply. Enterasys provides chassis and standalone Core router solutions. The Enterasys S-Series provides Terabit-class modular switch routers for edge-to-core and data center deployments Service Aggregation Routers Provides multiservice adaptation, aggregation and routing for Ethernet and IP/MPLS networks to enable service providers and enterprise edge networks simultaneously host resource-intensive integrated data, voice and video business and consumer services. Response: No current offering available Carrier Ethernet Routers High performance routers that enable service providers to deliver a suite of data, voice, and video services to enable nextgeneration applications such as IPTV, Video on Demand (VoD), and Software as a Service (SaaS). Response: No current offering available SECURITY Data Center and Virtualization Security Products and Appliances Products designed to protect high-value data and data center resources with threat defense and policy control. Response: No current offering available Intrusion Detection/Protection and Firewall Appliances Provide comprehensive inline network firewall security from worms, Trojans, spyware, key loggers, and other malware. This includes Next-Generation Firewalls (NGFW), which offer a wire-speed integrated network platform that performs deep inspection of traffic and blocking of attacks. Intrusion Detection/Protection and Firewall Appliances should provide: Non-disruptive in-line bump-in-the-wire configuration Standard first-generation firewall capabilities, e.g., network-address translation (NAT), stateful protocol inspection (SPI) and virtual private networking (VPN), etc. Application awareness, full stack visibility and granular control Capability to incorporate information from outside the firewall, e.g., directorybased policy, blacklists, white lists, etc. Upgrade path to include future information feeds and security threats SSL decryption to enable identifying undesirable encrypted applications (Optional) Response: Comply. Enterasys security offerings include the Enterasys Intrusion Prevention System (IPS) which ensures the confidentiality, integrity, and availability of business critical resources with industryleading Intrusion Prevention capabilities, including: Threat containment that leverages existing network investments In-line Intrusion Prevention to provide advanced security in a specific location Patented Distributed Intrusion Prevention to automate response to threats in real-time Out-of-band Intrusion Detection that simultaneously utilizes multiple response technologies Page 47 of 94 p. 430

272 WSCA-NASPO Data Communications Services Solicitation # JP14001 Forensics tools for session reconstruction to simplify threat mitigation and resolution Enterasys IPS is unique in its ability to gather evidence of an attacker s activity, remove the attacker s access to the network, and reconfigure the network to resist the attacker s penetration technique. Enterasys IPS stops attacks at the source of the threat and can proactively protect against future threats and vulnerabilities. Enterasys IPS offers an extensive range of detection capabilities, host-based and network-based deployment options, a portfolio of IPS appliances, and seamless integration with all Enterasys solutions. Enterasys IPS utilizes a state-of-the-art highperformance, multi-threaded architecture with virtual sensor technology that scales to protect even the largest enterprise networks. When deployed in combination with Enterasys Security Information & Event Manager (SIEM) and Enterasys NMS Automated Security Manager, it facilitates the automatic identification, location, isolation and remediation of security threats. Enterasys IPS also integrates seamlessly with Enterasys Network Access Control (NAC) for post-connect monitoring of behavior once network access has been granted Logging Appliances and Analysis Tools Solutions utilized to collect, classify, analyze, and securely store log messages. Response: No current offering available Secure Edge and Branch Integrated Security Products Network security, VPN, and intrusion prevention for branches and the network edge. Products typically consist of appliances or routers. Response: No current offering available Secure Mobility Products Delivers secure, scalable access to corporate applications across multiple mobile devices. Response: No current offering available Encryption Appliances A network security device that applies crypto services at the network transfer layer - above the data link level, but below the application level. Response: No current offering available On-premise and Cloud-based services for Web and/or Security Solutions that provide threat protection, data loss prevention, message level encryption, acceptable use and application control capabilities to secure web and communications. Response: No current offering available Secure Access Products that provide secure access to the network for any device, including personally owned mobile devices (laptops, tablets, and smart phones). Capabilities should include: Management visibility for device access Self-service on-boarding Centralized policy enforcement Differentiated access and services Device Management Response: Comply. Enterasys Mobile IAM and Enterasys NAC deliver a comprehensive BYOD solution that provides total security, full IT control and predictable network experience for all users. The solutions address IT challenges being driven by today s enterprise and campus mobility Page 48 of 94 p. 431

273 WSCA-NASPO Data Communications Solicitation # JP14001 imperatives providing end-to-end visibility and control over individual users, devices and applications, in multi-vendor infrastructures. It provides complete software for: identity, access and inventory management, context-based policy enforcement, end-to-end management from a single, easy-to-use management application, auditing and reporting. Policy management is the most granular in the industry including per port, per device layer 2-4 access control, QoS/priority, rate limit/shape and more. Real time tracking and unique state change notification for over 50 attributes per device and user give IT maximum visibility into all network activity. It offers an open architecture for assessment (MDM integration) and threat response (Next Generation Firewall (NGFW), Security Information and Event Management (SIEM), Intrusion Prevention System (IPS)). The following details advanced features of the Enterasys solution critical in supporting BYOD device strategies: Advanced Context-Based Policy Management: Enterasys BYOD solutions advanced context-based policy engine is the most flexible in the industry. The attributes available for policy rule definition include authentication type, device type, user, role, location, time, and assessment status. Within each attribute, specific classifications enable the most fine-grained discriminations. It integrates with authentication services and provides unified wired, wireless and VPN enforcement. Auto Discovery: Auto Discovery automatically detects end systems and users and creates a hardware inventory for all attached end systems. The multiple methods provided for user detection include network authentication using 802.1X, Kerberos and RADIUS snooping, portal-based registration and authentication and external user-ip mapping technologies. Multiple methods are used for device detection with MAC authentication followed by IP resolution and reverse DNS lookup and multilevel device profiling. Auto discovery can discover and track 50 attributes per end system and user pair a level of detail that is unmatched in the industry. Multi-Level Device Profiling: Enterasys BYOD provides a comprehensive set of profiling capabilities and API s for integrations to extend these capabilities even further. Features include OUI based profiling, DHCP option fingerprinting with the ability to customize, captive portal, user agent profiling and network-based and agent-based assessment. With MDM integration granular device type and capability information is identified. With the Enterasys NAC API information from external profilers that are behavior based can be incorporated. Zero Effort and Secure Onboarding and Authentication: With Enterasys BYOD, end users experience Zero Effort onboarding. Not even portal registration is required with the transparent web cache/proxy redirect functionality. For flexibility portal based and automated onboarding are two additional approaches that are provided. Portal based registration with back end integration into LDAP and RADIUS means zero effort for IT. With automated onboarding Web Services are used to allow external systems, Page 49 of 94 p. 432

274 WSCA-NASPO Data Communications Services Solicitation # JP14001 such as student management, dorm management, registration and enrollment portals to provision access. Managed Guest Access Control with Sponsorship: Guest access management provides accountability, tracking and control. It is fully integrated with Enterasys BYOD. There are no additional software modules to purchase and maintain. Guest access is through a voucher, preregistration, authenticated or sponsored access. It is highly automated, including, for example, web-based guest registration with automatic workflow for a sponsor s validation and approval. No matter which vendors populate the infrastructure, Enterasys BYOD automated guest services provide unified wired/wireless access control for all non-employees. Partners, contractors, visitors or conference attendees are productive while critical business systems and resources are protected from misuse or compromise STORAGE NETWORKING High-speed network of shared storage devices connecting different types of storage devices with data servers Director Class SAN (Storage Area Network) Switches and Modules A scalable, high-performance, and protocol-independent designed primarily to fulfill the role of core switch in a core-edge Fibre Channel (FC), FCOE or similar SAN topology. A Fibre Channel director is, by current convention, a switch with at least 128 ports. It does not differ from a switch in core FC protocol functionality. Fibre Channel directors provide the most reliable, scalable, high-performance foundation for private cloud storage and highly virtualized environments Fabric and Blade Server Switches A Fibre Channel switch is a network switch compatible with the Fibre Channel (FC) protocol. It allows the creation of a Fibre Channel fabric, which is currently the core component of most SANs. The fabric is a network of Fibre Channel devices, which allows many-to-many communication, device name lookup, security, and redundancy. FC switches implement zoning; a mechanism that disables unwanted traffic between certain fabric nodes Enterprise and Data Center SAN and VSAN (Virtual Storage Area Network) Management Management tools to provisions, monitors, troubleshoot, and administers SANs and VSANs SAN Optimization Tools to help optimize and secure SAN performance (ie. Encryption of data-at-rest, data migration, capacity optimization, data reduction, etc. Response: No current offering available for category SWITCHES Layer 2/3 devices that are used to connect segments of a LAN (local area network) or multiple LANs and to filter and forward packets among them Campus LAN Access Switches Provides initial connectivity for devices to the network and controls user and workgroup access to internetwork resources. The following are some of the features a campus LAN access switch should support: Security i.sshv2 (Secure Shell Version 2) Response: Comply. Enterasys supports SSHv2 across all switch families including: S-Series, K-Series, C-Series, B-Series and A- Series. ii.802.1x (Port Based Network Access Control) Response: Comply. All Enterasys switches support IEEE 802.1x, which protects against unauthorized access to a network, DoS attacks, theft of services, etc x configuration consists of Page 50 of 94 p. 433

275 WSCA-NASPO Data Communications Solicitation # JP14001 setting RADIUS parameters on the switches to point the switch to the authentication server. In addition, multiple users/devices per port can be authenticated via IEEE 802.1X, MAC address, or web authentication, and then assigned a pre-defined operational role. iii. Port Security Response: Comply. All Enterasys switches support MAC Locking (sometimes referred to as MAC-based port locking, port locking or port security) which helps prevent unauthorized access to the network by limiting access based on a device s MAC address. MAC locking locks a port to one or more MAC addresses, preventing connection of unauthorized devices via a port. With MAC locking enabled, the only frames forwarded on a MAC locked port are those with the configured or dynamically selected MAC addresses for that port. Support is provided for two different types of MAC locking: Static MAC Locking - Locking one or more specified MAC addresses to a port. Dynamic MAC Locking - Locking one or more MAC addresses to a port based on first arrival of received frames after dynamic MAC locking is enabled. The configuration specifies the maximum number of end users that will be allowed. As each new end user is identified, it is MAC locked up to the maximum number of users. Once the maximum number of users have been MAC locked, all other users will be denied access to the port until a MAC locked address is either aged, if aging is configured, or the session for that user ends. iv.dhcp (Dynamic Host Configuration Protocol) Snooping Response: Comply. All Enterasys switches support DHCP Snooping. The Enterasys anti-spoofing solution provides a flexible and secure approach to IP spoofing detection and prevention. To mitigate the effects of these types of attacks on a network, a source MAC to source IP address binding table is created. The three basic tools used to detect source IP to source MAC address associations, based on the entries in the binding table, and take action on violations are: DHCP snooping, Dynamic ARP inspection (DAI), and IP source guard. All three methods can create IP-to-MAC bindings in the binding table, although both DAI and IP source guard can be configured to run in inspection-only mode, limiting the association of IP addresses to MAC addresses to DHCP-snooping. Bindings created as a result of DHCP exchanges with trusted servers (DHCPsnooping) take precedence over bindings created through DAI or IP source guard. Use of all three tools allows bindings to be created for users in a network where DHCP is not in use or where a DHCP exchange has not occurred since the anti-spoofing feature has been enabled. Page 51 of 94 p. 434

276 WSCA-NASPO Data Communications Services Solicitation # JP14001 VLANs Response: Comply. By default, all Enterasys switches run in 802.1Q VLAN operational mode. All ports on all Enterasys switches are assigned to a default VLAN (VLAN ID 1); you can use the CLI commands or Enterasys NetSight to create additional VLANs to customize VLANs to support your organizational requirements. Depending on the product family, Enterasys switches support a maximum of up to 4094 active VLANs. There is a distinction however, between the maximum number of active VLANs some switches support and the range of VLAN ID (VID) values. For example, while the stackable and standalone switch products support 1024 active VLANs, they do support VIDs from anywhere in the full 802.1Q specified range. The total number of active VLANs supported on the Enterasys switch product families is: Up to 4094 on S-Series and K-Series Up to 1024 on stackable (B-Series, C-Series, A-Series) Enterasys switches support traffic classification for the following VLAN types. Static and Dynamic VLANs: All VLANs on an Enterasys switch are categorized as being either static or dynamic. Static VLANs are those that are explicitly created on the switch itself, persistently remaining as part of the configuration, regardless of actual usage. Dynamic VLANs, on the other hand, are not necessarily persistent. Their presence relies on the implementation of GVRP and its effect on egress membership. Port-Based VLANs: Port-based VLANs are configured by associating switch ports to VLANs in two ways: first, by manipulating the port VLAN ID (PVID); and second, by adding the port itself to the egress list of the VLAN corresponding to the PVID. Any traffic received by a port is associated to the VLAN identified by the port's PVID. By virtue of this association, this traffic may egress the switch only on those ports listed on the VLAN's egress list. For example, given a VLAN named Marketing, with an ID value of 6, by changing the PVID values of ports 1 through 3 to 6, and adding those ports to the egress list of the VLAN, we effectively restrict the broadcast domain of Marketing to those three ports. If a broadcast frame is received on port 1, it will be transmitted out ports 2 and 3 only. In this sense, VLAN membership is determined by the location of traffic ingress, and from the perspective of the access layer where users are most commonly located egress is generally untagged. Policy-Based VLANs: Rather than making VLAN membership decisions simply based on port configuration, each incoming frame can be examined by the classification engine which uses a match-based logic to assign the frame to a desired VLAN. For example, you could set up a policy which designates all traffic between the management officers of a company to a specific VLAN so that this traffic is restricted to certain portions of the network. With respect to network usage, the administrative advantages of policy classification would be application provisioning, acceptable use policy, and distribution layer policy. Enterasys Policy provides for the configuration of role-based profiles for securing and provisioning network resources based upon the role the user or device plays within the enterprise. By first defining the user or device role, network resources can be granularly tailored to a specific user, system, service, or port-based context by configuring and assigning rules to the policy role. A policy role can be configured for any combination of Class of Service, VLAN Page 52 of 94 p. 435

277 WSCA-NASPO Data Communications Solicitation # JP14001 assignment, classification rule precedence, logging, accounting, or default behavior based upon L2, L3, and L4 packet fields. Hybrid authentication allows either policy or dynamic VLAN assignment, or both, to be applied through RADIUS authorization. The three primary benefits of using Enterasys policy in your network are provisioning and control of network resources, security, and centralized operational efficiency using the Enterasys NetSight Policy Manager. Enterasys S-Series and K-Series supports GVRP and MVRP for network VLAN propagation; Enterasys C-Series and B-Series support GVRP for network VLAN propagation. Importantly, Enterasys solutions also offer centralized visibility and management with the NetSight Suite of Management applications. NetSight allows the concurrent configuration of almost any number of switches in one configuration step automating the definition, distribution and enforcement of VLAN and policy rules across the entire network. Fast Ethernet/Gigabit Ethernet Response: Comply. Enterasys switches are available to support a variety of Fast Ethernet and Gigabit Ethernet connectivity options. The following port density options are available: S-Series Chassis: 3-slot chassis offering up to 216 triple-speed ports 4-slot chassis offering up to 288 triple-speed ports 6-slot chassis offering up to 432 triple-speed ports 8-slot chassis offering up to 576 triple-speed ports K-Series Chassis: 6-slot chassis offering up to a maximum of 144 triple-speed ports and (4) 10Gb uplinks 10-slot chassis offering up to a maximum of 216 triple-speed ports and (8) 10Gb ports Stackable Switches (C-Series, B-Series, A-Series): B-Series/C-Series: 24 and 48 port 10/100/1000Base-TX switch options supporting up to 384 ports per switch stack with 1Gig and 10Gig uplink options A-Series: 4 and 48 port 10/100 or 10/100/1000Base-TX switch options supporting up to 384 ports per switch stack with 1Gig uplink options PoE (Power over Ethernet) Response: Comply. Enterasys switches support IEEE 802.3af and 802.3at PoE across all access layer switch models. All Enterasys S-Series and K- Series triple speed copper I/O modules are PoE-enabled, stackable switches providing 24 and 48 port PoE switch models. Depending on the switch model and chassis configuration support can be provided for up to 30 watts of power per port link aggregation Response: Comply. Enterasys switches support IEEE 802.3ad link aggregation providing a standardized means of grouping multiple parallel Page 53 of 94 p. 436

278 WSCA-NASPO Data Communications Services Solicitation # JP14001 Ethernet interfaces into a single logical Layer 2 link. The formed group of Ethernet interfaces is referred to as a Link Aggregation Group (LAG). Dynamic LAG formation and activation is provided by the Link Aggregation Control Protocol (LACP). 10 Gb support Response: Comply. Enterasys switches are available with 10GB uplink options which include: 10GB-ZR-SFPP 10 Gb, 10GBASE-ZR, SM, 1550 nm, 80 km, LC SFP+ 10GB-ER-SFPP 10 Gb, 10GBASE-ER, IEEE SM, 1550 nm Long Wave Length, 40 km, LC SFP+ 10GB-LR-SFPP 10 Gb, 10GBASE-LR, IEEE SM, 1310 nm Long Wave Length, 10 km, LC SFP+ 10GB-LRM-SFPP 10 Gb, 10GBASE-LRM, IEEE MM, 1310 nm Short Wave Length, 220 m, LC SFP+ 10GB-SR-SFPP 10 Gb, 10GBASE-SR, IEEE MM, 850 nm, 33/82/300/550 m, LC SFP+ 10GB-USR-SFPP 10 Gb, Ultra Short Reach MM, 850 nm, 100m on OM3 / 150 m on OM4, LC SFP+ Port mirroring Response: Comply. The Enterasys switches support one-to-one and manyto-one port mirroring. Span Taps Response: Comply. The Enterasys switches allows you to mirror (or redirect) the traffic being switched on a port for the purposes of network traffic analysis and connection assurance. Support of IPv6 and IPv4 Response: Comply. Standards-based rapid spanning tree Response: Comply. Enterasys switches support IEEE 802.1w Rapid Spanning Tree Protocol. Netflow Support (Optional). Response: Comply. Unsampled NetFlow is supported on all Enterasys S- Series and K-Series switches Campus LAN Core Switches Campus core switches are generally used for the campus backbone and are responsible for transporting large amounts of traffic both reliably and quickly. Core switches should provide: High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Page 54 of 94 p. 437

279 WSCA-NASPO Data Communications Solicitation # JP14001 Security i. SSHv2 Response: Comply. ii. MacSec encryption Response: Enterasys S-Series S140 and S80 modules are hardware capable of supporting 802.1AE MACsec; support will be provided in a future release. iii. Role-Based Access Control Lists (ACL) Response: Comply. Enterasys switches use a role-based model to associate traffic with appropriate VLAN, QoS, port, etc. Roles are established in policy profiles that can be associated with individual users, systems, services or ports. Enterasys policy profiles enable network administrators to write a set of rules that can control and prioritize various types of network traffic. The rules that make up a policy profile contain both classification definitions and actions to be enforced when a classification is matched. Classifications include Layer 2, Layer 3 and Layer 4 fields. Policy actions that can be enforced include VLAN assignment, filtering, inbound rate limiting, outbound rate shaping, priority class mapping and logging. Support of IPv6 and IPv4 Response: Comply. 1/10/40/100 Gbps support Response: Comply. Enterasys S-Series switch I/O fabrics and I/O modules are available with a wide array of interface types and port densities (10/100/1000BASE-TX, 1000BASE SFP, 10GBASE SFP+, 10GBASE-T and 40GBASE QSFP+) to address varied network requirements.100-gig modules are planned for a future hardware release. IGP (Interior Gateway Protocol) routing Response: Comply. Enterasys S-Series supports OSPF and IS-IS Interior Gateway Routing Protocols. EGP (Exterior Gateway Protocol) routing Response: Comply. Enterasys S-Series supports BGP Exterior Gateway Routing Protocols. VPLS (Virtual Private LAN Service) Support Response: Enterasys S-Series will provide support for VPLS in a future release. VRRP (Virtual Router Redundancy Protocol) Support Response: Comply. Enterasys S-Series support VRRP. Netflow Support. Response: Comply. Enterasys S-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flowbased ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched Page 55 of 94 p. 438

280 WSCA-NASPO Data Communications Services Solicitation # JP14001 and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S- Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Campus Distribution Switches Collect the data from all the access layer switches and forward it to the core layer switches. Traffic that is generated at Layer 2 on a switched network needs to be managed, or segmented into Virtual Local Area Networks (VLANs), Distribution layer switches provides the inter- VLAN routing functions so that one VLAN can communicate with another on the network. Distribution layer switches provides advanced security policies that can be applied to network traffic using Access Control Lists (ACLs). High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Security (SSHv2 and/or 802.1X) Response: Comply. Enterasys S-Series supports SSHv2 and 802.1x, which protects against unauthorized access to a network, DoS attacks, theft of services, etc x configuration consists of setting RADIUS parameters on the switches to point the switch to the authentication server. In addition, multiple users/devices per port can be authenticated via IEEE 802.1X, MAC address, or web authentication, and then assigned a pre-defined operational role. Support of IPv6 and IPv4 Response: Comply. Jumbo Frames Support Response: Comply. Enterasys S-Series supports Jumbo frames up to 10,239 bytes. Dynamic Trunking Protocol (DTP) Response: The Dynamic Trunking Protocol (DTP) is a Cisco proprietary protocol for the purpose of negotiating trunking on a link between two VLAN-aware switches, and for negotiating the type of trunking encapsulation to be used. Enterasys S-Series supports standards-based GVRP and MVRP for network VLAN propagation. Page 56 of 94 p. 439

281 WSCA-NASPO Data Communications Solicitation # JP14001 Per-VLAN Rapid Spanning Tree (PVRST+) Response: Comply. Enterasys switches support IEEE 802.1w Rapid Spanning Tree Protocol and 802.1s Per VLAN Spanning Tree. Switch-port auto recovery Response: Comply. NetFlow Support or equivalent Response: Comply. Enterasys S-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flowbased ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S- Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Data Center Switches Data center switches, or Layer 2/3 switches, switch all packets in the data center by switching or routing good ones to their final destinations, and discard unwanted traffic using Access Control Lists (ACLs), all at Gigabit and 10 Gigabit speeds. High availability and modularity differentiates a typical Layer 2/3 switch from a data center switch. Capabilities should include: High bandwidth Response: Comply. The Enterasys S-Series delivers a high-bandwidth flow-based switching architecture. The switch family consists of multiple chassis with varied switching capacity options. The available chassis and their associated systems switching capacity are as follows: S8 = 2.56 Tbps, S6 = 1.92 Tbps, S4 = 1.28 Tbps, S3 = 360 Gbps and S1 = 160 Gbps. Low latency Response: Comply. Enterasys S-Series provides low latency switching. Hot swappable power supplies and fans Response: Comply. Ultra-low latency through wire-speed ports with nanosecond port-to-port latency and hardware-based Inter-Switch Link (ISL) trunking Response: Comply. Enterasys S-Series delivers low latency and is designed to deliver non-blocking performance. The Flex-Edge functionality and deep packet buffers makes the S-Series switch significantly less vulnerable to network congestion issues at peak traffic times than other line rate switches. All Enterasys S-Series switches include the Flex-Edge feature, which provides the unique capability to classify traffic as it enters the switch. Traffic critical to ensuring the always up operational state of the network and to maintain application continuity is identified and prioritized at ingress, prior to being passed to the packet processor. Page 57 of 94 p. 440

282 WSCA-NASPO Data Communications Services Solicitation # JP14001 Enterasys switches support IEEE 802.3ad link aggregation providing a standardized means of grouping multiple parallel Ethernet interfaces into a single logical Layer 2 link. The formed group of Ethernet interfaces is referred to as a Link Aggregation Group (LAG). Dynamic LAG formation and activation is provided by the Link Aggregation Control Protocol (LACP). Enterasys S-Series switches also support Virtual Switch Bonding (VSB) that allows for the aggregation of links on two physical chassis, providing redundancy, while at the same time allowing ports on both chassis to pass data concurrently, effectively doubling the available bandwidth. VSB aggregates two like chassis into a single virtual network device. VSB joins two chassis into a single system by extending each chassis distribution to the other chassis using one or more 10GbE port interconnect links. There are two types of VSB interconnect ports depending upon the module and option cards installed: Dedicated VSB hardware fabric extended 10GbE ports are provided on the S180 class modules. Dedicated VSB hardware interconnect ports are not standard Ethernet data ports. They provide a line rate direct connection to the fabric and automatically provide VSB entitlement to the module (no license is required). Standard software assisted Ethernet data 10GbE port Load Balancing across Trunk group able to use packet based load balancing scheme Response: Comply. Bridging of Fibre Channel SANs and Ethernet fabrics Response: The Enterasys solution is able to co-exist with Fibre Channel environments, enabling the organization to continue to leverage existing investments. Enterasys provides support for Data Center Bridging (DCB) in multiple phases with different hardware and software requirements as the underlying technology to transport Fibre Channel over Ethernet (FCoE). As an alternative, Enterasys offers a simple, yet highly effective approach to enable, optimize and secure iscsi SAN or NFS NAS deployments. The Enterasys S-Series modular switch is a key component of our overall solution, delivering an easy and effective way to optimize communications through automatic discovery, classification, and prioritization of SANs. In addition, the Enterasys solution will identify and automatically respond to security threats against virtual storage nodes, enforce role-based network access control policies, and comply with regulations for monitoring and auditing. The IEEE Data Center Bridging task group, a working group of IEEE working group, is focused on defining a new set of standards which will enable Ethernet to effectively deliver data center transport for both server and storage traffic. Terms commonly associated with DCB are Data Center Ethernet, also known as DCE, and Convergence Enhanced Ethernet (CEE). It should be understood that DCB is the task group and term commonly being used to describe tomorrow s Data Center LANs. Data Center Bridging is focused primarily on three (3) IEEE specifications: IEEE 802.1Qaz ETS & DCBX bandwidth allocation to major traffic classes (Priority Groups); plus DCB management protocol IEEE 802.1Qbb Priority PAUSE. Selectively PAUSE traffic on link by Priority Group IEEE 802.1Qau Dynamic Congestion Notification Page 58 of 94 p. 441

283 WSCA-NASPO Data Communications Solicitation # JP14001 Jumbo Frame Support Response: Comply. Enterasys S-Series supports Jumbo frames up to 10,239 bytes. Plug and Play Fabric formation that allows a new switch that joins the fabric to automatically become a member Response: Comply. Automatic module self-configuration in the S-Series allows I/O modules to receive their configuration from other I/O modules automatically. This is ideal for replacing failed modules without manually reconfiguring the replacement module. Ability to remotely disable and enable individual ports Response: Comply. Support NetFlow or equivalent Response: Comply. Enterasys S-Series and K-Series supports NetFlow version 5 and version 9 completely free of charge. A distinct Enterasys advantage is flow-based ASIC capabilities that collect NetFlow statistics for every packet in every flow without sacrificing CPU or switching performance. The S-Series implementation enables the collection of NetFlow data on both switched and routed frames, allowing S-Series modules in all areas of a network infrastructure to collect and report flow data at gigabit speeds. The S-Series tracks every packet in every flow, collecting 9,000 flow records per second, per I/O module or standalone switch. This is an order of magnitude greater NetFlow collection performance than any other NetFlow appliance vendor and as such can provide network managers with nearly 100% accuracy of who is communicating and with what application across the switch Software Defined Networks (SDN) - Virtualized Switches and Routers Technology utilized to support software manipulation of hardware for specific use cases. Response: Enterasys has been developing SDN-like architectures since the mid-1990s. The proposed Enterasys switches, based on the OneFabric architecture, are leveraging SDN architectural components to provide centralized visibility and control over the entire network. Centralized visibility enables infrastructure and application teams to work together, eliminating costly misalignments and errors that occur through typical operational workflows. Embedded automation features improve application delivery for dynamic environments leveraging cloud, virtualization, server/storage consolidation and the consumerization of IT. The oncecomplex task of provisioning and de-provisioning servers and network infrastructure is made simple: defined locally and enforced globally achieving significant scale, improved operational efficiency and more reliable and successful application delivery. A unified management experience is provided by Enterasys NetSight s OneFabric Control Center, which allows network operations to leverage the power and intelligence built into Enterasys networking solutions. NetSight also supports and protects your investment in the myriad of third-party network devices already powering existing networks. Finally, NetSight integrates with major virtualization solutions, delivering unique and differentiated network-layer capabilities for virtual data centers. Page 59 of 94 p. 442

284 WSCA-NASPO Data Communications Services Solicitation # JP14001 Enterasys S-Series flow-based systems offer a hybrid architecture that has evolved over the years to provide a mature, scalable, agile and deployable solution. When you use a flow-based system the first packet can be used to make very sophisticated decisions in software (and thus in the controller or even other applications) and then subsequently all packets of that flow are switched in hardware. This is the innovative design that makes our proposed CoreFlow2-based switching and routing products so different. This is also the basis for all of the new, advanced and agile services that are associated with SDN Software Defined Networks (SDN) Controllers - is an application in softwaredefined networking (SDN) that manages flow control to enable intelligent networking. SDN controllers are based on protocols, such as OpenFlow, that allow servers to tell switches where to send packets. The SDN controller lies between network devices at one end and applications at the other end. Any communications between applications and devices have to go through the controller. The controller uses multiple routing protocols including OpenFlow to configure network devices and choose the optimal network path for application traffic. Response: The Enterasys development team is actively researching "southbound" API protocols including OpenFlow. The OpenFlow protocol is in the early stage of development with limited interoperability and there are concerns about the scalability of the protocol in a full scale enterprise network. While Enterasys does not currently have a committed plan to productize Openflow functionality, if the technology matures and there is market demand, support can be added via a firmware upgrade to the highly scalable flow based S-Series products Carrier Aggregation Switches Carrier aggregation switches route traffic in addition to bridging (transmitted) Layer 2/Ethernet traffic. Carrier aggregation switches major characteristics are: Designed for Metro Ethernet networks Designed for video and other high bandwidth applications Supports a variety of interface types, especially those commonly used by Service Providers Capabilities should include: Redundant Processors Redundant Power IPv4 and IPv6 unicast and multicast High bandwidth Low latency Hot swappable power supplies and fans MPLS (Multiprotocol Label Switching) BGP (Border Gateway Protocol) Software router virtualization and/or multiple routing tables Policy based routing Layer 2 functionality i. Per VLAN Spanning Tree ii. Rapid Spanning Tree iii. VLAN IDs up to 4096 iv. Layer 2 Class of Service (IEEE 802.1p) v. Link Aggregation Control Protocol (LACP) vi. QinQ (IEEE 802.1ad) Response: No current offering available. Page 60 of 94 p. 443

285 WSCA-NASPO Data Communications Solicitation # JP Carrier Ethernet Access Switches A carrier Ethernet access switch can connect directly to the customer or be utilized as a network interface on the service side to provide layer 2 services. Hot-swappable and field-replaceable integrated power supply and fan tray AC or DC power supply with DC input ranging from 18V to 32 VDC and 36V to 72 VDC Ethernet and console port for manageability SD flash card slot for additional external storage Stratum 3 network clock Line-rate performance with a minimum of 62-million packets per second (MPPS) forwarding rate Support for dying gasp on loss of power Support for a variety of small form factor pluggable transceiver (SFP and SFP+) with support for Device Object Model (DOM) Timing services for a converged access network to support mobile solutions, including Radio Access Network (RAN) applications Support for Synchronous Ethernet (SyncE) services Supports Hierarchical Quality of Service (H-QoS) to provide granular trafficshaping policies Supports Resilient Ethernet Protocol REP/G.8032 for rapid layer-two convergence Response: No current offering available WIRELESS Provides connectivity to wireless devices within a limited geographic area. System capabilities should include: Redundancy and automatic failover Response: Comply. There are no limitations with the Enterasys IdentiFi Wireless redundant architecture. Redundant Enterasys Wireless Controllers can be deployed anywhere in the network and operate in failover or load-sharing mode. When configured to operate in redundant load-sharing mode, access points can be configured for fast-failover mode to allow configuration and service restoration (in tunnel mode) in less than two seconds, thus enabling user sessions to continue uninterrupted inclusive of Voice over WLAN traffic. The secondary Enterasys Wireless Controller does not have to detect its link failure with the primary Enterasys Wireless Controller for the session availability to kick in. If the Wireless AP loses five consecutive polls to the primary controller either due to the controller outage or connectivity failure, it fails over to the secondary controller fast enough to maintain the user session. In session availability mode (as shown below), the Wireless APs connect to both the primary and secondary Enterasys Wireless Controllers. While the connectivity to the primary Enterasys Wireless Controller is via the active tunnel, the connectivity to the secondary Enterasys Wireless Controller is via the backup tunnel. Page 61 of 94 p. 444

286 WSCA-NASPO Data Communications Services Solicitation # JP14001 When switching traffic locally, APs continue to provide service even when the link to the wireless controller is severed. Importantly, Enterasys Wireless does not require additional add-on licenses to utilize the failover AP capacity (license included). IPv6 compatibility Response: Comply. NTP Support Response: Comply. Enterasys Wireless Controllers can be configured to utilize up to three NTP Servers Access Points A wireless Access Point (AP) is a device that allows wireless devices to connect to a wired network using Wi-Fi, or related standards. Capabilities should include: a/b/g/n Response: Comply. Enterasys offers a complete line of a/b/g/n compliant indoor and outdoor access point n Response: Comply ac Response: Planned for future capability. The Enterasys IdentiFi Wireless solution is designed to support a/b/g/n today with a focus on ac in the future. Enterasys plans to offer ac access point in the Q timeframe following ratification of the ac standard. Importantly, current generation Enterasys controllers, along with Enterasys s distributed data forwarding architecture, are capable of handling ac traffic. Capable of controller discovery method via DHCP (onsite controller or offsite through Cloud Architecture) Response: Comply. Enterasys IdentiFi access points can be located remotely while IdentiFi controllers can be centrally-located. This distributes data decisions and data handling, while centralizing management and control. The IdentiFi controllers can be centrally-located on premise at the Page 62 of 94 p. 445

287 WSCA-NASPO Data Communications Solicitation # JP14001 enterprise or in the cloud as a managed service offering. Both of these approaches provide centralized control over IdentiFi access points via the cloud, thus reducing the cost and complexity associated with locating dedicated controllers at every location. UL2043 plenum rated for safe mounting in a variety of indoor environments Response: Comply. Support AES-CCMP (128-bit) Response: Comply. Provides real-time wireless intrusion monitoring and detection Response: Comply. Enterasys IdentiFi Radar provides a set of advanced, intelligent, Wireless Intrusion Detection Service and Wireless Intrusion Prevention Service (WIDS and WIPS) features that are integrated into the Wireless Controller and its APs. Radar provides a basic solution for discovering unauthorized devices within the wireless coverage area. Radar performs basic RF network analysis to identify rogue APs/personal ad-hoc networks and protect against DoS attacks Outdoor Wireless Access Points Outdoor APs are rugged, with a metal cover and a DIN rail or other type of mount. During operations they can tolerate a wide temperature range, high humidity and exposure to water, dust, and oil. Capabilities should include: Flexible Deployment Options Response: Comply. Enterasys offers several outdoor AP models to meet the needs of various deployments. These industrial grade access points are designed to operate in harsh environments such as warehouses, mines, manufacturing plants, and stadiums. The AP3765i comes with an integrated six antenna array for ease of installation. The AP3765e and AP3767e include six RP-SMA antenna connectors supporting both 2.4G and 5G band antennas. The 3765 access points can be powered via 802.3at power or an optional industrial-grade external power adapter, while the 3767 requires the external power adapter. Provides real-time wireless intrusion monitoring and detection Response: Comply. Enterasys IdentiFi Radar provides a set of advanced, intelligent, Wireless Intrusion Detection Service and Wireless Intrusion Prevention Service (WIDS and WIPS) features that are integrated into the Wireless Controller and its APs. Radar provides a basic solution for discovering unauthorized devices within the wireless coverage area. Radar performs basic RF network analysis to identify rogue APs/personal ad-hoc networks and protect against DoS attacks. Capable of controller discovery method via DHCP (onsite controller or offsite through Cloud Architecture) Response: Comply. Enterasys IdentiFi access points can be located remotely while IdentiFi controllers can be centrally-located. This distributes data decisions and data handling, while centralizing management and control. The IdentiFi controllers can be centrally-located on premise at the enterprise or in the cloud as a managed service offering. Both of these approaches provide centralized control over IdentiFi access points via the Page 63 of 94 p. 446

288 WSCA-NASPO Data Communications Services Solicitation # JP14001 cloud, thus reducing the cost and complexity associated with locating dedicated controllers at every location Wireless LAN Controllers An onsite or offsite solution utilized to manage light-weight access points in large quantities by the network administrator or network operations center. The WLAN controller automatically handles the configuration of wireless access-points. Capabilities should include: Ability to monitor and mitigate RF interference/self-heal Response: Comply. Enterasys IdentiFi wireless solutions come standard with the latest in WiFi technology including Dynamic Radio Management (DRM). DRM operates independently on each radio, automatically adjusting radio power output and channel selection to accommodate changing RF environments. DRM ensures optimal AP coverage while maximizing availability and quality of user experience across the entire WLAN. Furthermore, if an AP fails, neighboring APs will increase power to maintain coverage in the affected area. Support seamless roaming from AP to AP without requiring re-authentication Response: Comply. The Enterasys IdentiFi Wireless solution centralizes the user's network point of presence, therefore abstracting and decoupling the user's IP address assignment from that of the APs location subnet. That means that the user is able to roam across any AP without losing its own IP address, regardless of the subnet on which the serving APs are deployed. In addition, an Enterasys Wireless Controller can learn about other Enterasys Wireless Controllers on the network and then exchange client session information. This enables a wireless device user to roam seamlessly between different Wireless APs on different Enterasys Wireless Controllers. Enterasys IdentiFi Wireless uses industry standards to deliver fast and secure roaming i pre-authentication (Pre-Auth) ensures that the user is authenticated to adjacent APs before entering their coverage range. Opportunistic Key Caching (OKC) is also a supported mechanism which greatly improves device roaming times. Support configurable access control lists to filter traffic and denying wireless peer to peer traffic Response: Comply. The Enterasys IdentiFi Wireless solution restricts users from peer-to-peer traffic. This not only prevents undesirable use of the system, but it protects WiFi users from neighbors. The Enterasys rolebased policy architecture also provides granular control of all user traffic seamlessly across all wireless access devices enabling customers to effectively enforce the appropriate network communications rules for each user, regardless of SSID. System encrypts all management layer traffic and passes it through a secure tunnel Response: Comply. Enterasys IdentiFi Wireless solution can be configured in Secure Tunnel mode to provide encryption, authentication, and key management between the AP and/or controllers. Policy management of users and devices provides ability to de-authorize or deny devices without denying the credentials of the user, nor disrupting other AP traffic Page 64 of 94 p. 447

289 WSCA-NASPO Data Communications Solicitation # JP14001 Response: Comply. Enterasys Wireless supports the assignment of rules and roles per user/device/application (not just to a specific VLAN or SSID) seamlessly across all wireless access devices. Leveraging the Enterasys role-based policy architecture customers can effectively enforce the appropriate network communications rules for each user, regardless of SSID. Access can be granted for all users with access to specific resources being limited or controlled based on the users role (administrator, employee, contractor, guest) in the network. No other vendor matches the control and visibility provided by Enterasys VLAN and SSID independent role-based authorization, access control and traffic management. Support configurable access control lists to filter traffic and denying wireless peer to peer traffic Response: Comply Wireless LAN Network Services and Management Enables network administrators to quickly plan, configure and deploy a wireless network, as well as provide additional WLAN services. Some examples include wireless security, asset tracking, and location services. Capabilities should include: Provide for redundancy and automatic failover Response: Comply. Historical trend and real time performance reporting is supported Response: State-of-the-art reporting provides historical and real-time data for high level network summary information and/or details. A collection of summary reports provide information on your wireless network components, including reports for AP groups, controllers, and mobility zones. Wireless reports also provide data on wireless components ranked by bandwidth and clients, such as top APs by bandwidth, top clients by bandwidth, and top controllers by clients, as well as reports on APs and controllers that are down. Management access to wireless network components is secured Response: Comply. SNMPv3 enabled Response: Comply. RFC 1213 compliant Response: Comply. Automatically discover wireless network components Response: Comply. When an Enterasys AP is powered on, it automatically begins a discovery process to determine its own IP address and the IP address of the controller. When the discovery process is successful, the Wireless AP registers with the controller Capability to alert for outages and utilization threshold exceptions Response: Comply. Alerts can be sent via SNMP Trap or Syslog. Page 65 of 94 p. 448

290 WSCA-NASPO Data Communications Services Solicitation # JP14001 Capability to support Apple s Bonjour Protocol / mdns Response: Comply. The Enterasys multicast traffic management solution is highly efficient based on distributed policy; Apple Bonjour and other chatty multicast traffic is contained in one or multiple domains based on user role and device as well as location. In addition, for optimized multicast delivery (aka Bonjour) Enterasys supports proxy ARP@AP, multicast-tounicast conversion, and Enterasys APs dynamically calculate multicast transmission speeds vs. assuming the minimum basic rate (MBR) reducing the risk that multicast traffic will bog down the WLAN network. QoS / Application identification capability Response: Comply. Enterasys IdentiFi Wireless provides role-based policies providing security, mobility and QoS priority that can be implemented on a per user, per SSID and per application basis. Enterasys Wireless provides true end-to-end Quality of Service (QoS) with each controller and AP supporting native IP prioritization (DiffServ, TOS, Precedence), Ethernet 802.1p, as well as e s WMM and TSPEC wireless QoS standards. When voice and data traffic are running on the same AP, voice traffic can be prioritized to ensure minimal delay and jitter for optimal voice quality. The wireless controllers are able to translate WMM prioritized traffic to existing QoS prioritization schemes on the wired network (TOS, DSCP, etc.) Cloud-based services for Access Points Cloud-based management of campus-wide WiFi deployments and distributed multi-site networks. Capabilities include: Zero-touch access point provisioning Response: Comply. When an Enterasys AP is powered on, it automatically begins a discovery process to determine its own IP address and the IP address of the controller. When the discovery process is successful, the Wireless AP registers with the controller. Network-wide visibility and control Response: Comply. Enterasys IdentiFi offers complete visibility and control over the wireless network. IdentiFi control and management are maintained centrally and are implemented and enforced throughout the entire network, providing operational flexibility. RF optimization, Response: Comply. Dynamic Radio Management (DRM) functionality of the Enterasys IdentiFi Wireless solution is used to help establish the optimum radio configuration for your Wireless APs. DRM is enabled by default and can: Adjusts power levels to balance coverage if another Wireless AP, which is assigned to the same SSID and is on the same channel, is added to or leaves the network. Allows wireless clients to be moved to another Wireless AP if the load is too high. Scans automatically for a channel, using a channel selection algorithm. Avoids other WLANs by reducing transmit power whenever other Wireless APs with the same channel, but different SSIDs are detected. Page 66 of 94 p. 449

291 WSCA-NASPO Data Communications Solicitation # JP14001 Firmware updates Response: Comply. Software updates can be distributed through the Enterasys Wireless Controller or with the Enterasys NetSight Inventory Manager. Both methods support the ability to perform time scheduled, mass updates. The upgrade through the Enterasys Wireless Controller allows you to select and control the state of an AP image upgrade: which APs to upgrade, when to upgrade, how to upgrade, and to which image the upgrade or downgrade should be done. The Firmware Upgrade Wizard within NetSight Inventory Manager allows you to easily perform scheduled upgrades to specific devices or groups of devices. The wizard gives you the flexibility of performing an immediate upgrade or scheduling the upgrade to take place at a later time. The download progress window within the Firmware Upgrade Wizard shows device list with status information for each device scheduled for upgrade. You can use these radio buttons to show all devices or show only those devices whose download operations are incomplete or have failed Bring Your Own Device (BYOD) Mobile Data Management (MDM) technology utilized to allow employees to bring personally owned mobile devices (laptops, tablets, and smart phones) to their workplace, and use those devices to access privileged government information and applications in a secure manner. Capabilities should include: Ability to apply corporate policy to new devices accessing the network resources, whether wired or wireless Response: Comply. The Enterasys BYOD solution delivers role-based access control that is unified across the wired and wireless infrastructure. Enterasys BYOD configuration options include time, location, authentication types, device and OS type, and end system and user groups. For example, customers can write and enforce policies that grant a precise level of network access based on the type of system connecting, the user's role in the organization, the location of a user at the time the user is connecting, or the time of day. Customers can give BYOD devices network access that is different than company owned devices. Enterasys BYOD solution automatically detects new devices entering the network and can identify them using over 50 end-device attributes, which are gathered and used to determine how to best provision access to Page 67 of 94 p. 450

292 WSCA-NASPO Data Communications Services Solicitation # JP14001 network resources. Device type can be an Operating System Family, Operating System or Hardware Type for example, Windows, Windows 7, Debian 3.0, HP Printer, iphone, ipad etc. Below is a graphic representation of the device fingerprinting provided with the Enterasys solution: Provide user and devices authentication to the network Response: Comply. Enterasys BYOD solution controls endpoint authentication. Enterasys BYOD Gateways acts as a RADIUS proxy, or RADIUS server for MAC Authentication, which communicates with the organization s RADIUS authentication services (e.g. interfaces with Microsoft Active Directory or another LDAP-based directory service). Provide secure remote access capability Response: Comply. Support 802.1x Response: Comply. Enterasys BYOD supports 802.1X (Extensible Authentication Protocol), MAC, Web-based and Kerberos Snooping (with certain restrictions) authentication. Enterasys NAC can integrate with your existing RADIUS server, LDAP and Active Directory to understand the authorized role for each user connecting to the system and use this to authorize specific access. Alternatively, this can be done through the onboard RADIUS server built into the NAC. NAC also has the ability to add users, devices, etc. to various groups that control access based on authentication type, time of day, location, device/os type, health of endsystem, etc. Network optimization for performance, scalability, and user experience Response: Comply. Enterasys comprehensive BYOD solution provides total security, full IT control and predictable network experience for all users. Enterasys solution addresses IT challenges being driven by today s enterprise and the needs to support BYOD by providing end-to-end visibility and control over individual users, devices and applications, in multi-vendor infrastructures. Enterasys BYOD solution is highly scalable and flexible in deployment. Enterasys offers a variety of out-of-band Gateways available to meet the needs of different-sized implementations and assessment server requirements. Enterasys BYOD Gateway models are available to meet the needs of different-sized implementations and multiple Gateways can be deployed to support a virtually unlimited number of endpoints UNIFIED COMMUNICATIONS (UC) A set of products that provides a consistent unified user interface and user experience across multiple devices and media types. Unified Communications that is able to provide services such as session management, voice, video, messaging, mobility, and web conferencing. It can provide the foundation for advanced unified communications capabilities of IM and presence-based services and extends telephony features and capabilities to packet telephony network devices such as IP phones, media processing devices, Voice over IP (VoIP) gateways, and multimedia applications. Additional services, such as unified messaging, multimedia conferencing, collaborative contact centers, and interactive multimedia response systems, are made possible through open telephony APIs. General UC solution capabilities should include: High Availability for Call Processing Hardware Platform High Availability Network Connectivity High Availability Page 68 of 94 p. 451

293 WSCA-NASPO Data Communications Solicitation # JP14001 Call Processing Redundancy IP Telephony Solutions utilized to provide the delivery of the telephony application (for example, call setup and teardown, and telephony features) over IP, instead of using circuit-switched or other modalities. Capabilities should include: Support for analog, digital, and IP endpoints Centralized Management Provide basic hunt group and call queuing capabilities Flexibility to configure queue depth and hold time, play unique announcements and Music on Hold (MoH), log in and log out users from a queue and basic queue statistics (from the phone E911 Support Instant messaging/ Presence Solutions that allow communication over the Internet that offers quick transmission of text-based messages from sender to receiver. In push mode between two or more people using personal computers or other devices, along with shared clients, instant messaging basically offers realtime direct written language-based online chat. Instant messaging may also provide video calling, file sharing, PC-to-PC voice calling and PC-to-regularphone calling Unified messaging Integration of different electronic messaging and communications media ( , SMS, Fax, voic , video messaging, etc.) technologies into a single interface, accessible from a variety of different devices. Ability to access and manage voice messages in a variety of ways, using inbox, Web browser, desktop client, VoIP phone, or mobile phone Visual Voic Support (Optional) Contact Center A computer-based system that provides call and contact routing for high-volume telephony transactions, with specialist answering agent stations and a sophisticated real-time contact management system. The definition includes all contact center systems that provide inbound contact handling capabilities and automatic contact distribution, combined with a high degree of sophistication in terms of dynamic contact traffic management Communications End Points and Applications Attendant Consoles IP Phones UC Network Management Provides end-to-end service management for Unified Communications. Capabilities include testing, performance monitoring, configuration management, and business intelligence reporting Collaboration Voice, video, and web conferencing; messaging; mobile applications; and enterprise social software Collaborative Video A set of immersive video technologies that enable people to feel or appear as if they were present in a location that they are not physically in. Immersive video consists of a multiple codec video system, where each meeting attendee uses an immersive video room to dial in and can see/talk to every other member on a screen (or screens) as if they were in the same room and provides call control that enables intelligent video bandwidth management Content Delivery Systems (CDS) A large distributed system of servers deployed in multiple data centers connected by the Internet. The purpose of the content delivery system is to serve content to end-users with high availability and high performance. CDSs serve content over the Internet, including web objects (text, graphics, URLs, and scripts), downloadable objects (media Page 69 of 94 p. 452

294 WSCA-NASPO Data Communications Services Solicitation # JP14001 files, software, documents), applications (e-commerce, portals), live streaming media, on-demand streaming media, and social networks Physical Security Technology utilized to restricting physical access by unauthorized people to controlled facilities. Technologies include: a. Access control systems b. Detection/Identification systems, such as surveillance systems, closed circuit television cameras, or IP camera networks and the associated monitoring systems. c. Response systems such as alert systems, desktop monitoring systems, radios, mobile phones, IP phones, and digital signage d. Building and energy controls Response: No current offering available for category SERVICES For each Category above ( ), the following services should be available for procurement as well at the time of product purchase or anytime afterwards. Response: Read, understood and comply Maintenance Services Capability to provide technical support, flexible hardware coverage, and smart, proactive device diagnostics for hardware. Response: Enterasys offers a comprehensive portfolio of maintenance services designed to address your business needs. Our maintenance services provide 24x7 access to our award winning support center, which is staffed with 100% in-house technical experts who collectively average over 13 years of technical experience. Enterasys understands that superior service and support is a critical component of your network solution. Our maintenance services provide all the post-implementation support services you need to maintain high network availability and performance cost effectively. Below is an overview of the maintenance services offerings available for all proposed product category offerings: Express Parts Our maintenance services provide full access to the latest firmware updates, ensuring you get the most from your network equipment. Advance parts replacement options range from next business day to two hour response and are available with or without an onsite field engineer. On-site Enterasys On-site maintenance program allows you to have an Enterasyscertified expert on site to help you diagnose and repair network faults and serve as a liaison with product engineers for problem escalation when necessary. Software and Appliance Services Enterasys Software and Application Services maintenance program allows you to avoid the expense of purchasing different revision levels, protecting your software investments. Our Appliance Services will help support elements that are critical to most effectively configure, maintain, support, upgrade and manage these product-specific Application environments. Page 70 of 94 p. 453

295 WSCA-NASPO Data Communications Solicitation # JP14001 The table below outlines what is provided with each option: For more information on Enterasys maintenance offerings please see: Professional Services Deployment Services Survey/ Design Services Includes, but not limited to, discovery, design, architecture review/validation, and readiness assessment. Response: Comply. Enterasys provides Survey/Design Services through our Professional Services Organization. Survey/Design Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing discovery, design, architecture review/validation, and readiness assessment services. Typical Survey/Design Services include (but are not limited to): Secure Network Readiness Assessment, Network Assessment, Wireless Assessment/Site survey, Network Security Assessment and Network design assistance. The goal of Enterasys assessments is to verify the current state/ status of the network and deploy best practices on the current and future network design. Implementation Services Includes, but not limited to, basic installation and configuration or end-to-end integration and deployment. Response: Comply. Enterasys provides Implementation Services through our Professional Services Organization. Implementation Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing basic installation, configuration and/or end-to-end integration/deployment services. Typical Page 71 of 94 p. 454

296 WSCA-NASPO Data Communications Services Solicitation # JP14001 Implementation Services include a range from basic rack/stack with L2 configuration through completed turn-key implementation for a routed L3 environment. Implementation Services can include (but are not limited to): Staging of equipment, mounting of equipment, design/configuration/testing of equipment, cutover support and post-cutover support. Enterasys Implementation Services are customized to support the specific needs of a project. The services also provide a means to augment the customer s existing staff or provide a complete implementation of the Enterasys equipment. Optimization Includes, but not limited to, assessing operational environment readiness, identify ways to increase efficiencies throughout the network, and optimize Customer s infrastructure, applications and service management. Response: Partially comply. Enterasys provides Optimization Services through our Professional Services Organization. Optimization Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing network operational readiness, increasing efficiencies and optimizing the customer s network infrastructure. Enterasys does not offer optimization for 3rd party applications or services. Typical Optimization services can include: Monthly/Bimonthly Network Health Checks, Network assessments and best practice recommendations. The goal of the Optimization Services is to assist the customer in implementing the best practice network infrastructure for their specific environment. Optimization services will provide the customer with standards based recommendations that increase network efficiency as well as overall network health. Remote Management Services Includes, but not limited to, continuous monitoring, incident management, problem management, change management, and utilization and performance reporting that may be on a subscription basis. Response: Partially comply. Enterasys provides Remote Management Services through our Professional Services Organization. Remote Management Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise in providing problem management, change management and utilization/performance reporting using Project Management resources. Enterasys does not currently offer continuous monitoring or incident management. Page 72 of 94 p. 455

297 WSCA-NASPO Data Communications Solicitation # JP14001 Typical Remote Management services can include: remote configuration, remote troubleshooting, remote design support and various project management tasks. Project Management tasks can include: problem management, change management and reporting. Consulting/Advisory Services Includes, but not limited to, assessing the availability, reliability, security and performance of Customer s existing solutions. Response: Comply. Enterasys provides Consulting/Advisory Services through our Professional Services Organization. Consulting/Advisory Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced engineers with an average of 13 years tenure at Enterasys and 23 years expertise in providing Consulting/Advisory Services, reliability, security and performance services for existing network infrastructure solutions. Typical Consulting/Advisory Services include (but are not limited to): Network Assessment, Post-installation Wireless Assessment/Site survey, Network Security Assessment and Network Health checks. Enterasys Consulting/Advisory Services are designed to assist customers with reporting as well as maintaining and improving the existing network infrastructure. Data Communications Architectural Design Services Developing architectural strategies and roadmaps for transforming Customer s existing network architecture and operations management. Response: Comply. Enterasys provides Data Communications Architectural Design Services through our Professional Services Organization. These services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise providing strategies and roadmaps for future network architecture and upcoming technologies. Typical Data Communications Architectural Design Services include (but are not limited to): Future Network Readiness Assessment, Network Assessment, Wireless Assessment/Site survey and Network design assistance. The goal of these services is to plan/design for future solutions, growth and requirements on the network infrastructure. Statement of Work (SOW) Services Customer-specific tasks to be accomplished and/or services to be delivered based on Customer s business and technical requirements. Response: Comply. Enterasys provides Statement of Work Services through our Professional Services Organization. Statement of Work Services are delivered by Enterasys Professional Services Engineers and Certified Partners. All Page 73 of 94 p. 456

298 WSCA-NASPO Data Communications Services Solicitation # JP14001 Professional Services Engineers are experienced with an average of 13 years tenure at Enterasys and 23 years expertise writing Statements of Work based on customer s business and technical requirements. Typical Statement of Work Services include (but are not limited to): Statement of Work writing assistance, Network implementation time/task estimating and time/task scoping. The goal of these services is to help customer s write Statements of Work that meet their business and technical requirements. Please note: Enterasys offers additional professional services for equipment categories listed in and below: 1. Network Management and Automation Software products and solutions for data center automation, cloud computing, and IT systems management. Response: Enterasys Data Center Manager (DCM) Advanced Service, provides a powerful unified management offering, automatically recognizes the VM provisioning event and dynamically provisions the virtual and physical switch with the services required by the application. DCM Service leverages Enterasys professional services expertise, embedded policy functionality in our S-Series core/data center switches and our NetSight Management Suite to provide IT administrators with a transparent, cross-functional service provisioning process that provides unified visibility and control of the Data Center by enabling the unification of the physical and virtual network and ensuring networks will have the high availability necessary for critical applications and business data. Traditionally, data center connectivity spans physical, virtual and storage networks using separate tools and management systems. To unify a data center network, it is necessary to have an integrated view of the network infrastructure, servers, storage systems and applications. The Enterasys Data Center Manager solution is designed to reduce the workload and increase the efficiency of the IT organization. Coordinating the automated assignment of virtual machines (VMs) within both the virtual and physical network fabrics, DCM ensures that proper network resources are allocated when a VM is provisioned, no matter where it is on the network. This is achieved with DCM s unique ability to automatically apply individual policies to various data objects in the switching fabric, solving the challenge of virtual machine sprawl. The use of granular policies, combined with Enterasys flowbased S-Series switching, helps users realize the goals of high availability and reliable delivery. With this approach, operational costs are lowered by providing a higher degree of automation as well as system-level management. Page 74 of 94 p. 457

299 WSCA-NASPO Data Communications Solicitation # JP Data Center Management and Automation Software products and solutions that capture and automate manual tasks across servers, network, applications, and virtualized infrastructure. Response: Enterasys Data Center Manager (DCM) Advanced Service, provides a powerful unified management offering, automatically recognizes the VM provisioning event and dynamically provisions the virtual and physical switch with the services required by the application. DCM Service leverages Enterasys professional services expertise, embedded policy functionality in our S-Series core/data center switches and our NetSight Management Suite to provide IT administrators with a transparent, cross-functional service provisioning process that provides unified visibility and control of the Data Center by enabling the unification of the physical and virtual network and ensuring networks will have the high availability necessary for critical applications and business data. Traditionally, data center connectivity spans physical, virtual and storage networks using separate tools and management systems. To unify a data center network, it is necessary to have an integrated view of the network infrastructure, servers, storage systems and applications. The Enterasys Data Center Manager solution is designed to reduce the workload and increase the efficiency of the IT organization. Coordinating the automated assignment of virtual machines (VMs) within both the virtual and physical network fabrics, DCM ensures that proper network resources are allocated when a VM is provisioned, no matter where it is on the network. This is achieved with DCM s unique ability to automatically apply individual policies to various data objects in the switching fabric, solving the challenge of virtual machine sprawl. The use of granular policies, combined with Enterasys flowbased S-Series switching, helps users realize the goals of high availability and reliable delivery. With this approach, operational costs are lowered by providing a higher degree of automation as well as system-level management Partner Services Provided by Contractor s Authorized Partners/Resellers. Subject to Contractor s approval and the certifications held by its Partners/Resellers, many Partners/Resellers can also offer and provide some or all of the Services as listed above at competitive pricing, along with local presence and support. As the prime, Contractor is still ultimately responsible for the performance of its Partners/ Resellers. Customers can have the option to purchase the Services to be directly delivered by Contractor (OEM) or its certified Partners/Resellers. Response: Comply. Enterasys authorized partners have the capability to deliver all Professional Services listed above. Page 75 of 94 p. 458

300 WSCA-NASPO Data Communications Services Solicitation # JP Training Learning offerings for IT professionals on networking technologies, including but not limited to designing, implementing, operating, configuring, and troubleshooting network systems pertaining to items provided under the master agreement. Response: Enterasys offers a full range of training options for all proposed product category offerings. The Enterasys Technical Training program is designed to provide IT professionals the skills and understanding they need to successfully manage their Enterasys solution. By using a blended learning environment, students are involved with configuring systems that emulate real-world environments in order to reinforce the lecture portion of the class. With seasoned instructorveterans, students will be guided throughout their learning path on acquiring the skills to design, build, manage, and troubleshoot Enterasys solutions. Enterasys offers the following technical training options: Classroom Attendance via our Authorized Training Centers Students have the opportunity to attend classes at either our Enterasys offices or any of our Authorized Partner Training Centers. Our technically educated instructors will lead you through a combination of lecture and hands-on lab courses that are designed to provide students with the information that they need in order to maximize their investments in Enterasys products and solutions. For a complete list of training center locations, please visit the following link: Onsite Training Onsite training delivers personalized classes focused on the topics that are important to achieving your business objectives. Our technically educated instructors come to your facility with the equipment, expertise and courseware to provide you with a valuable learning experience. Regional Training Powered by the Enterasys Mobile Classroom, Enterasys Technical Training brings our classes on the road, providing the same level of technical hands-on experiences that students would gain at our Authorized Training Centers but in a more convenient location: Closer to You. For a complete listing of locations and scheduled classes, please visit the following link: Classroom Attendance via the Enterasys Virtual Classroom The Enterasys live Virtual Classroom offers students the opportunity to take the same courses offered at our training locations, over the Internet using their personal computer. Within these classes, students would be exposed to the same material, the same technically educated instructors and the same lab exercises that they would have been exposed to had they attended an actual training class. Technical Certifications Our networking certification program has everything you need to develop your skills to maximize the performance of your network and better meet the needs of your business. You will learn the skills to successfully deploy and manage Enterasys products in your environment. We also offer a Page 76 of 94 p. 459

301 WSCA-NASPO Data Communications Solicitation # JP14001 number of certification levels, so you can choose the correct amount of training to achieve your business goals: For more information on our Technical Training offerings, please see: ADDING PRODUCTS The ability to add new equipment and services is for the convenience and benefit of WSCA- NASPO, the Participating States, and all the Authorized Purchasers. The intent of this process is to promote one-stop shopping and convenience for the customers and equally important, to make the contract flexible in keeping up with rapid technological advances. The option to add new product or service categories and/items will expedite the delivery and implementation of new technology solutions for the benefit of the Authorized Purchasers. After the contracts are awarded, additional IT product categories and/or items may be added per the request of the Contractor, a Participating State, an Authorized Purchaser or WSCA-NASPO. Additions may be ad hoc and temporary in nature or permanent. All additions to an awarded Contractor or Manufacturer s offerings must be products, services, software, or solutions that are commercially available at the time they are added to the contract award and fall within the original scope and intent of the RFP (i.e., converged technologies, value adds to manufacturer s solution offerings, etc.). Response: Read, understood and will comply New Product from Contractors If Contractor, a Participating State, an Authorized Purchaser or WSCA-NASPO itself requests to add new product categories permanently, then all awarded Contractors (Manufacturers) will be notified of the proposed change and will have the opportunity to work with WSCA to determine applicability, introduction, etc. Any new products or services must be reviewed and approved by the WSCA-NASPO Contract Administrator. Response: Read, understood and will comply Ad Hoc Product Additions A request for an ad hoc, temporary addition of a product category/item must be submitted to WSCA-NAPOS via the governmental entity s contracting/purchasing officer. Ad hoc, temporary requests will be handled on a case-by-case basis. Response: Read, understood and will comply Pricelist Updates As part of each Contractor s ongoing updates to its pricelists throughout the contract term, Contractor can add new SKUs to its awarded product categories that may have been developed in-house or obtained through mergers, acquisitions or joint Page 77 of 94 p. 460

302 WSCA-NASPO Data Communications Services Solicitation # JP14001 ventures; provided, however, that such new SKUs fall within the Contractor s awarded product categories. Response: Read, understood and will comply. Section 6: Evaluation 6.1 General Information Proposals will be evaluated for completeness and compliance with the requirements of this RFP by a sourcing team. The sourcing team may engage additional qualified individuals during the process to assist with technical, financial, legal, or other matters. Except at the invitation of the sourcing team, no activity or comments from Offerors regarding this RFP shall be discussed with any member of the sourcing team during the evaluation process. An Offeror who contacts a member of the sourcing team in reference to this RFP may have its proposal rejected. Each proposal must be submitted in Microsoft Word or Excel, or PDF labeled and organized in a manner that is congruent with the section number, headings, requirements, and terminology used in this RFP. Proposal documents must be use Arial font size 10. All proposals must be submitted in electronic form. Response: Read, understood and comply. 6.2 Administrative Requirements Compliance The sourcing team will evaluate each proposal for compliance with administrative requirements. Non compliance with any of these requirements will render a proposal non-responsive. Only those proposals that pass the administrative requirements will be evaluated further. In order to pass the Administrative Requirements, the following must be received by due date and time associated with this RFP as listed in Bid Sync References Vendor must provide a least three current account references for which your company provides similar Data Communications services for private, state and/or large local government clients (preferably government/public entities). Offerors are required to submit Attachment B - Reference Form, for business references. The business providing the reference must submit the Reference Form directly to the State of Utah, Division of Purchasing. It is the offeror s responsibility to ensure that completed forms are received by the State of Utah Division of Purchasing on or before the proposal submission deadline for inclusion in the evaluation process. Business references not received, or not complete, may adversely affect the offeror s score in the evaluation process. The Purchasing Division reserves the right to contact any or all business references for validation of information submitted. Response: Read, understood and Comply. 6.3 Minimum Scope Requirements Compliance The sourcing team will evaluate each proposal that passed the administrative requirements for compliance with Section 5.2 Data Communications Services Requirements. Scope requirements are evaluated in terms of the breadth and depth of the offeror proposal for each of the section Scope categories. Only those proposals in each section that score 70% or better will move on to cost evaluation. Response: Read, understood and comply. Page 78 of 94 p. 461

303 WSCA-NASPO Data Communications Solicitation # JP Evaluation Criteria The following table details how each proposal shall be evaluated on a basis of 100 points. An evaluation committee comprised of representatives from some WSCA-NASPO member States will be appointed by the WSCA-NASPO Contract Administrator to perform the proposal evaluation. All Offeror s proposals will be initially reviewed for compliance with the mandatory general requirements in Section 3 and Sections stated within the RFP. Any proposal failing to meet one or more mandatory requirement(s) will be considered non-responsive and deemed unacceptable, and will be eliminated from further consideration. Those proposals deemed acceptable or potentially acceptable will be evaluated against the following proposal evaluation criteria using a point-based scoring methodology. Proposal evaluation criteria are listed in relative order of importance: Response: Read and understood Cost (bid sheets including discounts off list price attached) 30% Given that technology products generally depreciate over time and go through typical product lifecycles, it is more favorable for customers to have prime contracts be based on minimum discounts off the Offeror s commercially published pricelists versus fixed pricing. In addition, Offerors must have the ability to update and refresh their respective price books, as long as the agreed-upon discounts are fixed. Minimum guaranteed contract discounts do not preclude an Offeror and/or its authorized resellers from providing deeper or additional, incremental discounts at there sole discretion. Response: Read, understood and will comply Refurbished Equipment Many IT manufacturers offer refurbished equipment at a substantially lower cost with attractive warranties that also address risk concerns some customers may have with refurbished gear. Offerors may add an optional provision for manufacturer-certified refurbished equipment to be available for procurement under this contract. This offering will not be evaluated as part of the cost scoring process. Response: Read and understood Demonstrate ability to provide products and services within scope of the RFP (Section ) 25% Response: Read and understood Qualifications, technical ability, maintenance, training and value added services 10% Response: Read and understood Ability to supply to WSCA / NASPO member states/geographical coverage -10% Response: Read and understood Offer profile and references (i.e., financial stability, presence in marketplace, adequate staff, marketing efforts etc.) 20% Response: Read and understood. Page 79 of 94 p. 462

304 WSCA-NASPO Data Communications Services Solicitation # JP Administrative (i.e., report generating ability, e-commerce, account reps, problem resolution, customer satisfaction, website hosting and other administrative related issues) 5% Response: Read and understood. At the option of the evaluation committee the WSCA-NASPO Contract Administrator may initiate discussion(s) with Offerors who submit responsive or potentially responsive proposals for the purpose of clarifying aspects of the proposal(s), however, proposals may be evaluated without such discussion(s). Such discussion(s) is not to be initiated by Offerors. Based on the competitive range of the evaluation scores, the evaluation committee may choose to make a finalist list of offeror s; if opted for, all offeror s will be notified of their status at this juncture by the Procurement Manager. Finalist Offeror s may be required, at the option of the evaluation committee, to present their proposals and possibly demonstrate their Internet website to the evaluation committee. The Procurement Manager will schedule the time and location for each Offeror presentation. Each Offeror presentation will be of equal duration for all offeror s and may also include an additional amount of time reserved for questions/answers. The sourcing team will evaluate each proposal that has passed the administrative requirements and met or exceeded the Section 3 and Section Mandatory Requirements. Response: Read, understood and will comply. Page 80 of 94 p. 463

305 WSCA-NASPO Data Communications Solicitation # JP14001 WSCA-NASPO Data Communications Equipment and Associated Products #JP14001 Firm Name: Section Number: Evaluator: Date: Score will be assigned as follows: 0 = Failure, no response 1 = Poor, inadequate, fails to meet requirement 2 = Fair, only partially responsive 3 = Average, meets minimum requirement 4 = Above average, exceeds minimum requirement 5 = Superior 1. Demonstrated Ability to meet scope of requirements (25 points possible) Scope and Varity of products provided Experience and technical ability of manufacturer Maintenance Program Training Program Service Program Demonstrate Effective Reseller Program managed by the manufacturer in WSCA / NASPO States 2. Demonstrate Qualifications and Technical Ability (10 points possible) 8 points possible 7 points possible 2 points possible 2 points possible 2 points possible 4 points possible Score Weight (0-5) X 1.6 X 1.4 X.40 X.40 X.40 X Points Technical Staff Qualifications Maintenance Staff Qualifications Training Staff Qualifications Technical Suitability of Products 3. Demonstrate ability to supply WSCA / NASPO member States (10 points possible) 4. Company profile and references (20 points) Financial Statements and Records References, Reputation, Breadth and Depth of Offering 5. Demonstrate ability to provide administrative support (5 points 2 points possible 2 points possible 2 points possible 4 points possible 10 points possible 10 points possible 10 points possible 5 points possible X.40 X.40 X.40 X.80 X X 2 X 2 X 1 Page 81 of 94 p. 464

306 WSCA-NASPO Data Communications Services Solicitation # JP14001 possible) 6. Cost (30 points possible)* Services (10 Points) Product Offering Discount Percentage (20 points) TOTAL EVALUATION POINTS 30 points possible (100 points possible) * Inserted by Purchasing Total * Purchasing will use the following cost formula for the Services : The points assigned to each Offeror s cost proposal will be based on the lowest proposal price. The offeror with the lowest Proposed Price will receive 100% of the price points. All other Offerors will receive a portion of the total cost points based on what percentage higher their Proposed Price is than the Lowest Proposed Price. An Offeror who s Proposed Price is more than double (200%) the Lowest Proposed Price will receive no points. The formula to compute the points is: Cost Points x (2- Proposed Price/Lowest Proposed Price). Response: Read and understood. Purchasing will use the following cost formula for the Product Offering Discount Percentage : The points assigned to each Offeror s cost proposal will be based on the highest discount percentage. The Offeror with the highest discount percentage will receive 100% of the price points. All other Offerors will receive a portion of the total cost points based on what percentage lower their discount percentage is than the highest discount percentage. An Offeror who s Proposed percentage discount is less than double (200%) the highest discount percentage will receive no points. The formula to compute the points is: Cost Points x (2- Highest Proposed Discount/Proposed Discount). Response: Read and understood. Section 7: Master Agreement Terms and Conditions/Exceptions 7.1 WSCA-NASPO Master Agreement Terms and Conditions The WSCA-NASPO Contract Administrator referred to in section 2 of the WSCA- NASPO Master Agreement Terms and Conditions is Debra Gunderson, State of Utah Division of Purchasing and General Services. This RFP represents the WSCA-NASPO Contract Administrator s written approval of the modifications, waivers, alterations, amendments, and supplements to the Master Agreement Terms and Conditions made in this RFP and this Section 7. Response: Read and understood Except as limited in this section or elsewhere in this RFP, Participating Entities who execute a Participating Addendum may alter, modify, supplement, or amend the WSCA- NASPO Master Agreement Terms and Conditions as necessary to comply with Participating Entity law or policy with respect to their orders under the Master Agreement. A Contractor may not deliver Products or perform services under this Master Agreement until a Participating Addendum acceptable to the Participating Entity and Contractor is executed. The WSCA-NASPO Terms and Conditions are applicable to any order by a Participating Entity, except to the extent altered, modified, supplemented or amended by a Participating Addendum. By way of illustration and not limitation, this authority may apply to unique delivery and invoicing requirements, confidentiality requirements, defaults on orders, governing law and venue relating to orders by a Participating Entity, Indemnification, and insurance requirements. Statutory or constitutional requirements relating to availability of funds may require specific language in some Participating Addenda in order to comply with applicable law. The expectation is that these Page 82 of 94 p. 465

307 WSCA-NASPO Data Communications Solicitation # JP14001 alterations, modifications, supplements, or amendments will be addressed in the Participating Addendum or, with the consent of the Participating Entity and Contractor, may be included in the commitment voucher (e.g. purchase order or contract) used by the Participating Entity to place the order. Response: Read, understood and will comply. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer The term Purchasing Entity and Participating Entity shall both mean Participating Entity as that term is defined in WSCA-NASPO Master Agreement Terms and Conditions. Response: Read and understood With respect to section 11, Indemnification, the terms of any Participating Addendum may alter, modify, supplement, or amend the language in section 11 and may include a limitation of liability mutually agreeable to the Participating Entity and the Contractor. Response: Read and understood With regard to section 20, Participants, Participating Entities who are not states may under some circumstances sign their own Participating Addendum, subject to the approval of the Chief Procurement Official of the state where the Participating Entity is located. Contractors may upon request obtain a copy of the written authorization from the WSCA-NASPO Contract Administrator. Response: Read and understood. 7.2 Offeror Exceptions to Terms and Conditions The Lead State discourages exception s to contract terms and conditions in the RFP, attached Participating Entity terms and conditions (if any), and the WSCA-NASPO Master Agreement Terms and Conditions. As specified in this RFP, exceptions may cause a proposal to be rejected as nonresponsive when, in the sole judgment of the Lead State (and its evaluation team), the proposal appears to be conditioned on the exception or correction of what is deemed to be a deficiency or unacceptable exception would require a substantial proposal rewrite to correct. Moreover, Offerors are cautioned that award may be made on receipt of initial proposals without clarification or an opportunity for discussion, and the nature of exceptions would be evaluated. Further, the nature of exceptions will be considered in the competitive range determination if one is conducted. Exceptions will be evaluated to determine the extent to which the alternative language or approach poses unreasonable, additional risk to the state, is judged to inhibit achieving the objectives of the RFP, or Page 83 of 94 p. 466

308 WSCA-NASPO Data Communications Services Solicitation # JP14001 whose ambiguity makes evaluation difficult and a fair resolution (available to all vendors) impractical given the timeframe for the RFP. Response: Read and understood. Enterasys takes exception to the following language from section 15, insurance: "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer The Lead State will entertain exceptions to contract terms and conditions in this RFP, including the WSCA-NASPO Master Agreement Terms and Conditions. Offerors are strongly encouraged to be judicious in identifying exceptions. Response: Read and understood Based on the market research conducted by the Lead State, the following provisions are intended to frame the contours of exceptions that may be acceptable, additional risk so long as the Offeror s exceptions are specified with sufficient particularity. Response: Read and understood The Lead State will consider Offeror standard terms for inspection and acceptance, so long as a reasonable time for acceptance is stated. However, the Participating Entities right to exercise revocation of acceptance under its Uniform Commercial Code must be preserved. Submit the standard terms with the offer and describe generally how commerciality in their use is established, e.g., identify publicly-available catalogs where the warranty terms are used and how long they have been in use. Response: Read and understood The Lead State will consider standard warranty and/or maintenance terms, but the alternative warranty and/or maintenance will be evaluated to determine whether they provide comparable protection to the warranty specified in section 30 of the WSCA- NASPO Master Agreement Terms and Conditions. Provide the terms of the warranty and maintenance in the offer. Also describe generally how commerciality is established for those terms, e.g., publicly-available catalogs the warranty terms are used and how long they have been in use. Provide one reference from a customer having comparable sales volume who is using the warranty and maintenance provisions, where the warranty term has expired, and who has exercised rights under the warranty. Response: Read and understood Intellectual property. The Lead State will consider license terms and conditions that as a minimum convey to Participating Entities a nonexclusive, irrevocable, perpetual, paid-up, royalty free license to use software or other intellectual property delivered with or inherent in the commodity or service, and to transfer the license rights to third parties for government purposes. Provide the terms of the license, including any terms that cover third party intellectual property used in the Offeror s solution. Offerors should be aware that Participating Entities using federal funds may be required to negotiate additional or different terms to satisfy minimum rights requirements of their federal grants. Response: Read and understood. Page 84 of 94 p. 467

309 WSCA-NASPO Data Communications Solicitation # JP Any limitation of liability provision including any exclusion of damages clause proposed by an Offeror to be the default limitation of liability provision under the Master Agreement must preserve a reasonable amount of direct damages for breach of contract, additionally permit the Participating Entity to recoup amounts paid for supplies or services not finally accepted (as in the case of advance or progress payments, if used), and preserve the right of the Participating Entity to be held harmless from costs of litigation as well as ultimate liability within limits agreed by the parties. Moreover, any limitation of liability clause proposed by an Offeror should be reciprocal, cover lost profits, and exclude claims or liability arising out of intellectual property infringement, bodily injury (including death), damage to tangible property, and data breach. Include the text of any such language if proposed. Further, provide contact information for a public entity, or private entity if no public entity exists, where the limitation of liability clause (or another clause substantially similar) operated to limit liability. If no such example exists, provide contact information for a state, or if no state exists, a higher education institution, or if none exists, a city or county represented by counsel in the negotiations who has agreed to the proposed terms and conditions. Response: Read and understood The enumerated examples in subsection 7.2 are not intended to limit the ability of Offerors to propose additional, reasonable exceptions. For any other exception, where the exception is based on claims of standard or normal commercial practice, provide contact information for a state, or if no state exists, a higher education institution, or if none exists, a city or county represented by counsel in the negotiations who has agreed to the proposed terms and conditions. Response: Read and understood. 7.3 WSCA-NASPO emarket Center In July 2011, WSCA-NASPO entered into a multi-year agreement with SciQuest, Inc. whereby SciQuest will provide certain electronic catalog hosting and management services to enable eligible WSCA-NASPO entity s customers to access a central online website to view and/or shop the goods and services available from existing WSCA- NASPO Cooperative Contracts. The central online website is referred to as the WSCA- NASPO emarket Center. Contractor shall either upload a hosted catalog into the emarket Center or integrate a punchout site with the emarket Center. Supplier s Interface with the emarket Center There is no cost charged by SciQuest to the Contractor for loading a hosted catalog or integrating a punchout site. At a minimum, the Contractor agrees to the following: 1. Implementation Timeline: WSCA-NASPO emarket Center Site Admin shall provide a written request to the Contractor to begin enablement process. The Contractor shall have fifteen (15) days from receipt of written request to work with WSCA- NASPO and SciQuest to set up an enablement schedule, at which time SciQuest s technical documentation shall be provided to the Contractor. The schedule will include future calls and milestone dates related to test and go live dates. The contractor shall have a total of Ninety (90) days to deliver either a (1) hosted catalog or (2) punch-out catalog, from date of receipt of written request. Page 85 of 94 p. 468

310 WSCA-NASPO Data Communications Services Solicitation # JP14001 Response: Read, understood and will comply. 2. Definition of Hosted and Punchout: WSCA-NASPO and SciQuest will work with the Contractor, to decide which of the catalog structures (either hosted or punch-out as further described below) shall be provided by the Contractor. Whether hosted or punch-out, the catalog must be strictly limited to the Contractor s awarded contract offering (e.g. products and/or services not authorized through the resulting cooperative contract should not be viewable by WSCA-NASPO Participating Entity users). a. Hosted Catalog. By providing a hosted catalog, the Contractor is providing a list of its awarded products/services and pricing in an electronic data file in a format acceptable to SciQuest, such as Tab Delimited Text files. In this scenario, the Contractor must submit updated electronic data annually to the the emarket Center for WSCA-NASPO Contract Administrator s approval to maintain the most up-to-date version of its product/service offering under the cooperative contract in the emarket Center. b. Punch-Out Catalog. By providing a punch-out catalog, the Contractor is providing its own online catalog, which must be capable of being integrated with the emarket Center as a. Standard punch-in via Commerce extensible Markup Language (cxml). In this scenario, the Contractor shall validate that its online catalog is up-to-date by providing a written update quarterly to the Contract Administrator stating they have audited the offered products/services and pricing listed on its online catalog. The site must also return detailed UNSPSC codes (as outlined in line 3) for each line item. Contractor also agrees to provide e-quote functionality to facilitate volume discounts. Response: Read, understood and will comply. Enterasys will work with WSCA-NASPO and SciQuest to provide a Hosted Catalog for the emarket Center. 3. Revising Pricing and Product Offerings: Any revisions (whether an increase or decrease) to pricing or product/service offerings (new products, altered SKUs, etc.) must be preapproved by the WSCA-NASPO Contract Administrator and shall be subject to any other applicable restrictions with respect to the frequency or amount of such revisions. However, no cooperative contract enabled in the emarket Center may include price changes on a more frequent basis than once per quarter. The following conditions apply with respect to hosted catalogs: a. Updated pricing files are required by the 1 st of the month and shall go into effect in the emarket Center on the 1 st day of the following month (i.e. file received on 1/01/14 would be effective in the emarket Center on 2/01/14). Files received after the 1 st of the month may be delayed up to a month (i.e. file received on 11/06/14 would be effect in the emarket Center on 1/01/15). b. Contract Administrator-approved price changes are not effective until implemented within the emarket Center. Errors in the Contractor s submitted pricing files will delay the implementation of the price changes in emarket Center. Response: Read, understood and will comply. 4. Supplier Network Requirements: Contractor shall join the SciQuest Supplier Network (SQSN) and shall use the SciQuest s Supplier Portal to import the Contractor s catalog and Page 86 of 94 p. 469

311 WSCA-NASPO Data Communications Solicitation # JP14001 pricing, into the SciQuest system, and view reports on catalog spend and product/pricing freshness. The Contractor can receive orders through electronic delivery (cxml) or through low-tech options such as fax. More information about the SQSN can be found at: or call the SciQuest Supplier Network Services team at Response: Read, understood and will comply. 5. Minimum Requirements: Whether the Contractor is providing a hosted catalog or a punchout catalog, the Contractor agrees to meet the following requirements: a. Catalog must contain the most current pricing, including all applicable administrative fees and/or discounts, as well as the most up-to-date product/service offering the Contractor is authorized to provide in accordance with the cooperative contract; and b. The accuracy of the catalog must be maintained by Contractor throughout the duration of the cooperative contract between the Contractor and the Contract Administrator; and c. The Catalog must include a Lead State contract identification number; and d. The Catalog must include detailed product line item descriptions; and e. The Catalog must include pictures when possible; and f. The Catalog must include any additional WSCA-NASPO and Participating Addendum requirements.* Response: Read, understood and will comply. 6. Order Acceptance Requirements: Contractor must be able to accept Purchase Orders via fax or cxml. a. The Contractor shall provide positive confirmation via phone or within 24 hours of the Contractor s receipt of the Purchase Order. If the Purchasing Order is received after 3pm EST on the day before a weekend or holiday, the Contractor must provide positive confirmation via phone or on the next business day. Response: Read, understood and will comply. 7. UNSPSC Requirements: Contractor shall support use of the United Nations Standard Product and Services Code (UNSPSC). UNSPSC versions that must be adhered to are driven by SciQuest for the suppliers and are upgraded every year. WSCA-NASPO reserves the right to migrate to future versions of the UNSPSC and the Contractor shall be required to support the migration effort. All line items, goods or services provided under the resulting statewide contract must be associated to a UNSPSC code. All line items must be identified at the most detailed UNSPSC level indicated by segment, family, class and commodity. More information about the UNSPSC is available at: and Response: Read, understood and will comply. 8. Applicability: Contractor agrees that WSCA-NASPO controls which contracts appear in the emarket Center and that WSCA-NASPO may elect at any time to remove any supplier s offering from the emarket Center. Response: Read and understood. Page 87 of 94 p. 470

312 WSCA-NASPO Data Communications Services Solicitation # JP The WSCA-NASPO Contract Administrator reserves the right to approve the pricing on the emarket Center. This catalog review right is solely for the benefit of the WSCA-NASPO Contract Administrator and Participating Entities, and the review and approval shall not waive the requirement that products and services be offered at prices (and approved fees) required by the Master Agreement. * Although suppliers in the SQSN normally submit one (1) catalog, it is possible to have multiple contracts applicable to different WSCA-NASPO Participating Entities. For example, a supplier may have different pricing for state government agencies and Board of Regents institutions. Suppliers have the ability and responsibility to submit separate contract pricing for the same catalog if applicable. The system will deliver the appropriate contract pricing to the user viewing the catalog. Several WSCA-NASPO Participating Entities currently maintain separate SciQuest emarketplaces, these Participating Entities do enable certain WSCA-NASPO Cooperative Contracts. In the event one of these entities elects to use this WSCA- NASPO Cooperative Contract (available through the emarket Center) but publish to their own emarketplace, the Contractor agrees to work in good faith with the entity and WSCA-NASPO to implement the catalog. WSCA-NASPO does not anticipate that this will require substantial additional efforts by the Contractor; however, the supplier agrees to take commercially reasonable efforts to enable such separate SciQuest catalogs. Response: Read, understood and will comply. Page 88 of 94 p. 471

313 WSCA-NASPO Data Communications Solicitation # JP14001 Attachment B Reference Form Please complete the following: Solicitation Number JP14001 WSCA-NASPO Data Communications RFP (Full Name of Company Requesting Reference) (Your Company Name) This form is being submitted to your company for completion as a business reference for the company listed above. This form is to be returned to the State of Utah, Division of Purchasing, via to teutsler@utah.gov or by fax to the attention of Tara Eutsler at , no later than, 2011, and must not be returned to the company requesting the reference. For questions or concerns regarding this form, please contact the State of Utah, Division of Purchasing, at dgundersen@utah.gov. When contacting the State, please be sure to include the solicitation number listed at the top of this page. QUESTIONS: CONFIDENTIAL INFORMATION WHEN COMPLETED Company providing reference: Contact Name and Title/Position: Contact Telephone Number: Contact Address: 1. In what capacity have you worked with this firm in the past? COMMENTS: 2. How would you rate this firm s knowledge and expertise? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 3. How would you rate this firm s flexibility relative to changes in the project scope and timelines? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 4. What is your level of satisfaction with materials produced by this firm? Page 89 of 94 p. 472

314 WSCA-NASPO Data Communications Services Solicitation # JP14001 (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 5. How would you rate the dynamics/interaction between firm and your staff? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 6. Who were the firm s principal representatives involved in your project and how would you rate them individually? Please comment on the skills, knowledge, behavior or other factors on which you based the rating? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) Principal Representative s Name: Rating: Principal Representative s Name: Rating: Principal Representative s Name: Rating: COMMENTS: 7. How satisfied are you with the manner in which the firm handled confidential, personal, and sensitive information? (3=Excellent; 2=Satisfactory; 1=Unsatisfactory; 0=Unacceptable) COMMENTS: 8. With what aspect(s) of this firm s services are you most satisfied? COMMENTS: 9. With which aspect(s) of this firm s services are you least satisfied? COMMENTS: 10. Would you recommend this firm s services to your organization again? COMMENTS: Response: Enterasys customers have participated and submitted Attachment B Reference Forms as required. Page 90 of 94 p. 473

315 WSCA-NASPO Data Communications Services Solicitation # JP14001 custom price Quantity SKU 1 Enterasys Service Unit PS-ESU-1 5 Enterasys Service Units PS-ESU-5 10 Enterasys Service Units PS-ESU Enterasys Service Units PS-ESU-20 Pricing includes T&E coverage for onsite engagements of three days or more. There is a one-year expiration. Hourly Rates Please note: When quoting hourly rates a minimum of 24 onsite hours is required. Onsite engagements during non standard hours will be charged at 1.5x the hourly rate. Please refer to the price file enclosed in the Cost Proposal for a detailed breakdown of proposed services offerings in each category above. Enterasys reserves the right to engage in special pricing on a case by case basis under competitive circumstances when bidding on one-time, fixed-priced projects and such pricing shall have no effect on the prices offered under this Contract. Page 94 of 94 p. 477

316 WSCA-NASPO Data Communications Solicitation # JP14001 Exception: WSCA NASPO Master Agreement Terms and Conditions Enterasys takes exception to the following language from section 15, insurance "Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days after notice of intended revocation thereof shall have been given to Participating Entity by the Contractor." Such a notice requirement is inconsistent with Enterasys' insurance coverage and the insurance industry in general. Enterasys proposes the following and is willing to negotiate in good faith. "Such policies shall also reference this Master Agreement. Contractor must provide notice of revocation of any policy immediately upon receiving such notice from insurer. p. 478

317 p. 479 State of Utah

318 Supplier: Enterasys Networks, Inc. STATE OF UTAH SOLICITATION NO. JP14001 WSCA-NASPO Data Communications Products & Services RESPONSES DUE NO LATER THAN: Aug 30, :00:00 AM MDT RESPONSES MAY BE SUBMITTED ELECTRONICALLY TO: RESPONSES MAY BE MAILED OR DELIVERED TO: State of Utah Division of Purchasing 3150 State Office Building, Capitol Hill Salt Lake City, Utah p. 480

319 Supplier: Enterasys Networks, Inc. State of Utah Request for Proposal Legal Company Name (include d/b/a if applicable) Enterasys Networks, Inc Federal Tax Identification Number State of Utah Sales Tax ID Number STC Ordering Address City State Zip Code 9 Northeastern Blvd Salem NH Remittance Address (if different from ordering address) City State Zip Code PO Box Woburn MA Type Corporation gfedcb Partnership Proprietorship gfedcb Government gfedcb gfedcb Company Contact Person Michael Swierk Telephone Number (include area code) Fax Number (include area code) Company=s Internet Web Address Address mswierk@enterasys.com Discount Terms (for bid purposes, bid discounts less than 30 days will not be considered) Net 30 Days Required for Delivery After Receipt of Order (see attached for any required minimums) 15 The undersigned certifies that the goods or services offered are produced, mined, grown, manufactured, or performed in Utah. Yes No gfedcb. If no, enter where produced, etc. Enterasys does not manufacture any products in the State of Utah. However, some of our products are manufactured in the US with a TAA compliant option. p. 481

320 Offeror=s Authorized Representative=s Signature Enterasys2013 Date August 28, 2013 Type or Print Name Michael Swierk Position or Title Contract Analyst p. 482

321 N O T I C E When submitting a response (proposal, quote or bid) electronically through BidSync, it is the sole responsibility of the supplier to ensure that the response is received by BidSync prior to the closing date and time. Each of the following steps in BidSync MUST be completed in order to place an offer: A. Login to B. Locate the bid (solicitation) to which you are responding; a. Click the Search tab on the top left of the page; b. Enter keyword or bid (solicitation) number and click Search ; C. Click on the Bid title/description to open the Bid (solicitation) Information Page; D. View and Accept all documents in the document section; E. Select Place Offer found at the bottom of the page; F. Enter your pricing, notes, other required information and upload attachments to this page; G. Click Submit at the bottom of the page; H. Review Offer(s); and I. Enter your password and click Confirm. Note that the final step in submitting a response involves the supplier s acknowledgement that the information and documents entered into the BidSync system are accurate and represent the supplier s actual proposal, quote or bid. This acknowledgement is registered in BidSync when the supplier clicks Confirm. BidSync will post a notice that the offer has been received. This notice from BidSync MUST be recorded prior to the closing date and time or the response will be considered late and will not be accepted. Be aware that entering information and uploading documents into BidSync may take considerable time. Please allow sufficient time to complete the online forms and upload documents. Suppliers should not wait until the last minute to submit a response. It is recommended that suppliers submit responses a minimum of 24 hours prior to the closing deadline. The deadline for submitting information and documents will end at the closing time indicated in the solicitation. All information and documents must be fully entered, uploaded, acknowledged (Confirm) and recorded into BidSync before the closing time or the system will stop the process and the response will be considered late and will not be accepted. Responses submitted in BidSync are completely secure. No one (including state purchasing staff) can see responses until after the deadline. Suppliers may modify or change their response at any time prior to the closing deadline. However, all modifications or changes must be completed and acknowledged (Confirm) in the BidSync system prior to the deadline. BidSync will post a notice that the modification/change (new offer) has been received. This notice from BidSync MUST be recorded prior to the closing date and time or the response will be considered late and will not be accepted. Utah Code (2) Unless otherwise agreed between a sender (supplier) and the recipient (State Purchasing), an electronic record is received when: (a) it enters an information processing system that the recipient has designated or uses for the purpose of receiving electronic records or information of the type sent and from which the recipient is able to retrieve the electronic record; and (b) it is in a form capable of being processed by that system. p. 483

322 REQUEST FOR PROPOSAL - INSTRUCTIONS AND GENERAL PROVISIONS 1. SUBMITTING THE PROPOSAL: (a) The Utah Division of Purchasing and General Services (DIVISION) prefers that proposals be submitted electronically. Electronic proposals may be submitted through a secure mailbox at BidSync (formerly RFP Depot, LLC) ( until the date and time as indicated in this document. It is the sole responsibility of the supplier to ensure their proposal reaches BidSync before the closing date and time. There is no cost to the supplier to submit Utah s electronic proposals via BidSync. (b) Electronic proposals may require the uploading of electronic attachments. The submission of attachments containing embedded documents is prohibited. All documents should be attached as separate files. (c) If the supplier chooses to submit the proposal directly to the DIVISION in writing: The proposal must be signed in ink, sealed, and delivered to the Division of Purchasing, 3150 State Office Building, Capitol Hill, Salt Lake City, UT by the "Due Date and Time. The "Solicitation Number" and "Due Date" must appear on the outside of the envelope. All prices and notations must be in ink or typewritten. Each item must be priced separately. Unit price shall be shown and a total price shall be entered for each item offered. Errors may be crossed out and corrections printed in ink or typewritten adjacent and must be initialed in ink by person signing offer. Unit price will govern, if there is an error in the extension. Written offers will be considered only if it is submitted on the forms provided by the DIVISION. (d) Proposals, modifications, or corrections received after the closing time on the "Due Date" will be considered late and handled in accordance with the Utah Procurement Rules, section R (e) Facsimile transmission of proposals to DIVISION will not be considered. 2. PROPOSAL PREPARATION: (a) Delivery time of products and services is critical and must be adhered to as specified. (b) Wherever in this document an item is defined by using a trade name of a manufacturer and/or model number, it is intended that the words, "or equivalent" apply. "Or equivalent" means any other brand that is equal in use, quality, economy and performance to the brand listed as determined by the DIVISION. If the supplier lists a trade name and/or catalog number in the offer, the DIVISION will assume the item meets the specifications unless the offer clearly states it is an alternate, and describes specifically how it differs from the item specified. All offers must include complete manufacturer=s descriptive literature if quoting an equivalent product. All products are to be of new, unused condition, unless otherwise requested in this solicitation. (c) Incomplete proposals may be rejected. (d) Where applicable, all proposals must include complete manufacturer=s descriptive literature. (e) By submitting the proposal the offeror certifies that all of the information provided is accurate, that they are willing and able to furnish the item(s) specified, and that prices offered are correct. (f) This proposal may not be withdrawn for a period of 60 days from the due date. 3. FREIGHT COST: Suppliers are to provide line item pricing FOB Destination Freight Prepaid. Unless otherwise indicated on the contract/purchase order, shipping terms will be FOB Destination Freight Prepaid. 4. SOLICITATION AMENDMENTS: All changes to this solicitation will be made through written addendum only. Answers to questions submitted through BidSync shall be considered addenda to the solicitation documents. Bidders are cautioned not to consider verbal modifications. 5. PROTECTED INFORMATION: Suppliers are required to mark any specific information contained in their offer which they are claiming as protected and not to be disclosed to the public or used for purposes other than the evaluation of the offer. Each request for non-disclosure must be made by completing the Confidentiality Claim Form located at: with a specific justification explaining why the information is to be protected. Pricing and service elements of any proposal will not be considered proprietary. All material becomes the property of the DIVISION and may be returned only at the DIVISION 's option. 6. BEST AND FINAL OFFERS: Discussions may be conducted with offerors who submit proposals determined to be reasonably susceptible of being selected for award for the purpose of assuring full understanding of, and responsiveness to, solicitation requirements. Prior to award, these offerors may be asked to submit best and final offers. In conducting discussions, there shall be no disclosure of any information derived from proposals submitted by a competing offeror. 7. SAMPLES: Samples of item(s) specified in this offer, brochures, etc., when required by the DIVISION, must be furnished free of expense to the DIVISION. Any item not destroyed by tests may, upon request made at the time the sample is furnished, be returned at the offeror's expense. 8. AWARD OF CONTRACT: (a) The contract will be awarded with reasonable promptness, by written notice, to the responsible offeror whose proposal is determined to be the most advantageous to the DIVISION, taking into consideration price and evaluation factors set forth in the RFP. No other factors or criteria will be used in the evaluation. The contract file shall contain the basis on which the award is made. Refer to Utah Code Annotated 65- p. 484

323 (b) The DIVISION may accept any item or group of items, or overall best offer. The DIVISION can reject any or all proposals, and it can waive any informality, or technicality in any proposal received, if the DIVISION believes it would serve the best interests of the DIVISION. (c) Before, or after, the award of a contract the DIVISION has the right to inspect the offeror's premises and all business records to determine the offeror's ability to meet contract requirements. (d) The DIVISION will open proposals publicly, identifying only the names of the offerors. During the evaluation process, proposals will be seen only by authorized DIVISION staff and those selected by DIVISION to evaluate the proposals. Following the award decision, all proposals become public information except for protected information (see number 5 above). A register of proposals and contract awards are posted at (e) Estimated quantities are for bidding purposes only, and not to be interpreted as a guarantee to purchase any amount. (f) Utah has a reciprocal preference law which will be applied against offerors offering products or services produced in states which discriminate against Utah products. For details see Section 63G and 63G-6-405, Utah Code Annotated. (g) Multiple contracts may be awarded if the DIVISION determines it would be in its best interest. 9. DEBRIEFING OF UNSUCCESSFUL OFFERORS: State Purchasing does not conduct face to face or teleconference debriefings. All debriefings are to be conducted in writing. A debrief request must be submitted in writing to the Purchasing Agent within seven (7) calendar days of the award notification or rejection notification made through written correspondence or posted on BidSync. The debrief response will be limited to critiquing the strength/weakness of an offeror s proposal based on the evaluation criteria. The debriefing is intended as a courtesy to offerors, providing feedback to be used for future opportunities. Comparisons between proposals or evaluations of other proposals will not be allowed. 10. DIVISION APPROVAL: Contracts written with the State of Utah, as a result of this proposal, will not be legally binding without the written approval of the Director of the DIVISION. 11. DEBARMENT: The CONTRACTOR certifies that neither it nor its principals are presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction (contract) by any governmental department or agency. If the CONTRACTOR cannot certify this statement, attach a written explanation for review by the DIVISION. 12. ENERGY CONSERVATION AND RECYCLED PRODUCTS: The contractor is encouraged to offer Energy Star certified products or products that meet FEMP (Federal Energy Management Program) standards for energy consumption. The State of Utah also encourages contractors to offer products that are produced with recycled materials, where appropriate, unless otherwise requested in this solicitation. 13. GOVERNING LAWS AND REGULATIONS: All State purchases are subject to the Utah Procurement Code, Title 63 Chapter 56 U.C.A. 1953, as amended, and the Procurement Rules as adopted by the Utah State Procurement Policy Board. These are available on the Internet at By submitting a bid or offer, the bidder/offeror warrants that the bidder/offeror and any and all supplies, services equipment, and construction purchased by the State shall comply fully with all applicable Federal and State laws and regulations, including applicable licensure and certification requirements. 14. SALES TAX ID NUMBER: Utah Code Annotated (UCA) requires anyone filing a bid with the state for the sale of tangible personal property or any other taxable transaction under UCA (1) to include their Utah sales tax license number with their bid. For information regarding a Utah sales tax license see the Utah State Tax Commission s website at The Tax Commission is located at 210 North 1950 West, Salt Lake City, UT 84134, and can be reached by phone at (801) (Revision Date: 05 Nov RFP Instructions) p. 485