1078271--9/9/2008--EXTREME_NETWORKS

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We Cannot Assure You That We Will Be Profitable in the Future Because A Number of Factors Could Cause Our Quarterly Financial Results to Be Worse Than Expected. Intense Competition in the Market for Networking Equipment Could Prevent Us from Increasing Revenue and Achieving Profitability. Our Success is Dependent on Our Ability to Continually Introduce New Products and Features that Achieve Broad Market Acceptance. Some of Our Customers May Decide Not to Purchase Our Products or May Not Have the Resources to Pay for Our Products as a Result of the Current Economic Environment. Claims of Infringement by Others May Increase and the Resolution of Such Claims May Adversely Affect Our Operating Results. Our Operating Results May be Negatively Affected by Defending or Pursuing Claims or Lawsuits. If We Fail To Protect Our Intellectual Property, Our Business Could Suffer. We Expect the Average Selling Prices of Our Products to Decrease, Which May Reduce Gross Margin and/or Revenue. When Our Products Contain Undetected Errors, We May Incur Significant Unexpected Expenses and Could Lose Sales. We Purchase Several Key Components for Products From Single or Limited Sources and Could Lose Sales if These Suppliers Fail to Meet Our Needs. Our Dependence on Three Manufacturers for All of Our Manufacturing Requirements Could Harm Our Operating Results. We Depend Upon International Sales for a Significant Portion of Our Revenue Which Imposes a Number of Risks on Our Business. We Must Continue to Develop and Increase the Productivity of Our Indirect Distribution Channels to Increase Net Revenues and Improve Our Operating Results. The Sales Cycle for Our Products is Long and We May Incur Substantial Non-Recoverable Expenses or Devote Significant Resources to Sales that Do Not Occur When Anticipated. If We Lose Key Personnel or are Unable to Hire Additional Qualified Personnel as Necessary, We May Not Be Able to Successfully Manage Our Business or Achieve Our Goals. Failure of Our Products to Comply With Evolving Industry Standards and Complex Government Regulations May Adversely Impact Our Business. If We Do Not Adequately Manage and Evolve Our Financial Reporting and Managerial Systems and Processes, Our Ability to Manage and Grow Our Business May Be Harmed. Changes in Financial Accounting Standards or Policies May Cause Adverse Unexpected Revenue or Expense Fluctuations and Affect Our Reported Results of Operations. Failure to Maintain Effective Internal Control Over Financial Reporting May Cause Us to Delay Filing Our Periodic Reports with the SEC, Affect Our Nasdaq Listing, and Adversely Affect Our Stock Price. Compliance with Laws, Rules and Regulations Relating to Corporate Governance and Public Disclosure May Result in Additional Expenses. Our Headquarters and Some Significant Supporting Businesses Are Located in Northern California and Other Areas Subject to Natural Disasters That Could Disrupt Our Operations and Harm Our Business. Failure to Successfully Expand Our Sales and Support Teams or Educate Them In Regard to Technologies and Our Product Families May Harm Our Operating Results. We May Engage in Future Acquisitions that Dilute the Ownership Interests of Our Stockholders, Cause Us to Incur Debt and Assume Contingent Liabilities. In Our Pending Tender Offer to Purchase Up to $100 Million of Our Shares, Our Directors and Executive Officers Do Not Intend to Tender Any Shares Owned by Them, and as a Result, Their Ownership Percentage Will Likely Increase. After the Completion of Our Pending Tender Offer, Our Common Stock Will Have a Smaller Public Float, Which Could Result In Reduced Liquidity For Our Common Stock and Greater Volatility In The Market Price of Our Common Stock. We May Need Additional Capital to Fund Our Future Operations and, If It Is Not Available When Needed, Our Business Will Be Adversely Impacted. We May Realize Losses on Our Investments in Auction Rate or Other Securities and be Unable to Liquidate These Investments at Desired Times and in Desired Amounts We May Be Required to Record Impairment Charges in Future Quarters as a Result of the Decline in Value of Our Investments in Auction Rate Securities. We Have Entered into Long-Term Lease Agreements for Several Facilities that are Currently Vacant and May be Difficult to Sublease due to Current Real Estate Market Conditions. Our Stock Price Has Been Volatile In the Past and Our Stock Price May Significantly Fluctuate in the Future. Provisions in Our Charter Documents and Delaware Law and Our Adoption of a Stockholder Rights Plan May Delay or Prevent an Acquisition of Extreme, Which Could Decrease the Value of Our Common Stock.

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1078271--9/9/2008--EXTREME_NETWORKS_INC