DEFA14A 1 b57751a3defa14a.htm ENTERASYS NETWORKS, INC. FORM DEFA14A defa14a
 

SCHEDULE 14A INFORMATION
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ENTERASYS NETWORKS, INC.
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Proxy Information
In connection with Enterasys’ solicitation of proxies with respect to the meeting of shareholders to be called with respect to the proposed merger, Enterasys will file with the Securities and Exchange Commission (the “SEC”), and will furnish to its shareholders a proxy statement. Shareholders are advised to read the proxy statement when it is finalized and distributed to shareholders because it will contain important information. Shareholders will be able to obtain, without charge, a copy of the proxy statement (when available) and other relevant documents filed with the SEC from the SEC’s Web site at www.sec.gov. Shareholders will also be able to obtain, without charge, a copy of the proxy statement and other relevant documents (when available) on the Web at www.enterasys.com, or by directing a request by mail or telephone to Enterasys Networks, Inc., 50 Minuteman Road, Andover, MA, 01810, Attention: Investor Relations; Telephone: 978-684-1473.
Enterasys and certain of its directors, executive officers and other members of management and employees may, under the rules of the SEC, be deemed to be “participants” in the solicitation of proxies from Enterasys’ shareholders in favor of the proposed merger. Information regarding the persons who may be considered “participants” in the solicitation of proxies will be set forth in Enterasys’ proxy statement relating to proposed merger when it is filed with the SEC. Information regarding certain of these persons and their beneficial ownership of Enterasys

 

 

common stock as of August 30, 2005, is also set forth in the Schedule 14A filed by Enterasys on September 15, 2005, with the SEC.
This filing contains forward-looking statements regarding future events, activities and financial performance, such as management’s expectations regarding future revenue and cash flow; strategic relationships and market opportunities; product development; and other business strategies and objectives. These statements may be identified with such words as “we expect,” “we believe,” “we anticipate,” or similar indications of future expectations. These statements are neither promises nor guarantees, and actual future financial performance, events and activities may differ materially. Readers are cautioned not to place undue reliance on these statements, which speak only as of the date hereof. We expressly disclaim any obligation to update such statements publicly to reflect changes in the expectations, assumptions, events or circumstances on which such statements may be based or that may affect the likelihood that actual results will differ materially.
Some risks and uncertainties that may cause actual results to differ materially from these forward-looking statements include, but are not limited to: risks associated with the proposed merger; worldwide and regional economic uncertainty and recent political and social turmoil may continue to negatively affect our business and revenue; we have a history of losses in recent years and may not operate profitably in the future; our quarterly operating results may fluctuate, which could cause us to fail to meet quarterly operating targets and result in a decline in our stock price; we earn a substantial portion of our revenue for each quarter in the last month of each quarter, which reduces our ability to accurately forecast our quarterly results and increases the risk that we will be unable to achieve previously forecasted results; we continue to introduce new products, and if our customers delay product purchases or choose alternative solutions, or if sales of new products are not sufficient to offset declines in sales of older products, our revenue could decline, we may incur excess and obsolete inventory charges, and our financial condition could be harmed; we may be unable to upgrade our indirect distribution channels or otherwise enhance our selling capabilities, which may hinder our ability to grow our customer base and increase our revenue; we have experienced significant changes in senior management and our current management team has been together for only a limited time, which could limit our ability to achieve our objectives and effectively operate our business; there is intense competition in the market for enterprise network equipment, which could prevent us from increasing our revenue and achieving profitability; a portion of the enterprises we sell to rely in whole or in part on public funding and often face significant budgetary pressure, and if these customers must delay, reduce or forego purchasing from us, our revenues could be harmed; we depend upon a limited number of contract manufacturers for substantially all of our manufacturing requirements, and the loss of any of our primary contract manufacturers would impair our ability to meet the demands of our customers; and those additional risks and uncertainties discussed in our most recent filings with the Securities and Exchange Commission, including our quarterly report on Form 10-Q for the fiscal quarter ended October 1, 2005.
This filing is an letter sent by Mark Aslett, Chief Executive Officer of Enterasys Networks, Inc. (the “Company”), to customers of the Company.
November 14, 2005
Dear (Customer Name),

 

 

For the past six months, Enterasys has executed on an ambitious plan to accelerate its path to profitability by growing the top line and reducing operating expenses. Our strong third-quarter financial results clearly demonstrate the substantial progress we have made:
  •   Our quarterly revenue increased 5 percent sequentially, with growth in all geographic regions.
 
  •   We achieved positive cash flow, absent trailing restructuring-related payments.
 
  •   We reported net income of $72.9 million.
Today, I am pleased to announce that Enterasys has signed a definitive agreement to be acquired by an investment group led by The Gores Group, LLC and Tennenbaum Capital Partners, LLC. Please see the attached news release for details on the transaction.
We believe this transaction is good news for customers. Both investment firms have established track records of successfully working with management to grow companies in the technology space. The transaction also creates a platform from which Enterasys can actively participate in future networking industry consolidation. Our Secure Networks™ strategy, completely refreshed product line, talented and dedicated employees and significantly improved financial performance made Enterasys a very attractive acquisition for the Gores and Tennenbaum group.
Most important, the interests of Enterasys and the investor group are closely aligned with your long-term interests as a customer, since the success of the transaction depends on growing the business and further developing our product roadmap and support capabilities.
At Enterasys, it is business as usual. We remain committed to serving your current and future needs through our industry-leading Secure Networks solutions and providing you with the high level of support on which we’ve built our reputation. The current senior management team will continue to lead the Company and its headquarters will remain in Andover, Massachusetts.
We are confident of the future growth and success of our business and we appreciate your continued support.
To provide you with more with more insight about the transaction, you are invited to join us for a conference call on Wednesday, November 16, 2005, at 11:00 a.m. EST. The dial-in numbers for the call are:
  •   United States: 866.713.8563
 
  •   International: 617.597.5311

 

 

  •   Participant Access Code: 23939383
I look forward to speaking with you on Wednesday.
Sincerely,
(-s- Mark Aslett)
Mark Aslett
President and CEO
Proxy Information
In connection with Enterasys’ solicitation of proxies with respect to the meeting of shareholders to be called with respect to the proposed merger, Enterasys will file with the Securities and Exchange Commission (the “SEC”), and will furnish to its shareholders a proxy statement. Shareholders are advised to read the proxy statement when it is finalized and distributed to shareholders because it will contain important information. Shareholders will be able to obtain, without charge, a copy of the proxy statement (when available) and other relevant documents filed with the SEC from the SEC’s Web site at www.sec.gov. Shareholders will also be able to obtain, without charge, a copy of the proxy statement and other relevant documents (when available) on the Web at www.enterasys.com, or by directing a request by mail or telephone to Enterasys Networks, Inc., 50 Minuteman Road, Andover, MA, 01810, Attention: Investor Relations; Telephone: 978-684-1473.
Enterasys and certain of its directors, executive officers and other members of management and employees may, under the rules of the SEC, be deemed to be “participants” in the solicitation of proxies from Enterasys’ shareholders in favor of the proposed merger. Information regarding the persons who may be considered “participants” in the solicitation of proxies will be set forth in Enterasys’ proxy statement relating to proposed merger when it is filed with the SEC. Information regarding certain of these persons and their beneficial ownership of Enterasys common stock as of August 30, 2005, is also set forth in the Schedule 14A filed by Enterasys on September 15, 2005, with the SEC.