diff --git a/README.md b/README.md
index fbefa7299b..02e2827925 100644
--- a/README.md
+++ b/README.md
@@ -9,11 +9,11 @@ intend to use to ensure alignment.
 
 ## Download Binaries and Docker Images
 
-The [`scripts/bootstrap.sh`](https://github.com/hyperledger/fabric-samples/blob/release-1.2/scripts/bootstrap.sh)
+The [`scripts/bootstrap.sh`](https://github.com/hyperledger/fabric-samples/blob/release-1.3/scripts/bootstrap.sh)
 script will preload all of the requisite docker
 images for Hyperledger Fabric and tag them with the 'latest' tag. Optionally,
 specify a version for fabric, fabric-ca and thirdparty images. Default versions
-are 1.2.0, 1.2.0 and 0.4.10 respectively.
+are 1.3.0-rc1, 1.3.0-rc1 and 0.4.12 respectively.
 
 ```bash
 ./scripts/bootstrap.sh [version] [ca version] [thirdparty_version]
diff --git a/fabric-ca/README.md b/fabric-ca/README.md
index 398fa7d0cd..d9166c1ce7 100755
--- a/fabric-ca/README.md
+++ b/fabric-ca/README.md
@@ -27,8 +27,8 @@ an older released version, or from locally built docker images as follows:
     and Fabric CA.
 
     b. Older versions of Fabric and Fabric CA can be used by setting the
-    `FABRIC_TAG` environment variable. For example, `export FABRIC_TAG=1.2.0`
-    will run the sample with 1.2.0 version of Fabric and Fabric CA.
+    `FABRIC_TAG` environment variable. For example, `export FABRIC_TAG=1.3.0-rc1`
+    will run the sample with 1.3.0-rc1 version of Fabric and Fabric CA.
 
     c. The sample can also be run with locally built Fabric and Fabric CA
     docker images. Fabric and Fabric CA repositories must be cloned with following
diff --git a/fabric-ca/makeDocker.sh b/fabric-ca/makeDocker.sh
index 3e2feae9a7..b031352137 100755
--- a/fabric-ca/makeDocker.sh
+++ b/fabric-ca/makeDocker.sh
@@ -12,7 +12,7 @@
 # IMPORTANT: The following default FABRIC_TAG value should be updated for each
 # release after the fabric-orderer and fabric-peer images have been published
 # for the release.
-export FABRIC_TAG=${FABRIC_TAG:-1.2.0}
+export FABRIC_TAG=${FABRIC_TAG:-1.3.0-rc1}
 
 export FABRIC_CA_TAG=${FABRIC_CA_TAG:-${FABRIC_TAG}}
 export NS=${NS:-hyperledger}
diff --git a/fabric-ca/start.sh b/fabric-ca/start.sh
index 973dfb2092..298a0d4794 100755
--- a/fabric-ca/start.sh
+++ b/fabric-ca/start.sh
@@ -11,7 +11,7 @@
 # By default, this test is run with the latest released docker images.
 #
 # To run against a specific fabric/fabric-ca version:
-#    export FABRIC_TAG=1.2.0
+#    export FABRIC_TAG=1.3.0-rc1
 #
 # To run with locally built images:
 #    export FABRIC_TAG=local
diff --git a/first-network/configtx.yaml b/first-network/configtx.yaml
index 24826c074f..9990a736a5 100644
--- a/first-network/configtx.yaml
+++ b/first-network/configtx.yaml
@@ -125,31 +125,43 @@ Organizations:
 ################################################################################
 Capabilities:
     # Channel capabilities apply to both the orderers and the peers and must be
-    # supported by both.  Set the value of the capability to true to require it.
-    Global: &ChannelCapabilities
+    # supported by both.
+    # Set the value of the capability to true to require it.
+    Channel: &ChannelCapabilities
         # V1.3 for Channel is a catchall flag for behavior which has been
-        # determined to be desired for all orderers and peers running < v1.3.0,
-        # but the modification of which would cause incompatibilities.  Users
-        # should leave this flag set to true.
+        # determined to be desired for all orderers and peers running at the v1.3.x
+        # level, but which would be incompatible with orderers and peers from
+        # prior releases.
+        # Prior to enabling V1.3 channel capabilities, ensure that all
+        # orderers and peers on a channel are at v1.3.0 or later.
         V1_3: true
 
     # Orderer capabilities apply only to the orderers, and may be safely
-    # manipulated without concern for upgrading peers.  Set the value of the
-    # capability to true to require it.
+    # used with prior release peers.
+    # Set the value of the capability to true to require it.
     Orderer: &OrdererCapabilities
-        # V1.1 for Order is a catchall flag for behavior which has been
-        # determined to be desired for all orderers running v1.0.x, but the
-        # modification of which  would cause incompatibilities.  Users should
-        # leave this flag set to true.
+        # V1.1 for Orderer is a catchall flag for behavior which has been
+        # determined to be desired for all orderers running at the v1.1.x
+        # level, but which would be incompatible with orderers from prior releases.
+        # Prior to enabling V1.1 orderer capabilities, ensure that all
+        # orderers on a channel are at v1.1.0 or later.
         V1_1: true
 
     # Application capabilities apply only to the peer network, and may be safely
-    # manipulated without concern for upgrading orderers.  Set the value of the
-    # capability to true to require it.
+    # used with prior release orderers.
+    # Set the value of the capability to true to require it.
     Application: &ApplicationCapabilities
-        # V1.2 for Application enables the new non-backwards compatible
-        # features and fixes of fabric v1.3
+        # V1.3 for Application enables the new non-backwards compatible
+        # features and fixes of fabric v1.3.
         V1_3: true
+        # V1.2 for Application enables the new non-backwards compatible
+        # features and fixes of fabric v1.2 (note, this need not be set if
+        # later version capabilities are set)
+        V1_2: false
+        # V1.1 for Application enables the new non-backwards compatible
+        # features and fixes of fabric v1.1 (note, this need not be set if
+        # later version capabilities are set).
+        V1_1: false
 
 ################################################################################
 #
diff --git a/scripts/bootstrap.sh b/scripts/bootstrap.sh
index 96c6da317a..769a111f15 100755
--- a/scripts/bootstrap.sh
+++ b/scripts/bootstrap.sh
@@ -6,11 +6,11 @@
 #
 
 # if version not passed in, default to latest released version
-export VERSION=1.2.0
+export VERSION=1.3.0-rc1
 # if ca version not passed in, default to latest released version
 export CA_VERSION=$VERSION
 # current version of thirdparty images (couchdb, kafka and zookeeper) released
-export THIRDPARTY_IMAGE_VERSION=0.4.10
+export THIRDPARTY_IMAGE_VERSION=0.4.12
 export ARCH=$(echo "$(uname -s|tr '[:upper:]' '[:lower:]'|sed 's/mingw64_nt.*/windows/')-$(uname -m | sed 's/x86_64/amd64/g')")
 export MARCH=$(uname -m)
 
@@ -32,8 +32,8 @@ printHelp() {
   echo "-d - bypass docker image download"
   echo "-b - bypass download of platform-specific binaries"
   echo
-  echo "e.g. bootstrap.sh 1.2.0 1.2.0 0.4.10"
-  echo "would download docker images and binaries for version 1.2.0 (fabric) 1.2.0 (fabric-ca) 0.4.10 (thirdparty)"
+  echo "e.g. bootstrap.sh 1.3.0-rc1 1.3.0-rc1 0.4.12"
+  echo "would download docker images and binaries for version 1.3.0-rc1 (fabric) 1.3.0-rc1 (fabric-ca) 0.4.12 (thirdparty)"
 }
 
 dockerFabricPull() {