<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 1995
OR
/ / TRANSACTION REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACTO OF 1934
For the transition period from N/A to N/A
Commission file number 0-1424
ADC Telecommunications, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Minnesota 41-0743912
- -------------------------------- -----------------------------------
(state or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
4900 West 78th Street, Minneapolis, MN 55435
---------------------------------------------
(Address of principal executive offices) (zip code)
(612) 938-8080
----------------------------------------------------
(Registrant's telephone number, including area code)
N/A
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common stock, $.20 par value: 56,104,768 shares as of March 14, 1995
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS - UNAUDITED
(IN THOUSANDS)
<TABLE>
<CAPTION>
ASSETS
JANUARY 31, OCTOBER 31,
1995 1994
----------- -----------
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 51,379 $ 49,512
Accounts receivable 74,264 75,348
Inventories 71,622 64,203
Prepaid income taxes and other assets 9,918 10,305
--------- ---------
Total current assets 207,183 199,368
PROPERTY AND EQUIPMENT, net 66,485 66,132
OTHER ASSETS, principally goodwill 68,107 69,184
--------- ---------
$ 341,775 $ 334,684
--------- ---------
--------- ---------
LIABILITIES AND STOCKHOLDERS' INVESTMENT
CURRENT LIABILITIES:
Current maturities of long-term debt $ 400 $ 400
Accounts payable 20,794 22,132
Accrued liabilities 42,781 44,821
--------- ---------
Total current liabilities 63,975 67,353
DEFERRED INCOME TAXES 2,069 2,163
LONG-TERM DEBT, less current maturities above 410 410
--------- ---------
Total liabilities 66,454 69,926
STOCKHOLDERS' INVESTMENT
(55,978 and 27,774 shares outstanding) 275,321 264,758
--------- ---------
$ 341,775 $ 334,684
--------- ---------
--------- ---------
</TABLE>
See accompanying notes to consolidated financial statements
2
<PAGE>
ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
FOR THE THREE MONTHS ENDED JANUARY 31
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
1995 1994
--------- ---------
<S> <C> <C>
NET SALES $ 121,774 $ 91,176
COST OF PRODUCT SOLD 62,402 45,247
--------- ---------
GROSS PROFIT 59,372 45,929
--------- ---------
Gross profit percentage 48.8% 50.4%
--------- ---------
EXPENSES:
Development and product engineering 13,209 11,003
Selling and administration 29,763 23,879
Goodwill amortization 784 784
--------- ---------
Total expenses 43,756 35,666
--------- ---------
OPERATING INCOME 15,616 10,263
OTHER INCOME(EXPENSE), NET:
Interest 656 133
Other 80 230
--------- ---------
INCOME BEFORE INCOME TAXES
AND EXTRAORDINARY ITEM 16,352 10,626
PROVISION FOR INCOME TAXES 5,886 3,931
--------- ---------
NET INCOME BEFORE EXTRAORDINARY ITEM 10,466 6,695
EXTRAORDINARY ITEM, NET OF TAXES -- (1,450)
--------- ---------
NET INCOME $ 10,466 $ 5,245
--------- ---------
--------- ---------
AVERAGE COMMON SHARES OUTSTANDING 55,849 55,470
--------- ---------
--------- ---------
EARNINGS PER SHARE BEFORE
EXTRAORDINARY ITEM $ 0.19 $ 0.12
--------- ---------
--------- ---------
EARNINGS PER SHARE $ 0.19 $ 0.09
--------- ---------
--------- ---------
ORDERS $ 124,680 $ 97,206
--------- ---------
--------- ---------
</TABLE>
See accompanying notes to consolidated financial statements
3
<PAGE>
ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED
FOR THE THREE MONTHS ENDED JANUARY 31
(IN THOUSANDS)
<TABLE>
<CAPTION>
1995 1994
-------- ---------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income $ 10,466 $ 5,245
Adjustments to reconcile net income to net cash from
operating activities -
Depreciation and amortization 5,980 5,619
Reduction in deferred compensation 107 288
Decrease in deferred income taxes (94) (1,218)
Other 67 --
Changes in assets and liabilities
Accounts receivable 982 10,641
Inventories (7,617) (4,564)
Prepaid income taxes and other assets 433 1,222
Accounts payable (1,354) (117)
Accrued liabilities (2,947) 3,135
-------- ---------
Total cash from operating activities 6,023 20,251
-------- ---------
INVESTMENT ACTIVITIES:
Acquisition payments -- (7,087)
Property and equipment additions, net (5,302) (3,174)
-------- ---------
Total cash used for investment activities (5,302) (10,261)
-------- ---------
FINANCING ACTIVITIES:
Common stock issued 1,143 559
-------- ---------
Total cash from financing activities 1,143 559
-------- ---------
EFFECT OF EXCHANGE RATE CHANGES ON CASH 3 --
-------- ---------
INCREASE IN CASH AND CASH EQUIVALENTS 1,867 10,549
CASH AND CASH EQUIVALENTS, beginning of period 49,512 16,324
-------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 51,379 $ 26,873
-------- ---------
-------- ---------
</TABLE>
See accompanying notes to consolidated financial statements
4
<PAGE>
ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION - UNAUDITED
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
1ST 4TH 3RD 2ND
QUARTER QUARTER QUARTER QUARTER
1995 1994 1994 1994
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
NET SALES $ 121,774 $ 128,298 $ 115,688 $ 113,573
COST OF PRODUCT SOLD 62,402 62,695 57,346 56,160
--------- --------- --------- ---------
GROSS PROFIT 59,372 65,603 58,342 57,413
--------- --------- --------- ---------
Gross profit percentage 48.8% 51.1% 50.4% 50.6%
--------- --------- --------- ---------
EXPENSES:
Development and product engineering 13,209 13,200 12,515 12,247
Selling and administration 29,763 31,607 27,434 27,888
Goodwill amortization 784 784 784 783
--------- --------- --------- ---------
Total expenses 43,756 45,591 40,733 40,918
--------- --------- --------- ---------
OPERATING INCOME 15,616 20,012 17,609 16,495
OTHER INCOME(EXPENSE), NET:
Interest 656 543 318 164
Other 80 (324) (471) (651)
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 16,352 20,231 17,456 16,008
PROVISION FOR INCOME TAXES 5,886 7,487 6,459 5,923
--------- --------- --------- ---------
NET INCOME $ 10,466 $ 12,744 $ 10,997 $ 10,085
--------- --------- --------- ---------
--------- --------- --------- ---------
AVERAGE COMMON SHARES
OUTSTANDING 55,849 55,740 55,658 55,568
--------- --------- --------- ---------
--------- --------- --------- ---------
EARNINGS PER SHARE $ 0.19 $ 0.23 $ 0.20 $ 0.18
--------- --------- --------- ---------
--------- --------- --------- ---------
ORDERS $ 124,680 $ 137,170 $ 119,160 $ 108,796
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
5
<PAGE>
ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
Note 1 ACCOUNTING POLICIES: The information furnished in this report is
unaudited but reflects all adjustments which are necessary, in the
opinion of management, for a fair statement of the results for the
interim periods. The operating results for the three months ended
January 31, 1995, are not necessarily indicative of the operating
results to be expected for the full fiscal year. These statements
should be read in conjunction with the Company's most recent Annual
Report on Form 10-K.
Note 2 STOCK DIVIDEND: On January 24, 1995, the Company declared a two-for-
one stock split effected in the form of a 100% stock dividend, payable
February 28, 1995, to stockholders of record as of February 15, 1995.
The share and per share information in this report (except balance
sheet data) have been adjusted to reflect the effect of the dividend.
Note 3 INVENTORIES: Inventories at January 31, 1995, and October 31, 1994,
consisted of (in thousands):
1995 1994
---- ----
Purchased materials and
manufactured products $63,919 $57,031
Work-in-process 7,703 7,172
------- -------
$71,622 $64,203
------- -------
------- -------
Note 4 EXTRAORDINARY ITEM: The building that serves as headquarters for
Fibermux Corporation, a wholly-owned subsidiary of the Company,
suffered damage as a result of the earthquake that struck Los Angeles
on January 17, 1994. The facility sustained damages of $2,300,000
(net of the related $850,000 tax benefit). All operations resumed by
February 8, 1994.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The percentage relationships to net sales of certain income and expense
items for the quarters ended January 31, 1995 and 1994, and the percentage
changes in these income and expense items between periods are contained in the
following table:
<TABLE>
<CAPTION>
PERCENTAGE OF NET SALES PERCENTAGE
FOR THE QUARTERS ENDED INCREASE
JANUARY 31, (DECREASE)
------------------------- BETWEEN
1995 1994 PERIODS
-------- -------- -----------
<S> <C> <C> <C>
NET SALES 100.0% 100.0% 33.6%
COST OF PRODUCTS SOLD (51.2) (49.6) 37.9
-------- --------
GROSS PROFIT 48.8 50.4 29.3
EXPENSES:
Development and product
engineering (10.9) (12.1) 20.0
Selling and administration (24.4) (26.2) 24.6
Goodwill amortization (.7) (.8) -
OPERATING INCOME 12.8 11.3 52.2
OTHER INCOME (EXPENSE),
NET
Interest .5 .1 -
Other .1 .2 -
------- -------
INCOME BEFORE INCOME
TAXES AND EXTRAORDINARY 13.4 11.6 53.9
ITEM
PROVISION FOR INCOME TAXES (4.8) (4.3) 49.7
------- -------
NET INCOME BEFORE
EXTRAORDINARY ITEM 8.6 7.3 56.3
EXTRAORDINARY ITEM,
NET OF TAXES - (1.5) -
------- -------
NET INCOME 8.6% 5.8% 99.5
------- -------
------- -------
</TABLE>
7
<PAGE>
RESULTS OF OPERATIONS
NET SALES: Net sales for the quarter ended January 31, 1995, by product
group, compared to the quarter ended January 31, 1994, are as follows:
<TABLE>
<CAPTION>
QUARTER ENDED JANUARY 31, ($ IN THOUSANDS)
------------------------------------------
1995 1994
----------------------- ----------------------
PRODUCT GROUP NET SALES % NET SALES %
- ------------- --------- -------- --------- -------
<S> <C> <C> <C> <C>
Transmission $35,418 29.1% $20,525 22.5%
Networking 31,147 25.6 23,035 25.3
Broadband Connectivity 55,209 45.3 47,616 52.2
--------- -------- --------- --------
Total $121,774 100.0% $91,176 100.0%
-------- -------- --------- --------
-------- -------- --------- --------
</TABLE>
Net sales of fiber optic products represented 40.8% and 32.4% of total net
sales for the quarters ended January 31, 1995 and 1994, respectively. This
increase reflects the 72.6% increase in net sales of the transmission product
group, which primarily consists of fiber optic systems.
Damage sustained by the ADC Fibermux facility from the earthquake that
struck Los Angeles on January 17, 1994, prevented shipment of approximately $4
million of product during the quarter ended January 31, 1994. If this product
had been shipped as scheduled, first quarter 1995 net sales of networking
products would represent a 15.2% increase over first quarter 1994, and total net
sales for the quarter would represent a 27.9% increase over total first quarter
1994 net sales.
Although net sales for the broadband connectivity group continue to decline
as a percentage of total net sales primarily due to the changing technologies in
the telecommunications marketplace, the 15.9% increase in net sales for the
quarter reflects important market successes for the Company in expanding
broadband, global markets.
GROSS PROFIT: The gross profit percentage for first quarter 1995, 48.8% of
net sales, was lower than the 50.4% gross profit percentage for first quarter
1994 primarily due to a product sales mix that was heavily weighted toward sales
of newer, lower margin products. The Company expects full year 1995 gross
margins to remain between 48.5% and 50.0% of net sales.
OPERATING EXPENSES: The Company was able to reduce its development and
product engineering expenses as a percentage of net sales by 1.2 percentage
points. These expenses increased in total by 20.0% during the quarter ended
January 31, 1995, primarily reflecting new
8
<PAGE>
product development efforts. Although selling and administration expenses were
down as a percentage of net sales in the quarter ended January 31, 1995, these
expenses increased 24.6% over first quarter 1994 primarily due to selling
activities associated with new product introductions.
The changing technologies in the telecommunications marketplace continue to
require product development investments by the Company. Management recognizes
the need to balance the cost of product development with expense control and
remains committed to minimizing the rate of increase of such expenses.
OTHER INCOME (EXPENSE), NET: For the quarters ended January 31, 1995 and
1994, the net interest income (expense) category represented net interest income
on cash balances. (See Liquidity and Capital Resources below for a discussion
of cash levels.)
INCOME TAXES: The effective income tax rate was 36.0% for the quarter
ended January 31, 1995, and 37.0% for the quarter ended January 31, 1994. In
addition to the $784,000 of non-deductible goodwill amortization included in
operating expenses each quarter, the rates reflect the beneficial impact of tax
credits.
EXTRAORDINARY ITEM: The extraordinary charge of $1,450,000, net of income
taxes, or $.03 per share, recorded in the quarter ended January 31, 1994,
represents the charge to clean up and repair the damage from the earthquake at
the Fibermux facility.
NET INCOME: Reflecting all of the matters discussed above, net income of
$10,466,000 was recorded in the quarter ended January 31, 1995. After adjusting
for the two-for-one common stock split paid on February 28, 1995, to
shareholders of record on February 15, 1995, earnings per share of $.19 per
share were recorded for the quarter. For the quarter ended January 31, 1994,
the comparable amounts were $5,245,000 of net income and, after adjusting for
the stock split, $.09 per share (reflecting the 1994 extraordinary charge).
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents, primarily short-term investments in commercial
paper with maturities of less than 90 days, increased $1,867,000 and $10,549,000
during the quarters ended January 31, 1995 and 1994, respectively. The 1995
increase primarily reflects net income reduced by $4,443,000 of net operating
cash utilization and $5,302,000 of net property and equipment additions.
9
<PAGE>
The Company may borrow up to $40 million under revolving credit agreements.
Borrowings under these agreements bear interest at floating short-term market
rates, may be repaid any time without penalty and may be converted to term loans
bearing interest principally at the prime rate, payable in annual installments
through December 2000. At January 31, 1995 and October 31, 1994, the full $40
million of revolving borrowing remained available to the Company, and its long-
term debt to total capitalization ratios were .1% and .2%, respectively.
Management expects that cash balances together with cash generated from
operating activities plus borrowings available under revolving credit agreements
will be adequate to fund operating requirements and property and equipment
expenditures for the remainder of 1995. Recognizing the dynamic nature of the
telecommunications industry, the business development opportunities available to
the Company, and the possibility that one or more of the Company's product
initiatives may achieve strong market acceptance, Company management will
consider appropriate financing alternatives as business growth requires. Total
property and equipment additions for 1995 are expected to be approximately $30
million.
10
<PAGE>
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
a. An annual meeting of shareholders was held on February 28, 1995.
b. Proxies for the meeting were solicited pursuant to Regulation 14
under the Securities and Exchange Act of 1934, there was no
solicitation in opposition to the management's nominees for director
as listed in the proxy statement and all such nominees were elected.
c-1. Amendments to the Company's 1991 Stock Incentive Plan to (a)
increase the number of shares of the Company's Common Stock
available for issuance pursuant to awards thereunder from
2,743,060 to 4,107,927 and (b) satisfy the requirements of
Section 162(m) of the Internal Revenue Code of 1986 were approved
(18,510,206 affirmative votes; 6,308,647 negative votes; 90,472
abstentions and 0 broker non-votes).
c-2. Amendments to the Company's Nonemployee Director Stock Option Plan
to (a) increase from 2,000 to 4,000 the number of shares of Common
Stock subject to the option automatically granted to each
nonemployee director upon initial election to the Board of
Directors and (b) increase from 1,000 to 2,000 the number of
shares subject to the option automatically granted to each
incumbent nonemployee director annually were approved (21,635,438
affirmative votes; 3,166,023 negative votes; 107,864 abstentions
and 0 broker non-votes).
11
<PAGE>
c-3. The following table shows the vote totals with respect to the
election of the five directors:
For term expiring in 1996
VOTES AUTHORITY
NAME FOR WITHHELD
---------------------------------------------------------------
James C. Castle, Ph.D. 24,827,581 81,744
For terms expiring in 1998
NAME VOTES AUTHORITY
FOR WITHHELD
---------------------------------------------------------------
Thomas E. Holloran 23,793,745 1,115,580
Charles W. Oswald 24,824,895 84,430
Alan E. Ross 24,832,458 76,867
Warde F. Wheaton 24,796,713 112,612
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits
4-a Specimen certificate for shares of Common Stock of ADC
Telecommunications, Inc. (Incorporated by reference to
Exhibit 4-a to the Company's Quarterly Report on Form 10-Q
for the quarter ended July 31, 1989).
4-b Restated Articles of Incorporation of ADC
Telecommunications, Inc., as amended to date.
(Incorporated by reference to Exhibit 4-b of the Company's
Registration Statement on Form S-8 dated March 11, 1994,
for the Company's 1994 Employee Stock Purchase Plan).
4-c Composite Restated Bylaws of ADC Telecommunications, Inc.,
as amended to date (Incorporated by reference to the
Company's Annual Report on Form 10-K for the fiscal year
ended October 31, 1989).
4-d Amended and Restated Rights Agreement, amended and
restated as of August 16, 1989 between ADC
Telecommunications, Inc. and Norwest Bank Minnesota, N.A.,
as Rights Agent (Incorporated by reference to Exhibit 1 to
Amendment No. 1 on Form 8 dated August 16, 1989, to the
Company's Registration Statement on Form 8-A dated
September 23, 1986).
12
<PAGE>
10-a Consulting Agreement dated October 24, 1994, between ADC
Telecommunications, Inc. and William B. Porter.
10-b Access Platform Systems Incentive Plan 7/1/94 - 10/31/96.
10-c ALS Management Incentive Plan Fiscal Year 1995.
10-d Broadband Connectivity Copper Management Incentive Plan
Fiscal Year 1995.
10-e Broadband Connectivity Fiber Management Incentive Plan
Fiscal Year 1995.
10-f Broadband Connectivity Management Incentive Plan Fiscal
Year 1995.
10-g Corporate Management Incentive Plan Fiscal Year 1995.
10-h Fibermux President Management Incentive Plan Fiscal Year 1995.
10-i International Management Incentive Plan Fiscal Year 1995.
10-j Kentrox Management Incentive Plan Fiscal Year 1995.
10-k Network Services Management Incentive Plan Fiscal Year 1995.
10-l Transmission Group Management Incentive Plan Fiscal Year 1995.
10-m Vice President of Sales and Customer Service Management Incentive
Plan Fiscal Year 1995.
10-n Wireless Management Incentive Plan Fiscal Year 1995.
27-a Financial Data Schedule
b. Reports on Form 8-K
None.
13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ADC TELECOMMUNICATIONS, INC.
BY: /s/ Robert E. Switz
---------------------------------------
Robert E. Switz
Vice President, Chief Financial Officer
and Secretary (Principal Financial
Officer, Duly Authorized Officer)
Dated: March 17, 1995
14
<PAGE>
ADC TELECOMMUNICATIONS, INC.
EXHIBIT INDEX TO FORM 10-Q
FOR THE QUARTER ENDED JANUARY 31, 1995
Exhibit
Number Description Page
- ------- ----------- ----
4-a Specimen certificate for shares of Common Stock of ADC N/A
Telecommunications, Inc. incorporated by reference to
Exhibit 4-a to the Company's Quarterly Report on Form 10-Q
for the quarter ended July 31, 1989.)
4-b Restated Articles of Incorporation of ADC Telecommunications, N/A
Inc., as amended to date. (Incorporated by reference to
Exhibit 4(b) of the Company's Registration Statement on
Form S-8 dated March 11, 1994, for the Company's 1994 Employee
Stock Purchase Plan).
4-c Composite Restated Bylaws of ADC Telecommunications, Inc., N/A
as amended to date (Incorporated by reference to the Company's
Annual Report on Form 10-K for the fiscal year ended October
31, 1989).
4-d Amended and Restated Rights Agreement, amended and restated N/A
as of August 16, 1989 between ADC Telecommunications, Inc.
and Norwest Bank Minnesota, N.A., as Rights Agent (Incorporated
by reference to Exhibit 1 to Amendment No. 1 on Form 8 dated
August 16, 1989, to the Company's Registration Statement on
Form 8-A dated September 23, 1986).
10-a Consulting Agreement dated October 24, 1994, between ADC
Telecommunications, Inc. and William B. Porter.
10-b Access Platform Systems Incentive Plan 7/1/94 - 10/31/96.
10-c ALS Management Incentive Plan Fiscal Year 1995.
10-d Broadband Connectivity Copper Management Incentive Plan
Fiscal Year 1995.
10-e Broadband Connectivity Fiber Management Incentive Plan
Fiscal Year 1995.
10-f Broadband Connectivity Management Incentive Plan
Fiscal Year 1995.
10-g Corporate Management Incentive Plan Fiscal Year 1995.
10-h Fibermux President Management Incentive Plan Fiscal Year 1995.
15
<PAGE>
10-i International Management Incentive Plan Fiscal Year 1995.
10-j Kentrox Management Incentive Plan Fiscal Year 1995.
10-k Network Services Management Incentive Plan Fiscal Year 1995.
10-l Transmission Group Management Incentive Plan Fiscal Year 1995.
10-m Vice President of Sales and Customer Service Management
Incentive Plan Fiscal Year 1995.
10-n Wireless Management Incentive Plan Fiscal Year 1995.
27-a Financial Disclosure Schedule
16
<PAGE>
EXHIBIT 10-a
AGREEMENT FOR CONSULTING SERVICES
---------------------------------
This Agreement, dated as of October 24, 1994, is entered into by and
between ADC Telecommunications, Inc., a Minnesota Corporation ("Company") and
William B. Porter ("Consultant"). Company and Consultant agree as follows:
1. THE SERVICES. Consultant shall perform for Company such consulting
services within Consultant's capabilities as may be requested by Company during
the term of this Agreement (the "Term"). The services performed by Consultant
under this Agreement are sometimes referred to herein as the "Services." Such
services may include, but are not necessarily limited to, the following:
1.1 SERVICES AND PAYMENT SCHEDULE OUTLINED IN EXHIBIT A.
2. COMPENSATION. Company shall pay to Consultant the amounts set forth on
Exhibit A. Consultant shall be liable for all withholding taxes and other
taxes.
3. THE TERM. The term shall commence as of January 1, 1995, to December 31,
1995. After November 30, 1995, either party may terminate the Agreement by
providing 30 days written notice. If no such notice of termination is provided,
the Agreement will continue on a month to month basis subject to the 30 day
notice period. The Agreement will immediately terminate 30 days after the death
or disability of the Consultant.
4. PERFORMANCE BY CONSULTANT. Consultant shall perform the Services in
accordance with his own methods and manner of performance. Consultant shall
personally perform all of the Services and shall put forth his best efforts in
the performance of Services. Consultant shall not, by contract or otherwise,
delegate performance of any Services to any other person or entity. Consultant
shall comply with all applicable legal requirements in performing the Services.
5. INDEPENDENT CONTRACTOR. Consultant shall at all times be an independent
contractor, not an employee or agent, of Company with regard to performance of
the Services. Consultant shall not represent that he is, or hold himself out
as, an employee or agent of Company. Consultant shall not, and is not
authorized to, enter into any contract, agreement or undertaking for, on behalf
of or in the name of Company. Consultant shall not be entitled to worker's
compensation, retirement, insurance or other benefits afforded to employees of
Company. Consultant may perform services for persons other than Company during
the Term of this Agreement.
6. EXPENSES. Company shall reimburse Consultant for reasonable expenses
incurred by Consultant in performing services hereunder; provided, any such
expense shall be reimbursable only to the extent that such expense shall have
been approved by Company prior to Consultant's having incurred such expense.
7. PAYMENTS. Subject to the terms and conditions of this Agreement, Company
will pay to Consultant the amounts set forth on Exhibit A.
8. NON-COMPETE. During the consulting period and for the six (6) months
following the end of the consulting period, Consultant will not directly or
indirectly, either as a principal, agent, employee, consultant, stockholder,
partner or in any other personal or representative capacity, engage in, or
assist any person to engage in, any aspect of the business of Company to which
this Agreement relates. Consultant acknowledges that the market for such
business is world wide.
- --------------------
Consulting Agreement
ADC - Porter
<PAGE>
9. OWNERSHIP OF MATERIALS. All materials, information, property and other
items obtained or developed in connection with and related to the Services
(including, but not limited to, reports, data, drawings, software, working
papers and other writings), together with all rights associated with ownership
of such items (such as copyright, patent, trade secret, trademark, and trade
name rights, shall deliver such items, together with all other items furnished
by Company or the cost of which is included in the compensation payable under
this Agreement, to Company upon request and in any event at the end of the Term.
10. RIGHTS TO INVENTIONS. Company shall become the exclusive owner of and
Consultant hereby assigns to Company all concepts, inventions, improvements,
designs, programs, formulas, know-how, methods, products, processes and
writings, whether or not copyrightable or patentable, provided to Company or
developed or first reduced to practice in connection with performance of the
Services. If requested by Company, Consultant shall, at Company's expense, do
all things necessary or convenient to obtain patents or copyrights on any
concepts, invention, methods, products, processes, programs, software, or
writings provided to Company or developed or first reduced to practice in
connection with performance of the Services, to the extent the same may be
patented or copyrighted.
11. CONFIDENTIALITY.
11.1 DEFINITION. "Confidential Information" means any and all unpublished
information owned or controlled by Company that relates to the technical,
manufacturing, marketing, sales, or financial operation of Company and that is
not generally disclosed by Company to the public. Confidential Information
includes, without limitation: proprietary processes and designs; traded
secrets; know-how, inventions (whether or not patentable); formulas; technical
drawings and data; research subjects, methods and results; proprietary computer
software; unpublished product specifications and characteristics; plans for
future products; business and marketing plans and strategies; product
development plans; pricing policies; cost and profit information; customer
lists; supplier identities; and the like, whether disclosed to Consultant
orally, in writing, or by inspections, or accumulated or developed by Consultant
in the course of Services performed for Company.
11.2 DISCLOSURE AND USE. Consultant agrees during the Term of this
Agreement and for a period of one (1) year thereafter:
a. to use Confidential Information only for the purpose of carrying
out the Services specified herein, and
b. to hold in confidence and not disclose to any third party all
such Confidential Information.
11.3 LIMITATIONS. The obligation imposed by this Agreement on the
Consultant shall not apply to any Confidential Information that:
a. was in the public domain at the time it was disclosed to or
developed by the Consultant;
b. was known to the Consultant prior to performance of the Services
as evidenced by documentation bearing a date prior to the date of
such Services;
c. is disclosed with the prior written approval of Company.
12. RELEASE AND INDEMNITY. Consultant releases Company, its successors and
assigns, and the respective directors, its successors and assigns (collectively,
the "Indemnities") from all claims, losses, harm, liabilities, damages, costs
and expenses related to any property damage or personal injury (including death)
that may result or occur in connection with the Services or this Agreement.
- --------------------
Consulting Agreement
ADC - Porter
<PAGE>
Further, Consultant shall defend, indemnify and hold harmless each of the
Indemnities from any such claim, loss, harm, liability, damage, cost or expense
arising out of or in connection with Consultant's negligence. This paragraph
shall survive the end of the Term.
13. ASSIGNMENT. Consultant shall not (by contract, operation of law or
otherwise) assign this Agreement or any right or interest in this Agreement.
Any such assignment shall be void. Subject to the foregoing restriction on
assignment by Consultant, this Agreement shall be fully binding upon, inure to
the benefit of, and be enforceable by the successors, assigns and legal
representatives of the respective parties to this Agreement.
14. GENERAL PROVISIONS.
14.1 NOTICES. All notices given under this Agreement shall be in writing.
Notices may be served by certified or registered mail, postage paid with return
receipt requested; by private courier, prepaid; by facsimile or other
telecommunications device capable of transmitting or creating a written record;
or personally. Mailed notices shall be deemed delivered three (3) days after
mailing, properly addressed. Couriered notices shall be deemed delivered on the
date that the courier warrants that delivery will occur. Telecommunicated
notices shall be deemed delivered when receipt is either confirmed by confirming
transmission equipment or acknowledged by the address by giving notice to the
other party as provided herein, notices shall be delivered to the parties at the
following addresses:
Consultant: William B. Porter
3014 Country Club Drive
Lynn Haven, FL 32444
(904) 265-9272
Company: ADC Telecommunications, Inc.
12501 Whitewater Drive
Minnetonka, MN 55343
Attention: General Counsel
15. MISCELLANEOUS. This Agreement sets forth the entire agreement, and
supersedes any and all prior agreements, of the parties with regard to the
Services. No amendment or modification of this Agreement shall be valid unless
set forth in a written instrument signed by the party to be bound thereby. This
Agreement shall be governed under the laws of the State of Florida.
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands the
day and year first above written.
COMPANY
By: /s/ William J. Cadogan
Title: Chairman of the Board, Chief Executive
Officer and President
CONSULTANT
By: /s/ William B. Porter
- --------------------
Consulting Agreement
ADC - Porter
<PAGE>
EXHIBIT A
I. Ongoing Retainer $3,000.00/month
Services provided
- Unlimited telephone/fax consultation
- Written reports as required
- Local travel
- Surveys upon request
- Assistance in recruiting
- Other services as mutually agreed upon
II. Additional Day Rate Services $1,500.00/day
Services provided upon request and job specification by ADC
- normally two week notice to start required
- travel days charged at 1/2 rate
III. Billing Schedule for Retainer Services
April 15, 1995 $9,000.00
July 15, 1995 9,000.00
September 15, 1995 9,000.00
December 15, 1995 9,000.00
IV. Billing Schedule for Additional Day Rate Services
30 days after receipt of invoice from Consultant
V. Travel -- Coach class Airfare and actual but reasonable other expenses
<PAGE>
EXHIBIT 10-b
ADC TELECOMMUNICATIONS, INC.
ACCESS PLATFORM SYSTEMS INCENTIVE PLAN
7/1/94 - 10/31/96
<PAGE>
ADC TELECOMMUNICATIONS, INC.
ACCESS PLATFORM SYSTEMS
INCENTIVE PLAN
7/1/94 - 10/31/96
I. PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company") Access
Platform Systems Incentive Plan, effective July 1, 1994 through October 31, 1996
and is being implemented under and pursuant to the ADC Telecommunications, Inc.
1991 Stock Incentive Plan (the "1991 Plan").
II. PURPOSE
The purpose of the Plan is to aid in maintaining and developing key employees of
the Company capable of assuring the future success of the Company's Access
Platform Systems division, to offer such personnel incentive to put forth
maximum efforts for the success of the Company's Access Platform Systems
division and to afford such personnel an opportunity to acquire a proprietary
interest in the Company.
III. ADMINISTRATION
This Plan will be administered by the Compensation and Organization Committee of
the Board of Directors of the Company (the "Board"), or such other Committee
designated by the Board pursuant to the 1991 Plan (the "Committee"). Subject to
the complete and full discretion of the Board of Directors, the Committee is
authorized to make all decisions as required in administration of the Plan and
to exercise its discretion to define, interpret, construe, apply, and make any
exceptions to the terms of the Plan.
IV. ELIGIBILITY
Because of the critical nature of the Access Platform Systems Division
objectives, the Committee has designated as key employees all regular status
Access Platform Systems employees and other ADC employees who will work full-
time on Access Platform Systems during the term of the Plan, as approved by the
Committee, as eligible for participation.
Eligibility will be communicated to the participant by an incentive opportunity
statement ("Participant Form") specifying the threshold, target and maximum
incentive levels for the participant. Regular Part-Time employees will receive
a pro-rata performance award under this Plan based on the number of scheduled
hours worked per week. No employee will become a participant in the Plan after
10/31/95.
V. TIME OF PAYMENT
Cash payments which become due under this Plan will be made as soon as
administratively feasible following the achievement of the goals as determined
by the Committee. Stock option grants which become due under this Plan will be
made immediately following achievement of the goals and the approval of the
Compensation and Organization Committee of the Board of Directors.
VI. PLAN GOALS
See Appendix A
VII. PLAN PAYOUTS
Performance awards issued under the Plan will consist of a combination of cash
and stock option grants for the achievement of the four goals. The threshold
opportunity is 20% of target and the maximum opportunity is 200% of target.
<PAGE>
A. CASH INCENTIVES: For all participants the cash incentive opportunity for
the four goals combined is as follows:
THRESHOLD TARGET MAXIMUM
--------- ------ -------
(20% OF TARGET) (100% OF TARGET) (200% OF TARGET)
--------------- --------------- ----------------
6.0% 30% 60%
Cash incentives will be based as a % of annual base salary effective at the time
of the goal achievement.
B. STOCK OPTIONS:
- - The number of stock options granted will be determined by the goal
achievement (e.g. target, threshold, maximum) and salary grade at the time
of the goal achievement. The threshold, target, and maximum option shares
for each goal is designated on the "Participant Form".
- - Upon achievement of a Plan goal, the Committee will grant the appropriate
number of options for the purchase of Company Common Stock, subject to the
terms of individual "Award Agreements" (as defined in the Plan) to be
entered into by the Company and each participant following such grants.
The options to be granted by the Committee under the Plan will include the
following terms:
1) The exercise price of each option shall be equal to the last sale
price of the Company Common Stock as reported on the NASDAQ
National Market System on the date the stock option grants are
made by the Compensation and Organization Committee.
2) The term of each option granted under the Plan will be for ten
years from the date of grant. Each option granted under the Plan
will be exerciseable for up to two years following termination of
the participant's employment with the Company subject to the
expiration date of the stock option.
3) Stock options will immediately vest at the time of the grant and
will be immediately exerciseable by the participant. For
participants subject to Section 16 of the Securities Exchange Act
of 1934 (basically Senior Company Officers), options granted
under the Plan will not be exerciseable until the six-month
anniversary of the date of the grant.
4) Approved stock options will be granted as Qualified Incentive
Stock Options (ISOs). Individuals who meet the $100,000
statutory limit will be granted the remaining options as Non-
Qualified Stock Options (NQSOs).
C. INDIVIDUAL AWARDS
How individual awards are determined is shown by the following example:
Assume we have a Plan participant with the following facts:
Grade 12
Base salary at the time of goal achievement: $45,000
Goal #1 achieved at Target
CASH INCENTIVE CALCULATION:
$45,000 (base salary) x 30% (target opportunity) x 25% (goal weight) x 100%
(result as a % of target) = $3,375
STOCK OPTION CALCULATION:
304 shares (shares at target for Grade 12 participant) x 25% (goal weight) x
100% (result as a % of target) = 76 shares
2
<PAGE>
VIII. IMPACT ON OTHER COMPENSATION PROGRAMS
Participants in the Plan will not be eligible for merit increases during FY
1995 and FY 1996 as long as they are participants in this Plan. In addition,
participants in this plan who are eligible for participation in the FY 1994
Access Platform Systems Management Incentive Plan will lose eligibility for FY
1994 and will not be eligible for any FY 1995 or FY 1996 Management Incentive
Plans as long as they are participants in this Plan. The current "Access
Platform Systems 1994 Management Incentive Plan" will be terminated as of the
effective date of this Plan.
IX. IMPACT ON BENEFIT PROGRAMS
Performance Awards under this Plan paid in the form of cash incentives will be
considered as part of eligible earnings for purposes of the Company's 401(k)
pension, life insurance, and long-term disability plans. Deductions will be
taken from cash incentive payments for the 401(k) and the stock purchase plans.
Stock option grants have no impact on any benefit programs.
X. EFFECT OF CHANGE IN EMPLOYMENT STATUS
A. VOLUNTARY OR INVOLUNTARY TERMINATION. A participant who voluntarily or
involuntarily terminates employment prior to the achievement of a goal will
relinquish all right to any performance award payment for goals achieved after
the date of the termination.
B. NEW HIRES AND TRANSFERS INTO ACCESS PLATFORM: Employees hired or
transferred into Access Platform Systems after 10/31/95 will not be eligible for
participation in the Plan. Employees hired or transferred into Access Platform
Systems before 10/31/95 will be eligible to become a Plan participant and to
receive a pro-rata performance award. The specifics of an individual's pro-rata
eligibility will be determined at the time of hire or transfer in the discretion
of the Committee and will depend on the hire or transfer date and the number of
goals achieved to date and/or the status of unachieved goals.
C. CHANGE BASED UPON VOLUNTARY OR INVOLUNTARY TRANSFER INTO A NON-ACCESS
PLATFORM SYSTEMS POSITION: A participant who voluntarily or involuntarily
transfers to a non-eligible position will generally not be eligible for any
performance award payment for goals achieved after the effective date of the
transfer. At the discretion of the Committee, the Committee may award a
performance award payment if a goal achievement occurs shortly after a
participant's effective date of transfer.
XI. AMENDMENT OR TERMINATION OF THE PLAN
Subject to the terms of Section 7 of the 1991 Plan, the Board of Directors
reserves and retains the right to modify, rescind, or terminate this Plan in
whole or in part, at its sole discretion, and nothing in this Plan limits this
right in any way or creates any rights in any employee of future participation
in this Plan or any other Plan, or constitutes any guarantee of compensation or
employment with ADC. Further, neither the Board of Directors nor the Company
has any obligation under this Plan or otherwise to adopt this or any other Plan
in any future fiscal year. All terms and conditions of the 1991 Plan,
including the "General Provisions" of Section 9 of the 1991 Plan, shall apply to
this Plan.
3
<PAGE>
EXHIBIT 10-c
ADC TELECOMMUNICATIONS
ALS
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
ALS
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), ALS
Management Incentive Plan - Fiscal Year ("FY") 1995 effective November 1, 1994
through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by an incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for ALS participants
are as follows:
ALS Revenue 30%
ALS Operating Profit 40%
ALS International Revenue 10%
*Individual Contribution 20%
---
TOTAL 100%
Note: Above goals exclude China venture.
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objective" form and require your direct managers and Division
heads approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This rate
has been established at 10%, after tax, based on stockholders' equity at the
beginning of the fiscal year.
The threshold for ALS Revenue OR ALS Operating Profit must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
Participant Form.
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
ALS Revenue: 30% 100%
ALS Operating Profit: 40% 90%
ALS International Revenue: 10% 110%
Individual Contribution: 20% 100%
----
OVERALL RESULT AS % OF TARGET 97%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 97% (Overall Result as a % of
Target)=$6,402.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to any
payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for reasons
of unsatisfactory job performance will relinquish all right to any payment under
this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata payment
based upon the time served in the eligible position during the fiscal year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during FY
1995 will have a pro rata calculation of payment based on the goals and length
of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served the
eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-d
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY COPPER
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY COPPER
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Broadband
Connectivity Copper Management Incentive Plan - Fiscal Year ("FY") 1995,
effective November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required I administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by the incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payment which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Broadband
Connectivity Copper participants are as follows :
Broadband Connectivity Copper Revenue:
Overall 15%
International 15%
Broadband Connectivity Copper Operating Profit 40%
Broadband Connectivity Operating Profit 20%
Broadband Connectivity Customer Service/
Inventory Turn Management 10%
---
TOTAL 100%
Note: All goals exclude AOFR.
Fiber products exclude HCS and software.
THE BROADBAND CONNECTIVITY CUSTOMER SERVICE/INVENTORY TURN MANAGEMENT goal
measures the ability to deliver products to meet customer's request dates while
also effectively managing inventories. Customer Service/Inventory Turn
Management is measured by average inventory turns (the cost of goods sold
divided by average inventory cost) and by shipping performance (relative to
meeting customer request dates). A single numerical representation of customer
service/inventory management is derived by multiplying the average inventory
turn by the percentage of customer request dates met by the Broadband
Connectivity Division.
For example, If Broadband Connectivity's average annual inventory turns is 4.8
and the percentage of customer request dates met is 80%, the result is a
customer service/inventory turn management achievement of 3.84.
Average inventory turns 4.8
% customer request dates met .80
---
Result 3.84
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This rate
has been established at 10%, after tax, based on stockholders' equity at the
beginning to the fiscal year.
The threshold for Overall Broadband Connectivity Copper Revenue OR Broadband
Connectivity Copper Operating Profit OR Overall Broadband Operating Profit must
be met.
<PAGE>
VIII. CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The obligation to make payment under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENT UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance requirements are met.
Goal Weight Achievement
BCD Copper Revenue:
Overall 15% 90%
International 15% 100%
BCD Copper Operating Profit 40% 100%
BCD Operating Profit 20% 100%
BCD Customer Service/Inventory
Turn Management 10% 110%
----
OVERALL RESULT AS % OF TARGET 99.5%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 99.5% (Overall Result as a %
of Target) = $6,567.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to any
payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for reasons
of unsatisfactory job performance will relinquish all right to any payment under
this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata payment
based upon the time served in the eligible position during the fiscal year.
CHANGE BASED UPON A PROMOTION/DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro-rata calculation of payment
based upon the time served in each position during FY 95.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during FY
1995 will have a pro rata calculation of payment based on the goals and length
of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served in
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board or Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board or
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-e
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY FIBER
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY FIBER
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Broadband
Connectivity Fiber Management Incentive Plan - Fiscal Year ("FY") 1995,
effective November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required I administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by the incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payment which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Broadband
Connectivity Fiber participants are as follows :
<TABLE>
<S> <C>
Broadband Connectivity Fiber Revenue:
Overall 15%
International 15%
Broadband Connectivity Fiber Operating Profit 40%
Broadband Connectivity Operating Profit 20%
Broadband Connectivity Customer Service/
Inventory Turn Management 10%
---
TOTAL 100%
</TABLE>
Note: All goals exclude AOFR.
Fiber products exclude HCS and software.
THE BROADBAND CONNECTIVITY CUSTOMER SERVICE/INVENTORY TURN MANAGEMENT goal
measures the ability to deliver products to meet customer's request dates while
also effectively managing inventories. Customer Service/Inventory Turn
Management is measured by average inventory turns (the cost of goods sold
divided by average inventory cost) and by shipping performance (relative to
meeting customer request dates). A single numerical representation of customer
service/inventory management is derived by multiplying the average inventory
turn by the percentage of customer request dates met by the Broadband
Connectivity Division.
For example, If Broadband Connectivity's average annual inventory turns is 4.8
and the percentage of customer request dates met is 80%, the result is a
customer service/inventory turn management achievement of 3.84.
<TABLE>
<S> <C>
Average inventory turns 4.8
% customer request dates met .80
---
Result 3.84
</TABLE>
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This rate
has been established at 10%, after tax, based on stockholders' equity at the
beginning to the fiscal year.
The threshold for Overall Broadband Connectivity Fiber Revenue OR Broadband
Connectivity Fiber Operating Profit OR Overall Broadband Operating Profit must
be met.
<PAGE>
VIII. CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The obligation to make payment under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENT UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
<TABLE>
<S> <C>
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
</TABLE>
All minimum performance requirements are met.
<TABLE>
<CAPTION>
GOAL Weight Achievement
- ----
<S> <C> <C>
BCD Fiber Revenue:
Overall 15% 90%
International 15% 100%
BCD Fiber Operating Profit 40% 100%
BCD Operating Profit
20% 100%
BCD Customer Service/Inventory
Turn Management 10% 110%
----
OVERALL RESULT AS % OF TARGET 99.5%
</TABLE>
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 99.5% (Overall Result as a %
of Target) = $6,567.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to any
payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for reasons
of unsatisfactory job performance will relinquish all right to any payment under
this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata payment
based upon the time served in the eligible position during the fiscal year.
CHANGE BASED UPON A PROMOTION/DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro-rata calculation of payment
based upon the time served in each position during FY 95.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during FY
1995 will have a pro rata calculation of payment based on the goals and length
of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served in
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board or Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board or
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-f
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
BROADBAND CONNECTIVITY
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Broadband
Connectivity Management Incentive Plan - Fiscal Year ("FY") 1995, effective
November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required I administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by the incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payment which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Broadband
Connectivity participants are as follows :
Broadband Connectivity Revenue:
Overall 15%
International 15%
Broadband Connectivity Operating Profit 40%
Broadband Connectivity Customer Service/
Inventory Turn Management: 10%
** Individual Contribution: 20%
---
TOTAL 100%
Note: All goals exclude AOFR
THE BROADBAND CONNECTIVITY CUSTOMER SERVICE/INVENTORY TURN MANAGEMENT goal
measures the ability to deliver products to meet customer's request dates while
also effectively managing inventories. Customer Service/Inventory Turn
Management is measured by average inventory turns (the cost of goods sold
divided by average inventory cost) and by shipping performance (relative to
meeting customer request dates). A single numerical representation of customer
service/inventory management is derived by multiplying the average inventory
turn by the percentage of customer request dates met by the Broadband
Connectivity Division.
For example, If Broadband Connectivity's average annual inventory turns is 4.8
and the percentage of customer request dates met is 80%, the result is a
customer service/inventory turn management achievement of 3.84.
Average inventory turns 4.8
% customer request dates met .80
----
Result 3.84
** The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objectives" form and require your direct manager's and division
head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This rate
has been established at 10%, after tax, based on stockholders' equity at the
beginning to the fiscal year.
The threshold for Overall BCD Revenue or BCD Operating Profit must be met.
<PAGE>
VIII. CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The obligation to make payment under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENT UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form"
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance requirements are met.
GOAL Weight Achievement
BCD Revenue:
Overall 15% 90%
International 15% 100%
BCD Operating Profit 40% 100%
BCD Customer Service/Inventory
Turn Management 10% 110%
Individual Contribution 100%
----
OVERALL RESULT AS % OF TARGET 99.5%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 99.5% (Overall Result as a %
of Target) = $6,567.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to any
payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for reasons
of unsatisfactory job performance will relinquish all right to any payment under
this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata payment
based upon the time served in the eligible position during the fiscal year.
CHANGE BASED UPON A PROMOTION/DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro-rata calculation of payment
based upon the time served in each position during FY 95.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during FY
1995 will have a pro rata calculation of payment based on the goals and length
of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served in
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board or Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board or
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-g
ADC TELECOMMUNICATIONS
CORPORATE
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
CORPORATE
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Corporate
Management Incentive Plan - Fiscal Year ("FY") 1995 effective November 1, 1994
through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by an incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Corporate
participants are as follows:
Corporate Revenue 30%
Corporate Operating Profit 40%
International Revenue 10%
*Individual Contribution 20%
---
TOTAL 100%
Note: Goals exclude AOFR and include China venture.
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objective" form and require your direct manager's and Division
head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity at
the beginning of the fiscal year.
The threshold for Corporate Revenue OR Corporate Operating Profit must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Corporate and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
Corporate Revenue: 30% 90%
Corporate Operating Profit: 40% 100%
International Revenue: 10% 110%
Individual Contribution: 20% 100%
----
OVERALL RESULT AS % OF TARGET 98%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 98% (Overall Result as a % of
Target)=$6,468.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata
payment based upon the time served in the eligible position during the
fiscal year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during
FY 1995 will have a pro rata calculation of payment based on the goals and
length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have
pro-rata calculation of payment based upon the time the participant served
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-h
ADC TELECOMMUNICATIONS
PRESIDENT FIBERMUX
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
PRESIDENT FIBERMUX
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), President
Fibermux Management Incentive Plan - Fiscal Year ("FY") 1995 effective November
1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
To qualify for participation under this Plan, the employee must be employed by
ADC as President Fibermux
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights are as follows:
Revenue:
Kentrox 10%
Fibermux 20%
Kentrox and Fibermux International 10%
Operating Profit:
Kentrox 15%
Fibermux 25%
*Individual Contribution 20%
---
TOTAL 100%
* The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objective" form and require your direct manager's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity at
the beginning of the fiscal year.
The threshold for Kentrox or Fibermux Revenue OR Kentrox or Fibermux Operating
Profit must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 22
Target Payout: 40% of base salary earnings
Base Salary Earnings: 200,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
Revenue:
Kentrox 10% 110%
Fibermux 20% 90%
Kentrox and Fibermux International 10% 100%
Operating Profit:
Kentrox 15% 100%
Fibermux 25% 100%
Individual Contribution: 20% 100%
----
OVERALL RESULT AS % OF TARGET 99%
Calculation of Payment:
$200,000 (FY Earnings) x 40% (Target Opportunity) x 99% (Overall Result as a %
of Target) = $79,200.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata
payment based upon the time served in the eligible position during the
fiscal year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals
during FY 1995 will have a pro rata calculation of payment based on the
goals and length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have
a pro-rata calculation of payment based upon the time the participant served
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-i
ADC TELECOMMUNICATIONS
INTERNATIONAL
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
INTERNATIONAL
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"),
International Management Incentive Plan - Fiscal Year ("FY") 1995 effective
November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by an incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for International
participants are as follows:
International Revenue:
Broadband Connectivity 20%
Network Services 10%
Other 10%
International Contribution Profit: 30%
*Major contract awards that use Homeworx as core product:
Number of Awards 5%
Revenue from Awards 5%
**Individual Contribution 20%
---
TOTAL 100%
* Major contract awards can take the form of an actual order, a letter of
intent or some other reasonable statement of commitment from the
customer. See Appendix A.
** The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the
attached "Individual Objective" form and require your direct manager's
and division head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity at
the beginning of the fiscal year.
The threshold for Overall International Revenue (BCD, NSD AND other combined) OR
International Contribution Profit must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
International and individual performance against the established goals..
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
International Revenue:
Broadband Connectivity 20% 110%
Network Services 10% 100%
Other 10% 100%
International Contribution Profit: 30% 90%
Major contract awards that use homeworx as core product:
Number of Awards 5% 100%
Revenue from Awards 5% 100%
Individual Contribution: 20% 100%
----
OVERALL RESULT AS % OF TARGET 99%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 99% (Overall Result as a % of
Target)=$6,534.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata
payment based upon the time served in the eligible position during the fiscal
year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during
FY 1995 will have a pro rata calculation of payment based on the goals and
length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-j
ADC TELECOMMUNICATIONS
KENTROX
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
KENTROX
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Kentrox
Management Incentive Plan - Fiscal Year ("FY") 1995, effective November 1, 1994
through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required I administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by the incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payment which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Kentrox
participants are as follows :
Kentrox Revenue 30%
Kentrox Operating Profit 40%
Kentrox International Revenue 10%
Individual Contribution: 20%
---
TOTAL 100%
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objectives" form and require your direct manager's and division
head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This rate
has been established at 10%, after tax, based on stockholders' equity at the
beginning to the fiscal year.
The threshold for Kentrox Revenue or Kentrox Operating Profit must be met.
<PAGE>
VIII. CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The obligation to make payment under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENT UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance requirements are met.
GOAL WEIGHT ACHIEVEMENT
Kentrox Revenue: 30% 100%
Kentrox Operating Profit 40% 95%
Kentrox International Revenue 10% 100%
Individual Contribution 20% 100%
----
OVERALL RESULT AS % OF TARGET 98.0%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 98.0% (Overall Result as a %
of Target) = $6,468.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job may retain the right to a pro-rata payment based
upon the time served in the eligible position during the fiscal year.
CHANGE BASED UPON A PROMOTION/DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro-rata calculation of payment
based upon the time served in each position during FY 95.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during
FY 95 will have a pro rata calculation of payment based on the goals and
length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served in
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-k
ADC TELECOMMUNICATIONS
NETWORK SERVICES
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
NETWORK SERVICES
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Network
Services Management Incentive Plan - Fiscal Year ("FY") 1995, effective November
1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required I administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by the incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payment which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Network Services
participants are as follows :
Network Services Revenue:
Overall 15%
International 15%
Network Services Operating Profit 40%
Network Services Customer Service/ 10%
Inventory Turn Management
** Individual Contribution: 20%
---
TOTAL 100%
The Network Services Customer Service/Inventory Turn Management goal measures
the ability to deliver products to meet customer's request dates while also
effectively managing inventories. Customer service/inventory turn
management is measured by average inventory turns (the cost of goods sold
divided by average inventory cost) and by shipping performance (relative to
meeting customer request dates). A single numerical representation of
customer service/inventory management is derived by multiplying the average
inventory turn by the percentage of customer request dates met by the
Network Services Division.
For example, if Network Services average annual inventory turns is 3.0 and the
percentage of customer request dates met is 77%, the result is a customer
service/inventory turn managment achievement of 2.31.
Average inventory turns 3.0
% customer request dates met .77
---
Result 2.31
** The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objectives" form and require your direct
manager's and division head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity
at the beginning to the fiscal year.
The threshold for Overall Network Services Revenue or Network Services Operating
Profit must be met.
<PAGE>
VIII. CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The obligation to make payment under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENT UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance requirements are met.
GOAL WEIGHT ACHIEVEMENT
Network Services Revenue:
Overall 15% 90%
International 15% 100%
Network Services Operating Profit 40% 100%
10% 110%
Individual Contribution 20% 100%
----
OVERALL RESULT AS % OF TARGET 99.5%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 99.5% (Overall Result as a %
of Target) = $6,657.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION OR RETIREMENT. Subject to the approval of the
Committee, a participant who is involuntarily terminated or transferred to a
non-eligible position because of a job elimination or retires from the
Company may retain the right to a pro-rata payment based upon the time served
in the eligible position during the fiscal year.
CHANGE BASED UPON A PROMOTION/DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro-rata calculation of payment
based upon the time served in each position during FY 95.
CHANGE BASED UPON TRANSFER BETWEEN CORPORATE AND/OR BUSINESS UNITY PARTICIPANT
CATEGORIES. A current participant who transfers between the Corporate staff
and Transmission or between different Business Units with different goals
during FY 95 will have a pro-rata calculation based on the goals and length
of time spent in the respective participant categories.
DEATH. If a participant dies during the fiscal year, the participant's heirs or
beneficiary will retain the right to a pro-rata payment based upon the time
the participant served in the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board or Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board or
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-l
ADC TELECOMMUNICATIONS
TRANSMISSION GROUP
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
TRANSMISSION GROUP
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"),
Transmission roup Management Incentive Plan - Fiscal Year ("FY") 1995 effective
November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by an incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights are as follows:
Transmission Group Revenue:
Overall 15%
International 15%
Transmission Group Operating Loss 40%
*Individual Contribution 30%
---
TOTAL 100%
Note: Overall Revenue and Operating Loss Goals include China venture -
International Revenue Goal excludes China venture.
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the
attached "Individual Objective" form and require your direct
manager's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity
at the beginning of the fiscal year.
The threshold for Overall Transmission Group Revenue or Transmission Group
Operating Loss must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 17
Target Payout: 20% of base salary earnings
Base Salary Earnings: 75,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
- ---- ------ -----------
Transmission Group Revenue:
Overall 15% 100%
International 15% 100%
Transmission Group Operating Loss: 40% 90%
Individual Contribution: 30% 100%
----
OVERALL RESULT AS % OF TARGET 96%
Calculation of Payment:
$75,000 (FY Earnings) x 20% (Target Opportunity) x 96% (Overall Result as a % of
Target)=$14,400.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-
eligible position because of a job elimination may retain the right to a
pro-rata payment based upon the time served in the eligible position during
the fiscal year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive
eligible position during the fiscal year will have a pro rata calculation
of payment based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals
during FY 1995 will have a pro rata calculation of payment based on the
goals and length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have
a pro-rata calculation of payment based upon the time the participant
served the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-m
ADC TELECOMMUNICATIONS
VP OF SALES AND CUSTOMER SERVICE
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
VP OF SALES AND CUSTOMER SERVICE
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), VP of
Sales and Customer Service Management Incentive Plan - Fiscal Year ("FY") 1995
effective November 1, 1994 through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
To qualify for participation under this plan, the employee must be employed by
ADC as VP of Sales and Customer Service.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights are as follows:
Revenue:
Total (includes ATM) 40%
Network Services (includes Canada) 20%
Canada (includes ALS and Kentrox) 10%
Expense (without incentives)/Revenue Ratio 10%
*Individual Contribution 20%
---
TOTAL 100%
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objective" form and require your direct manager's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity at
the beginning of the fiscal year.
The threshold for Total Revenue must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 21
Target Payout: 35% of base salary earnings
Base Salary Earnings: 150,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
- ---- ------ -----------
Revenue:
Total 40% 105%
Network Services 20% 100%
Canada 10% 100%
Expense (without incentives)/Revenue Ratio: 10% 90%
Individual Contribution 20% 100%
OVERALL RESULT AS % OF TARGET 101%
Calculation of Payment:
$150,000 (FY Earnings) x 35% (Target Opportunity) x 101% (Overall Result as a %
of Target)=$53,025.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata
payment based upon the time served in the eligible position during the fiscal
year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during
FY 1995 will have a pro rata calculation of payment based on the goals and
length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<PAGE>
EXHIBIT 10-n
ADC TELECOMMUNICATIONS
WIRELESS
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
<PAGE>
ADC TELECOMMUNICATIONS
WIRELESS
MANAGEMENT INCENTIVE PLAN
FISCAL YEAR 1995
PLAN NAME AND EFFECTIVE DATE
The name of this Plan is the ADC Telecommunications, Inc. ("Company"), Wireless
Management Incentive Plan - Fiscal Year ("FY") 1995 effective November 1, 1994
through October 31, 1995.
PURPOSE
The purpose of the Plan is to provide, with full regard to the protection of
shareholder's investments, a direct financial incentive for eligible management
employees to perform an effective leadership role and make a significant
contribution to the Company's established goals.
ADMINISTRATION
This Plan will be administered by a Management Incentive Plan Committee
("Committee") appointed and authorized by the Company's Board of Directors.
Subject to the complete and full discretion of the Board of Directors, the
Committee is authorized to make all decisions as required in administration of
the Plan and to exercise its discretion to define, interpret, construe, apply
and make any exceptions to the terms of the Plan.
ELIGIBILITY
The Committee will establish rules of eligibility for participation in the Plan
and determine eligibility in accordance with those rules. Participation will be
effective as of the date approved by the Committee and will be communicated to
the participant by an incentive opportunity statement ("Participant Form")
specifying the target incentive level for the position held by the participant.
No employee will become a participant in the Plan after May 1, 1995.
TIME OF PAYMENT
Payments which become due under this Plan will be made as soon as
administratively feasible following the close of the Company's fiscal year.
<PAGE>
PLAN GOALS
The Plan reinforces the annual financial goals which support ADC's long-term
strategic plans. The FY 1995 goal categories and weights for Wireless
participants are as follows:
Wireless Revenue 30%
Wireless Operating Profit 40%
Wireless International Revenue 10%
*Individual Contribution 20%
---
TOTAL 100%
The Individual Contribution goal measures your performance against pre-
determined objectives. The objectives are to be documented on the attached
"Individual Objective" form and require your direct manager's and Division
head's approval.
MINIMUM PERFORMANCE PAYOUT REQUIREMENTS
The following minimum performance goals must be met to assure protection of
shareholder interest before an incentive payout can be generated.
Incentive payments will be made only if the Company's consolidated net profits
are in excess of a threshold rate of return on stockholders' equity. This
rate has been established at 10%, after tax, based on stockholders' equity at
the beginning of the fiscal year.
The threshold for Wireless Revenue OR Wireless Operating Profit must be met.
<PAGE>
CALCULATION OF PAYMENTS
DETERMINATION OF ACHIEVEMENT AGAINST GOALS AND OBLIGATION TO MAKE PAYMENTS.
The Obligation to make Payments under the Plan will be determined by achievement
of goals determined by the Board of Directors.
The payout opportunity for meeting the threshold goal is 30% of target. The
payout opportunity for meeting the maximum goal is 200% of target. Results
between threshold-target and target-maximum are interpolated.
CALCULATION OF INDIVIDUAL PAYMENTS UNDER THIS PLAN IS A FUNCTION OF:
Target incentive opportunity - expressed as a percentage of an individual's FY
1995 earnings. The target % for each participant is designated on the
"Participant Form".
Participant's 1995 fiscal year base salary earnings.
Business unit and individual performance against the established goals.
HOW INDIVIDUAL AWARDS ARE DETERMINED IS SHOWN BY THE FOLLOWING EXAMPLE:
Assume we have a Plan participant with the following facts:
Grade: 15
Target Payout: 11% of base salary earnings
Base Salary Earnings: 60,000
All minimum performance payout requirements met.
GOAL WEIGHT ACHIEVEMENT
Wireless Revenue: 30% 100%
Wireless Operating Profit: 40% 95%
Wireless International Revenue: 10% 100%
Individual Contribution: 20% 100%
----
OVERALL RESULT AS % OF TARGET 98.0%
Calculation of Payment:
$60,000 (FY Earnings) x 11% (Target Opportunity) x 98% (Overall Result as a % of
Target)=$6,468.
<PAGE>
EFFECT OF CHANGE IN EMPLOYMENT STATUS
VOLUNTARY RESIGNATION. A participant who voluntarily resigns full-time
employment prior to the end of the Fiscal Year will relinquish all right to
any payment under the Plan.
CHANGE BASED UPON UNSATISFACTORY JOB PERFORMANCE. A participant who is
involuntarily terminated or transferred to a non-eligible position for
reasons of unsatisfactory job performance will relinquish all right to any
payment under this plan.
CHANGE BASED UPON JOB ELIMINATION. Subject to the approval of the Committee, a
participant who is involuntarily terminated or transferred to a non-eligible
position because of a job elimination may retain the right to a pro-rata
payment based upon the time served in the eligible position during the fiscal
year.
CHANGE BASED UPON PROMOTION / DEMOTION. A current participant who is promoted
or demoted from an incentive eligible position to another incentive eligible
position during the fiscal year will have a pro rata calculation of payment
based upon the time served in each position during FY 1995.
CHANGE BASED UPON TRANSFER TO ANOTHER POSITION. A current participant who
transfers to another position within the Company that is eligible for
participation in an ADC Management Incentive Plan with different goals during
FY 1995 will have a pro rata calculation of payment based on the goals and
length of time served in the respective positions.
DEATH. If a participant dies during the fiscal year, the participant's heirs as
determined by will or applicable laws of descent and distribution will have a
pro-rata calculation of payment based upon the time the participant served
the eligible position during the fiscal year.
AMENDMENT OR TERMINATION OF PLAN
The Board of Directors reserves and retains the right to modify, rescind or
terminate this plan in whole or in part, at its sole discretion, and nothing in
this Plan limits this right in any way or creates any rights in any employee of
future participation in this Plan or any other plan, or constitutes any
guarantee of compensation or employment with ADC. Further, neither the Board of
Directors nor the Company has any obligation under this Plan or otherwise to
adopt this or any other plan in any future fiscal year.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for ADC Telecommunications, Inc. and Subsidiaries, for the
quarterly period ended January 31, 1995, and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1995
<PERIOD-START> NOV-01-1994
<PERIOD-END> JAN-31-1995
<CASH> 51,379
<SECURITIES> 0
<RECEIVABLES> 74,264<F1>
<ALLOWANCES> 1,681
<INVENTORY> 71,622<F2>
<CURRENT-ASSETS> 207,183
<PP&E> 166,429
<DEPRECIATION> (99,944)
<TOTAL-ASSETS> 341,775
<CURRENT-LIABILITIES> 63,975
<BONDS> 410
<COMMON> 5,597
0
0
<OTHER-SE> 269,724
<TOTAL-LIABILITY-AND-EQUITY> 341,775
<SALES> 121,774
<TOTAL-REVENUES> 121,774
<CGS> 62,402
<TOTAL-COSTS> 62,402
<OTHER-EXPENSES> 43,756
<LOSS-PROVISION> 154
<INTEREST-EXPENSE> 63
<INCOME-PRETAX> 16,352
<INCOME-TAX> 5,886
<INCOME-CONTINUING> 10,466
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 10,466
<EPS-PRIMARY> 0.19
<EPS-DILUTED> 0.19
<FN>
<F1>Amount is net of allowance for bad debts and returns and allowances
<F2>Amount is net of obsolescence reserves
</FN>
</TABLE>