Exhibit 99



RISK FACTORS




Our business faces many risks.
The risks described below may not be the only risks we face. Additional risks that we do not yet know of or that we currently think are immaterial may
also impair our business operations. If any of the events or circumstances described in the following risks actually occur, our business, financial
condition or results of operations could suffer, and the trading price of our common stock could decline.




Risks Related to Our Business




Our operating results were adversely affected by the
significant downturn in the communications equipment industry and the slowdown in the United States economy in fiscal 2003, 2002 and 2001, and there
can be no assurance that we will consistently maintain operating profitability in the future.




Our operating results during the
last four fiscal years were significantly impacted by the substantial downturn in the telecommunications equipment industry. We incurred losses from
continuing operations of $42.6 million and $980.2 million in fiscal 2003 and 2002, respectively. We also incurred significant losses in fiscal 2001.
While we returned to profitability in fiscal 2004 and are currently profitable, it is not clear that we will be able to continue to achieve revenue and
gross margin levels needed to sustain profitability. Further, the increase in our 2004 revenue was primarily because of our acquisition of KRONE in May
2004.




In this market environment, many
of our customers reduced their equipment purchases and deferred capital spending. Our customers are dependent on the level of end user demand for
communication services, and they are likely to defer significant network expansions when they do not believe there is significant demand for greater
Internet, data, video and voice services. During the well-documented downturn of the telecommunications industry that occurred in our fiscal years
2001, 2002 and 2003, some of our customers experienced serious financial difficulties, including bankruptcy filings or cessation of
operations.




The general slowdown in the
United States economy in the last several years also negatively impacted our business and operating results. While there is debate about the strength
of an ongoing general recovery in the overall economy and we have experienced revenue growth in fiscal 2004 and 2005, we expect significant recovery in
the communications market to lag behind the general economic recovery. If general economic conditions in the United States and globally do not continue
to improve, or if there is a worsening of the United States or global economy, we may experience material adverse effects on our business, financial
condition and results of operations such as were experienced in fiscal 2003, 2002 and 2001. Further, when our customers announce spending initiatives
that might positively impact sales of one or more of our products, it is possible the customers will contemporaneously reduce spending in a manner that
would negatively impact other of our products.




When the significant reduction in
communications equipment spending became evident in fiscal 2001, we implemented a restructuring plan to reduce operating expenses and capital
expenditures and to narrow the strategic focus of our business. Due large part to this restructuring plan, we incurred impairment and restructuring
charges of $14.0 million, $43.7 million and $543.1 million in fiscal years 2004, 2003 and 2002, respectively. We may be required to further restructure
our business if we do not achieve sustained profitability.




As a result of the restructuring,
we significantly reduced expenses and lowered our quarterly revenue break-even point. However, we may not be able to achieve anticipated revenue levels
in future quarters or further reduce our expenses if revenue shortfalls occur. As a result, no assurance can be given that we will continue to achieve
and maintain operating profitability.




Shifts in our product mix may result in declines in gross
profit, as a percentage of net sales.




Our gross profit, as a percentage
of net sales, varies among our product groups. Our overall gross profit, as a percentage of net sales, has fluctuated from quarter to quarter as a
result of shifts in product mix (that is, how much of each product type we sell in any particular quarter), the introduction of new products, decreases
in average selling prices and our ability to reduce manufacturing and other costs. We expect such fluctuation in gross profit to continue in the
future. Both KRONE and FONS historically sold certain products at margins lower than the margins at which the majority of our products sold. The
integration of KRONE has impacted our gross profit levels,


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and it is likely that the
integration of FONS will do so as well. In addition, our gross margins could decrease based on the amount of new products we sell that have lower
startup gross margins.




Consolidation among our customers could result in our losing
a customer or experiencing a slowdown as integration takes place.




We believe there likely will be
continued consolidation among our customers in order for them to increase market share, diversify product portfolios and achieve greater economies of
scale. Consolidation is likely to impact our business as our customers focus on integrating their operations and choosing their equipment vendors,
although we have not yet seen this impact. After a consolidation occurs, there can be no assurance that we will continue to supply equipment to the
surviving communications service provider. The impact of significant mergers on our business is likely to be unclear until sometime after such
transactions have closed.




Our sales could be negatively impacted if one or more of our
key customers substantially reduce orders for our products.




Our customer base is relatively
concentrated with our top ten customers accounting for 46.3%, 55.3% and 54.1% of net sales for fiscal years 2004, 2003 and 2002, respectively. While
our acquisition of KRONE diversified our customer base, if we lose a significant customer, our sales and gross margins would be negatively impacted.
Further, in the product areas where we believe the potential for revenue growth is most pronounced (e.g. fiber-to-the-X initiatives and wireless
products), our sales remain highly concentrated with the major telephone companies. The loss of sales may require us to record additional impairment
and restructuring charges or exit a particular business or product line.




In the aftermath of Hurricane Katrina, we may experience an
impact to sales of our products and services.




We sell our products and services
to customers operating in some of the areas hardest hit by Hurricane Katrina and understand that communications networks have been adversely impacted
along with other infrastructure in this area. Although we are not certain about the effect that Hurricane Katrina may have on sales of our products and
services, it is possible that we will experience slower sales in the near term while affected customers work to stabilize their networks and normalize
operations. Moving forward, there may also be a temporary upturn in our sales as our customers work to replace damaged or destroyed network elements in
the areas impacted by the Hurricane.




Our market is subject to rapid technological change, and to
compete effectively, we must continually introduce new products that achieve market acceptance.




The communications equipment
industry is characterized by rapid technological change. In our industry, we also face evolving industry standards, changing market conditions and
frequent new product and service introductions and enhancements by our competitors. The introduction of products using new technologies or the adoption
of new industry standards can make our existing products or products under development obsolete or unmarketable. For example, it is possible that
fiber-to-the-X initiatives may negatively impact sales of non-fiber products. In order to grow and remain competitive, we will need to adapt to these
rapidly changing technologies, to enhance our existing solutions and to introduce new solutions to address our customers changing
demands.




We may not accurately predict
technological trends or new products in the communications equipment market. New product development often requires long-term forecasting of market
trends, development and implementation of new technologies and processes and a substantial capital commitment. In addition, we do not know whether our
products and services will meet with market acceptance or be profitable. Many of our competitors have greater engineering and product development
resources than we do. Although we expect to continue to invest substantial resources in product development activities, our efforts to achieve and
maintain profitability will require us to be more selective and focused with our research and development expenditures. If we fail to anticipate or
respond in a cost-effective and timely manner to technological developments, changes in industry standards or customer requirements, or if we have any
significant delays in product development or introduction, our business, operating results and financial condition could be materially adversely
affected.


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We may make additional strategic changes to our product
portfolio, but our strategic changes and restructuring programs may not yield the benefits that we expect.




In connection with the downturn
in the communications industry, we divested or ceased operating numerous product lines and businesses that either were not profitable or did not match
our new strategic focus. We may make further divestitures or closures of product lines and businesses. In addition, we have recently made acquisitions
that we believe are aligned with our current strategic focus.




The impact of potential changes
to our product portfolio and the effect of such changes on our business, operating results and financial condition, are unknown at this time. If we
acquire other businesses in our areas of strategic focus, we may have difficulty assimilating these businesses and their products, services,
technologies and personnel into our operations. These difficulties could disrupt our ongoing business, distract our management and workforce, increase
our expenses and adversely affect our operating results and financial condition. Further, we may not be able to retain key management, technical and
sales personnel after an acquisition. In addition to these integration risks, if we acquire new businesses, we may not realize all of the anticipated
benefits of these acquisitions. Divestitures or elimination of existing businesses or product lines could also have disruptive effects and may cause us
to incur material expenses.




If we are unable garner customer support for the FONS
acquisition, we may not be able to realize the gains we anticipated.




Both ADC and FONS rely heavily on
the business generated from one customer for a large percentage of sales in the FTTX space. If this particular customer does not show support for the
FONS acquisition, or decreases the amount of product it purchases, or seeks out additional suppliers for products rather than allowing us to
consolidate the combined revenue share of both ADC and FONS, the efficiencies that we projected with this acquisition may not come to
pass.




If we seek to secure additional financing, we may not be able
to obtain it. Also, if we are able to secure additional financing, our shareowners may experience dilution of their ownership interest or we may be
subject to limitations on our operations.




We currently anticipate that our
available cash resources, which include existing cash and cash equivalents, will be sufficient to meet our anticipated needs for working capital and
capital expenditures to execute our near-term business plan, based on current business operations and economic conditions so long as we are able to
maintain breakeven or positive cash flow from operations. If our estimates are incorrect and we are unable to generate sufficient cash flows from
operations, we may need to raise additional funds. In addition, if one or more of our strategic acquisition opportunities exceeds our existing
resources, we may be required to seek additional capital. We do not currently have any significant available lines of credit or other significant
credit facilities, and we are not certain that we can obtain commercial bank financing on acceptable terms. If we raise additional funds through the
issuance of equity or equity-related securities, our shareowners may experience dilution of their ownership interests, and the newly issued securities
may have rights superior to those of common stock. See Risks Related to our Common Stock below. If we raise additional funds by issuing
debt, we may be subject to restrictive covenants that could limit our operating flexibility.




Our industry is highly competitive and subject to significant
downward pressure on the pricing for our products.




Competition in the communications
equipment and related services industry is intense. We believe our success in competing with other manufacturers of communications equipment products
and related services will depend primarily on our engineering, manufacturing and marketing skills, the price, quality and reliability of our products,
our delivery and service capabilities and our control of operating expenses. We have experienced and anticipate experiencing increasing pricing
pressures from current and future competitors as well as general pricing pressure from our customers. Our industry is currently characterized by many
vendors pursuing relatively few and very large customers, which provides our customers with the ability to exert significant pressure on their
suppliers both in terms of pricing and contractual terms. Many of our competitors have more extensive engineering, manufacturing, marketing, financial
and personnel resources than we do. As a result, other competitors may be able to respond


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more quickly to new or
emerging technologies, changes in customer requirements or offer more aggressive price reductions.




Possible consolidation among our competitors could result in
a loss of sales.




We expect to see continued
consolidation among communication equipment vendors. This can result in our competitors becoming financially stronger and obtaining broader product
portfolios. It is possible that such consolidation can lead to a loss of sales for us as our competitors increase their resources through
consolidation.




Our operating results fluctuate significantly, and if we miss
quarterly financial expectations, our stock price could decline.




Our operating results are
difficult to predict and may fluctuate significantly from quarter to quarter. It is likely that our operating results in some periods will be below
investor expectations. If this happens, the market price of our common stock is likely to decline. Fluctuations in our future quarterly earnings
results may be caused by many factors, including without limitation:


| |  | the volume and timing of orders from and shipments to our
customers;
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| |  | work stoppages and other developments affecting the operations
of our customers;
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| |  | the timing of and our ability to obtain new customer contracts
and sales recognition;
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| |  | the timing of new product and service announcements;
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| |  | the availability of products and services;
|- |  | ------------------------------------------

| |  | the overall level of capital expenditures by our
customers;
|- |  | -----------------------------------------------------------

| |  | the market acceptance of new and enhanced versions of our
products and services;
|- |  | --------------------------------------------------------------------------------

| |  | variations in the mix of products and services we
sell;
|- |  | -------------------------------------------------------

| |  | the utilization of our production capacity and employees;
and
|- |  | -------------------------------------------------------------

| |  | the availability and cost of key components.
|- |  | --------------------------------------------



Our expense levels are based in
part on expectations of future revenues. If revenue levels in a particular period are lower than expected, our operating results will be affected
adversely.




In addition, prior to fiscal 2001
and during fiscal 2004, our operating results were subject to seasonal factors. We historically have had stronger demand for our products and services
in the fourth fiscal quarter ending October 31, primarily as a result of our year-end incentives and customer budget cycles. We typically have
experienced weaker demand for our products and services in the first fiscal quarter ending the last Friday in January, primarily as a result of the
number of holidays in late November, December and early January, the development of annual capital budgets by our customers during that period and a
general industry slowdown during that period.




Due to the economic downturn in
the communications equipment and services market, this historical trend of seasonality was not evident during fiscal years 2001-2003. Our historical
seasonal pattern returned in fiscal 2004, but we are not certain whether we will return to the seasonality that we saw in our historical
central-office-based business.




The regulatory environment in which our customers operate is
changing.




Although our business is not
subject to a significant amount of direct regulation, the communications service industry in which our customers operate is subject to significant and
evolving federal and state regulation in the United States as well as regulation in other countries. The United States Telecommunications Act of 1996
(Act) lifted certain restrictions on the ability of companies, including the major telephone companies and other ADC customers, to compete
with one another. The Act also made other significant changes in the regulation of the telecommunications industry. These changes generally increased
our opportunities to provide solutions for our customers Internet, data, video and voice needs. The established telecommunications providers have
stated that some of these changes have diminished the profitability of additional investments made by them in their networks,


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which reduces their demand
for our products. Recently however, the Federal Communications Committee (FCC) ended the practice of forced line-sharing, which
means that major telephone companies are no longer legally mandated to lease space to DSL resellers. This ruling also included language allowing major
telephone companies to maintain sole ownership of newly built networks that include fiber deployment (i.e. FTTX). While it is anticipated that this
ruling would benefit ADC, there can be no assurance that it will have any impact on sales of our product.




Additional regulatory changes
affecting the communications industry are anticipated both in the United States and internationally. A European Union directive on waste electrical and
electronic equipment (WEEE) and the restriction of hazardous substances (RoHS) in such equipment is in the process of being implemented in member
states. The Directive sets a framework for producers obligations in relation to manufacturing (including the amounts of named hazardous
substances contained in products sold), labeling, and treatment, recovery and recycling of electronic products in the European Union. We have
established policies and procedures to comply with these Directives as they become transposed in various member states. Detailed regulations on
practices and procedures related to WEEE and RoHS are evolving in member states.




These changes could affect our
customers and alter demand for our products. Recently announced or future changes could also come under legal challenge and be altered, thereby
reversing the effect the initial announcement of changes was expected to have on our business. In addition, competition in our markets could intensify
as the result of changes to existing regulations or new regulations. Accordingly, changes in the regulatory environment could adversely affect our
business and results of operations.




Customer payment defaults could have an adverse effect on our
financial condition and results of operations.




As a result of adverse conditions
in the communications market, some of our customers have experienced and may continue to experience serious financial difficulties, which in some cases
have resulted or may result in bankruptcy filings or cessation of operations. If customers experiencing financial problems default and fail to pay
amounts owed to us, we may not be able to collect these amounts or recognize expected revenue. It is possible those customers from whom we expect to
derive substantial revenue will default or that the level of defaults will increase. Any material payment defaults by our customers would have an
adverse effect on our results of operations and financial condition.




Many of our competitors engage in
financing transactions with some of their customers for purchase of equipment. To remain competitive, we believe that it may become necessary for us to
offer similar financing arrangements. If such financings occur, it would be our intent to sell all or a portion of these commitments and outstanding
receivables to third parties. In the past, we have sold some receivables with recourse and have had to compensate the purchaser for the
loss.




Conditions in global markets could affect our
operations.




Our non-United States sales
accounted for approximately 40.4%, 26.0% and 20.2% of our net sales in fiscal 2004, 2003 and 2002, respectively. We expect non-United States sales to
remain a significant percentage of net sales in the future. In addition to sales and distribution in numerous countries, we own or lease operations
located in Austria, Australia, Belgium, Brazil, Canada, Chile, China, France, Germany, Hungary, India, Indonesia, Italy, Japan, Malaysia, Mexico, New
Zealand, Norway, Philippines, Puerto Rico, Russia, Singapore, South Africa, South Korea, Spain, Taiwan, Thailand, the United Arab Emirates, the United
Kingdom, the United States, Venezuela and Vietnam. Due to our non-United States sales and our non-United States operations, we are subject to the risks
of conducting business globally. These risks include, without limitation:


| |  | local economic and market conditions;
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| |  | political and economic instability;
|- |  | -----------------------------------

| |  | unexpected changes in or impositions of legislative or
regulatory requirements;
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| |  | fluctuations in foreign currency exchange rates;
|- |  | ------------------------------------------------

| |  | tariffs and other barriers and restrictions;
|- |  | --------------------------------------------

| |  | longer payment cycles;
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| |  | difficulties in enforcing intellectual property and contract
rights;
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| |  | greater difficulty in accounts receivable
collection;
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| |  | potentially adverse taxes; and
|- |  | ------------------------------

| |  | the burdens of complying with a variety of non-United States
laws and telecommunications standards.
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We also are subject to general
geopolitical and environmental risks, such as terrorism, political and economic instability, changes in the costs of key resources such as oil, changes
in diplomatic or trade relationships and natural disasters. Economic conditions in many of the non-U.S. markets in which we do business represent
significant risks to us. We cannot predict whether our sales and business operations in these markets will be affected adversely by these
conditions.




Instability in non-United States
markets, which we believe is most likely to occur in the Middle East, Asia and Latin America, could have a negative impact on our business, financial
condition and operating results. The wars in Afghanistan and Iraq and other turmoil in the Middle East and the global war on terror also may have
negative effects on the operating results of some of our businesses. In addition to the effect of global economic instability on non-United States
sales, sales to United States customers having significant non-United States operations could be impacted negatively by these
conditions.




Our intellectual property rights may not be adequate to
protect our business.




Our future success depends in
part upon our proprietary technology. Although we attempt to protect our proprietary technology through patents, trademarks, copyrights and trade
secrets, these protections are limited. Accordingly, we cannot predict whether such protection will be adequate, or whether our competitors can develop
similar technology independently without violating our proprietary rights.




Also, rights that may be granted
under any patent application in the future may not provide competitive advantages to us. Intellectual property protection in foreign jurisdictions may
be limited or unavailable. In addition, many of our competitors have substantially larger portfolios of patents and other intellectual property rights
than us.




As the competition in the
communications equipment industry increases and the functionality of the products in this industry further overlaps, we believe that companies in the
communications equipment industry are becoming increasingly subject to infringement claims. We have received and may continue to receive notices from
third parties, including some of our competitors, claiming that we are infringing third-party patents or other proprietary rights. We cannot predict
whether we will prevail in any litigation over third-party claims, or whether we will be able to license any valid and infringed patents on
commercially reasonable terms. It is possible that unfavorable resolution of such litigation could have a material adverse effect on our business,
results of operations or financial condition. Any of these claims, whether with or without merit, could result in costly litigation, divert our
managements time, attention and resources, delay our product shipments or require us to enter into royalty or licensing agreements, which could
be expensive. A third party may not be willing to enter into a royalty or licensing agreement on acceptable terms, if at all. If a claim of product
infringement against us is successful and we fail to obtain a license or develop or license non-infringing technology, our business, financial
condition and operating results could be affected adversely.




We are dependent upon key personnel.




Like all technology companies,
our success is dependent on the efforts and abilities of our employees. Our ability to attract, retain and motivate skilled employees is critical to
our success. In addition, because we may acquire one or more businesses in the future, our success will depend, in part, upon our ability to retain and
integrate our own personnel with personnel from acquired entities who are necessary to the continued success or the successful integration of the
acquired businesses.




Our recent initiatives to focus
our business on core operations and products by restructuring and streamlining operations, including substantial reductions in our workforce, have
created uncertainty on the part of our employees regarding future employment with us. This uncertainty, together with our history of operating losses
and general industry uncertainty, may have an adverse effect on our ability to retain and attract key personnel.


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Internal Controls under Sarbanes-Oxley Act of
2002.




Pursuant to Section 404 of the
Sarbanes-Oxley Act of 2002, we will be required, beginning with our fiscal year ending October 31, 2005, to include in our annual report our assessment
of the effectiveness of our internal control over financial reporting as of the end of fiscal 2005. Furthermore, our independent registered public
accounting firm will be required to attest as to whether our assessment of the effectiveness of our internal control over financial reporting is fairly
stated in all material respects and separately report on whether it believes we maintained, in all material respects, effective internal control over
financial reporting as of October 31, 2005. We presently are implementing a plan designed to assure compliance with these new requirements, but we have
not yet completed our assessment of the effectiveness of our internal control over financial reporting. If we fail to timely complete this assessment,
or if our independent registered public accounting firm cannot timely attest to our assessment, we could be subject to regulatory sanctions and a loss
of public confidence in our internal control over financial reporting. In addition, any failure to implement required new or improved controls, or
difficulties encountered in their implementation, could harm our operating results or cause us to fail to meet our regulatory reporting obligations
timely.




Loss of Key Finance Employees




In recent weeks, our Corporate
Controller resigned to pursue an opportunity at another company. He left for personal reasons and not as a result of any disagreement with the Company
or its current management on any matter relating to the Companys operations, policies or practices. As we work to fill the vacant Corporate
Controllers position and other positions on our internal finance and accounting staff, we have engaged outside assistance and taken other
temporary measures while also taking steps to locate and retain permanent replacement personnel as needed. Until such personnel are retained and become
familiar with our operations, however, our ability to maintain effective internal controls over financial reporting could possibly be
impaired.




Product defects could cause us to lose customers and revenue
or to incur unexpected expenses.




If our products do not meet our
customers performance requirements, our customer relationships may suffer. Also, our products may contain defects. Any failure or poor
performance of our products could result in:


| |  | delayed market acceptance of our products;
|- |  | ------------------------------------------

| |  | delays in product shipments;
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| |  | unexpected expenses and diversion of resources to replace
defective products or identify the source of errors and correct them;
|- |  | -------------------------------------------------------------------------------------------------------------------------------

| |  | damage to our reputation and our customer
relationships;
|- |  | --------------------------------------------------------

| |  | delayed recognition of sales or reduced sales; and
|- |  | --------------------------------------------------

| |  | product liability claims or other claims for damages that may be
caused by any product defects or performance failures.
|- |  | -----------------------------------------------------------------------------------------------------------------------



Our products are often critical
to the performance of communication systems. Many of our supply agreements contain limited warranty provisions. If these contractual limitations are
unenforceable in a particular jurisdiction or if we are exposed to product liability claims that are not covered by insurance, a successful claim could
harm our business.




We may encounter difficulties obtaining raw materials and
supplies needed to make our products and the prices of these materials and supplies are subject to fluctuation.




Our ability to produce our
products is dependent upon the availability of certain raw materials and supplies. The availability of these raw materials and supplies is subject to
market forces beyond our control. From time to time, there may not be sufficient quantities of raw materials and supplies in the marketplace to meet
the customer demand for our products. In addition, the costs to obtain these raw materials and supplies are subject to price fluctuations because of
global market demands. Further, some raw materials or supplies may be subject to regulatory actions which may affect available supplies. Many companies
utilize the same raw materials and supplies in the production of their products as


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we use in our products.
Companies with more resources than our own may have a competitive advantage in obtaining raw materials and supplies due to greater purchasing power.
Reduced supply and higher prices of raw materials and supplies may affect our business, operating results and financial condition
adversely.




In addition, we have significant
reliance on contract manufacturers to make certain of our products on our behalf. If these contract manufacturers do not fulfill their obligations to
us, or if we do not properly manage these relationships, our existing customer relationships may suffer. We may outsource additional functions in the
future.




We have been named as a defendant in a case related to an
alleged breach of fiduciary duty under ERISA.




We have been named as a defendant
in a purported class action lawsuit alleging breach of fiduciary duties under ERISA. This case, In Re ADC Telecommunications, Inc. ERISA
Litigation, has been brought by individuals who seek to represent a class of participants in our Retirement Savings Plan who purchased our common
stock as one of the investment alternatives under the Plan.




Litigation is by its nature
uncertain and unfavorable resolutions of this lawsuit could materially adversely affect our business, results of operations or financial
condition.




We are a party to various other
lawsuits, proceedings and claims arising in the ordinary course of business or otherwise. Many of these disputes may be resolved amicably without
resort to formal litigation. The amount of monetary liability resulting from the ultimate resolution of these matters cannot be determined at this
time. As of July 29, 2005, we had recorded approximately $6.5 million in loss reserves for these matters. Because of the uncertainty inherent in
litigation, it is possible that unfavorable resolutions of these lawsuits, proceedings and claims could exceed the amount currently reserved and could
have a material adverse affect on our business, results of operations or financial condition.




We are subject to risks associated with changes in interest
rates, security prices, and foreign currency exchange rates.




We face market risks from changes
in certain commodity prices, security prices and interest rates. Market fluctuations could affect our results of operations and financial condition
adversely. At times, we reduce this risk through the use of derivative financial instruments. However, we do not enter into derivative instruments for
the purpose of speculation.




Also, we are exposed to market
risks from changes in foreign currency exchange rates. From time to time, we hedge our foreign currency exchange risk. The objective of this program is
to protect our net monetary assets and liabilities in non-functional currencies from fluctuations due to movements in foreign currency exchange rates.
We attempt to minimize exposure to currencies in which hedging instruments are unavailable or prohibitively expensive by managing our operating
activities and net assets position. As a result of our increased international exposure due to the KRONE acquisition, we may expand our foreign
currency hedging program in the future. At July 29, 2005, principal currencies hedged are the Australian dollar, British pound, and the Canadian
dollar.




Risks Related to Our Common Stock




Our stock price is volatile.




Based on the trading history of
our common stock and the nature of the market for publicly traded securities of companies in our industry, we believe that some factors have caused and
are likely to continue to cause the market price of our common stock to fluctuate substantially. The fluctuations could occur from day-to-day or over a
longer period of time. The factors that may cause such fluctuations include, without limitation:


| |  | announcements of new products and services by us or our
competitors;
|- |  | --------------------------------------------------------------------

| |  | quarterly fluctuations in our financial results or the financial
results of our competitors or our customers;
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| |  | customer contract awards to us or our competitors;
|- |  | --------------------------------------------------

| |  | increased competition with our competitors or among our
customers;
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| |  | consolidation among our competitors or customers;
|- |  | -------------------------------------------------

| |  | disputes concerning intellectual property rights;
|- |  | -------------------------------------------------

| |  | the financial health of ADC, our competitors or our
customers;
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| |  | developments in telecommunications regulations;
|- |  | -----------------------------------------------

| |  | general conditions in the communications equipment industry;
and
|- |  | ----------------------------------------------------------------

| |  | general economic conditions in the U.S. or
internationally.
|- |  | -----------------------------------------------------------



In addition, stocks of companies
in our industry in the past have experienced significant price and volume fluctuations that are often unrelated to the operating performance of such
companies. This market volatility may adversely affect the market price of our common stock.




We have not in the past and do not intend in the foreseeable
future to pay cash dividends on our common stock.




We currently do not pay any cash
dividends on our common stock and do not anticipate paying any cash dividends on our common stock in the foreseeable future. We intend to retain future
earnings, if any, to finance our operations and for general corporate purposes.




Anti-takeover provisions in our charter documents, our
shareowner rights plan and Minnesota law could prevent or delay a change in control of our company.




Provisions of our articles of
incorporation and bylaws, our shareowner rights plan (also known as a poison pill) and Minnesota law may discourage, delay or prevent a
merger or acquisition that a shareowner may consider favorable and may limit the market price for our common stock. These provisions include the
following:


| |  | advance notice requirements for shareowner
proposals;
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| |  | authorization for our Board of Directors to issue preferred
stock without shareowner approval;
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| |  | authorization for our Board of Directors to issue preferred
stock purchase rights upon a third partys acquisition of 15% or more of our outstanding shares of common stock; and
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| |  | limitations on business combinations with interested
shareowners.
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Some of these provisions may
discourage a future acquisition of ADC even though our shareowners would receive an attractive value for their shares or a significant number of our
shareowners believed such a proposed transaction would be in their best interest.