Document:

Prepared by MerrillDirect

SEPARATION
AGREEMENT

         
This SEPARATION AGREEMENT, dated effective as of November 1, 2000, is made and
entered into between ADC Telecommunications, Inc., a Minnesota corporation
(“ADC”), and William J. Cadogan, an individual resident of the state of
Minnesota (“Cadogan”).

BACKGROUND

         
Cadogan currently is employed by ADC as Chairman of the Board of Directors,
President, and Chief Executive Officer; Cadogan has announced to ADC that he
intends to resign his employment from ADC at a specific future time, and
Cadogan and ADC desire to establish a reasonable time period for ADC to effect
a transition to Cadogan’s successor and for Cadogan to assist ADC in that
transition.  Cadogan acknowledges that ADC operates in a highly
competitive industry and that the Company will enhance its opportunities to
succeed by establishing certain policies designed to protect ADC’s interests
during the transition.

         
NOW THEREFORE, in consideration of the mutual obligations incurred and
benefits obtained hereunder, the sufficiency of which are admitted, ADC and
Cadogan agree as follows:

         
1.       Employment.  ADC will
continue to employ Cadogan, and Cadogan accepts such employment and agrees to
perform services for ADC or any affiliate of ADC (collectively, the “ADC
Affiliates”), for the period and upon the other terms and conditions set forth
in this Agreement.  The terms of Cadogan’s continued status as a Member of
the Board of Directors of ADC (the “ADC Board”) shall be governed by Section
10.

         
2.       Term.  Unless
terminated at an earlier date in accordance with Section 7 below, this
Agreement shall take effect on November 1, 2000, and shall extend for a
continuous period ending on November 1, 2001 (the “Term”).  Upon the
expiration of the Term, Cadogan will resign his employment and all then
currently held officer duties with ADC.  Upon Cadogan’s resignation, ADC
will have no further financial obligation to Cadogan, except as expressly
described in this Agreement, including without limitation, Exhibit B, or in the
terms or conditions of an ADC compensation plan or program applicable to
Cadogan.

         
3.       Position and Duties.

3.01   Service with ADC. 
Until such time as a new Chief Executive Officer of the Company has been
elected by the ADC Board and commences employment in such capacity, Cadogan
shall continue to serve in the role of Chief Executive Officer of the
Company.  After a new Chief Executive Officer is elected, Cadogan will
resign any officer duties with ADC upon ADC’s request, and will perform such
duties as the ADC Board or the Chief Executive Officer shall request from time
to time during the remainder of the Term, which may include, without
limitation, assisting with various projects or activities relating to the transition
to a new Chief Executive Officer.  In addition, at any time during the
Term, ADC may request that Cadogan resign any officer or director position he
currently holds with ADC or an ADC Affiliate, and Cadogan agrees to resign such
position(s) immediately upon any such request.

 

         
3.02   Performance of Duties.  Cadogan agrees to serve
ADC faithfully and to the best of his ability, and to devote the necessary
amount of time, and level of attention and efforts to any service that ADC
requests he provide.  Cadogan hereby confirms that he is under no
contractual commitments inconsistent with his obligations pursuant to this
Agreement and he agrees that, during the Term, he will not (a) serve as an
employee of any other company, or (b) render or perform any services for any
other corporation, firm, entity or person that are inconsistent with the
provisions of this Agreement or which would otherwise impair his ability to
perform his duties hereunder.  After a new CEO is elected, and during the
remainder of the Term, ADC will provide Cadogan with such office space as the
new CEO reasonably determines is appropriate for Cadogan to perform his duties
under this Agreement.

         
4.       Compensation.

          4.01  
Base Salary.  As base compensation for all services to be rendered
by Cadogan under this Agreement during the Term, ADC shall pay to Cadogan an
annualized salary of $742,500.  Cadogan’s salary shall be paid in
accordance with ADC’s normal payroll procedures and policies, as such procedures
and policies may be modified from time to time.

          4.02  
Incentive Compensation.  The Term coincides with ADC’s 2001 fiscal
year.  During fiscal year 2001, Cadogan shall be eligible to participate
in the Management Incentive Plan (“MIP”) for that fiscal year, according to the
terms and conditions of the MIP plan, targets, objectives, and other MIP
conditions established by the Compensation Committee of the ADC Board.

          4.03  
Participation in Benefits.  During the Term, Cadogan
shall be entitled to participate in the employee benefits offered by ADC, to
the extent that Cadogan’s position, tenure, salary, health, and other
qualifications make him eligible to participate.  Cadogan’s participation
in such benefits shall be subject to the terms of the applicable plans, as the
same may be amended from time to time.  ADC does not guarantee the
adoption or continuance of any particular employee benefit during the Term, and
nothing in this Agreement is intended to, or shall in any way restrict ADC’s right
to amend, modify or terminate any of its benefits during the Term.

 

 

         
4.04   Post-Termination Medical Benefits.  Following the
expiration of the Term, ADC will provide Cadogan, at no cost to him, with
continuing coverage of medical benefits.  Cadogan shall initially receive
such coverage through COBRA continuation coverage.  After COBRA coverage
is exhausted, additional medical coverage ("Extended Coverage") shall
be provided to Cadogan and Cadogan’s eligible dependents.  For purposes of
this Agreement, Extended Coverage shall be comprised of medical coverage for
Cadogan and Cadogan’s eligible dependents until the earliest of:  (a)
Cadogan’s Medicare eligibility; (b) Cadogan’s eligibility for coverage under
another employer’s group health plan; or (c) the fifth (5th) year
anniversary of the commencement date of coverage, according to the terms of the
applicable benefit plans providing that coverage.  Cadogan’s eligible
dependents shall also have Extended Coverage while Cadogan is covered for so long
as they meet the dependency eligibility requirements of the applicable benefit
plan.  During the period of Extended Coverage, ADC in its sole discretion
may amend, modify or terminate any benefit plans providing the Extended
Coverage described here; provided, however, that the level and extent of
coverage will remain substantially similar to the coverage provided to
U.S.-based ADC active employees.

          4.05  
Stock Options.  The Compensation and Organization Committee of
ADC's Board (the "Committee") will approve the grant to grant Cadogan
an option (1) to purchase up to four thousand five hundred and seven (4,507)
shares of ADC’s common stock, in accordance with the terms of the ADC 1991
Stock Incentive Plan and an Incentive Stock Option Agreement to be entered into
by Cadogan and ADC, which is attached here as Exhibit C, and (2) an option to
purchase three hundred forty-five thousand four hundred ninety-three (345,493)
shares of ADC’s common stock, in accordance with the terms of the ADC 1991 Stock
Incentive Plan (the "Plan") and a Nonqualified Stock Option Agreement
to be entered into by Cadogan and ADC, which is attached here as Exhibit
D.  For purposes of this Agreement, the stock option grants identified
here will be referred to collectively as the “Option.”  The Option shall
be granted effective as of November 1, 2000. Cadogan acknowledges that he has
already received and accepted the Option Agreements set forth in Exhibits C and
D.

          4.06  
Deferred Payment. In accordance with the terms of this Section 4.06, ADC
shall make an additional one-time payment to Cadogan (the "Deferred
Payment"), in further consideration of the services provided and covenants
made by Cadogan under this Agreement; specifically including the non-competition
and non-solicitation covenants set forth herein. As determined in the
discretion of the Committee, ADC may make the Deferred Payment in the form of
(i) cash or (ii) ADC stock options (“Additional Options”) as set forth
below. The final form of the Deferred Payment shall be determined by the
Committee on a date which is (1) after the date that a new Chief Executive
Officer been named by the Board and assumes responsibilities as such and (2)
prior to the end of the Term hereunder.

          (a)     
If the Deferred Payment is made in the form of cash, the total amount of such
payment shall be $ 4,352,000, after applicable state and federal income taxes
related to such payment.  In the case of a cash payment, such payment will
be made in two equal installments on November 1, 2001 and November 1, 2002.

 

         
(b)      If the Deferred Payment is made in the form
of Additional Options, Cadogan will be granted options to purchase shares of
ADC common stock at an exercise price equal to the fair market value of ADC
common stock on the effective date of such option grant by ADC.  The
number of shares covered by the Additional Options shall be calculated using
the “Black Scholes” method of valuation such that the Black Scholes value of
the Additional Options on the date of grant shall be $4,352,000.  
For purposes of this Agreement, the Black Scholes calculation shall be made in
a manner consistent with ADC’s internal methodology as determined by ADC. 
If Additional Options are granted, they would be subject to the terms
established by the Compensation Committee on the date of grant as well as the
terms of the Plan and a NonQualified Stock Option Agreement.  Cadogan
acknowledges that he is responsible for any individual taxes related to the
Additional Options.

          4.07  
Expenses.  In accordance with ADC’s normal policies for expense
reimbursement, ADC will reimburse Cadogan for all reasonable and necessary
expenses he incurs in performing his duties under this Agreement, subject to
the presentment of receipts or other documentation acceptable to ADC.

         
5.       Confidential
Information/Intellectual Property.  As a condition precedent to ADC
performing its obligations hereunder, Cadogan shall execute and deliver to ADC
the Employee Invention, Copyright and Trade Secret Agreement in the form
attached hereto as Exhibit A (the “Employee Invention Agreement”).

         
6.       Compliance with ADC Policies. 
During the Term, Cadogan shall comply with all of ADC’s policies in effect for
employees of ADC generally, or that are in effect for executive management
employees specifically.  Cadogan acknowledges that these policies
specifically include the policies that are part of ADC’s Business Conduct
Program, as the same may be amended from time to time.

7.     Termination.

          7.01  
Termination Due to Cadogan’s Death or Total Disability.  Cadogan’s
employment pursuant to this Agreement shall terminate automatically prior to
the expiration of the Term in the event of Cadogan’s death or his total
disability which results in his inability to perform the duties ADC has or may
request that he perform, with or without reasonable accommodation; provided
however, that Cadogan has exhausted his entitlement to any applicable
leave.  Notwithstanding the termination of Cadogan’s employment pursuant
to this Section 7.01, if Cadogan dies or becomes totally disabled during the
Term, he (or his estate, as applicable) shall be entitled to receive (i) the
compensation which would otherwise have been payable to Cadogan pursuant to
Section 4.06; (ii) the compensation otherwise payable pursuant to Sections 4.01
and 4.02, prorated up to the date of termination of Employment under this
Section 7.01, and (iii) the Post-Termination Medical Benefits otherwise
provided under Section 4.04, subject to the terms thereof.

 

         
7.02   Termination by ADC for Cause.  Cadogan’s
employment pursuant to this Agreement shall terminate prior to the expiration
of the Term in the event ADC shall determine, in its sole discretion, that
there is “cause” to terminate Cadogan’s employment, which shall include any of
the following:

          (a)     
Cadogan’s breach of any material contractual obligation to ADC or any ADC
Affiliate under the terms of this Agreement or the Employee Invention
Agreement, or his breach of any fiduciary duty to ADC or any ADC Affiliate;

          (b)     
Cadogan’s conviction of any crime involving moral turpitude or any felony;

          (c)     
Cadogan’s failure to carry out any reasonable directive of the ADC Board or ADC’s
Chief Executive Officer; or

          (d)     
Cadogan’s embezzlement of funds or other assets of ADC or any ADC Affiliate.

          If Cadogan
acts or fails to act in a manner that ADC determines gives it “cause” to
terminate his employment pursuant to Section 7.02(b) or (d), ADC may terminate
Cadogan’s employment immediately upon providing written notice thereof to
Cadogan.  If Cadogan acts or fails to act in a manner that ADC determines
gives it “cause” to terminate his employment pursuant to Section 7.02(a) or
(c), ADC shall provide Cadogan with notice of the act or failure to act and a
period of thirty (30) days in which to cure the act or failure to act to ADC’s
satisfaction, and if at the end of that 30-day period, Cadogan has not cured
the act or failure to act to ADC’s satisfaction, ADC may immediately terminate
Cadogan’s employment upon providing Cadogan with written notice thereof;
provided, however, that if ADC determines the act or failure to act cannot be
cured to its satisfaction, ADC has no obligation to provide Cadogan with an
opportunity to cure and ADC may terminate Cadogan’s employment for “cause”
immediately upon providing Cadogan with written notice thereof.

          ADC may
terminate Cadogan’s employment pursuant to this Section 7.02 without regard to
the provisions of Section 11; provided, however, that any such termination may
give rise to a Dispute (as that term is defined in Section 11.01) that shall be
resolved in accordance with Section 11.

          7.03  
Request to Cease Providing Services Without Cause.  At any time
during the Term, ADC may immediately relieve Cadogan of all of his remaining
duties, provided that during the remainder of the Term, Cadogan shall be
entitled to compensation pursuant to Section 4.

 

 

         
7.04   Termination by Cadogan.  Cadogan may terminate
this Agreement at any time during the Term by giving sixty (60) days written
notice thereof to the ADC Board.  Upon notice of termination by Cadogan,
ADC may at its option elect to have Cadogan cease to provide services
immediately, provided that during such 60–day notice period Cadogan shall be
entitled to base salary compensation pursuant to Section 4.01.

          7.05  
Effect of Termination.  Notwithstanding any termination of
Cadogan’s employment with ADC, Cadogan acknowledges that he shall remain bound
by the provisions of this Agreement which specifically relate to periods,
activities or obligations arising upon or subsequent to the cessation of
Cadogan’s employment, including, but not limited to, the restrictive covenants
contained in Section 8 hereof and the Employee Invention Agreement.

          In the
event that Cadogan’s employment terminates for any reason, Cadogan will not
earn and will have no right to receive any compensation after the effective
date of that termination, except as expressly provided in this Agreement, or in
the terms and conditions of an ADC compensation plan or program applicable to
Cadogan, or as required by applicable law.

          7.06  
Surrender of Records and Property.  Upon any cessation of Cadogan’s
employment with ADC, Cadogan shall deliver promptly to ADC the SecurID Net
Access card, and all records, manuals, books, blank forms, documents, letters,
memoranda, notes, notebooks, reports, computer disks, computer software,
computer programs (including source code, object code, on-line files,
documentation, testing materials and plans and reports), designs, drawings,
formulae, data, tables or calculations or copies thereof, which are the
property of ADC or any ADC Affiliate or which relate in any way to the
business, products, practices or techniques of ADC or any ADC Affiliate, and
all other property, trade secrets and confidential information of ADC or any
ADC Affiliate, including, but not limited to, all tangible, written, graphical,
machine readable and other materials (including all copies) which in whole or
in part contain any trade secrets or confidential information of ADC or any ADC
Affiliate which in any of these cases are in Cadogan’s possession or under his control.

         
8.       Noncompetition and
Nonsolicitation.

          8.01  
Agreement Not to Compete.  In consideration of the financial and
other benefits described in Section 8.07 below, Cadogan agrees that, during the
“Covered Period” (as hereinafter defined), he shall not, directly or
indirectly, engage in any “Competing Business Activity” (as hereinafter
defined), in any manner or capacity (e.g., as an advisor, principal,
agent, partner, officer, director, investor, shareholder, employee, member of
any association or otherwise) except as expressly permitted under Section 8.03
below.  As used in this Agreement, “Covered Period” shall mean the period
commencing on the effective date of this Agreement (as described in Section 2)
and ending on the date that is two (2) years after the date on which Cadogan
ceases to be employed by ADC  (for whatever reason and whether such
cessation is occasioned by Cadogan or ADC).  As used in this Agreement,
“Competing Business Activity” shall mean any business activities that are
competitive with the business conducted by ADC or any ADC Affiliate on or prior
to the date Cadogan ceases to be employed by ADC.

 

 

         
8.02   Geographical Extent of Covenant.  Cadogan
acknowledges that ADC directly, or indirectly through ADC Affiliates, currently
is engaged in business on a world-wide basis.  Consequently, Cadogan
agrees that his obligations under this Section 8 to refrain from any Competing
Business Activity during the Covered Period shall apply in any market, foreign or
domestic, in which: (a) ADC or, as applicable, an ADC Affiliate(s), operates
during the term of the Covered Period; and (b) ADC or, as applicable, an ADC
Affiliate(s), has plans to enter on the date Cadogan ceases to be employed by
ADC.

          8.03  
Venture Investments.  ADC and Cadogan acknowledge that Cadogan has
made investments in early stage companies, and that he is interested in
continuing to do so.  Therefore, notwithstanding the limitations in
Section 8.01 and 8.02, the parties agree that this Agreement shall not prohibit
Cadogan from making such investments in or from acting as an advisor or member
of the board of directors of early stage companies, including those engaged in
Competing Business Activity; provided that (a) in all events the provisions of
Sections 8.04 and 8.05 will apply, and (b) if such company is engaged in a
Competing Business Activity, then Cadogan shall not serve as an officer or
employee or otherwise being involved in the day to day operations of the
company at any time during the Covered Period.

          8.04  
Nonsolicitation; Non-hire and Noninterference.  During the Covered
Period, Cadogan shall not (a) induce or attempt to induce any employee of ADC
or any ADC Affiliate to leave the employ of ADC or such ADC Affiliate, or in
any way interfere adversely with the relationship between any such employee and
ADC or such ADC Affiliate; (b) induce or attempt to induce any employee of ADC
or any ADC Affiliate to work for, render services to, provide advice to, or
supply confidential business information or trade secrets of ADC or any ADC
Affiliate to any third person, firm or corporation; (c) employ, or otherwise
pay for services rendered by, any employee of ADC or any ADC Affiliate in any
business enterprise with which Cadogan may be associated, connected or
affiliated in any manner; or (d) induce or attempt to induce any customer,
supplier, licensee, licensor or other business relation of ADC or any ADC
Affiliate to cease doing business with ADC or such ADC Affiliate, or in any way
interfere with the relationship between any such customer, supplier, licensee,
licensor or other business relation and ADC or such ADC Affiliate.

          8.05  
Indirect Competition or Solicitation.  Cadogan agrees that, during
the Covered Period, he will not, directly or indirectly, assist, solicit or
encourage any employee of ADC or an ADC Affiliate, or any other person in
carrying out, directly or indirectly, any activity that would be prohibited by
the provisions of this Section 8 if such activity were carried out by Cadogan,
either directly or indirectly.

 

         
8.06   Breach; Notice and Opportunity to Cure.  Cadogan
shall have committed a “Breach” of his obligations under this Section 8 if (i)
ADC determines Cadogan has acted or failed to act in a manner that constitutes
a breach of his obligations under this Section 8 and ADC provides written
notice thereof to Cadogan, and (ii) within thirty (30) days of receiving that
notice, Cadogan has not cured the identified breach to ADC’s satisfaction;
provided, however, that if ADC determines Cadogan’s breach of his obligations
under this Section 8 cannot be cured to its satisfaction, ADC will have no
obligation to provide Cadogan with an opportunity to cure and Cadogan shall
have committed a “Breach” of his obligations under this Section 8 upon ADC
providing Cadogan with written notice that it has determined he acted or failed
to act in a manner that constitutes a breach of his obligations under this
Section 8.  ADC may determine that a “Breach” has occurred without regard
to the provisions of Section 11; provided, however, that any such “Breach” may
give rise to a Dispute (as that term is defined in Section 11.01) that shall be
resolved in accordance with Section 11.

          8.07
  Consideration.  Cadogan acknowledges and agrees that ADC’s
willingness to employ him during the Term, subject to termination only due to
death or total disability, or for “cause” as described in Section 7, above, and
the other benefits and compensation that ADC has agreed to provide to him
pursuant to this Agreement are adequate consideration for Cadogan’s agreement
to undertake the obligations and duties described in this Section 8.

9.       Release
of Claims.

          9.01  
General Release.  By this Agreement, ADC and Cadogan also intend to
settle any and all claims Cadogan has or may have against ADC as the result of
Cadogan’s employment with ADC prior to the date Cadogan executes this
Agreement.  In exchange for the consideration expressed here, Cadogan hereby
completely releases and waives any and all claims, complaints, causes of
action, demands, suits, and damages, of any kind or character, which he has or
may have against ADC and/or its employees, agents, officers, directors,
counsel, predecessors, successors, subsidiaries, affiliates, assigns, and
insurers and each and all thereof (collectively, the “Released Parties”),
arising out of any acts, omissions, statements, conduct, decisions, behavior,
or events occurring up through the date of his signature on this Agreement.

          Cadogan
understands and accepts that his release of claims includes, but is not limited
to, claims based upon:  Title VII of the Federal Civil Rights Act of 1964,
as amended; the Americans with Disabilities Act; the Equal Pay Act; the Fair
Labor Standards Act; the Employee Retirement Income Security Act; the Minnesota
Human Rights Act; or any other federal, state or local statute, ordinance or
law.  Cadogan also understands that he is giving up all other claims,
including those grounded in contract or tort theories, including but not
limited to:  wrongful discharge; violation of Minn. Stat. §176.82; breach
of contract; tortious interference with contractual relations; promissory
estoppel; breach of the implied covenant of good faith and fair dealing; breach
of express or implied promise; breach of manuals or other policies; breach of
fiduciary duty; assault; battery; fraud; false imprisonment; invasion of
privacy; intentional or negligent misrepresentation; defamation, including
libel, slander, discharge defamation and self-publication defamation; discharge
in violation of public policy; whistleblower; intentional or negligent
infliction of emotional distress; or any other theory, whether legal or
equitable.

 

 

         
Cadogan further understands that he is releasing, and does hereby release, any
claims for damages, by charge or otherwise, whether brought by him or on his
behalf by any other party, governmental or otherwise, and agrees not to
institute any claims for damages via administrative or legal proceedings
against any of the Released Parties.  Cadogan also waives and releases any
and all rights to money damages or other legal relief awarded by any
governmental agency related to any charge or other claim.

          9.02  
Right to Revoke and Rescind.  After signing and dating this
Agreement, Cadogan may revoke it insofar as it extends to his release of claims
under the Minnesota Human Rights Act (MHRA) only if he delivers a written
rescission to ADC within fifteen (15) days after signing this Agreement. 
Cadogan must deliver any such revocation by hand within the applicable period
or send it by certified mail within the applicable period to Laura Owen, Vice
President - Human Resources, ADC Telecommunications, Inc., P.O. Box 1101, Minneapolis,
MN 55440-1101.  If Cadogan exercises his right to revoke, ADC may at its
option either nullify this Agreement, or keep it in effect in all respects
other than as to Cadogan’s release of claims that he has revoked.  If ADC
chooses to nullify this Agreement, neither Cadogan nor ADC shall have any
rights or obligations under it.

          9.03  
Release of Claims Upon Resignation.  In exchange for the
consideration expressed in this Agreement, Cadogan further agrees that, upon
the termination or resignation of his employment during, or at the expiration
of, the Term, he will execute a general release of claims in a form
substantially similar to the provisions in this Section 9.

         
10.     Service on Board of Directors. 
Currently, Cadogan is a Member and Chairman of the ADC Board.  At any time
during the Term and for so long thereafter as Cadogan remains a Member of the
ADC Board, ADC may request that Cadogan resign his position as a Member of ADC
Board and Cadogan agrees to resign immediately upon such request.

 

         
11.     Dispute Resolution.

          11.01 Dispute
Resolution Process.  ADC and Cadogan desire to establish a reasonable
and confidential means of resolving any dispute arising out of or relating to
(i) this Agreement or the alleged breach or threatened breach of it, (ii) the
making of this Agreement, including claims of fraud in the inducement, (iii)
Cadogan’s employment by ADC pursuant to this Agreement, including claims of
wrongful termination or discrimination, or (iv) any activities by Cadogan
following the cessation of his employment with ADC (each such dispute to be
referred to herein as a “Dispute”).  In furtherance of the parties’ mutual
desire, ADC and Cadogan agree that if either party believes a Dispute exists,
that party shall provide the other with written notice of the claimed
Dispute.  Upon receipt of that written notice, the following procedure
shall be the exclusive means of fully and finally resolving the Dispute. 
Within thirty (30) days of the other party receiving that notice, Cadogan and
appropriate management representatives of ADC will meet to attempt to resolve
amicably the Dispute.  If a mutually agreeable resolution is not reached
within thirty (30) days following the parties’ first meeting, the parties will
engage in mediation with a neutral mediator, said mediation to be held within
forty-five (45) days of the final meeting between Cadogan and ADC’s
representatives.  If the dispute is not resolved through mediation, the
dispute shall be resolved exclusively by final and binding arbitration held in
accordance with the provisions of this Agreement and the American Arbitration
Association (“AAA”) National Rules for the Resolution of Employment Disputes
then in effect, unless such rules are inconsistent with the provisions of this
Agreement.  In connection with such arbitration:

          (a)     
Any such arbitration shall be conducted: (i) by a neutral arbitrator appointed
by mutual agreement of the parties; or (ii) failing such agreement, by a
neutral arbitrator appointed in accordance with said AAA rules;

          (b)     
The parties shall be permitted reasonable discovery in accordance with the
provisions of the Minnesota Rules of Civil Procedure, including the production
of relevant documents by the other party, the exchange of witness lists, and a
limited number of depositions, including depositions of any expert who will
testify at the arbitration;

          (c)     
The summary judgment procedure applicable under Rule 56 of the Minnesota Rules
of Civil Procedure shall be available and apply to any arbitration conducted
pursuant to this Agreement;

          (d)     
The arbitrator’s award shall include findings of fact and conclusions of law
showing the legal and factual bases for the arbitrator’s decision;

          (e)     
The arbitrator shall have the authority to award to the prevailing party any
remedy or relief that a United States District Court or court of the State of
Minnesota could order or grant if the dispute had first been brought in that
judicial forum, including costs and attorneys’ fees;

          (f)      
The arbitrator’s award may be entered by any court of competent jurisdiction;
and

         
(g)      Unless otherwise agreed by the parties, the
place of any arbitration proceeding shall be Minneapolis, Minnesota.

 

 

         
11.03 Confidentiality of Dispute Resolution.  Except as the parties
shall agree in writing or upon court order, neither ADC nor Cadogan will
disclose to any third party, except for their counsel, retained experts and
other persons directly serving counsel or retained experts, any fact or
information in any way pertaining to the process of resolving a Dispute under
this Section 11, or to the fact of or any term that is part of a resolution or
settlement of any Dispute.  This prohibition on disclosure specifically
includes, without limitation, any disclosure of an oral statement or of a
written document made or provided by either Cadogan or ADC, or by any of its or
his representatives, counsel or retained experts, or other persons directly
serving any representatives, counsel or retained experts.

          11.04 ADC’s
Right to Injunctive Relief.  Cadogan acknowledges and agrees that the
services to be rendered by him hereunder are of a special, unique and
extraordinary character, that it would be difficult to replace such services
and that any violation of Sections 5, 7.06 or 8 hereof or of the Employee
Invention Agreement would be highly injurious to ADC and/or to any ADC
Affiliate and that it would be extremely difficult to compensate ADC and/or any
ADC Affiliate fully for damages for any such violation.  Accordingly, the
terms of this Section 11 notwithstanding, Cadogan specifically agrees that ADC
or any ADC Affiliate, as the case may be, shall be entitled to obtain temporary
and permanent injunctive relief from a court of law, said relief to be obtained
in accordance with Section 12.01, to enforce the provisions of Sections 5,
7.06 and 8 hereof, and the Employee Invention Agreement, and that such relief
may be granted without the necessity of proving actual damages and without
necessity of posting any bond.  This provision with respect to injunctive
relief shall not, however, diminish the right of ADC or any ADC Affiliate to
claim and recover damages, or to seek and obtain any other relief available to
it pursuant to the provisions of this Section 11.

12.     Miscellaneous.

          12.01 Governing
Law and Venue Selection.  This Agreement is made under and shall be
governed by and construed in accordance with the laws of the State of
Minnesota, without regard to conflicts of laws principles thereof, or those of
any other state of the United States of America, or of any other country,
province or city.  The parties agree that any litigation in any way
relating to this Agreement or to Cadogan’s employment by ADC, including but not
limited to any action brought pursuant to Section 11.04, will be venued in the
State of Minnesota, Hennepin County District Court, or the United States
District Court for the District of Minnesota.  Cadogan and ADC hereby
consent to the personal jurisdiction of these courts and waive any objection
that such venue is inconvenient or improper.

          12.02 Notice. 
For the purpose of this Agreement, notices and all other communications provided
for in the Agreement shall be in writing and shall be deemed to have been duly
given when actually delivered, when sent by telefacsimile, with electronic
confirmation of receipt, or when mailed by United States registered mail,
postage prepaid, addressed to the other party as follows:

 

                   
If to ADC, to:

                   
ADC Telecommunications, Inc.

                   
Attention: General Counsel

                   
P.O. Box 1101

                   
Minneapolis, Minnesota 55440-1101

                   
Fax (952) 946-3209

                   
If to Cadogan, to:

                   
William J. Cadogan

                   
18530 Bearpath Trail

                   
Eden Prairie, Minnesota 55347

                   
Fax (952) 906-0310

Either party may change its address for purposes of this Section 12.02
by giving 15 days prior notice to the other party.

          12.03 Prior
Agreements.  This Agreement (including other agreements specifically
mentioned in this Agreement) contains the entire agreement of the parties
relating to the employment of Cadogan by ADC and the other matters discussed
herein, and supersedes all prior proposals, promises, contracts, agreements and
understandings of any kind, whether express or implied, oral or written, with respect
to such subject matter (including, but not limited to, any proposal, promise,
contract, agreement or understanding, whether express or implied, oral or
written, by and between ADC and Cadogan), and the parties hereto have made no
agreements, representations or warranties relating to the subject matter of
this Agreement which are not set forth herein or in the other agreements
mentioned herein.

          12.04 Withholding
Taxes.  ADC may take such action as it deems appropriate to insure
that all applicable federal, state, city and other payroll, withholding, income
or other taxes (“Taxes”) arising from any compensation, benefits or any other
payments made pursuant to this Agreement, or any other contract, agreement or
understanding which relates, in whole or in part, to Cadogan’s employment with
ADC. are withheld or collected from Cadogan.

          12.05 Amendments. 
No amendment or modification of this Agreement shall be deemed effective unless
made in writing and signed by Cadogan and ADC.

          12.06 No
Waiver.  No term or condition of this Agreement shall be deemed to
have been waived, nor shall there be any estoppel to enforce any provisions of
this Agreement, except by a statement in writing signed by the party against
whom enforcement of the waiver or estoppel is sought.  Any written waiver
shall not be deemed a continuing waiver unless specifically stated, shall
operate only as to the specific term or condition waived, and shall not
constitute a waiver of such term or condition for the future or as to any act
other than as specifically set forth in the waiver.

 

 

          12.07 Assignment. 
This Agreement shall not be assignable, in whole or in part, by any party
without the written consent of the other party, except that ADC may, without the
consent of Cadogan, assign its rights and obligations under this Agreement to
any ADC Affiliate or to any corporation, firm or other business entity with or
into which ADC may merge or consolidate, or to which ADC may sell or transfer
all or substantially all of its assets, or of which 50% or more of the equity
investment and of the voting control is owned, directly or indirectly, by, or
is under common ownership with, ADC.  After any such assignment by ADC,
ADC shall be discharged from all further liability hereunder and such assignee
shall thereafter be deemed to be ADC for the purposes of all provisions of this
Agreement including this Section 12.07.

          12.08 Severability. 
To the extent any provision of this Agreement shall be determined to be invalid
or unenforceable in any jurisdiction, such provision shall be deemed to be
deleted from this Agreement as to such jurisdiction only, and the validity and
enforceability of the remainder of such provision and of this Agreement shall
be unaffected.  In furtherance of and not in limitation of the foregoing,
Cadogan expressly agrees that should the duration of, geographical extent of,
or business activities covered by Section 8 of this Agreement be in excess of
that which is valid or enforceable under applicable law in a given
jurisdiction, then such provision, as to such jurisdiction only, shall be
construed to cover only that duration, extent or activities that may validly or
enforceably be covered.  Cadogan acknowledges the uncertainty of the law
in this respect and expressly stipulates that this Agreement shall be construed
in a manner that renders its provisions valid and enforceable to the maximum
extent (not exceeding its express terms) possible under applicable law in each
applicable jurisdiction.

 

         

         
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date set forth in the first paragraph.

	
   
  	
  ADC TELECOMMUNICATIONS, INC.
  
	
   
  	
   
  
	
   
  	
  By /s/ Laura N. Owen

  

  
	
   
  	
  Name: Laura N. Owen
  
	
   
  	
  Title: Vice President, Human Resources
  
	 
  	 
  
	
   
  	
  CADOGAN
  
	
   
  	
   
  
	
   
  	
  /s/ William J. Cadogan

  

  
	
   
  	
  WILLIAM J. CADOGAN
  
	
   
  	
   
  
	
   
  	
  Signed on February 12, 2001 effective as of

   November 1, 2000.ESCROW AGREEMENT IN ACCORDANCE WITH RULE 419
                        UNDER THE SECURITIES ACT OF 1933

     ESCROW  AGREEMENT  dated as of February 28, 2001 (the  "Agreement")  by and
between BLUE THUNDER  CORP.  (the  "Company"),  and ADAMS DAVIS CO. (the "Escrow
Agent"), (collectively the "Parties" and, individually, a "Party").

     The Company,  through its President,  will sell in its public offering (the
"Offering")  2,000,000  units (the "Units") each Unit consisting of one share of
common stock, par value $.001 (the "Shares") and one Class "A" redeemable common
stock purchase warrant,  one Class "B" redeemable common stock purchase warrant,
and one Class "C" redeemable common stock purchase warrant (the "Warrants"),  as
more fully described in the Company's definitive  Prospectus  comprising part of
the Company's Registration Statement on Form SB-2 (the "Registration Statement")
under the Securities Act of 1933, (the  "Securities  Act") (File No.  333-36058)
when declared effective (the "Prospectus").  The Company desires that the Escrow
Agent  accept all offering  proceeds,  without  deduction,  to be derived by the
Company  from the sale of the Units (the  "Offering  Proceeds"),  as well as the
share and  warrant  certificates  representing  the Shares and  Warrants,  which
constitute the Units,  issued in connection with the Offering,  in escrow, to be
held and disbursed as hereinafter provided.

     NOW,  THEREFORE,  in consideration of the promises and the mutual covenants
hereinafter set forth, the Parties agree as follows:

     1. Appointment of Escrow Agent.

     The Company hereby appoints the Escrow Agent, to act in accordance with and
subject to the terms of this Agreement; and the Escrow Agent hereby accepts such
appointment and will act in accordance with and subject to such terms.

     2. Deposit of Offering Proceeds and Share Certificates.

     Subject  to  Rule  419,  upon  the  Company's  receipt  and  acceptance  of
subscriptions and Offering  Proceeds,  the Company shall promptly deliver to the
Escrow Agent such checks in the aggregate amount of the Offering  Proceeds drawn
to the order of the Escrow Agent or, alternatively, in the event that checks are
drawn to the order of the  Company,  they shall be  endorsed  by the Company for
collection by the Escrow Agent and credited to the Escrow Account.

     All share and warrant  certificates  representing  the Shares and Warrants,
respectively,  issued in connection with the Offering shall also be deposited by
the  Company  directly  into the Escrow  Account  promptly  upon  issuance.  The
identity of the purchasers of the securities  shall be included on the stock and
warrant certificates and other documents evidencing such securities.  Securities
held in the Escrow  Account are to remain as issued and  deposited  and shall be
held for the sole benefit of the  purchasers,  who shall have voting rights with
respect to securities held in their names.  No transfer or other  disposition of
securities held in the Escrow Account or any interest related to such securities
shall be permitted  other than by will or the laws of descent and  distribution,
or pursuant to a qualified  domestic  relations order as defined by the Internal
Revenue Code of 1986 as amended,  or Title 1 of the Employee  Retirement  Income
Security Act and the rules  thereunder.  Warrants held in the Escrow Account may
not be  exercised.

<PAGE>

     3. Disbursement of the Escrow Account.

     Upon  the  earlier  of  (i)  receipt  by  the  Escrow  Agent  of  a  signed
representation  from the Company to the Escrow  Agent that the  requirements  of
Rule  419  have  been  met  and  consummation  of  an  acquisition  meeting  the
requirements  of Rule 419 or (ii) written  notification  from the Company to the
Escrow  Agent to  deliver  the  Offering  Proceeds  to another  escrow  agent in
accordance with Paragraph 4 then, in such event, the Escrow Agent shall disburse
the Offering  Proceeds  (inclusive of interest,  if any, thereon) to the Company
and the  securities to the  purchasers or registered  holders  identified on the
deposited  securities  or deliver the Offering  Proceeds and  securities to such
other  escrow  agent,  as the case may be,  whereupon  the Escrow Agent shall be
released from further liability hereunder.

     Notwithstanding  the foregoing,  if the Company has not informed the Escrow
Agent  within  18 months  after the date of the  Prospects  in  writing  that an
acquisition meeting the requirements of Rule 419 has occurred, funds held in the
Escrow Account shall be returned by first class mail or equally prompt means pro
rata to the purchasers  and all  securities  held in the Escrow Account shall be
returned to the Company within five business days following that date.

     4. Concerning the Escrow Agent.

     The Escrow  Agent shall not be liable for any  actions  taken or omitted by
it, or any action suffered by it to be taken or omitted by it, in good faith and
in the exercise of its own best judgment, and may rely conclusively and shall be
protected  in acting  upon any order,  notice  demand,  certificate,  opinion or
advice of counsel  (including  counsel chosen by the Escrow  Agent),  statement,
instrument,  report or other paper or document (not only as to its due execution
and the validity and  effectiveness  of its provision,  but also as to the truth
and acceptability of any information therein contained) which is believed by the
Escrow Agent to be genuine and to be signed or presented by the proper person or
person.

     The Escrow Agent shall not be bound by any notice or demand, or any waiver,
modification,  termination or rescission of this Agreement unless evidenced by a
writing delivered to the Escrow Agent signed by the proper Party or Parties and,
if the duties or rights of the Escrow Agent are  affected,  unless it shall have
given its prior written consent thereto.

     The Escrow Agent shall not be responsible  for the sufficiency or accuracy,
the form of, or the execution validity,  value or genuineness of any document or
property  received,  held or delivered by it  hereunder,  or of any signature or
endorsement  thereon,  or for  any  lack  of  endorsement  thereon,  or for  any
description  therein, nor shall the Escrow Agent be responsible or liable in any
respect on account of the identity,  authority or rights of the person executing
or  delivering or purporting to execute or deliver any document or property paid
or delivered by the Escrow Agent under the provisions hereof.

     The Escrow  Agent shall not be liable for any loss which may be incurred by
reason of any investment of any monies or properties  which it holds  hereunder.
The  Escrow  Agent  shall have the right to  assume,  in the  absence of written
notice to the  contrary  from the proper  person or  persons,  that a fact or an
event by reason of which an action  would or might be taken by the Escrow  Agent
does not exist or has not occurred,  without incurring  liability for any action
taken or omitted, in good faith and in the exercise of its own best judgment, in
reliance upon such assumption.

<PAGE>

     The Escrow Agent shall be indemnified and held harmless by the Company from
and against any  expenses,  including  counsel fees and  disbursements,  or loss
suffered  by the  Escrow  Agent in  connection  with any  action,  suit or other
proceeding involving any claim, or in connection with any claim or demand, which
in any way directly or  indirectly  arises out of or relates to this  Agreement,
the services of the Escrow Agent hereunder, the monies or other property held by
it  hereunder  or any such  expense or loss.  Promptly  after the receipt by the
Escrow Agent of notice of any demand or claim or the commencement of any action,
suit or proceeding,  the Escrow Agent shall, if a claim in respect thereof shall
be made  against  the other  Parties,  notify such  Parties in writing;  but the
failure by the Escrow Agent to give such notice shall not relieve any Party form
any liability which such Party may have to the Escrow Agent hereunder.  Upon the
receipt of such notice,  the Escrow Agent, in its sole discretion,  may commence
an action in the nature of  interpleader  in an  appropriate  court to determine
ownership  or  disposition  of the Escrow  Account or it may  deposit the Escrow
Account  with the clerk of any  appropriate  court or it may  retain  the Escrow
Account  pending  receipt  of a final,  non-appealable  order of a court  having
jurisdiction  over  all  of  the  Parties  directing  to  whom  and  under  what
circumstances the Escrow Account is to be disbursed and delivered.

     The Escrow  Agent  shall be entitled to  reasonable  compensation  from the
Company  for all  services  rendered by it  hereunder.  From time to time on and
after the date hereof, the Company shall deliver or cause to be delivered to the
Escrow Agent such further  documents and instruments and shall do or cause to be
done such further acts as the Escrow  Agent shall  reasonably  request (it being
understood  that the Escrow Agent shall have no obligation to make such request)
to carry out more effectively the provisions and purposes of this Agreement,  to
evidence  compliance herewith or to assure itself that it is protected in acting
hereunder.  The Escrow Agent may resign at any time and be  discharged  from its
duties as Escrow Agent  hereunder by its giving the Company at least thirty (30)
days'  prior  written  notice  thereof.   As  soon  as  practicable   after  its
resignation,  the Escrow  Agent  shall  turn over to a  successor  escrow  agent
appointed  by  the  Company,   all  monies  and  property  held  hereunder  upon
presentation of the document  appointing the new escrow agent and its acceptance
thereof.  If no new escrow  agent is so  appointed  in the sixty (60) day period
following the giving of such notice of resignation, the Escrow Agent may deposit
the Escrow Account with any court it deems appropriate.

     The Escrow Agent shall resign and be  discharged  form its duties as Escrow
Agent hereunder if so requested in writing at any time by the Company, provided,
however,  that such  resignation  shall become effective only upon acceptance of
appointment  by a  successor  escrow  agent as provided  above.  Notwithstanding
anything  herein to the  contrary,  the Escrow Agent shall not be relieved  from
liability thereunder for its own gross negligence or its own willful misconduct.

     5. Miscellaneous.

     This Agreement  shall for all purposes be deemed to be made under and shall
be construed in accordance with the internal laws of the State of Delaware. This
Agreement  contains  the entire  agreement  of the Parties  with  respect to the
subject  matter  hereof and,  except as expressly  provided  herein,  may not be
changed or modified except by an instrument in writing signed by the Party to be
charged.  The headings  contained in this  Agreement are for reference  purposes
only and shall not affect in any way the meaning or interpretation thereof.

<PAGE>

     This  Agreement  shall be  binding  upon and  inure to the  benefit  of the
respective Parties and their legal representatives,  successors and assigns. Any
notice or other communication  required or which may be given hereunder shall be
in writing  and  either be  delivered  personally  or be  mailed,  certified  or
registered mail, return receipt requested,  postage prepaid, and shall be deemed
given when so delivered personally or, if mailed, two (2) days after the date of
mailing.  The Parties may change the persons and  addresses to which the notices
or other  communications  are to be sent by  giving  written  notice to any such
change in the manner provided herein for giving notice.

     WITNESS the execution of this Agreement as of the date first above written.

         BLUE THUNDER CORP.

         By:  /s/Edward Reilly
             -------------------------
              Edward Reilly, President

     This Escrow Agreement is accepted as of the 28th day of February, 2001.

         ADAMS DAVIS CO.
         Escrow Agent

         By:  /s/Robert Cashman
             --------------------------
              Robert Cashman, President

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