EXHIBIT 10.9

DUCOMMUN INCORPORATED

PERFORMANCE STOCK UNIT AGREEMENT

This performance stock unit agreement is made as of January 1, ____ (the
“Effective Date”), between Ducommun Incorporated, a Delaware corporation (the
“Corporation”), and _______________ (“Award Holder”).

R E C I T A L S

This performance stock unit agreement is pursuant to the 2007 Stock Incentive
Plan (the “Plan”).

A G R E E M E N T S

1. Grant. The Corporation hereby grants to the Award Holder an award (the
“Award”) with a target (if the Corporation achieves the target level performance
goals described in Exhibit A) of _____ performance stock units (the “Target
Units”), and a maximum of up to two hundred percent (200%) of the Target Units
(if Corporation achieves the maximum level performance goals described in
Exhibit A), in each case subject to certain adjustments as described herein.
Each performance stock unit represents the right to receive one share of Common
Stock, subject to the conditions set forth in this performance stock unit
agreement and the Plan.

2. Definitions. Unless the context clearly indicates otherwise, and subject to
the terms and conditions of the Plan as the same may be amended from time to
time, the following terms, when used in this performance stock unit agreement,
shall have the meanings set forth in this Section 2.

“Common Stock” shall mean the Common Stock, $.01 par value, of the Corporation
or such other class of shares or other securities as may be applicable pursuant
to the provisions of Section 7 of this performance stock unit agreement.

“Subsidiary” shall mean a corporation or other form of business entity more than
50% of the voting shares of which is owned or controlled, directly or
indirectly, by the Corporation and which is designated by the Committee for
participation in the Plan by the key employees thereof.

“Committee” shall mean the Compensation Committee of the Board of Directors of
the Corporation, or if there is no such committee acting, the Board of Directors
of the Corporation.

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3. Vesting. The Award shall vest based on a 3-year cumulative performance cycle,
beginning as of January 1, ____ and ending on December 31, ____ (the
“Performance Period”). The vesting of the Award shall be subject to the
Corporation achieving by the end of the Performance Period the Diluted Earnings
Per Share and the Relative Total Shareholder Return, as provided in Exhibit A
attached hereto. Following the end of the Performance Period and the collection
of relevant data necessary to determine the extent to which the performance
goals set forth in Exhibit A have been satisfied, the Committee will determine:
(a) the amount of Diluted Earnings Per Share and Relative Total Shareholder
Return that was achieved by the Corporation over the Performance Period, and
(b) the percentage of the Target Units that become Vested Units (as defined in
Exhibit A) as of the last day of the Performance Period. The Committee shall
make these determinations in its sole discretion. The level of achievement of
Diluted Earnings Per Share and Relative Total Shareholder Return shall be
evidenced by the Committee’s written certification, in accordance with Internal
Revenue Code Section 162(m). For the avoidance of doubt, any performance stock
units subject to this Award that do not vest in accordance with the forgoing
shall expire without consideration at the end of the Performance Period.

4. Settlement of Vested Units. Upon the vesting of all or a portion of the
Award, one share of Common Stock shall be issuable for each Vested Unit (as
defined in Exhibit A) (the “PSU Shares”). Thereafter, the Corporation will
transfer such PSU Shares to the Award Holder upon the Committee’s written
certification as set forth in Section 3 and the satisfaction of any required tax
withholding obligations, securities law registration or other requirements, and
applicable stock exchange listing. No fractional shares shall be issued with
respect to the Award. The Award Holder shall not acquire or have any rights as a
shareholder of the Corporation by virtue of this performance stock unit
agreement (or the Award evidenced hereby) until the certificates representing
shares of Common Stock issuable pursuant to this Award are actually issued and
delivered to the Award Holder in accordance with the terms of the Plan and this
performance stock unit agreement.

5. Change in Control.

(a) In the event that a Change in Control occurs, the Target Units shall be
deemed to have become fully vested immediately prior to the consummation of the
Change in Control, provided, however, that the Committee may, in its discretion,
increase (but not decrease) the number of performance stock units that are
deemed to vest in the event of a Change in Control up to a maximum of two
hundred percent (200%) of the Target Units.

(b) For purposes of this performance stock unit agreement, a “Change in Control”
of the Corporation shall mean a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”); provided that, without limitation, such a change in control
shall be deemed conclusively to have occurred if (i) a tender offer shall be
made and consummated for the ownership of 25% or more of the outstanding voting
securities of the Corporation, (ii) the shareholders of the corporation approve
that the Corporation be merged or consolidated with another corporation and as a
result of such merger or consolidation less than 75% of the outstanding voting
securities of the surviving or resulting corporation shall be owned in the
aggregate by the former

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shareholders of the Corporation, other than affiliates (within the meaning of
the Exchange Act) of any party to such merger or consolidation, as the same
shall have existed immediately prior to such merger or consolidation, (iii) the
shareholders of the Corporation approve that the Corporation sell, lease,
exchange or transfer substantially all of its assets to another corporation,
entity or person which is not a wholly-owned subsidiary and all government
regulatory approvals necessary for the consummation of such transaction shall
have been obtained, (iv) a person, as defined in Sections 13(d) and 14(d) (as in
effect on the date hereof) of the Exchange Act, shall acquire 35% or more of the
outstanding voting securities of the Corporation (whether directly, indirectly,
beneficially or of record), (v) the shareholders of the Corporation approve a
plan or proposal for the liquidation or dissolution of the Corporation and all
government regulatory approvals necessary for the consummation of such
transaction shall have been obtained, or (vi) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors cease for any reason to constitute at least a majority
thereof unless the election, or the nomination for election by the Corporation’s
shareholders, of each new director was approved by a vote of at least two-thirds
of the directors then still in office who were directors at the beginning of the
period. For purposes hereof, ownership of voting securities shall take into
account and shall include ownership as determined by applying the provisions of
Rule 13d-3 (as in effect on the date hereof) under the Exchange Act. A sale or
other change in control of any Subsidiary of the Corporation by which the Award
Holder is employed shall not be deemed a Change in Control of the Corporation
for purposes of this Agreement.

6. Termination. If the Award Holder’s employment with the Corporation or a
Subsidiary terminates before the end of the Performance Period for any reason,
except as provided in this Section 6 or in Section 5 above, then the Award will
be forfeited and cancelled and surrendered to the Corporation without payment of
any consideration, effective on the date of the Award Holder’s termination of
employment. Upon the termination of the Award Holder’s employment with the
Corporation or a Subsidiary as a result of (a) death or “permanent disability”
(as defined herein) or (b) “retirement” (as defined herein), the Target Units
covered by the Award shall be reduced to a number of performance stock units
equal to the Target Units set forth in Section 1 multiplied by a fraction,
(i) the numerator of which equals the number of full calendar quarters that have
elapsed between the Effective Date and the date of termination of employment and
(ii) the denominator of which equals twelve (12). The performance stock units
(as reduced) shall then vest as provided in Sections 3 and 5 above, provided
that the Award Holder has not rendered services, directly or indirectly, to any
third party engaged in competition with the Corporation or its Subsidiaries. As
used herein, the term “retirement” shall mean that, on the date on which the
Award Holder terminates employment with the Corporation or a Subsidiary, either
(x) the Award Holder is sixty-five (65) or more years of age, or (y) the
combination of the Award Holder’s age plus years of service equals not less than
seventy (70). As used herein, the term “permanent disability” shall mean the
date on which the Award Holder has not worked or been able to work due to
physical or mental incapacity for a period of one hundred eighty
(180) consecutive days.

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7. Adjustments

(a) If the outstanding shares of Common Stock of the Corporation are increased,
decreased, changed into or exchanged for a different number or kind of shares or
securities of the Corporation through recapitalization (other than the
conversion of convertible securities according to their terms),
reclassification, stock dividend, stock split or reverse stock split, an
appropriate and proportionate adjustment shall be made, or if the Corporation
shall spin-off, spin-out or otherwise distribute assets with respect to the
outstanding shares of Common Stock of the Corporation, an appropriate and
proportionate adjustment shall be made, in the number of performance stock units
subject to this Award.

(b) In the event of the dissolution or liquidation of the Corporation, or upon
any merger, consolidation or reorganization of the Corporation with any other
corporations or entities as a result of which the Corporation is not the
surviving corporation, or upon the sale of all or substantially all of the
assets of the Corporation or the acquisition of more than 80% of the stock of
the Corporation by another corporation or entity, there shall be substituted for
each of the shares of Common Stock then subject to this Award the number and
kind of shares of stock, securities or other assets which would have been
issuable or payable in respect of or in exchange for such Common Stock then
subject to the Award, as if the Award Holder had been the owner of such shares
as of the transaction date. Any securities so substituted shall be subject to
similar successive adjustments.

8. No Right to Continued Employment. Nothing in the Plan, in this performance
stock unit agreement or in any other instrument executed pursuant thereto shall
confer upon the Award Holder any right to continue in the employ of the
Corporation or any Subsidiary of the Corporation or shall interfere in any way
with the right of the Corporation or any such Subsidiary to at any time
terminate the employment of the Award Holder with or without cause.

9. Legal Requirements. No shares issuable under this Award shall be issued or
delivered unless and until, in the opinion of counsel for the Corporation, all
applicable requirements of federal and state law and of the Securities and
Exchange Commission pertaining to the issuance and sale of such shares and any
applicable listing requirements of any national securities exchange on which
shares of the same class are then listed, shall have been fully complied with.
In connection with any such issuance or transfer, the person acquiring the
shares shall, if requested by the Corporation, give assurances satisfactory to
counsel to the Corporation in respect of such matters as the Corporation or any
Subsidiary of the Corporation may deem desirable to assure compliance with all
applicable legal requirements.

10. No Rights as a Shareholder. Neither the Award Holder nor any beneficiary or
other person claiming under or through the Award Holder shall have any right,
title or interest in or to any shares of Common Stock allocated or reserved for
the purpose of the Plan or subject to this Agreement except as to such shares of
Common Stock, if any, as shall have been issued or transferred to such person.

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11. Withholding. The Corporation or any Subsidiary of the Corporation may make
such provisions as it may deem appropriate for the withholding of any taxes
which the Corporation or such Subsidiary determines it is required to withhold
in connection with this performance stock unit agreement and the transactions
contemplated hereby, and the Corporation or any such Subsidiary may require the
Award Holder to pay to the Corporation or such Subsidiary in cash any amount or
amounts which may be required to be paid as withheld taxes in connection with
any issuance of Common Stock pursuant to this Award or any other transaction
contemplated hereby as a condition to the issuance of shares of the Common
Stock, provided, however, that any amount withheld for taxes in connection with
this Award may, at the election of the Award Holder, be paid with previously
issued shares of Common Stock or the deduction of shares of Common Stock to be
issued in connection with this Award.

12. No Assignments. Neither this performance stock unit agreement, nor this
Award nor any other rights and privileges granted hereby shall be transferred,
assigned, pledged or hypothecated in any way, whether by operation of law of
descent and distribution. Upon any attempt to so transfer, assign, pledge,
hypothecate or otherwise dispose of this performance stock unit agreement, this
Award or any other right or privilege granted hereby contrary to the provisions
hereof, this performance stock unit agreement, this Award and all of such rights
and privileges shall immediately become null and void.

13. Other Programs. Nothing contained in this performance stock unit agreement
shall affect the right of the Award Holder to participate in and receive
benefits under and in accordance with the then current provisions of any
pension, insurance, profit-sharing or other employee benefit plan or program of
the Corporation or of any Subsidiary of the Corporation.

14. The Plan. The Award hereby granted is subject to, and the Corporation and
Award Holder agree to be bound by all of the terms and conditions of the Plan as
the same may be amended from time to time in accordance with the terms thereof,
but no such amendment may adversely affect the Award Holder’s rights under this
performance stock unit agreement. Award Holder acknowledges receipt of a
complete copy of the Plan.

15. Committee Authority. All questions arising under the Plan or under this
performance stock unit agreement shall be decided by the Committee in its total
and absolute discretion. It is expressly understood that the Committee is
authorized to administer, construe and make all determinations necessary or
appropriate to the administration of the Plan and this performance stock unit
agreement, all of which shall be binding upon the Award Holder to the maximum
extent permitted by the Plan.

16. Consideration. The consideration for the rights and benefits conferred on
Award Holder by this Award are the services rendered by the Award Holder after
and not before the grant of this Award.

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17. Applicable Law. This Award has been granted as of the effective date set
forth above at Los Angeles, California, and the interpretation, performance and
enforcement of this Agreement shall be governed by the laws of the State of
California.

 

DUCOMMUN INCORPORATED By:       Chief Executive Officer By:       Secretary

 

   Award Holder

By his or her signature, the spouse of the Award Holder hereby agrees to be
bound by all the terms and conditions of this written performance stock unit
agreement.

 

   Spouse of Award Holder

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PERFORMANCE STOCK UNIT AGREEMENT

Dated as of January 1, ____

Exhibit A

For purposes of this performance stock unit agreement, the “Diluted Earnings Per
Share” means the sum of the diluted earnings per share of the Corporation for
the Corporation’s fiscal years ending December 31, ____, December 31, ____ and
December 31, ____ as included in the Corporation’s audited financial statements,
subject to adjustment as provided herein. The Diluted Earnings Per Share shall
be adjusted (as determined by the Committee) (i) for changes in accounting,
(ii) for discontinued operations, (iii) to exclude gain or loss on the sale of
any business or product line, and (iv) to exclude any asset impairment
write-offs or charges (whether of goodwill, intangible or tangible assets). An
appropriate adjustment in the Diluted Earnings Per Share amounts in the table
below also shall be made for any of the events described in Section 7(a) above.

For purposes of this performance stock unit agreement, the “Relative Total
Shareholder Return” means the Corporation’s annualized total shareholder return
(as determined by the Committee) over the Performance Period as compared to the
annualized total shareholder return of the SPADE Defense Index (as determined by
the Committee) over the Performance Period, and expressed as the compound annual
percentage by which the Corporation’s total shareholder return exceeds or is
exceeded by that of the SPADE Defense Index. The determination of the annualized
total shareholder return for the Corporation and the SPADE Defense Index shall
include the appreciation or depreciation of stock prices plus dividends paid as
if reinvested. If an annualized total shareholder return (including the
reinvestment of dividends) is not published for the SPADE Defense Index, then
the annualized total shareholder return (including the reinvestment of
dividends) for the SPADE Defense Index shall be calculated using such methods as
the Committee shall determine. If the SPADE Defense Index ceases to be
published, the Committee shall, in its discretion, substitute another
broad-based stock index that it determines is appropriate.

If the Diluted Earnings Per Share does not equal or exceed the threshold in the
table below and the Relative Total Shareholder Return does not equal or exceed
the threshold in the table below, the Award shall expire without consideration.
In addition, notwithstanding anything herein to the contrary, none of the
performance stock units will vest based on the Corporation’s Relative Total
Shareholder Return achievement unless the Corporation’s Total Shareholder Return
over the Performance Period is equal to or greater than zero. Subject to the
foregoing paragraphs and provided that the Award Holder has remained in the
employment or service of the Corporation over the Performance Period, (except in
the event of death, permanent disability or retirement as provided above), the
number of performance stock units that will vest under this performance stock
unit agreement shall be determined in accordance with the following table:

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Diluted Earnings

Per Share*

  

Vesting Percentage of
Target Units

  

Relative Total Shareholder
Return

  

Vesting Percentage of
Target Units

[0%] (threshold)

   15%    -5.0% (threshold)    15%

[3%]

   33%    -2.5%    33%

[6%] (target)

   50%    0% (target)    50%

[9%]

   67%    2.5%    67%

[12%]

   83%    5.0%    83%

[15%]

   100%    7.5%    100%

 

*

Actual cumulative three-year Diluted Earnings Per Share targeted amounts will be
inserted. Percentages reflect the compound annual growth rates from year prior
to Performance Period that will be used to determine the actual Diluted Earnings
Per Share target amounts. For example, the 6% target cumulative three-year
Diluted Earnings Per Share target amount would be calculated as follows:

6% Target = 1.06 X + (1.062) X + (1.063) X

Where X = Diluted EPS in year prior to Performance Period

In the event that the Corporation’s Diluted Earnings Per Share and/or Relative
Total Shareholder Return for the Performance Period falls between two of the
percentages listed in the table above, the applicable percentage of Target Units
based on such achievement shall be determined by linear interpolation. The total
number of performance stock units subject to the Award that vest based upon the
Corporation’s achievement over the Performance Period (as determined by the
Committee) will be equal to the sum of (i) the Vesting Percentage determined by
reference to the table above with respect to the Corporation’s Diluted Earnings
Per Share over the Performance Period multiplied by the number of Target Units
set forth in Section 1 above, plus (ii) the Vesting Percentage determined by
reference to the table above with respect to the Corporation’s Relative Total
Shareholder Return over the Performance Period multiplied by the number of
Target Units set forth in Section 1 above (such units, the “Vested Units”).
Notwithstanding anything herein to the contrary, in no event will more that two
hundred percent (200%) of the number of Target Units become vested hereunder.
Performance stock units granted under this Award that are not vested and remain
subject to forfeiture are referred to herein as “Unvested Units.”