EXHIBIT
10.17


FORM OF CHANGE IN CONTROL
AGREEMENT


POWER-ONE,
INC.

CHANGE IN CONTROL SEVERANCE AGREEMENT


THIS
CHANGE IN CONTROL SEVERANCE AGREEMENT is made and entered into by and between Power-One,
Inc., a Delaware corporation (hereinafter referred to as the “Company”) and                            
(hereinafter referred to as the “Executive”).


RECITALS


A.                                   The Board of Directors of the Company has
approved the Company entering into a severance agreement with the Executive.


B.                                     The Executive is a key executive of the
Company.


C.                                     Should the possibility of a Change in
Control of the Company arise, the Board believes it imperative that the Company
and the Board should be able to rely upon the Executive to continue in his
position, and that the Company should be able to receive and rely upon the
Executive’s advice, if requested, as to the best interests of the Company and
its stockholders without concern that the Executive might be distracted by the
personal uncertainties and risks created by the possibility of a Change in
Control.


D.                                    Should the possibility of a Change in
Control arise, in addition to his regular duties, the Executive may be called
upon to assist in the assessment of such possible Change in Control, advise
management and the Board as to whether such Change in Control would be in the
best interests of the Company and its stockholders, and to take such other
actions as the Board might determine to be appropriate.


NOW
THEREFORE, to
help assure the Company that it will have the continued dedication of the
Executive and the availability of his advice and counsel notwithstanding the
possibility, threat, or occurrence of a Change in Control of the Company, and
to induce the Executive to remain in the employ of the Company in the face of
these circumstances and for other good and valuable consideration, the Company
and the Executive agree as follows:


Article 1.                                            Term


This Agreement
shall be effective as of [                       ]
(the “Effective Date”).  This Agreement
will continue in effect through [                       ].  However, at the end of such one (1) year
period and, if extended, at the end of each additional year thereafter, the
term of this Agreement shall be extended automatically for one (1) additional
year, unless the Committee delivers written notice at least six (6) months
prior to the end of such term, or extended term, to the Executive that this
Agreement will not be extended, and if such notice is timely given this
Agreement will terminate at the end of the term then in progress; provided,
however, that this provision for automatic extension shall have no
application following a Change in Control.


However, in the
event a Change in Control occurs during the original or any extended term, this
Agreement will remain in effect for the longer of: (i) twenty-four (24) months
beyond











the month in which such
Change in Control occurred; or (ii) until all obligations of the Company
hereunder have been fulfilled, and until all benefits required hereunder have
been paid to the Executive.  Any subsequent
Change in Control (“Subsequent Change in Control”) that occurs during the
original or any extended term shall also continue the term of this Agreement
until the later of: (i) twenty-four (24) months beyond the month in which such
Subsequent Change in Control occurred; or (ii) until all obligations of the
Company hereunder have been fulfilled, and until all benefits required
hereunder have been paid to the Executive; provided, however,
that if a Subsequent Change in Control occurs, it shall only be considered a
Change in Control under this Agreement if it occurs no later than twenty-four
(24) months after the immediately preceding Change in Control or Subsequent
Change in Control.


Article 2.                                            ERISA


This Agreement is
intended as part of a severance program of the Company that constitutes (i) a
pension plan within the meaning of Section 3(2) of ERISA, and (ii) an unfunded
pension plan maintained by the Company for a select group of management or
highly compensated employees within the meaning of Department of Labor
Regulation 2520.104-23 promulgated under ERISA, and Sections 201, 301, and 401
of ERISA.


Article 3.                                            Definitions


Whenever used in
this Agreement, the following terms shall have the meanings set forth below
and, when the meaning is intended, the initial letter of the word is
capitalized:


(a)                                  “Agreement” means this Change in Control
Severance Agreement.


(b)                                 “Base Salary” means the salary of record
paid to the Executive by the Company as annual salary (whether or not
deferred), but excludes amounts received under incentive or other bonus plans.


(c)                                  “Beneficial Owner” shall have the meaning
ascribed to such term in Rule 13d-3 of the General Rules and Regulations under
the Exchange Act.


(d)                                 “Beneficiary” means the persons or
entities designated or deemed designated by the Executive pursuant to Section
11.2.


(e)                                  “Board” means the Board of Directors of
the Company.


(f)                                    “Cause” means the occurrence of either or
both of the following:


(i)                                     the Executive’s conviction for committing
an act of fraud, embezzlement, theft, or other act constituting a felony (other
than traffic related offenses or as a result of vicarious liability); or


(ii)                                  the willful engaging by the Executive in
misconduct that is significantly injurious to the Company.  However, no act or failure to act, on the
Executive’s part shall be considered “willful” unless done, or omitted to be
done, by the Executive not in good faith and without reasonable belief that the
Executive’s action or omission was in the best interest of the Company.











(g)                                 “Change in Control” of the Company shall
be deemed to have occurred as of the first day that any one or more of the
following conditions shall have been satisfied:


(i)                                     Any Person (other than those Persons in
control of the Company as of the Effective Date) becomes the Beneficial Owner,
directly or indirectly, of securities of the Company representing twenty
percent (20%) or more of either (1) the then-outstanding shares of common stock
of the Company (the “Outstanding
Company Common Stock”) or (2) the combined voting power of the
then-outstanding voting securities of the Company entitled to vote generally in
the election of directors (the “Outstanding
Company Voting Securities”); provided, however, that, for
purposes of this clause (i), the following acquisitions shall not constitute a
Change in Control: (A) any acquisition directly from the Company, (B) any
acquisition by the Company, (C) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any affiliate of
the Company or a successor, or (D) any acquisition by any entity pursuant to a
transaction that complies with Sections (g)(ii), (iii) and (iv) below; further
provided, that, creditors of the Company who become stockholders of the
Company in connection with any bankruptcy of the Company under the laws of the
United States shall not, by virtue of such bankruptcy, be deemed a “group” or a
single Person for the purposes of this clause (i) (provided that any one
of such creditors may trigger a Change in Control pursuant to this clause (i)
if such creditor’s ownership of Company securities equals or exceeds the
foregoing threshold);


(ii)                                  On any day after the Effective Date (the “Measurement
Date”) Continuing Directors cease for any reason to constitute either: (1) if
the Company does not have a Parent, a majority of the Board; or (2) if the
Company has a Parent, a majority of the Board of Directors of the Controlling
Parent.  A director is a “Continuing
Director” if he or she either:


(1)                                  was a member of the Board on the applicable
Initial Date (an “Initial Director”); or


(2)                                  was elected to the Board (or the Board of
Directors of the Controlling Parent, as applicable), or was nominated for
election by the Company’s or the Controlling Parent’s stockholders, by a vote
of at least two-thirds (2/3) of the Initial Directors then in office.


A member of the
Board (or Board of Directors of the Controlling Parent, as applicable) who was
not a director on the applicable Initial Date shall be deemed to be an Initial
Director for purposes of clause (2) above if his or her election, or nomination
for election by the Company’s or the Controlling Parent’s stockholders, was
approved by a vote of at least two-thirds (2/3) of the Initial Directors
(including directors elected after the applicable Initial Date who are deemed
to be Initial Directors by application of this provision) then in office; provided
that such member of the Board shall not be deemed to be an Initial Director if
his or her initial assumption











of office occurs
as a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board.


“Initial Date”
means the later of (1) the Effective Date or (2) the date that is two (2) years
before the Measurement Date.


(iii)                               Consummation of a reorganization, merger, statutory
share exchange or consolidation or similar corporate transaction involving the
Company or any of its subsidiaries, a sale or other disposition of all or
substantially all of the assets of the Company, or the acquisition of assets or
stock of another entity by the Company or any of its subsidiaries (each, a “Business
Combination”), in each case unless, following such Business Combination, (1)
all or substantially all of the individuals and entities that were the
Beneficial Owners of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities immediately prior to such Business Combination
Beneficially Own, directly or indirectly, more than sixty percent (60%) of the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding voting securities entitled to vote generally in the election
of directors, as the case may be, of the entity resulting from such Business
Combination (including, without limitation, an entity that, as a result of such
transaction, is a Parent of the Company or the successor of the Company) in
substantially the same proportions as their ownership immediately prior to such
Business Combination of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities, as the case may be, (2) no Person
(excluding any entity resulting from such Business Combination or a Parent of
the Company or any successor of the Company or any employee benefit plan (or
related trust) of the Company or such entity resulting from such Business
Combination or a Parent of the Company or the successor entity) Beneficially
Owns, directly or indirectly, twenty percent (20%) or more of, respectively,
the then-outstanding shares of common stock of the entity resulting from such
Business Combination or the combined voting power of the then-outstanding
voting securities of such entity, except to the extent that the ownership in
excess of twenty percent (20%) existed prior to the Business Combination, and
(3) a Change in Control is not triggered pursuant to clause (ii) above with
respect to the Company (including any successor entity) or any Parent of the
Company (or the successor entity).


(iv)                              A complete liquidation or dissolution of
the Company other than in the context of a transaction that does not constitute
a Change in Control of the Company under clause (iii) above.


Notwithstanding
the foregoing, in no event shall a transaction or other event that occurred
prior to the Effective Date constitute a Change in Control.  Notwithstanding anything to the contrary in
clause (iii) above to the contrary, a change in ownership of the Company
resulting from creditors of the Company











becoming
stockholders of the Company in connection with any bankruptcy of the Company
under the laws of the United States shall not trigger a Change in Control
pursuant to clause (iii) above.


(h)                                 “Code” means the United States Internal
Revenue Code of 1986, as amended.


(i)                                     “Committee” means the Compensation
Committee of the Board, or any other committee appointed by the Board to
perform the functions of the Compensation Committee.


(j)                                     “Company” means Power-One, Inc., a
Delaware corporation (including, for purposes of determining whether the
Executive is employed by the Company, any and all subsidiaries specified by the
Committee), or any successor thereto as provided in Article 10.


(k)                                  “Controlling Parent” means the Company’s
Parent so long as a majority of the voting stock or voting power of that Parent
is not Beneficially Owned, directly or indirectly through one or more
subsidiaries, by any other Person.  In
the event that the Company has more than one “Parent,” then “Controlling Parent”
shall mean the Parent of the Company the majority of the voting stock or voting
power of which is not Beneficially Owned, directly or indirectly through one or
more subsidiaries, by any other Person.


(l)                                     “Disability” means disability as defined
in the Company’s long-term disability plan in which the Executive participates
at the relevant time or, if the Executive does not participate in a Company
long-term disability plan at the relevant time, such term shall mean a “permanent
and total disability” within the meaning of Section 22(e)(3) of the Code.


(m)                               “Effective Date” has the meaning given to
such term in Article 1 hereof.


(n)                                 “Effective Date of Termination” means the
date on which a Qualifying Termination occurs.


(o)                                 “ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.


(p)                                 “Exchange Act” means the United States
Securities Exchange Act of 1934, as amended.


(q)                                 “Executive” means the individual
identified in the first sentence, and on the signature page, of this Agreement.


(r)                                    “Good Reason” means, without the
Executive’s express written consent, the occurrence of any one or more of the
following:


(i)                                     A material reduction in the nature or
status of the Executive’s authorities, duties, and/or responsibilities, (when
such authorities, duties, and/or responsibilities are viewed in the aggregate)
from their level in effect on the











day
immediately prior to the start of the Protected Period, other than an
insubstantial and inadvertent act that is remedied by the Company promptly
after receipt of notice thereof given by the Executive; provided that if
the Executive is a vice president, for purposes of the preceding phrase the
Executive’s loss of vice president status (other than a promotion to a higher
level officer) will constitute Good Reason. 
In addition, Good Reason will be deemed to exist if the Executive’s
reporting relationship is diminished from the Executive’s reporting
relationship in effect on the day immediately prior to the start of the
Protected Period (for example, if the Executive reports directly to the Company’s
Chief Executive Officer on the day immediately prior to the start of the
Protected Period, Good Reason will be deemed to exist if the Executive’s
reporting relationship is changed such that the Executive no longer reports
directly to the Chief Executive Officer of the Company or any Parent or
directly to the Board of Directors of the Company or any Parent).  The change in status of the Company from a
publicly-traded company to a company the securities of which are not
publicly-traded (including any related termination of the Company’s reporting
obligations under the Exchange Act) shall not, in and of itself, constitute
Good Reason or a material reduction in the nature or status of the Executive’s
authorities, duties, and/or responsibilities.


(ii)                                  A reduction by the Company in the
Executive’s Base Salary as in effect immediately prior to the start of the
Protected Period or as the same shall be increased from time to time.


(iii)                               A significant reduction by the Company of
the Executive’s aggregate incentive opportunities under the Company’s short
and/or long-term incentive programs, as such opportunities exist immediately
prior to the start of the Protected Period, or as such opportunities may be
increased from time to time.  For this
purpose, a significant reduction in the Executive’s incentive opportunities
shall be deemed to have occurred in the event his targeted annualized award
opportunities and/or the degree of probability of attainment of such annualized
award opportunities are materially diminished by the Company from the levels
and probability of attainment that existed immediately prior to the start of
the Protected Period.  If the Company has
a Parent, a significant reduction of the Executive’s aggregate incentive
opportunities under the Company’s short and/or long-term incentive programs
shall not be deemed to have occurred if there is an across-the-board
reduction in or elimination of any such program which similarly affects all
executives of the Company and the reduced or eliminated incentives are replaced
by a similar program of a Parent.


(iv)                              The failure of the Company to maintain
(x) the Executive’s relative level of coverage and accruals under the Company’s
employee benefit and/or retirement plans, policies, practices, or arrangements
in which the Executive participates immediately prior to the start of the
Protected Period, both in terms of the amount of benefits provided, and amounts
accrued and











(y)
the relative level of the Executive’s participation in such plans, policies, practices,
or arrangements on a basis at least as beneficial as, or substantially
equivalent to, that on which the Executive participated in such plans
immediately prior to the start of the Protected Period.  For this purpose, the Company may eliminate
and/or modify existing programs and coverage levels; provided, however,
that the Executive’s level of coverage under all such programs must be at least
as great as is provided to executives who have the same or lesser levels of
reporting responsibilities within the Company’s organization.


(v)                                 The failure of the Company to obtain a
satisfactory agreement from any successor to the Company to assume and agree to
perform this Agreement, as contemplated in Article 10.


(vi)                              Any purported termination by the Company
of the Executive’s employment that is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 4.6 and for purposes of this
Agreement, no such purported termination shall be effective.


(vii)                           The Executive is informed by the Company that his
principal place of employment for the Company will be relocated to a location
that is greater than thirty-five (35) miles away from the Executive’s principal
place of employment for the Company at the start of the corresponding Protected
Period; provided that, if the Company communicates an intended effective
date for such relocation, in no event shall Good Reason exist pursuant to this
clause (vii) more than ninety (90) days before such intended effective date.


The
Executive’s right to terminate employment for Good Reason shall not be affected
by the Executive’s incapacity due to physical or mental illness.  The Executive’s continued employment shall
not constitute a consent to, or a waiver of rights with respect to, any
circumstances constituting Good Reason herein; provided, however,
that if the Executive does not terminate employment and claim Good Reason for
such termination within ninety (90) days after the Executive has knowledge of
an event or circumstance that would constitute Good Reason, then the Executive
shall be deemed to have waived his right to claim Good Reason as to that
specific fact or circumstance (except that the event or circumstance may be
considered for purposes of determining whether any subsequent, separate, event
or circumstance constitutes Good Reason; for example, and without limitation, a
reduction in the Executive’s authorities that is deemed waived by operation of
this clause may be considered for purposes of determining whether any
subsequent reduction in the Executive’s authorities (when taken into
consideration with the first reduction) constitutes a “material reduction” in
the nature or status of the Executive’s authorities from their level in effect
on the day immediately prior to the start of the Protected Period).











(s)                                  “Parent” means an entity that
Beneficially Owns a majority of the voting stock or voting power of the
Company, or all or substantially all of the Company’s assets, directly or
indirectly through one or more subsidiaries.


(t)                                    “Qualifying Termination” has the meaning
given to such term in Section 4.2(a).


(u)                                 “Severance Benefits” means the payments
and/or benefits provided in Section 4.3.


Article 4.                                            Severance Benefits


4.1.                    Right to Severance Benefits. 
The Executive shall be entitled to receive from the Company Severance
Benefits, as described in Section 4.3, if the Executive has incurred a
Qualifying Termination.


The Executive shall not
be entitled to receive Severance Benefits if his employment terminates
(regardless of the reason) before the Protected Period (as such term is defined
in Section 4.2(c)) corresponding to a Change in Control of the Company or more
than twenty-four (24) months after the date of a Change in Control of the
Company.


4.2.                    Qualifying Termination.


(a)                                  Subject to Sections 4.2(d), 4.4, and 4.5,
the occurrence of any one or more of the following events within the Protected
Period corresponding to a Change in Control of the Company, or within
twenty-four (24) calendar months following the date of a Change in Control of
the Company shall constitute a “Qualifying Termination”:


(i)                                     An involuntary termination of the
Executive’s employment by the Company for reasons other than Cause;


(ii)                                  A voluntary termination of employment by
the Executive for Good Reason;


(iii)                               A successor company fails or refuses to assume by
written instrument the Company’s obligations under this Agreement, as required
by Article 10; or


(iv)                              The Company or any successor company
repudiates or breaches any of the provisions of this Agreement.


(b)                                 If more than one of the events set forth
in Section 4.2(a) occurs, such events shall constitute but a single Qualifying
Termination and the Executive shall be entitled to but a single payment of the
Severance Benefits.


(c)                                  The “Protected Period” corresponding to a
Change in Control of the Company shall be a period of time determined in
accordance with the following:


(i)                                     If the Change in Control is triggered by
a tender offer for shares of the Company’s stock or by the offeror’s
acquisition of shares pursuant to such a tender offer, the Protected Period
shall commence on the date of the initial tender offer and shall continue
through and including the date of the Change in Control; provided that
in no case will the Protected Period











commence
earlier than the date that is six (6) months prior to the Change in Control.


(ii)                                  If the Change in Control is triggered by
a merger, consolidation, or reorganization of the Company with or involving any
other corporation, the Protected Period shall commence on the date that serious
and substantial discussions first take place to effect the merger,
consolidation, or reorganization and shall continue through and including the
date of the Change in Control; provided that in no case will the
Protected Period commence earlier than the date that is six (6) months prior to
the Change in Control.


(iii)                               In the case of any Change in Control not described in
clause (i) or (ii) above, the Protected Period shall commence on the date that
is six (6) months prior to the Change in Control and shall continue through and
including the date of the Change in Control.


(d)                                 Notwithstanding anything else contained
herein to the contrary, the Executive’s termination of employment on account of
reaching mandatory retirement age, as such age may be defined from time to time
in policies adopted by the Company prior to the commencement of the Protected
Period, and consistent with applicable law, shall not be a Qualifying
Termination.


(e)                                  Notwithstanding anything else contained
herein to the contrary (other than those provisions that contain an express
exception to this Section 4.2(e)), the Executive’s Severance Benefits under
this Agreement shall be reduced by the severance benefits (including, without
limitation, any other change-in-control severance benefits and any other severance
benefits generally) that the Executive may be entitled to under any other plan,
program, agreement or other arrangement with the Company (including, without
limitation, any such benefits provided for by an employment agreement).  For purposes of the foregoing, any cash
severance benefits payable to the Executive under any other plan, program,
agreement or other arrangement with the Company shall offset the cash severance
benefits otherwise payable to the Executive under this Agreement on a dollar-for-dollar
basis.  For purposes of the foregoing,
non-cash severance benefits to be provided to the Executive under any other
plan, program, agreement or other arrangement with the Company shall offset any
corresponding benefits otherwise to be provided to the Executive under this
Agreement or, if there are no corresponding benefits otherwise to be provided
to the Executive under this Agreement, the value of such benefits shall offset
the cash severance benefits otherwise payable to the Executive under this
Agreement on a dollar-for-dollar basis. 
If the amount of other benefits to be offset against the cash severance
benefits otherwise payable to the Executive under this Agreement in accordance
with the preceding two sentences exceeds the amount of cash severance benefits
otherwise payable to the Executive under this Agreement, then the excess may be
used to offset other non-cash severance benefits otherwise to be provided to
the Executive under this Agreement on a dollar-for-dollar basis.  For purposes of this paragraph, the Committee
shall reasonably determine the value of any non-cash benefits.















4.3.                    Description of Severance Benefits. 
In the event that the Executive becomes entitled to receive Severance
Benefits, as provided in Sections 4.1 and 4.2, the Company shall pay to the
Executive and provide him with the following:


(a)                                  An amount equal to [2x for CEO and COO; 1x for other
named executive officers] times the Executive’s highest annualized rate of Base Salary
in effect at any time after the commencement of the Protected Period and on or
before the Effective Date of Termination.


(b)                                 An amount equal
to [2x
for CEO and COO; 1x for other named executive officers]  the highest aggregate
bonus(es) paid by the Company to the Executive for any one of the three (3) full fiscal years of the Company
immediately preceding Executive’s Effective Date of Termination.


(c)                                  A continuation of the Executive’s medical
coverage, dental coverage, and group term life insurance for the Executive, his
spouse, and his eligible dependents for the [2 for CEO and COO; 1 for other
named executive officers] year(s) following the Executive’s Effective Date of
Termination; provided that such continuation of coverage shall run
concurrently with COBRA continuation or similar state law continuation periods;
and provided further that the continuation of such coverage shall be
discontinued prior to the end of the [2 for CEO and COO; 1 for other named executive
officers]
year period in the event the Executive has available substantially similar
benefits from a subsequent employer, as reasonably determined by the
Committee.  Except as provided in the
next sentence, such benefits shall be provided to the Executive at the same
premium cost, and at the same coverage level, as in effect as of the Executive’s
Effective Date of Termination.  However,
in the event the premium cost and/or level of coverage shall change for all
employees of the Company, the cost and/or coverage level, likewise, shall
change for the Executive in a corresponding manner.  The continuation of coverage for the period
contemplated by this Section 4.3(c) shall be coordinated with and paid
secondary to any benefits that the Executive, his spouse, or his dependent
receives from another employer or from Medicare (following the Executive’s, his
spouse’s, and/or his dependent’s entitlement to Medicare benefits) to the
maximum extent permissible under relevant law.


(d)                                 A lump-sum cash amount equal to the
portion of the Executive’s account under the Company’s qualified retirement
plan (including, without limitation, any 401(k) matching contributions) that
has not become vested under the terms of such plan as of the Effective Date of
Termination.


(e)                                  A lump-sum cash amount equal to the
portion of the Executive’s account under any Company nonqualified deferred
compensation or other supplemental retirement plan that has not become vested
under the terms of such plan as of the Effective Date of Termination.


(f)                                    If any stock option, restricted stock, or
other equity or equity-based award granted by the Company to the Executive is
subject to a vesting schedule and does not automatically become fully vested
upon or in connection with the termination of the Executive’s employment with
the Company or the related Change in Control











event,
the portion of such award that was scheduled to vest (assuming that the
Executive continued to be employed by the Company) at any time within the [2 for CEO and COO; 1 for other
named executive officers]  year
period following the Effective Date of Termination shall automatically become
vested as of the Effective Date of Termination; provided, however,
that any portion of such award remaining unvested after giving effect to the
foregoing clause shall immediately terminate upon the Effective Date of
Termination.  In the event that the
Effective Date of Termination occurs during the Protected Period related to a Change
in Control and a portion of a stock option or other award referred to in the
preceding sentence is deemed to become vested in connection with the
termination of the Executive’s employment pursuant to the preceding sentence,
and such portion of the award would otherwise terminate or expire upon or prior
to the date of the related Change in Control, the Executive shall be given a
reasonable opportunity to exercise such accelerated portion of the option or
other award before it terminates.


(g)                                 The Company shall pay or reimburse the
Executive for up to $15,000 of outplacement services obtained by the Executive
during the twelve (12) month period following the Effective Date of
Termination.


4.4.                    Termination Due to Disability,
Death or Retirement.  Termination of the Executive’s employment due
to the Executive’s death or Disability is not a Qualifying Termination.  However, if immediately prior to the
condition or event leading to, or the commencement of, the Disability of the
Executive (but not the death of the Executive), the Executive would have
experienced a Qualifying Termination if he had terminated at that time, then
upon termination of his employment for Disability he shall be entitled to the
benefits provided by this Agreement for a Qualifying Termination.  A voluntary termination of employment by the
Executive due to the Executive’s retirement is not a Qualifying
Termination.  However, if immediately
prior to the Executive’s retirement (but not death), the Executive would have
experienced a Qualifying Termination if he had terminated at that time, then
upon his retirement he shall (subject to Section 4.2(d)) be entitled to the
benefits provided by this Agreement for a Qualifying Termination.


4.5.                    Termination for Cause or by the
Executive Other Than for Good Reason   Termination
of the Executive’s employment by the Company for Cause or by the Executive
other than for Good Reason does not constitute a Qualifying Termination.


4.6.                    Notice of Termination. 
Any termination by the Company for Cause or by the Executive for Good
Reason shall be communicated by a Notice of Termination.  For purposes of this Agreement, a “Notice of
Termination” shall mean a written notice which shall indicate the specific
termination provision in this Agreement relied upon, and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive’s employment under the provision so indicated.


Article
5.                                            Form and Timing of Severance Benefits;
Tax Withholding;


5.1.                    Form and Timing of Severance
Benefits.  The Severance Benefits described in Section
4.3(a), 4.3(b), 4.3(d) and 4.3(e) shall be paid in cash to the Executive in a
single lump sum as soon as practicable following the Effective Date of
Termination, but in no event beyond thirty (30) days from such date.











5.2.                    Withholding of Taxes. 
The Company shall be entitled to withhold from any amounts payable under
or pursuant to this Agreement all taxes as legally shall be required
(including, without limitation, any United States Federal taxes, and any other
state, city, or local taxes).


Article 6.                                            Section 280G Potential Cut-Back


6.1.                    Cut-Back. 
Notwithstanding anything contained in this Agreement to the contrary, to
the extent that any payment or distribution of any type to or for the Executive
by the Company or any of its affiliates, whether paid or payable or distributed
or distributable pursuant to the terms of this Agreement or otherwise
(including, without limitation, any accelerated vesting of stock options or
restricted stock granted by the Company pursuant to this Agreement or
otherwise) (collectively, the “Total Payments”) is or will be subject to the
excise tax imposed under Section 4999 of the Code (which reference includes,
for purposes of this Agreement, any similar successor provision to Section
4999), then the Total Payments shall be reduced (but not below zero) so that
the maximum amount of the Total Payments (after reduction) shall be one dollar
($1.00) less than the amount which would cause the Total Payments to be subject
to the excise tax imposed by Section 4999 of the Code.  Unless the Executive shall have given prior
written notice to the Company to effectuate a reduction in the Total Payments
if such a reduction is required, the Company shall reduce or eliminate the
Total Payments by first reducing or eliminating any cash severance benefits,
then by reducing or eliminating any accelerated vesting of stock options, then
by reducing or eliminating any accelerated vesting of restricted stock, then by
reducing or eliminating any other remaining Total Payments.  The preceding provisions of this Section 6.1
shall take precedence over the provisions of any other plan, arrangement or
agreement governing the Executive’s rights and entitlements to any benefits or
compensation; provided, however, that if the Executive is a party
to a written employment or other written agreement with the Company that
contains express provisions for a so-called “gross-up” payment to the extent
that excise taxes are imposed under Section 4999 of the Code, the Section 280G
and/or Section 4999 provisions of such employment or other agreement shall
control.


6.2.                    Determination. 
Any determination that Total Payments to the Executive must be reduced
or eliminated in accordance with the forgoing provisions of this Section 6 and
the assumptions to be utilized in arriving at such determination, shall be made
by a nationally recognized accounting firm or consulting firm with experience
in such matters selected by the Company (the “Accounting Firm”), which shall
provide detailed supporting calculations both to the Company and the Executive
within fifteen (15) business days after the date such calculation is requested
by the Company or the Executive.  In the
event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change in Control, the Executive
shall appoint another nationally recognized accounting or consulting firm with
experience in such matters to make the determinations required hereunder (which
accounting firm shall then be referred to as the Accounting Firm
hereunder).  All fees and expenses of the
Accounting Firm shall be borne solely by the Company.  If a reduction or elimination of Total
Payments to the Executive in accordance with the foregoing is necessary based
on the Accounting Firm’s determination, the Accounting Firm shall furnish the
Executive with a written opinion that failure to limit the amount of the Total
Payments would result in the imposition of a tax under Section 4999 of the Code.  Any determination by the Accounting Firm
shall be binding upon the Company and the Executive.  As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that











Total Payments to the
Executive which will not have been made by the Company should have been made (“Underpayment”).  The Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Company to or for the benefit of the Executive.  In the event that any Total Payment made to
the Executive shall be determined by the Accounting Firm to result in the
imposition of any tax under Section 4999 of the Code, the Executive shall
promptly repay the amount of such excess to the Company together with interest
on such amount (at the same rate as is applied to determine the present value
of payments under Section 280G or any successor thereto), from the date the
reimbursable payment was received by the Executive to the date the same is
repaid to the Company.


Article 7.                                            The Company’s Payment Obligation


7.1.                    Payment of Obligations Absolute. 
Except as provided in Sections 4.2(e) and 5.2 and in Article 6, the
Company’s obligation to make the payments and the arrangements provided for
herein shall be absolute and unconditional, and shall not be affected by any
circumstances, including, without limitation, any offset, counterclaim,
recoupment, defense, or other right which the Company may have against the
Executive or anyone else.  All amounts
payable by the Company hereunder shall be paid without notice or demand.  Each and every payment made hereunder by the Company
shall be final, and the Company shall not seek to recover all or any part of
such payment from the Executive or from whoever may be entitled thereto, for
any reasons whatsoever, except as otherwise provided in Article 6 or Article 9.


The Executive shall not
be obligated to seek other employment in mitigation of the amounts payable or
arrangements made under any provision of this Agreement, and the obtaining of
any such other employment shall in no event effect any reduction of the Company’s
obligations to make the payments and arrangements required to be made under
this Agreement, except to the extent provided in Section 4.3(c).


7.2.                    Contractual Right to Benefits. 
This Agreement establishes and vests in the Executive a contractual
right to the benefits to which he or she is entitled hereunder.  The Company expressly waives any ability, if
possible, to deny liability for any breach of its contractual commitment
hereunder upon the grounds of lack of consideration, accord and satisfaction or
any other defense.  In any dispute
arising after a Change in Control as to whether the Executive is entitled to
benefits under this Agreement, there shall be a presumption that the Executive
is entitled to such benefits and the burden of proving otherwise shall be on
the Company.  However, nothing herein
contained shall require or be deemed to require, or prohibit or be deemed to
prohibit, the Company to segregate, earmark, or otherwise set aside any funds
or other assets, in trust or otherwise, to provide for any payments to be made
or required hereunder.


7.3.                    Pension Plans; Duplicate Benefits. 
All payments, benefits and amounts provided under this Agreement shall
be in addition to and not in substitution for any pension rights under the
Company’s tax-qualified pension plan, supplemental retirement plans,
nonqualified deferred compensation plans, and any disability, workers’
compensation or other Company benefit plan distribution that the Executive is
entitled to at his Effective Date of Termination.  Notwithstanding the foregoing, this Agreement
shall not create an inference that any duplicate payments shall be
required.  No payments made pursuant to
this Agreement shall be considered compensation for purposes of any such
benefit plan.  Payment of the Executive’s
accrued and unpaid Base Salary and accrued vacation pay through the Executive’s
Effective Date of Termination shall be deemed to not











duplicate any benefit
contemplated by this Agreement and shall not result in an offset pursuant to
Section 4.2(e).  If the acceleration of
vesting, lapse of restrictions and/or payout provisions triggered by a Change
in Control as to any award held by the Executive under any long-term incentive
plan are more favorable to the Executive as to that award than the provisions
of Section 4.3(f), the provisions more favorable to the Executive shall
control; provided that if the provisions of such a plan are more
favorable to the Executive in the circumstances and the provisions of such plan
are deemed to control as to an award, Section 4.3(f) shall not be applied to
provide any duplicate benefits or result in any greater vesting as to the award
than the provisions of such plan.


Article 8.                                            Trade Secrets; Non-Solicitation and
Non-Disparagement


By executing this
Agreement and again by receiving any benefits provided for by this Agreement,
the Executive agrees follows:


(a)                                  In the course of performing his duties
for the Company, the Executive will receive, and acknowledges that he or she
has received, confidential information, including without limitation,
information not available to competitors relating to the Company’s existing and
contemplated financial plans, products, business plans, operating plans,
research and development information, and customer information, all of which is
hereinafter referred to as “Trade Secrets.” 
The Executive agrees that he or she will not, either during his
employment or subsequent to the termination of his employment with the Company,
directly or indirectly disclose, publish or otherwise divulge any Trade Secret
of the Company or any of its affiliates to anyone outside the Company, or use
such information in any manner which would adversely affect the business or
business prospects of the Company, without prior written authorization from the
Company to do so.  The Executive further
agrees that if, at the time of the termination of his employment with the
Company, he is in possession of any documents or other written or electronic
materials constituting, containing or reflecting Trade Secrets, the Executive
will return and surrender all such documents and materials to the Company upon
leaving its employ.  The restrictions and
protection provided for in this Section 8(a) shall be in addition to any
protection afforded to Trade Secrets by law or equity and in addition to any
protection afforded to Trade Secrets by any other agreement between the
Executive and the Company.


(b)                                 For a period of one year following the
termination of the Executive’s employment with the Company, the Executive shall
not, directly or indirectly through, aid, assistance or counsel, on the
Executive’s own behalf or on behalf of another person or entity (i) contact,
solicit or offer to hire any person who was, within a period of six months
prior to the termination of the Executive’s employment with the Company,
employed by the Company or one of its subsidiaries, or (ii) by any means issue
or communicate any private or public statement that may be critical or
disparaging of the Company or any of its affiliates, or any of their respective
products, services, officers, directors or employees.


Article 9.                                            Claims Procedure


9.1.                    Committee Review. 
The Executive or, in the event of the Executive’s death, the Executive’s
Beneficiary (as applicable, the “Claimant”) may deliver to the Committee a
written











claim for a determination
with respect to the amounts distributable to such Claimant from this
Agreement.  Such claim shall be delivered
to the Committee care of the Company in accordance with the notice provisions
of Section 11.6.  If such a claim relates
to the contents of a notice received by the Claimant, the claim must be made
within sixty (60) days after such notice was received by the Claimant.  All other claims must be made within two
hundred and seventy (270) days of the date on which the event that caused the
claim to arise occurred (subject to Section 3(r) as to the timing of certain
claims related to a purported termination for Good Reason).  The claim must state with particularity the
determination desired by the Claimant.


9.2.                    Notification of Decision. 
The Committee shall consider a Claimant’s claim pursuant to Section 9.1
within a reasonable time, but no later than ninety (90) days after receiving
the claim.  If the Committee determines
that special circumstances require an extension of time for processing the
claim, written notice of the extension shall be furnished to the Claimant prior
to the termination of the initial ninety (90) day period.  In no event shall such extension exceed a
period of ninety (90) days from the end of the initial period.  The extension notice shall indicate the
special circumstances requiring an extension of time and the date by which the
Committee expects to render the benefit determination.  The Committee shall notify the Claimant in
writing:


(c)                                  that the Claimant’s requested
determination has been made, and that the claim has been allowed in full; or


(d)                                 that the Committee has reached a
conclusion contrary, in whole or in part, to the Claimant’s requested
determination, and such notice must set forth in a manner calculated to be
understood by the Claimant:


(i)                                     the specific reason(s) for the denial of
the claim, or any part of it;


(ii)                                  specific reference(s) to pertinent
provisions of this Agreement upon which such denial was based;


(iii)                               a description of any additional material
or information necessary for the Claimant to perfect the claim, and an
explanation of why such material or information is necessary;


(iv).                           a statement that the Claimant is entitled
to receive, upon request and free of charge, reasonable access to and copies
of, all documents, records and other information relevant (as defined in
applicable ERISA regulations) to the Claimant’s claim for benefits; and


(v)                                 a statement of the Claimant’s right to
seek arbitration pursuant to Section 9.4.


9.3.                    Pre and Post-Change in
Control Procedures.  With respect to claims made prior to the occurrence
of a Change in Control, a Claimant’s compliance with the foregoing provisions
of this Article 9 is a mandatory prerequisite to a Claimant’s right to commence
arbitration pursuant to Section 9.4 with respect to any claim for benefits
under this Agreement.  With respect to
claims made upon and after the occurrence of a Change in Control, the Claimant
may proceed directly to arbitration in accordance with Section 9.4 and need not
first satisfy the foregoing provisions of this Article 9.











9.4.                    Arbitration of Claims. 
All claims or controversies arising out of or in connection with this
Agreement, that the Company may have against any Claimant, or that any Claimant
may have against the Company or against its officers, directors, employees or
agents acting in their capacity as such, shall, subject to the initial review
provided for in the foregoing provisions of this Article 9 that are effective
with respect to claims brought prior to the occurrence of a Change in Control,
be resolved through arbitration as provided in this Section 9.4.  The decision of an arbitrator on any issue,
dispute, claim or controversy submitted for arbitration, shall be final and
binding upon the Company and the Claimant and that judgment may be entered on
the award of the arbitrator in any court having proper jurisdiction.  The arbitrator shall review de novo any claim previously considered by
the Committee pursuant to Section 9.1.


Except as otherwise
provided in this procedure or by mutual agreement of the parties, any
arbitration shall be administered: (1) in accordance with the then-current
Model Employment Arbitration Procedures of the American Arbitration Association
(“AAA”) before an arbitrator who is licensed to practice law in the state in
which the arbitration is convened; or (2) if locally available, the Judicial
Arbitration & Mediation Services, Inc. (“JAMS”), in accordance with the
JAMS procedures then in effect.  The
party who did not initiate the claim can designate between JAMS or AAA (the “Tribunal”).  The arbitration shall be held in the city in
which the Claimant is or was last employed by the Company in the nearest
Tribunal office or at a mutually agreeable location.  Pre-hearing and post-hearing procedures may
be held by telephone or in person as the arbitrator deems necessary.


The arbitrator shall be
selected as follows: if the parties cannot agree on an arbitrator, the Tribunal
(JAMS or AAA) shall then provide the names of nine (9) available arbitrators
experienced in business employment matters along with their resumes and fee
schedules.  Each party may strike all
names on the list it deems unacceptable. 
If more than one common name remains on the list of all parties, the
parties shall strike names alternately until only one remains.  The party who did not initiate the claim
shall strike first.  If no common name
remains on the lists of the parties, the Tribunal shall furnish an additional
list or lists until an arbitrator is selected.


The arbitrator shall
interpret this Agreement, any applicable Company policy or rules and
regulations, any applicable substantive law (and the law of remedies, if
applicable) of the state in which the claim arose, or applicable federal
law.  In reaching his or her decision,
the arbitrator shall have no authority to change or modify any lawful Company
policy, rule or regulation, or this Agreement. 
The arbitrator, and not any federal, state or local court or agency,
shall have exclusive and broad authority to resolve any dispute relating to the
interpretation, applicability, enforceability or formation of this Agreement,
including but not limited to, any claim that all or any part of this Agreement
is voidable.


The arbitration shall be
conducted pursuant to California Code of Civil Procedure Sections 1282 et. seq.


9.5.                    Claims Expenses; Legal Fees and
Expenses of Executive.                                         The Company shall advance and bear all reasonable
expenses of any arbitration conducted under this Section 9 and all reasonable
legal fees and expenses incurred by Claimant in pursuing a claim at and through
any stage of review or dispute resolution pursuant to this Section 9; provided,
however, that if it is finally determined that the Claimant did not
pursue the claim or commence the arbitration in good











faith and had no
reasonable basis therefore, the Claimant shall repay all of Claimant’s legal
fees and expenses advanced by the Company and shall reimburse the Company for
its reasonable legal fees and expenses in connection therewith (except that, in
any event, the Company shall be responsible for payment of the forum costs of
any arbitration hereunder, including the arbitrator’s fee).


Article 10.                                     Successors and Assignment


10.1.             Successors to the Company. 
The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) of all or substantially all of
the business and/or assets of the Company or of any division or subsidiary
thereof (the business and/or assets of which constitute at least fifty percent
(50%) of the total business and/or assets of the Company) to expressly assume
and agree to perform the Company’s obligations under this Agreement in the same
manner and to the same extent that the Company would be required to perform
them if such succession had not taken place. 
Failure of the Company to obtain such assumption and agreement in a
written instrument prior to the effective date of any such succession shall be
a breach of this Agreement and shall entitle the Executive to compensation from
the Company in the same amount and on the same terms as they would be entitled
to hereunder if they had terminated their employment with the Company
voluntarily for Good Reason.  Except for
the purpose of implementing the foregoing, the date on which any such
succession becomes effective shall be deemed the Executive’s Effective Date of
Termination if the Executive so elects, but any delay or failure by the
Executive to so elect shall not be a waiver or release of any rights hereunder
which may be asserted at any time.


10.2.             Assignment by the Executive. 
This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees, and legatees.  If the Executive dies while any amount would
still be payable to him hereunder had he continued to live, all such amounts,
unless otherwise provided herein, shall be paid to the Executive’s Beneficiary
in accordance with the terms of this Agreement. 
If the Executive has not named a Beneficiary, then such amounts shall be
paid to the Executive’s devisee, legatee, or other designee, or if there is no
such designee, to the Executive’s estate.


Article 11.                                     Miscellaneous


11.1.             Employment Status. 
Except as may be provided under any other written agreement between the
Executive and the Company, the employment of the Executive by the Company is “at
will,” and, prior to the effective date of a Change in Control, may be
terminated by either the Executive or the Company at any time, subject to
applicable law.


11.2.             Beneficiaries. 
The Executive may designate one or more persons or entities as the
primary and/or contingent Beneficiaries of any Severance Benefits owing to the
Executive under this Agreement.  The
Executive may make or change such designation at any time, provided that
any designation or change thereto must be in the form of a signed writing
acceptable to and received by the Committee.


11.3.             Gender and Number. 
Except where otherwise indicated by the context, any masculine term used
herein also shall include the feminine, the plural shall include the singular,
and the singular shall include the plural.











11.4.             Severability. 
In the event any provision of this Agreement shall be held illegal or
invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of this Agreement, and this Agreement shall be construed and
enforced as if the illegal or invalid provision had not been included.  Further, the captions of this Agreement are
not part of the provisions hereof and shall have no force and effect.


11.5.             Modification. 
Except as expressly provided in Section 3(r) with respect to certain
waivers of circumstances that would otherwise constitute Good Reason, no
provision of this Agreement may be modified, waived, or discharged unless such
modification, waiver, or discharge is agreed to in writing and signed by the
Executive and by an authorized member of the Committee or its designee, or by
the respective parties’ legal representatives and successors.


11.6.             Notice. 
For purposes of this Agreement, notices, including a Notice of
Termination, and all other communications provided for in this Agreement shall
be in writing and shall be deemed to have been duly given when delivered or on
the date stamped as received by the U.S. Postal Service for delivery by
certified or registered mail, postage prepaid and addressed: (i) if to the
Executive, to his latest address as reflected on the records of the Company,
and (ii) if to the Company: Power-One, Inc., 740 Calle Plano, Camarillo,
California 93012, Attn: Corporate Secretary, or to such other address as the
Company may furnish to the Executive in writing with specific reference to this
Agreement and the importance of the notice, except that notice of change of
address shall be effective only upon receipt.


11.7.             Applicable Law. 
To the extent not preempted by the laws of the United States, the laws
of the State of California shall be the controlling law in all matters relating
to this Agreement.  Any statutory
reference in this Agreement shall also be deemed to refer to all applicable
final rules and final regulations promulgated under or with respect to the
referenced statutory provision.


IN
WITNESS WHEREOF,
the parties have executed this Agreement on this                           
day of                                                ,
                 .


	
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