| 1.   | REFERENCE      TO EMPLOYMENT AGREEMENT. |
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| 2.   | ARRANGEMENT. |
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| 3.   | TERM. |
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| 4.   | CAPACITY,      SERVICES AND PERFORMANCE. |
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| 4.1   | Capacity.  Executive      shall serve the Company as its Chairman of the Board of Directors of the      Company (the “Board”)      and Chief Executive Officer, or in such other Board or executive capacity      as the Board may designate from time to time, but only upon agreement with      Executive. |
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| 4.2   | Services.  In      the capacity set forth in Section 4.1 above, Executive shall be      retained by the Company and shall perform such duties and responsibilities      on behalf of the Company as Executive and the Board shall by mutual      agreement from time to timedetermine. |
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| 4.3   | Performance.  During      the Employment Term,  Executive shall use his business judgment,      skill and knowledge to the advancement of the Company’s interests and to      the discharge of his duties and responsibilities hereunder; provided, however,      that  Executive shall be required only to devote so much time      as  Executive determines is reasonably necessary to discharge      his duties as Chairman of the Board and Chief Executive Officer, and,      subject to the provisions of Section 6 below, Executive may engage in      other business activities during the Employment  Term. |
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| 5.   | COMPENSATION      AND BENEFITS. |
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| 5.1   | Salary.  Effective      as of July 1, 2008, and during the Employment Term, Executive shall      receive an annual salary (the “Salary”)      of one million and forty-one thousand dollars ($1,041,000) during each      year of the Employment Term.  The Salary shall be subject to      adjustment from time to time by the Compensation Committee of the Board      (the “Compensation      Committee”); provided, however, that      at no time shall the Salary be adjusted below the Salary for the preceding      year.  Commencing on July 1, 2009, and on July 1st of      each year thereafter during the Employment Term, the Salary then in effect      shall be increased by an amount not less than the amount determined by      applying to the Salary then in effect to the percentage increase in the      U.S. Bureau of Labor Statistics Consumer Price Index Revised - Urban Wage      Earners and Clerical Workers - National - All Items (1982-84 = 100) (the      “Index”)      for the consecutive twelve (12)-month period (July through June)      immediately preceding such July 1.  If the Index is no      longer issued, the Compensation Committee and Executive shall agree upon a      substitute index issued by such agency which most reasonably reflects the      criteria utilized in the most recent issue of the Index.  Except      as otherwise provided in this Agreement, the Salary shall be payable      biweekly or in accordance with the Company’s current payroll practices,      and shall be pro-rated for any period of service less than a full      year. |
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| 5.2   | Bonuses.  Executive      may receive bonuses from the Company when, as and if determined from time      to time by the Compensation Committee.  Any such bonuses paid to      Executive shall be in addition to the Salary then in      effect.  The incentive bonus shall be paid in accordance with      Company policy, but in no event later than March 15th of the year      following the year in respect of which Executive earned such      bonus. |
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| 5.3   | Benefits.  So      long as employed, Executive shall be entitled to participate in all      employee benefit plans, life insurance plans, disability income plans,      incentive compensation plans and other benefit plans, other than      retirement plans, as may be from time to time in effect for executives of      the Company generally.  In addition, Executive and his spouse,      for as long as they each may live, shall be entitled to (i) all medical,      dental and health benefits available from time to time to the Company’s      executive officers and their spouses, respectively (other than medical      reimbursement plans) on similar terms and conditions as active employees      (provided that the level of such benefits is not greater than the benefits      available to Executive on December 31, 2004 and which included 100%      reimbursement of all medical and dental benefits incurred by Executive and      his family, the cost of which is fully paid by the Company), and (ii) the      benefits available under the Company’s executive medical reimbursement      plan in effect as of March 1, 2001. |
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| 5.4   | Business      Expenses.  The Company shall pay or reimburse Executive      for all reasonable business expenses incurred or paid by him during the      Employment Term in the performance of his  services. |
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| 5.5   | Automobile.  So      long as employed, Executive shall receive either an automobile owned or      leased by the Company or a monthly automobile allowance, as determined by      the Company, which automobile or allowance shall be at least equivalent to      that which the Company was providing to Executive as of April 30,      2006.  The automobile allowance, if applicable, shall be paid in      accordance with Company policy, but in any event, no later than      March 15th      of the year following the year in which the automobile allowance was      accrued. |
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| 5.6   | Equity Incentive      Compensation.  So long as employed, Executive shall be      eligible to participate in any applicable equity incentive compensation      program of the Company on the terms set forth by the Compensation      Committee in its sole discretion. |
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| 6.   | PROPRIETARY      RIGHTS AND NON-COMPETITION. |
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| 6.1   | Confidentiality.   Executive      will maintain in confidence and will not disclose or use, either during or      after the Employment Term, any proprietary or confidential information or      know-how belonging to the Company (“Proprietary      Information” hereinafter defined), whether or not in written form,      except to the extent required to perform duties on behalf of the      Company.  For purposes of this Agreement, “Proprietary      Information” shall mean any information, not generally known to the      relevant trade or industry, which was obtained from the Company, or which      was learned, discovered, developed, conceived, originated or prepared by      Executive in connection with this Agreement.  Such Proprietary      Information includes, without limitation, software, technical and business      information relating to the Company’s inventions or products, research and      development, production processes, manufacturing and engineering      processes, machines and equipment, finances, customers, marketing and      production and future business plans, information belonging to customers      or suppliers of the Company disclosed incidental to Executive’s      performance under this Agreement, and any other information which is      identified as confidential by the Company, but only so long as the same is      not generally known in the relevant trade or  industry. |
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| 6.2   | Inventions. |
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| 6.2.1     | Definition of      Inventions.  For purposes of this Agreement, “Inventions”      shall mean any new or useful art, discovery, contribution, finding or      improvement, whether or not patentable, and all related      know-how.  Inventions shall include, without limitation, all      designs, discoveries, formulae, processes, manufacturing techniques,      semiconductor designs, computer software, inventions, improvements and      ideas. |
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| 6.2.2     | Disclosure and      Assignment of Inventions.  Executive will promptly      disclose and describe to the Company all Inventions which he may solely or      jointly conceive, develop, or reduce to practice during the Employment      Term or the Consulting Period (as defined in Section 7.7) (i) which      relate at the time of conception, development, or reduction to practice of      the Invention to the Company’s business or actual or demonstrably      anticipated research or development, (ii) which were developed, in whole      or in part, on the Company’s time or with the use of any of the Company’s      equipment, supplies, facilities or trade secret information, or (iii)      which resulted from any work performed by  Executive for the      Company (the “Company’s      Inventions”).  Executive hereby assigns to the Company      all of his right, title and interest world-wide in and to the Company’s      Inventions and in all intellectual property rights based upon the      Company’s Inventions; provided, however, that      Executive does not assign or agree to assign any Inventions, whether or      not relating in any way to the Company’s business or demonstrably      anticipated research and development, which were made by him prior to the      date of this Agreement, or which were developed by him independently      during the Employment Term and not under the conditions stated in      subparagraph (ii) above. |
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| 6.3   | Documents and      Materials.  Upon termination of this Agreement or at any      other time upon the Company’s request, Executive will promptly deliver to      the Company, without retaining any copies, all documents and other      materials furnished to him by the Company (other than personal copies of      documents relating to Executive’s employment terms), prepared by him for      the Company or otherwise relating to the Company’s business, including,      without limitation, all written and tangible material in his possession      incorporating any ProprietaryInformation. |
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| 6.4   | Competitive      Employment.  During the Employment Term, the Consulting      Period (as defined in Section 7.7), if applicable, and for a period      of two (2) years thereafter (collectively, the “Extended      Term”), Executive will not engage in any employment, consulting, or      other activity in any business competitive with the Company without the      Company’s written consent, which consent shall not be unreasonably      withheld; provided, however, that      nothing in this Section 6.4 shall preclude Executive from serving as      a director of any other corporation, or a partner or investor in a private      equity firm. |
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| 6.5   | Non-Solicitation.  During      the Extended Term, Executive will not solicit or encourage, or cause      others to solicit or encourage, any employees of the Company to terminate      their employment with the Company. |
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| 6.6   | Acts to Secure      Proprietary Rights. |
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| 6.6.1     | Further      Acts.  Executive agrees to perform, during and after the      Employment Term and the Consulting Period, if applicable, all acts deemed      necessary or desirable by the Company to permit and assist it, at its      expense, in perfecting and enforcing the full benefits, enjoyment, rights      and title throughout the world in the Company’s      Inventions.  Such acts may include, without limitation,      execution of documents and assistance or cooperation in the registration      and enforcement of applicable patents and copyrights or other legal      proceedings. |
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| 6.6.2     | Appointment of      Attorney-In-Fact.  In the event that the Company is      unable, for any reason whatsoever, to secure Executive’s signature to any      lawful and necessary document required to apply for or execute any patent,      copyright or other applications with respect to any of the Company’s      Inventions (including improvements, renewals, extensions, continuations,      divisions or continuations in part thereof), Executive hereby irrevocably      appoints the Company and its duly authorized officers and agents as his      agents and attorneys-in-fact to execute and file any such application and      to do all other lawfully permitted acts to further the prosecution and      issuance of patents, copyrights or other rights thereon with the same      legal force and effect as if executed by him, intending hereby to create a      so-called “durable power” which will survive any subsequent      disability. |
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| 6.7   | No Conflicting      Obligations.  Executive’s performance of this Agreement      does not breach and will not breach any agreement to keep in confidence      proprietary information, knowledge or data acquired by  him. |
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| 6.8   | Corporate      Opportunities.  Executive agrees that during the      Employment Term and the Consulting Period, if applicable, he will first      present to the Board, for its acceptance or rejection on behalf of the      Company, any opportunity to create or invest in any company which is or      will be involved in equipping or furnishing airplane cabin interiors,      which comes to his attention and in which he, or any of his affiliates,      might desire to participate.  If the Board rejects the same or      fails to act thereon in a reasonable time, Executive shall be free to      invest in, participate or present such opportunity to any other natural      person, corporation, limited liability company, limited or general      partnership, or any other entity (each, a “Person”). |
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| 6.9   | Specific      Performance.  Executive acknowledges that a breach of any      of the promises or agreements contained herein could result in irreparable      and continuing damage to the Company for which there may be no adequate      remedy at law, and the Company shall be entitled to seek injunctive relief      and/or a decree for specificperformance. |
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| 7.   | TERMINATION      AND CHANGE OF CONTROL. |
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| 7.1   | Termination Date;      Termination or Resignation other than Contemporaneously with a Change of      Control. |
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| 7.1.1     | Termination      Date.  The term “Termination      Date” shall mean the date on which Executive incurs a Separation      from Service (as defined below) with the Company and its subsidiaries and      affiliates for any reason. |
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| 7.1.2     | Termination by      Executive.  If Executive resigns his employment for any      reason other than (i) death pursuant to Section 7.2, (ii) Incapacity      pursuant to Section 7.3,  (iii) Good Reason following a      Change of Control pursuant to Section 7.4.3 or (iv) contemporaneously      with a Change of Control pursuant to Section 7.4.2, then on the      Termination Date, Executive shall receive payment of (A) any accrued and      unpaid Salary and benefits through the Termination Date, (B) the entire      remaining unpaid balance of the Retirement Compensation pursuant to      Section 7.6 hereof, determined as of the Termination Date, and (C)      the Severance Payment pursuant to Section 7.5 hereof.  In      addition, Executive and his spouse shall continue to be entitled to      medical, dental and health benefits pursuant to Section 5.3 hereof      and the Company shall engage Executive to render consulting services to      the Company in accordance with Section 7.7  hereof. |
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| 7.1.3     | Termination by the      Company.  If the Company terminates Executive’s      employment hereunder for any reason other than (i) death pursuant to      Section 7.2, (ii) Incapacity pursuant to Section 7.3 or      (iii) contemporaneously with a Change of Control pursuant to      Section 7.4.2, then on the Termination Date, Executive shall receive      payment of (A) any accrued and unpaid Salary and benefits through the      Termination Date, (B) any bonuses payable to Executive for any fiscal      periods of the Company ending prior to the Termination Date, (C) a      lump-sum amount equal to his Salary that he would have received had he      remained employed from the Termination Date through the Expiration Date,      (D) the entire remaining unpaid balance of the Retirement Compensation      pursuant to Section 7.6 hereof, determined as of the Expiration Date,      and (E) the Severance Payment pursuant to Section 7.5      hereof.  In addition, (x) Executive and his spouse shall      continue to be entitled to medical, dental and health benefits pursuant to      Section 5.3 hereof, (y) any stock options or restricted stock awards      (“Equity      Awards”) granted to Executive that would not vest on or prior to      the Termination Date shall vest and be exercisable immediately, and,      notwithstanding any termination of employment provisions set forth in the      applicable agreement or related plan, all Equity Awards shall continue to      be exercisable until their original stated expiration date and (z) the      Company shall engage Executive to render consulting services to the      Company in accordance with Section 7.7  hereof. |
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| 7.2   | Death. |
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| 7.2.1     | Executive’s      employment hereunder shall terminate upon his death.  In such      event, the Company shall, within thirty (30) days following the date of      death, pay to such Person as Executive shall have designated in a notice      filed with the Company, or if no such Person shall have been designated,      to his estate, a lump-sum payment equal to (i) the Salary that would have      been due to Executive had this Agreement been in effect from the date of      his death until the Expiration Date and (ii) the entire remaining unpaid      balance of the Retirement Compensation as provided in Section 7.6      below, determined as of the TerminationDate. |
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| 7.2.2     | Upon      Executive’s death at any time during or after the Employment Term, the      Company shall, within thirty (30) days following the date of death, also      pay to such Person as Executive shall have designated in a notice filed      with the Company, or if no such Person shall have been designated, to his      estate, a lump-sum death benefit in the amount of three (3) million      dollars in accordance with the Death Benefit Agreement attached as Exhibit A      hereto. |
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| 7.2.3     | The      Company shall, within thirty (30) days following Executive’s date of      death, also pay to such Person as Executive shall have designated in a      notice filed with the Company, or if no such Person shall have been      designated, to his estate, a lump-sum amount equal to (i) any accrued and      unpaid Salary and benefits through his date of death, and (ii) any bonuses      payable to Executive for any fiscal periods of the Company ending prior to      the date of death.  Executive’s spouse shall continue to be      entitled to medical, dental and health benefits pursuant to      Section 5.3 hereof. |
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| 7.2.4     | Upon      Executive’s death, any Equity Awards granted to Executive that would not      vest on or prior to the Termination Date shall vest and, if applicable, be      exercisable immediately and, notwithstanding any termination of employment      provisions set forth in the applicable agreement or related plan, all      Equity Awards shall continue to be exercisable until their original stated      expiration date. |
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| 7.3   | Incapacity.  If,      in the reasonable judgment of the Compensation Committee, as a result of      the Executive’s incapacity due to a medically determinable physical or      mental illness, the Executive shall have been absent from his full-time      duties as described hereunder for the entire period of twenty-nine (29)      consecutive months (“Incapacity”),      the Executive’s employment shall terminate at the end of the twenty-nine      (29)-month period as provided in this Section 7.3.  In such      event: |
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| (i)       | the      Company shall give prompt notice to Executive of any such      termination; |
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| (ii)       | the      Company shall pay to the Executive within sixty (60) days following the      Termination Date, a lump-sum amount equal to two (2) times the Salary (at      the rate in effect on the Termination Date) that would have been payable      from the Termination Date through the Expiration  Date; |
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| (iii)       | the      Company shall pay to Executive the entire remaining unpaid balance of the      Retirement Compensation as provided in Section 7.6 and below,      determined as of the TerminationDate; |
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| (iv)       | the      Company shall pay to Executive within ten (10) business days after the      Termination Date a lump-sum amount equal to (A) any accrued and unpaid      Salary and benefits through the Termination Date and (B) any bonuses      payable to Executive for any fiscal periods of the Company ending prior to      the Termination Date; |
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| (v)       | the      Company shall continue to provide medical, dental and health benefits as      provided in Section 5.3 hereof;and |
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| (vi)       | any      Equity Awards granted to Executive that would not vest on or prior to the      Termination Date shall vest and, if applicable, be exercisable immediately      and, notwithstanding any termination of employment provisions set forth in      the applicable agreement or related plan, such Equity Awards shall      continue to be exercisable until their original stated expiration      date. |
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| 7.4   | Change of Control;      Definitions. |
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| 7.4.1     | Change of      Control.  If a “Change of Control” of the Company occurs,      the Company will be obligated as provided in this      Section 7.4.1.  For purposes of determining the Company’s      obligations under this Section 7.4.1, the date on which a Change of      Control occurs shall be referred to as the “Change of      Control Date.”  If a Change of Control occurs during the      Employment Term, the Company or its successor in interest      shall: |
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| (i)       | pay      to Executive the amount of any Gross-Up Payment payable by the Company to      Executive under Section 7.8 hereof in accordance with the payment      terms therein; |
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| (ii)       | continue      to provide to Executive and his spouse, for their respective lifetimes,      medical, dental and health benefits as provided in Section 5.3      hereof; provided, however, that      the terms and level of such benefits shall be substantially similar as      Executive and his spouse were receiving as of the Change of Control Date,      or if greater, as they were receiving on December 31, 2004;      and |
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| (iii)       | provide      that any Equity Awards granted to Executive that would not vest on or      prior to the Change of Control Date shall vest, settle and, if applicable,      be exercisable upon the earlier of (i) the Change of Control Date and (ii)      the execution of an agreement, if any, that would constitute a Change of      Control (regardless of whether such agreement is consummated), and,      notwithstanding any termination of employment provisions set forth in the      applicable agreement or related plan, such Equity Awards shall continue to      be exercisable until their original stated expiration  date. |
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| 7.4.2     | Termination or      Resignation Contemporaneous with a Change of      Control.  If, contemporaneously with a Change of Control,      Executive’s employment is terminated by the Company for any reason or      Executive resigns his employment for any reason other than for Good Reason      pursuant to Section 7.4.3, the Company  shall: |
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|     (i)       | pay      to Executive on the Termination Date a lump-sum amount equal to      (A) any accrued and unpaid Salary and benefits through the      Termination Date and (B) any bonuses payable to Executive for any fiscal      periods of the Company ending prior to the Termination    Date; |
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| (ii)       | pay      to Executive the entire remaining unpaid balance of the Retirement      Compensation, as provided in Section 7.6 and below, determined as of      the Termination Date; |
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| (iii)       | continue      to provide medical, dental and health benefits as provided in      Section 5.3 hereof; |
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| (iv)       | engage      Executive to render consulting services to the Company in accordance with      Section 7.7 hereof; and |
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| (v)       | pay      to Executive the Severance Payment pursuant to Section 7.5      hereof. |
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| 7.4.3     | Resignation for Good      Reason following a Change of Control.  If, following a      Change of Control, Executive resigns his employment for Good Reason, then      on the Termination Date, Executive shall receive,  payment of      (A) any accrued and unpaid Salary and benefits through the Termination      Date, (B) any bonuses payable to Executive for any fiscal periods of the      Company ending prior to the Termination Date, (C) a lump-sum amount equal      to his Salary from the Termination Date through the Expiration Date, (D)      the entire remaining unpaid balance of the Retirement Compensation      pursuant to Section 7.6 hereof, determined as of the Expiration Date,      and (E) the Severance Payment pursuant to Section 7.5      hereof.  In addition, (x) Executive and his spouse shall      continue to be entitled to medical, dental and health benefits pursuant to      Section 5.3 hereof, (y) any Equity Awards granted to Executive that      would not vest on or prior to the Termination Date shall vest, settle and      be exercisable immediately, and, notwithstanding any termination of      employment provisions set forth in the applicable agreement or related      plan, all Equity Awards shall continue to be exercisable until their      original stated expiration date and (z) the Company shall engage Executive      to render consulting services to the Company in accordance with      Section 7.7 hereof. |
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| 7.4.4     | Grantor      Trust.  If, at any time during the Employment Term it      appears that a Change of Control is likely to occur, the Company hereby      agrees to establish a trust pursuant to Rev. Proc. 92-64, promulgated      under Subpart E, part I, subchapter J, chapter I, subtitle A of the Code,      as modified by Notice 2000-56.  The grantor trust shall serve as      a vehicle for accumulating assets to secure its potential obligations to      Executive in the event of a Change of Control.  Such obligation      may be paid from the general assets of the Company or from the assets of      any such rabbi trust.  Any trust so established and any assets      held therein will be subject to the claims of the Company’s creditors in      the event of insolvency orbankruptcy. |
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| 7.4.5     | Definitions. |
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| (i)       | For      purposes of this Agreement, a “Change of      Control” means: |
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| (A)       | Individuals      who, as of January 1, 2005 (the “Effective      Date”) constitute the Board (the “Incumbent      Board”) cease for any reason to constitute at least a majority of      the Board, provided that      any Person becoming a director subsequent to the Effective Date whose      election, or nomination for election by the Company’s shareholders, was      approved by a vote of at least a majority of the directors then comprising      the Incumbent Board (other than an election or nomination of an individual      whose initial assumption of office is in connection with an actual or      threatened election contest relating to the election of the directors of      the Company, as such terms are used in Rule 14a-11 of Regulation 14A      promulgated under the Securities Exchange Act) shall be, for purposes of      this Agreement, considered as though such Person were a member of the      Incumbent Board; |
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| (B)       | a      transaction or other event occurs such that any Person or Persons acting      as a group acquires ownership of stock of the Company that, together with      stock held by such Person or group, constitutes more than 50% of the total      fair market value or total voting power of the stock of the      Company; |
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| (C)       | a      transaction or other event occurs such that any one Person or group      acquires (or has acquired during the twelve (12)-month period ending on      the date of the most recent acquisition by such Person or group) ownership      of stock of the Company possessing 35% or more of the total voting power      of the stock of the Company; or |
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| (D)       | a      transaction or other event occurs such that any one Person or group      acquires (or has acquired during the twelve (12)-month period ending on      the date of the most recent acquisition by such Person or group) ownership      of assets of the Company that have a total gross fair market value equal      to or more than 40% of the total gross fair market value of all of the      assets of the Company immediately prior to such acquisition or      acquisitions; provided, however, that      no acquisition of ownership of the assets of the Company shall be deemed a      Change of Control if the acquiring Person or group  is: |
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| (1)       | A      shareholder of the Company in exchange for or with respect to its      stock; |
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| (2)       | Any      Majority Owned Entity, as defined below, of the  Company; |
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| (3)       | A      Person or group of which the Company is a Majority Owned Entity;      or |
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| (4)       | A      Majority Owned Entity of any Person or group described by (3),      above. |
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| (ii)       | For      the purposes of this Section 7.4.5, Persons will not be considered to      be acting as a group solely because they purchase or own stock of the same      corporation at the same time, or as the result of the same public      offering.  However, Persons will be considered to be acting as a      group if they are owners of a Person that enters into a merger,      consolidation, purchase or acquisition of stock or assets or similar      business transaction with theCompany. |
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| (iii)       | For      the purposes of this Section 7.4.5, a “Majority      Owned Entity” of any Person is any entity, 50% or more of the total      value or voting power of which is owned, directly or indirectly, by such      Person. |
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| (iv)       | A      Change of Control shall occur on the effective date of any event specified      in Section 7.4.5(i) above.  In connection with any      determination of ownership for purposes of Section 7.4.5(i) above,      the attribution rules of Section 318(a) of the Internal Revenue Code      of 1986, as amended (the “Code”),      shall apply. |
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| (v)       | For      purposes of this Agreement, “Good      Reason” means: |
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| (A)       | Any      decrease in Executive’s Salary or a failure by the Company to pay any      material compensation due and payable to Executive in connection with his      employment; |
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| (B)       | Any      change in Executive’s responsibilities, positions, duties, status, title      or reporting relationships; |
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| (C)       | Executive      ceasing to be the Chief Executive Officer of a publicly traded company      pursuant to this Agreement; |
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| (D)       | Following      a Change of Control, the Company (or its successor) requiring Executive to      be based at any office or location other than Executive’s principal place      of employment immediately prior to the effective date of the Change of      Control, if applicable; or |
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| (E)       | A      material breach by the Company of any term of this    Agreement; |
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| 7.5   | Severance      Payment. |
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| 7.6   | Retirement      Compensation. |
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| 7.6.1     | Amount      of Retirement Compensation. In recognition that Executive      founded the Company and will not be eligible for any retirement plan to be      offered by the Company to its executives (as provided in Section 5.3      above), Executive shall be entitled to an annual retirement compensation      contribution ("Retirement      Compensation") equal to the product of 1.5 times the annual Salary      then in effect (the "Specified      Annual Salary"), with a ratable adjustment should Executive's      final period of service be less than a full year.  In addition, the      Executive shall be entitled to supplemental contributions equal to      the difference between all prior Retirement Compensation payments and the      amounts that would have been paid had such payments been made based      on the most recent Specified Annual Salary.  The Retirement      Compensation as so determined shall be paid to Executive (or in the event      of Executive's subsequent death, to such Person as Executive shall have      designated in a notice filed with the Company or, if no such Person shall      have been designated, to his estate) at the times specified in Section      7.6.2 below, or contributed to the Retirement Trust described in Section      7.6.3 below in accordance with that Section.  The amount of the      Retirement Compensation so due and payable shall not be present-valued or      otherwise reduced by use of any other discount or discounting      method. |
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| 7.6.2     | Payment of Retirement      Compensation. |
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| (i)       | Within      five business days after the date on which the BE Aerospace, Inc.      Executive Compensation Trust II dated April 21, 1999, as amended, is      terminated (the “Distribution      Date”), the Company will distribute the amount of Retirement      Compensation that would have been payable to Executive under      Section 7.6.1 as of the Distribution Date, based on his years of      service through the Distribution Date and his then Specified Annual      Salary. |
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| (ii)       | Within      five (5) business days after Executive’s actual Termination Date, the      Company shall pay to Executive an amount equal to (x) the Retirement      Compensation payable to Executive as determined in Section 7.6.1      hereof less (y) the sum of (1) the amount of Retirement Compensation      previously distributed to Executive pursuant to Section 7.6.2(i)      hereof, and (2) the amounts previously distributed pursuant to      Section 7.6.3(i) or 7.6.3(ii). |
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| 7.6.3     | Retirement      Trust. |
|-------------------------------|------------------------|

| (i)       | Within      ninety (90) days after the Distribution Date, the Company shall establish      a trust for the duration of the Employment Term, and, commencing on such      date and on a quarterly basis thereafter, each a “Contribution      Date” the Company shall contribute to the trust (the “Retirement      Trust”) for the benefit of Executive an amount equal to (a) the      Retirement Compensation that would be payable to Executive under      Section 7.6.2(ii) if the Contribution Date was his Termination Date      minus (b) the total of all contributions made to the Retirement Trust by      the Company as of such Contribution Date.  The Retirement Trust      to which the Company shall make these contributions shall be      irrevocable.  The Retirement Trust shall provide that Executive      may withdraw from the Retirement Trust, within the thirty (30)-day period      beginning on the date on which he receives notice from the Company that      the Company has made a contribution pursuant to this      Section 7.6.3(i), an amount up to but not to exceed the amount of      that contribution.  If and to the extent that Executive fails to      exercise this withdrawal right within the thirty (30)-day period, such      withdrawal right shall lapse.  The Retirement Trust also shall      contain such other provisions as the Company and Executive reasonably      agree are necessary in order for the Retirement Trust to qualify as a      grantor trust under Section 671 of the Code with Executive as the      grantor.  The trust agreement for the Retirement Trust shall      provide that any assets remaining in the Retirement Trust, after payment      of all the Retirement Compensation payable pursuant to this      Section 7.6, shall be paid to Executive, and that the Retirement      Trust shall be exempt from the claims of the Company’s      creditors. |
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| (ii)       | The      Executive shall be responsible for all applicable Federal, State and local      income and employment taxes due with respect to each contribution made by      the Company under Section 7.6.3(i).  As of the last day of      each calendar quarter ending on or after the Distribution Date, during the      Employment Term, the trustee of the Retirement Trust shall be required to      distribute to Executive 25% of the amount by which (x) the Assumed Taxes      that the Company reasonably estimates will be assessed upon Executive for      the calendar year for which the distribution is being made as a result of      his beneficial interest in the Retirement Trust, exceeds (y) the amount      withdrawn by Executive in such calendar year pursuant to      Section 7.6.3(i).  For this purpose, the term “Assumed      Taxes” shall mean the Federal, State and local income and      employment taxes that would be payable by Executive for the year in      question, assuming that the amount taxable would be subject to the highest      Federal and applicable State and local income and employment      taxes. |
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| 7.7   | Consulting      Arrangement.  In the event that Executive’s employment      terminates for any reason (including, without limitation, Executive’s      voluntary resignation) other than death pursuant to Section 7.2 or      Incapacity pursuant to Section 7.3, then the Company shall retain      Executive to perform consulting services for a period of five (5) years      following the Termination Date (the “Consulting      Period”).  The terms of Executive’s consulting      arrangement are set forth on Exhibit B      attached hereto. |
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| 7.8   | Certain Additional      Payments by the Company. |
|-----------------|--------------------------------------------------|

| 7.8.1     | Anything      in this Agreement to the contrary notwithstanding, in the event it shall      be determined that any payment, distribution, benefit, equity-based or      other compensation or other transfer or action by the Company to or for      the benefit of Executive (whether paid or payable or distributed or      distributable pursuant to the terms of this Agreement or      otherwise  and including without limitation any additional      payments required under this Section 7.8) (a “Payment”)      would be subject to an excise tax imposed by Section 4999 of the      Code, or any interest or penalties are incurred by Executive with respect      to any such excise tax (such excise tax, together with any such interest      and penalties, are hereinafter collectively referred to as the “Excise      Tax”), the      Company shall make a payment to Executive (a “Gross-Up      Payment”) in an amount such that after payment by Executive of all      taxes (including any Excise Tax) imposed upon the Gross-Up Payment,      Executive retains (or has had paid to the Internal Revenue Service on his      behalf) an amount of the Gross-Up Payment equal to the sum of (x) the      Excise Tax imposed upon the Payments and (y) the product of any deductions      disallowed because of the inclusion of the Gross-Up Payment in Executive’s      adjusted gross income and the highest applicable marginal rate of federal      income taxation for the calendar year in which the Gross-Up Payment is to      be made.  For purposes of determining the amount of the Gross-Up      Payment, Executive shall be deemed to (i) pay federal income taxes at the      highest marginal rates of federal income taxation for the calendar year in      which the Gross-Up Payment is to be made, and (ii) pay applicable state      and local income taxes at the highest marginal rate of taxation for the      calendar year in which the Gross-Up Payment is to be made, net of the      maximum reduction in federal income taxes which could be obtained from      deduction of such state and local income and employment      taxes.  The Gross-Up Payment shall be paid to the Executive no      later than the end of the taxable year next following the taxable year in      which the Executive remits the taxes related to the Gross-Up      Payment. |
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| 7.8.2     | Subject      to the provisions of Section 7.8.3, all determinations required to be      made under this Section 7.8, including whether and when a Gross-Up      Payment is required and the amount of such Gross-Up Payment and the      assumptions to be utilized in arriving at such determination, shall be      made by Deloitte & Touche LLP (the “Accounting      Firm”) which shall provide detailed supporting calculations both to      the Company and Executive within fifteen (15) business days of the receipt      of notice from Executive that there has been a Payment, or such earlier      time as is requested by the Company.  In the event that the      Accounting Firm is serving as accountant or auditor for the individual,      entity or group effecting the Change of Control, Executive shall appoint      another nationally recognized accounting firm 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.  Any      Gross-Up Payment, as determined pursuant to this Section 7.8, shall      be paid by the Company to Executive promptly following the receipt of the      Accounting Firm’s determination but in no event later than the end of the      taxable year next following the taxable year in which the Accounting      Firm’s determination is received.  If the Accounting Firm      determines that no Excise Tax is payable by Executive, it shall furnish      Executive with a written opinion that failure to report the Excise Tax on      Executive’s applicable federal income tax return would not result in the      imposition of a negligence or similar penalty.  Any      determination by the Accounting Firm shall be binding upon the Company and      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 Gross-Up Payments which      will not have been made by the Company should have been made (“Underpayment”),      consistent with the calculations required to be made      hereunder.  In the event that the Company exhausts its remedies      pursuant to Section 7.8 and Executive thereafter is required to make      a payment of any Excise Tax, 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 Executive      but in no event later than the end of the taxable year next following the      taxable year in which the Executive remits the taxes.  The      previous sentence shall apply mutatis mutandis to any      overpayment of the Gross-UpPayment. |
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| 7.8.3     | Executive      shall notify the Company in writing of any claim by the Internal Revenue      Service that, if successful, would require the payment by the Company of      the Gross-Up Payment.  Such notification shall be given as soon      as practicable but no later than ten (10) business days after Executive is      informed in writing of such claim and shall apprise the Company of the      nature of such claim and the date on which such claim is requested to be      paid.  Executive shall not pay such claim prior to the      expiration of the thirty (30)-day period following the date on which it      gives such notice to the Company (or such shorter period ending on the      date that any payment of taxes with respect to such claim is      due).  If the Company notifies Executive in writing prior to the      expiration of such period that it desires to contest such claim, Executive      shall: |
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| (i)       | give      the Company any information reasonably requested by the Company relating      to such claim, |
|-----------------------------------------|--------------------------------------------------------------------------------------------------------|

| (ii)       | take      such action in connection with contesting such claim as the Company shall      reasonably request in writing from time to time, including, without      limitation, accepting legal representation with respect to such claim by      an attorney reasonably selected by theCompany, |
|------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (iii)       | cooperate      with the Company in good faith in order effectively to contest such claim,      and |
|-------------------------------------------|----------------------------------------------------------------------------------------------------|

| (iv)       | permit      the Company to participate in any proceedings relating to such      claim; |
|------------------------------------------|----------------------------------------------------------------------------------------|

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| 7.8.4     | If,      after the receipt by Executive of an amount advanced by the Company      pursuant to Section 7.8.3, Executive becomes entitled to receive any      refund with respect to such claim, Executive shall (subject to the      Company’s complying with the requirements of Section 7.8.3 promptly      pay to the Company the amount of such refund (together with any interest      paid or credited thereon after taxes applicable thereto).  If,      after the receipt by Executive of an amount advanced by the Company      pursuant to Section 7.8.3, a determination is made that Executive      shall not be entitled to any refund with respect to such claim and the      Company does not notify Executive in writing of its intent to contest such      denial of refund prior to the expiration of thirty (30) days after such      determination, then such advance shall be forgiven and shall not be      required to be repaid and the amount of such advance shall offset, to the      extent thereof, the amount of Gross-Up Payment required to be      paid. |
|-------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 7.9   | Restricted Stock      Award.  On July 31, 2006, the Company granted to      Executive, without payment by Executive, 387,878 shares of restricted      common stock of the Company (the “Restricted      Stock”).  The Restricted Stock was granted pursuant to      and on the terms provided in the Company’s 2005 Long-Term Incentive Plan,      as amended (the “Plan”),      and, to the extent not inconsistent with the terms hereof, the applicable      Restricted Stock Award Document (as defined in the Plan).  The      Restricted Stock granted to Executive pursuant to this Section 7.9      will vest and become unrestricted ratably over a four (4)-year period      commencing on July 31, 2007, the first (1st)      anniversary of the grant date and or each anniversary thereafter, provided that      Executive is employed by the Company or is rendering consulting services      pursuant to Section 7.7 hereof on each vesting date.  In      addition, the Restricted Stock will immediately become fully vested and      unrestricted, (i) immediately prior to a Change of Control, (ii) upon      Executive’s death or termination due to Incapacity, or (iii) upon      termination of Executive’s employment by the Company for any      reason.  For the avoidance of doubt, all vesting of the      Restricted Stock pursuant to this Section 7.9 shall be subject to the      provisions of Sections 7.8 and 12 of this  Agreement. |
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| 8.   | WITHHOLDING. |
|----------------|--------------|

| 9.   | INDEMNIFICATION. |
|----------------|------------------|

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| 10.   | LEGAL      FEES. |
|-----------------|------------------|

| 11.   | UNFUNDED      STATUS. |
|-----------------|-----------------------|

| 12.   | SECTION 409A. |
|-----------------|--------------------|

| 12.1   | If      any amounts that become due under Section 7 (other than      Section 7.8) of this Agreement constitute “nonqualified deferred      compensation” within the meaning of Section 409A of the Code, payment      of such amounts shall not commence until the Executive incurs a      “Separation from Service” (as defined below) if and only if necessary to      avoid accelerated taxation or tax penalties in respect of such      amounts.  For the avoidance of doubt, the parties agree and      acknowledge that the Retirement Compensation is not “nonqualified deferred      compensation” within the meaning of  Section 409A. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.2   | Notwithstanding      any provision of this Agreement to the contrary, if Executive is a      “Specified Employee” (as defined below) he shall not be entitled to any      payments upon a Separation from Service until the earlier of (i) the date      which is the first (1st)      business day following the date that is six (6) months after the      Executive’s Separation from Service for any reason other than death or      (ii) Executive’s date of death.  The Company shall establish a      trust pursuant to Rev. Proc. 92-64, promulgated under subpart E, part I,      subchapter J, chapter 1, subtitle A of the Code, as modified by Notice      2000-56, and fund any such payments that are deferred pursuant to this      Section 12.2 that otherwise would be immediately payable      to  Executive.  The provisions of this      Section 12.2 shall only apply if required to comply with      Section 409A of the Code. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.3   | For      purposes of this Agreement, “Separation      from Service” shall have the meaning set forth in      Section 409A(a)(2)(A)(i) of the Code and determined in accordance      with the default rules under Section 409A of the      Code.  “Specified      Employee” shall have the meaning set forth in      Section 409A(a)(2)(B)(i) of the Code, as determined in accordance      with the uniform methodology and procedures adopted by the Company and      then in effect. |
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| 12.4   | It      is intended that the terms and conditions of this Agreement comply with      Section 409A of the Code.  If any provision of this      Agreement contravenes any regulations or Treasury guidance promulgated      under Section 409A of the Code, or could cause any amounts or      benefits hereunder to be subject to taxes, interest and penalties under      Section 409A of the Code, this Agreement or any provision hereof may      be reformed by the Executive, subject to the consent of the Company (which      consent shall not be unreasonably withheld) to:  (i) comply      with, or avoid being subject to, Section 409A of the Code, (ii) avoid      the imposition of taxes, interest and penalties under Section 409A of      the Code, and/or (iii) maintain, to the maximum extent practicable, the      original intent of the applicable provision without violating the      provisions of Section 409A of theCode. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 12.5   | Anything      in this Agreement to the contrary notwithstanding, no reimbursement      payable to Executive pursuant to any provisions of this Agreement or      pursuant to any plan or arrangement of the Company or its subsidiary or      affiliate covered by this Agreement shall be paid later than the last day      of the calendar year following the calendar year in which the related      expense was incurred, except to the extent that the right to reimbursement      does not provide for a “deferral of compensation” within the meaning of      Section 409A of the Code.  No amount reimbursed during any      calendar year shall affect the amounts eligible for reimbursement in any      other calendar year. |
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| 12.6   | The      provisions of Section 7.8 of this Agreement, mutatis mutandis, shall      apply to any imposition of taxes on Executive under Section 409A of      the Code so that Executive shall be fully grossed up for the amount of,      and shall not be adversely affected by, such  taxes. |
|------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 13.   | WAIVER. |
|-----------------|---------|

| 14.   | SEVERABILITY. |
|-----------------|---------------|

| 15.   | NOTICES. |
|-----------------|----------|

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| 16.   | SURVIVAL. |
|-----------------|-----------|

| 17.   | MISCELLANEOUS. |
|-----------------|----------------|

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| EXECUTIVE                    |   | BE      AEROSPACE, INC. |                                                   |
|------------------------------|--------|-------------------------|--------------------------------------------------------|
|                         |   |                    |                                                   |   |
|                         |   |                    |                                                   |   |
| /s/      Amin      J. Khoury |   | By:                     | /s/      Thomas P. McCaffrey                           |   |
| Amin      J. Khoury          |   | Name:                   | Thomas      P. McCaffrey                               |   |
|                         |   | Title:                  | Senior      Vice President and Chief Financial Officer |   |
|                         |   |                    |                                                   |   |
|                         |   | By:                     | /s/      Michael B. Baughan                            |   |
|                         |   | Name:                   | Michael      B. Baughan                                |   |
|                         |   | Title:                  | President      and Chief Operating Officer             |   |

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