Exhibit 10.13


 


COMMUNICATIONS SYSTEMS, INC.

CHANGE IN CONTROL AGREEMENT





THIS CHANGE IN CONTROL AGREEMENT is adopted
this 1st day of January, 2015 (the “Effective Date”) by and between COMMUNICATIONS SYSTEMS, INC., a Minnesota
corporation located in Minnetonka, Minnesota (the “Company”), and ____________, an executive of the Company or one
of its subsidiaries (the “Executive”).


 


The Board of Directors of the Company (the “Board”)
has determined that it is in the best interests of the Company to retain the Executive’s services and to reinforce and encourage
the continued attention and dedication of the Executive to his or her assigned duties, without distraction in potentially disturbing
circumstances arising from the possibility of a change in control of the Company.


 


The Company and the Executive agree as provided
herein.


 


Article 1


 


Definitions


 


Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:


 


1.1          “Agreement”
means this Communications Systems, Inc. Change in Control Agreement, as it may be amended from time to time.


 


1.2          “Annual Compensation”
means the Executive’s average compensation paid by the Company which was includible in the Executive’s gross income
during the most recent two taxable years ending before the date of the Change in Control. The definition includes amounts includible
in compensation, prior to any reduction for a salary contribution to a plan described in Section 125 of the Code or qualified under
Section 401(k) of the Code, as well as any compensation included in the Executive’s compensation within the meaning of Section
280G of the Code.


 


1.3          “Cause”
means


 


		(a)	Gross negligence or gross neglect of duties; or



 


		(b)	Commission of a felony or of a gross misdemeanor involving moral turpitude which in the reasonable determination of the Board
is materially and demonstrably injurious to the Company or which impairs the Executive’s ability to perform substantially
the Executive’s duties with the Company or a Subsidiary; or



 


		(c)	Fraud, disloyalty, dishonesty or willful violation of any law or a willful violation of a material Company or Subsidiary policy
which, after warning, remains a continuing violation, committed in connection with the Executive’s employment.



 


1.4          “Change in Control”
shall occur on the earliest date that:


 


		(a)	A “person” or “group” acquires ownership of stock of the Company that, together with stock held by
such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock
of the Company;



 


		(b)	Any 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 thirty percent (30%) or more of the total voting power of
the stock of the Company;



 



    


     


    

 


		(c)	A majority of the members of the Board is replaced during any twelve (12) month period by directors whose appointment or election
is not endorsed by a majority of the members of the Company’s Board prior to the date that such appointments or elections
are made;



 


		(d)	Any 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, assets from the Company that have a total gross fair market value equal to or more than forty percent
(40%) of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions;
or



 


		(e)	For the purposes of this Section 1.4, “person” or “group” does not include The Communications Systems,
Inc. Employee Stock Ownership Plan and Trust.



 


1.5          “Code”
means the Internal Revenue Code of 1986, as amended.


 


1.6          “Disability”
means the Executive’s suffering a sickness, accident or injury which has been determined by the insurance carrier of any
individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability
rendering the Executive totally and permanently disabled. The Executive must submit proof to the Plan Administrator of the insurance
carrier’s or Social Security Administration’s determination upon the request of the Plan Administrator.


 


1.7          “Good Reason”
means the existence of any of the following without the Executive’s written consent:


 


		(a)	A material diminution by the Company in the Executive’s
annual base salary.



 


		(b)	A material diminution in the Executive’s authority, duties or responsibilities as in effect in the three (3) month period
immediately preceding a Change in Control.



 


		(c)	A material diminution in the authority, duties or responsibilities as in effect in the three (3) month period immediately preceding
a Change in Control, of the person to whom the Executive is required to report, including a requirement that the Executive report
to a corporate officer or employee instead of reporting directly to the Company’s Board, if the Executive otherwise reported
directly to the Company’s Board;



 


		(d)	A material diminution in the budget over which the Executive retains authority as in effect in the three (3) month period immediately
preceding a Change in Control;



 


		(e)	The Company requiring the Executive to be based more than thirty (30) miles from where the Executive’s office is located
immediately prior to a Change in Control, except for required travel on the Company’s business, and then only to the extent
substantially consistent with the business travel obligations which the Executive undertook on behalf of the Company during the
90-day period ending on the date of the Change in Control (without regard to travel related to or in anticipation of the Change
in Control); or



 


		(f)	Any other action or inaction that constitutes a material breach by the Company of this Agreement.



 



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The Executive will have Good Reason to terminate
employment only if within ninety (90) days following the Executive’s actual knowledge of the event which the Executive determines
constitutes Good Reason, the Executive notifies the Company in writing that the Executive has determined a Good Reason exists and
specifies the event creating Good Reason; following receipt of the notice, the Company fails to remedy the event within thirty
(30) days; and the Executive’s resignation for Good Reason is effective within ninety (90) days following the Company’s
period for remedy. If such conditions are not met, the Executive will not have a Good Reason to terminated employment.


 


1.8          “Subsidiary”
means any entity that, along with the Company, would be treated as a single employer under Sections 414(b) and (c) of the Code.


 


1.9          “Successor”
means any entity that assumes the rights and the obligations of the Company by merger, acquisition, or other valid legal succession.


 


1.10        “Termination
Date” shall mean the date of the Executive’s Termination of Employment.


 


1.11        “Termination
of Employment” shall mean Executive’s separation from service with the Company or one of its Subsidiaries.


 





Article 2


 


Change in Control Benefits


 


2.1         Change in Control Benefit.
Subject to the terms and conditions of this Agreement, if within twenty-four (24) months following a Change in Control of the Company,
the Executive shall be subject to an involuntary Termination of Employment by the Company other than for Cause, death, disability
or retirement, or Executive shall initiate a voluntary Termination of Employment for Good Reason, the Company shall pay to the
Executive the benefit specified below in this Section 2.1. If a Change in Control as defined in the Agreement occurs, this Agreement
shall expire on the second anniversary of such Change in Control; provided, however, that any benefits provided under
this Section 2.1 shall continue in effect until fully paid or satisfied.


 


2.1.1      Amount of Benefit.
The benefit under this Section 2.1 is one (1) times the Executive’s Annual Compensation at the date of the Change of Control.


 


2.1.2      Payment of Benefit.
The Company shall pay the benefit to the Executive in a lump sum seventy-five (75) days following the Termination Date provided
that, prior to such date the Executive has executed a release of all claims against the Company, its officers and Directors.


 


2.1.3      Insurance Benefits.
If a benefit is payable under Section 2.1, then for a period of twelve (12) months following the Termination Date the Executive
shall receive, in addition to the benefit provided in Section 2.1.1 of this Agreement the following benefits substantially in the
form and expense to the Executive as received by the Executive on the Termination Date: (a) medical and dental insurance; and (b)
life insurance. The provision of medical and dental insurance and the provision of life insurance benefits pursuant to this Section
2.1.3 shall, however, be subject to the following limitations: (i) the benefits provided during Executive’s taxable year
may not affect the benefits to be provided to Executive in any other taxable year, (ii) reimbursements or payments must be made
on or before the last day of Executive’s taxable year following the taxable year in which the expense being paid or reimbursed
was incurred, and (iii) the right to continued coverage is not subject to liquidation or exchange for another benefit.


 



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It is understood and agreed that any rights and
privileges of the Executive provided by the Consolidated Omnibus Budget Reconciliation Act of 1986 “(COBRA”), amending
the Employee Retirement Income Security Act, the Internal Revenue Code and the Public Health Services Act, as amended, shall begin
immediately following the Termination Date.


 


2.2          Excess Parachute Payment.
Notwithstanding anything to the contrary in this Agreement, the payments made to the Executive under this Section 2 shall be one
dollar ($1.00) less than the amount which would cause the payments to the Executive (including payments to the Executive which
are not included in this Agreement) to be subject to the excise tax imposed by Section 4999 of the Code. Any reductions in payments
under this section will come first from payments under Section 2.1.1 and then from payments under Section 2.1.3


 


2.3          Withholding & Payroll
Taxes. To the extent required by law, the Company shall withhold from other amounts owed to the Executive or require the Executive
to remit to the Company an amount sufficient to satisfy federal, state and local withholding tax requirements on any payments made
to the Executive under this Agreement. Determinations by the Company as to withholding shall be binding on the Executive.


 





Article 3


 


Miscellaneous


 


3.1         Confidential Information.
The Executive recognizes and acknowledges that the Executive will have access to certain information of the Company and that such
information is confidential and constitutes valuable, special and unique property of the Company. The Executive shall not at any
time, either during or subsequent to the term of this Agreement, disclose to others, use, copy or permit to be copied, except as
directed by law or in pursuance of the Executive’s duties for or on behalf of the Company, its Successors, assigns or nominees,
any Confidential Information of the Company (regardless of whether developed by the Executive), without the prior written consent
of the Company. The term “Confidential Information” with respect to any person means any secret or confidential information
or know-how and shall include, but shall not be limited to, the plans, customers, costs, prices, uses, and applications of products
and services, results of investigations, studies owned or used by such person, and all products, processes, compositions, computer
programs, and servicing, marketing or operational methods and techniques at any time used, developed, investigated, made or sold
by such person, before or during the term of this Agreement, that are not readily available to the public or that are maintained
as confidential by such person. The Executive shall maintain in confidence any Confidential Information of third parties received
as a result of the Executive’s employment with the Company in accordance with the Company’s obligations to such third
parties and the policies established by the Company.


 



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3.2          No Competition.
If within the twenty-four (24) months following a Change in Control of the Company, the Executive shall have an involuntary Termination
of Employment by the Company other than for Cause, death, disability or retirement, or shall have a voluntary Termination of Employment
for Good Reason, then and for a period of one (1) year immediately following the Termination Date, the Executive shall not directly
or indirectly engage in any business in which the Company directly or indirectly engages during the term of the Agreement; provided,
however, that this restriction shall apply only to the geographic market of the Company. The Executive shall be deemed to engage
in a business if the Executive directly or indirectly, engages or invests in, owns, manages, operates, controls or participates
in the ownership, management, operation or control of, is employed by, associated or in any manner connected with, or renders services
or advice to, any business in which the Company directly or indirectly engages, provided, however, that the Executive may invest
in the securities of any enterprise (but without otherwise participating in the activities of such enterprise) if two conditions
are met: (a) such securities are listed on any national or regional securities exchange or have been registered under Section 12(g)
of the Securities Exchange Act of 1934 and (b) the Executive does not beneficially own (as defined Rule 13d-3 promulgated under
the Securities Exchange Act of 1934) in excess of one percent of the outstanding capital stock of such enterprise. In the event
the Executive is eligible for and receives a payment under this Agreement, for the twelve (12) months after termination of employment,
the Executive will not, directly or indirectly, solicit, induce or attempt to solicit or induce any of the Company’s employees
or independent contractors for the purpose of hiring them to work for the Executive or another individual, entity or employer,
or for the purpose of inducing them to leave their employment with the Company, except with the Company’s written consent.
In the event the Executive violates this Section 3.2 or Section 3.1, any and all rights of the Executive under this Agreement shall
terminate and no further payment shall be due the Executive, which shall be in addition to, and not in lieu of, any other rights
or remedies of the Company under this Agreement.


 


3.3         Termination of Agreement
Prior to Change of Control. At any time after the Effective Date and prior to a Change of Control, the Board of Directors of
the Company may amend or terminate this Agreement: provided that no such amendment or termination shall be effective until at least
sixty (60) days following written notification of Executive of such termination or amendment of this Agreement. Further, this Agreement
shall automatically terminate if, prior to a Change of Control, Company terminates Executive, whether with or without Cause, or
Executive voluntarily terminates his or her employment with the Company, whether with or without Good Reason.


 


3.4         Delivery of Documents
Upon Termination of Employment. The Executive shall deliver to the Company or its designee at the Executive’s Termination
of Employment all correspondence, memoranda, notes, records, drawings, sketches, plans, customer lists, product compositions, and
other documents and all copies thereof, made, composed or received by the Executive, solely or jointly with others, that are in
the Executive’s possession, custody, or control at such Termination of Employment and that are related in any manner to the
past, present, or anticipated business of the Company.


 


3.5         Remedies. The Executive
acknowledges that a remedy at law for any breach or attempted breach of the Executive’s obligations under Sections 3.1, 3.2
and 3.3 may be inadequate, agrees that the Company may be entitled to specific performance and injunctive and other equitable remedies
in case of any such breach or attempted breach and further agrees to waive any requirement for the securing or posting of any bond
in connection with the obtaining of any such injunctive or other equitable relief. The Company shall have the right to offset against
amounts to be paid to the Executive pursuant to the terms hereof any amounts owed by the Executive to the Company at the time of
payment.


 


The termination of the Agreement shall not be deemed to be a waiver
by the Company of any breach by the Executive of this Agreement or any other obligation owed the Company, and notwithstanding such
a termination the Executive shall be liable for all damages attributable to such a breach.


 


3.6         Dispute Resolution.
Subject to the Company’s right to seek injunctive relief in court as provided in Section 3.4 of this Agreement, any dispute,
controversy or claim arising out of or in relation to or connection to this Agreement, including without limitation any dispute
as to the construction, validity, interpretation, enforceability or breach of this Agreement, shall be settled by arbitration administered
by the American Arbitration Association under its National Rules for the Resolution of Employment Disputes and judgment upon the
award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof.


 



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Any such Arbitration will be conducted: (i) by a
neutral arbitrator appointed by mutual agreement of the parties; or (ii) failing such agreement, by a neutral arbitrator appointed
in accordance with said AAA rules; the Company shall pay the fees and reasonable expenses of the arbitrator; the parties will be
permitted reasonable discovery in accordance with the provisions of the Minnesota Rules of Civil Procedure, including the production
of relevant documents by the other party, the exchange of witness lists, and a limited number of depositions, including depositions
of any expert who will testify at the arbitration; the arbitrator’s award will include findings of fact and conclusions of
law showing the legal and factual bases for the arbitrator’s decision; the arbitrator will have the authority to award to
the prevailing party any remedy or relief that a United States District Court or court of the State of Minnesota could order or
grant if the Dispute had first been brought in that judicial forum, including costs and attorneys’ fees; and unless otherwise
agreed by the parties, the place of any arbitration proceeding will be Minneapolis, Minnesota.


 


3.7          Acknowledgement of Parties.
The Company and the Executive understand and acknowledge that this Agreement means that neither can pursue an action against the
other in a court of law regarding any employment dispute, except for claims involving workers’ compensation benefits or unemployment
benefits, and except as set forth elsewhere in this Agreement, in the event that either party notifies the other of its demand
for arbitration under this Agreement. The Company and the Executive understand and agree that this Section 3.5, concerning arbitration,
shall not include any controversies or claims related to any agreements or provisions (including provisions in this Agreement)
respecting confidentiality, proprietary information, non-competition, non-solicitation, trade secrets, or breaches of fiduciary
obligations by the Executive, which shall not be subject to arbitration.


 


3.8          Right to Consult Counsel.
Executive has been advised of the Executive’s right to consult with an attorney prior to entering into this Agreement.


 


3.9         Successors of the Company.
The Company will require any Successor by agreement in form and substance satisfactory to the Executive, expressly to assume and
agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no
such succession had taken place. The failure of the Company to obtain such agreement prior to the effectiveness of any such succession
shall be a breach of this Agreement and shall entitle the Executive to terminate the Agreement and receive compensation from the
Company in the same amount and on the same terms as the Executive would be entitled hereunder if the Executive terminated the Executive’s
employment for Good Reason. As used in this Agreement, “Company” as hereinbefore defined shall include any Successor
to its business and/or assets as aforesaid which executes and delivers the agreement provided for in this Section 3.8 or which
otherwise becomes bound by all the terms and provisions of this Agreement by operation of law.


 


3.10        Executive’s Heirs,
etc. The Executive may not assign the Executive’s rights or delegate the Executive’s duties or obligations hereunder
without the written consent of the Company. 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
should die while any amounts would still be payable to the Executive hereunder if the Executive had continued to live, all such
amounts, unless other provided herein, shall be paid in accordance with the terms of this Agreement to the Executive’s designee
or, if there be no such designee, to the Executive’s estate.


 



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3.11        Notices. Any notice
or communication required or permitted under the terms of this Agreement shall be in writing and shall be delivered personally,
or sent by registered or certified mail, return receipt requested, postage prepaid, or sent by nationally recognized overnight
carrier, postage prepaid, or sent by facsimile transmission to the Company at the Company’s principal office and facsimile
number in Minnetonka, Minnesota, or to the Executive at the address and facsimile number, if any, appearing on the books and records
of the Company. Such notice or communication shall be deemed given (a) when delivered if personally delivered; (b) five mailing
days after having been placed in the mail, if delivered by registered or certified mail; (c) the business day after having been
placed with a nationally recognized overnight carrier, if delivered by nationally recognized overnight carrier, and (d) the business
day after transmittal when transmitted with electronic confirmation of receipt, if transmitted by facsimile. Any party may change
the address or facsimile number to which notices or communications are to be sent to such party by giving notice of such change
in the manner herein provided for giving notice. Until changed by notice, the following shall be the address and facsimile
number to which notices shall be sent:


 



	
        If to the Company:


         
	If to the Executive:
	
        Communications Systems, Inc.

         

        Attention: President and CFO

         

        10900 Red Circle Drive

         

        Minnetonka, MN 55343

         

        Fax: (952) 946-1835

	
         

         

         

         

         

         



 


3.12        Amendment or Waiver.
No provisions of this Agreement may be modified, waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and such officer as may be specifically designated by the Board (which shall not include the
Executive). No waiver by either party hereto at any time of any breach by the other party hereto of or compliance with, any condition
or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions
or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied,
with respect to the subject matter hereof have been made by either party, which are not set forth expressly in this Agreement.
This Agreement constitutes the entire agreement between the Company and the Executive as to the subject matter hereof, and supersedes
any prior agreement, whether written or oral. No rights are granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.


 


3.13        Invalid Provisions.
Should any portion of this Agreement be adjudged or held to be invalid, unenforceable or void, such holding shall not have the
effect of invalidating or voiding the remainder of this Agreement and the parties hereby agree that the portion so held invalid,
unenforceable or void shall if possible, be deemed amended or reduced in scope, or otherwise be stricken from this Agreement to
the extent required for the purposes of validity and enforcement thereof. In this regard, the parties hereto hereby agree that
any judicial authority construing this Agreement shall be empowered to sever any portion of the geographic area or any prohibited
business activity from the coverage of this Agreement, and to reduce the duration of the non-compete period and to apply the provisions
of this Agreement to the remaining portion of the geographic area or the remaining business activities not to be severed by such
judicial authority and to the duration of the non-compete period as reduced by judicial determination.


 



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3.14        Survival of the Executive’s
Obligations. The Executive’s obligations under this Agreement shall survive regardless of whether the Executive incurs
a Termination of Employment, voluntarily or involuntarily, by the Company or the Executive, with or without Cause.


 


3.15        Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together
will constitute one and the same instrument.


 


3.16        Governing Law.
This Agreement and any action or proceeding related to it shall be governed by and construed under the laws of the State of Minnesota.


 


3.17        Captions and Gender.
The use of Captions and Section headings herein is for purposes of convenience only and shall not affect the interpretation or
substance of any provisions contained herein. Similarly, the use of the masculine gender with respect to pronouns in this Agreement
is for purposes of convenience and includes either sex who may be a signatory.


 


3.18        No Guarantee of Tax
Treatment. Nothing herein shall be construed as an entitlement to or guarantee of any particular tax treatment to the Executive.
This Agreement is drafted and shall be interpreted to be exempt from Code Section 409A.





 


IN WITNESS WHEREOF, the Executive and a duly
authorized representative of the Company have signed this Agreement.


 





	EXECUTIVE:	 	COMPANY:
	 	 	 
	 	 	 	COMMUNICATIONS SYSTEMS, INC.
	 	 	 	 
	 	 	By   	
	 	 	 	 	 	 	 
	 	 	 	Its	 	 	 
	 	 	 	 	 	 	 	 	 


 



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