**Exhibit 10.23**

 

CHANGE OFCONTROL AGREEMENT

 

This Change of Control Agreement (the “Agreement”)is made and entered into December 8, 2004 by and between DeCrane AircraftHoldings, Inc. (the “Company”) and [**Name**]“Executive”) based on thefollowing facts:

 

A.           Executive is currently employed by the Company in thecapacity as [**Title**] and is a key executive of the Company.

 

B.             The Company desires to define the terms and conditionsof any termination of employment upon a Change of Control (as defined herein)in the Company.

 

Based on the foregoing facts andcircumstances and for good and valuable consideration, receipt of which ishereby acknowledged, the Company and Executive agree as follows:

 

1.               Term of Agreement. Except as otherwise provided herein, the term of this Agreement shallcommence effective the date hereof and shall continue for two years (the “Term”).

 

2.   A.            Compensation Upon Termination Following a Change ofControl. In the event that (i) aChange of Control shall have occurred during the term of this Agreement andwhile Executive is employed by the Company and (ii) the Executive’s employmentshall be involuntarily terminated for any reason on a date which is less thantwo years after the date of the Change of Control (whether during or after theterm of this Agreement) other than for Cause, death or disability or Executiveshall terminate his employment for Good Reason, then the Company shall make thefollowing payments to Executive within 15 days following the date of suchtermination of employment (the “Termination Date”). subject in each caseto any applicable payroll or other taxes required to be withheld.

 

(1)          The Company shall pay Executive a lump sum amount incash equal to the sum of (a) Executive’s monthly base salary multiplied by anumber equal to 24 minus the number of whole months elapsed from the date ofthe Change of Control to the Termination Date (the “Multiplier”) and (b)Executive’s average annual bonus including in such average any such annualbonus earned (even though such bonus may be paid in the year following the yearin which earned), (computed over the shorter of (x) the period of Executive’semployment by the Company or (y) five calendar years each as measured to theday immediately preceding the Termination Date) divided by 12 and multiplied bythe Multiplier.  In no event, however,shall the multiplier be less than 12.

 

(2)          The Company shall pay Executive a lumpsum amount in cash equal to accrued but unpaid salary and bonus through theTermination Date, and unpaid salary with respect to any vacation days accruedbut not taken as of the Termination Date.

 

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B.            Definitions.

 

(1)          As used in this Agreement, “Change of Control” shallmean an event involving the Company of a nature that would be required to bereported in response to Item 6(e) of Schedule 14A of Regulation 14A promulgatedunder the Securities Exchange Act of 1934, as amended (the “Exchange Act”),assuming that such Schedule, Regulation and Act applied to the Company,provided that such a Change of Control shall be deemed to have occurred at suchtime as: (i) any “person” (as that term is used in Sections 13(d) and 14(d)(2)of the Exchange Act) (other than an Excluded Person (as defined below))becomes, directly or indirectly, the “beneficial owner” (as defined in Rule13d-3 under the Exchange Act) of securities representing 20% or more of thecombined voting power for election of members of the Board of Directors of thethen outstanding voting securities of the Company or any successor of theCompany, excluding any person whose beneficial ownership of securities of theCompany or any successor is obtained in a merger or consolidation not includedin paragraph (iii) below; (ii) during any period of two consecutive years orless, individuals who at the beginning of such period constituted the Board ofDirectors of the Company cease, for any reason, to constitute at least amajority of the Board, unless the appointment, election or nomination forelection of each new member of the Board (other than a director whose initialassumption of office is in connection with an actual or threatened electioncontest, including but not limited to a consent solicitation, relating to theelection of directors of the Company) was approved by a vote of at leasttwo-thirds of the members of the Board of Directors then still in office whowere members of the Board at the beginning of the period or whose appointment,election or nomination was so approved since the beginning of such period;(iii) there is consummated any merger, consolidation or similar transaction towhich the Company is a party as a result of which the persons who were equityholders of the Company immediately prior to the effective date of the merger orconsolidation shall have beneficial ownership of less than 50% of the combinedvoting power for election of members of the Board of Directors (or equivalent)of the surviving entity or its parent following the effective date of suchmerger or consolidation; (iv) any sale or other disposition (or similartransaction) (in a single transaction or series of related transactions) of (x)50% or more of the assets or earnings power of the Company or (y) businessoperations which generated a majority of the consolidated revenues (determinedon the basis of the Company’s four most recently completed fiscal quarters forwhich reports have been completed) of the Company and its subsidiariesimmediately prior thereto, other than a sale, other disposition, or similartransaction to an Excluded Person or to an entity of which equityholders of theCompany beneficially own at least 50% of the combined voting power; (v) anyliquidation of the Company. For purposes of this definition of Change ofControl, the term “Excluded Person” shall mean and include (i) any corporationbeneficially owned by shareholders of the Company in substantially the sameproportion as their ownership of shares of the Company and (ii) the Company.

 

(2)   As used in this Agreement, “Good Reason”shall mean the occurrence, following a Change of Control, of any one of thefollowing events without Executive’s consent: (i) the Company assigns Executiveto any duties substantially inconsistent with his position, duties,responsibilities, status or reporting responsibility with the Companyimmediately prior to the Change of Control, or assigns Executive to a positionthat

 

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does not provide Executive with substantially the same or bettercompensation, status, responsibilities and duties as Executive enjoyedimmediately prior to the Change of Control; (ii) the Company reduces the amountof Executive’s base salary as in effect as of the date of the Change of Controlor as the same may be increased thereafter from time to time, except foracross-the-board salary reductions similarly affecting all senior executives ofthe Company; (iii) the Company fails to pay Executive an annual bonusconsistent with past practices and bonuses consistent with past practices arepaid to any other senior executives of the Company; (iv) the Company changesthe location at which Executive is employed by more than 50 miles from thelocation at which Executive is employed as of the date of this Agreement; or(v) the Company breaches this Agreement in any material respect, includingwithout limitation failing to obtain a succession agreement from any successorto assume and agree to perform this Agreement.

 

(3)          For Cause. Asused in this Agreement, “Cause” shall mean (i) any material act of dishonestyconstituting a felony (of which Executive is convicted or pleads guilty) whichresults or is intended to result directly or indirectly in substantial gain orpersonal enrichment to Executive at the expense of the Company, or (ii) afternotice of breach delivered to Executive specifying in reasonable detail and areasonable opportunity for Executive to cure the breaches specified in thenotice, the Board, acting by a two thirds vote, after a meeting held for thepurpose of making such determination and after reasonable notice to Executiveand an opportunity for him together with his counsel to be heard before theBoard, determines, in good faith, other than for reasons of physical or mentalillness, Executive willfully and continually fails to substantially perform hisduties pursuant to this Agreement and such failure results in demonstrablematerial injury to the Company. The following shall not constitute Cause: (i)Executive’s bad judgment or negligence, (ii) any act or omission by Executivewithout intent of gaining therefrom directly or indirectly a profit to whichExecutive was not legally entitled, (iii) any act or, omission by Executivewith respect to which a determination shall have been made that Executive metthe applicable standard of conduct prescribed for indemnification orreimbursement of payment of expenses under the By-Laws of the Company or thelaws of the State of Delaware as in effect at the time of such act or omission.

 

3.               Mitigation.Executive is not required to seek other employment or otherwise mitigate theamount of any payments to be made by the Company pursuant to this Agreement.

 

4.               Assignment.Neither Company nor Executive shall, have the right to assign its respectiverights pursuant to this Agreement. The Company shall require any proposedsuccessor (whether direct or indirect, by purchase, merger, consolidation orotherwise) to all or substantially all of the business and/or assets of theCompany, by agreement in form and substance reasonably satisfactory toExecutive, to expressly assume and agree to perform this agreement in the samemanner and to the same extent that the Company would be required to perform itif no such succession had taken place, concurrent with the execution of adefinitive agreement with the Company to engage in such transaction.

 

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5.               This Agreement shall be binding on the inure to thebenefit of Executive and his heirs and the Company and any permitted assignee.The Company shall not engage in any transaction, including a merger or sale ofassets unless, as a condition to such transaction such successor organizationassumes the obligations of the Company pursuant to this Agreement.

 

6.               Notices.

 
| If to Company:   | DeCrane Aircraft Holdings, Inc.   2361 Rosecrans Avenue, Suite 180   El Segundo, CA 90245   Attention: Chief Financial Officer   Fax: 310-643-0746 |
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| If to Executive: | [**Name**]  [**Address**]   [**Address**]   [**Fax**]                                                                                              |

 

7.               Facsimile Signatures. Execution and Delivery. This Agreement shall be effective upon transmission ofa signed facsimile by one party to the other.

 

8.               Miscellaneous. This Agreement supersedes and makes void any prior agreement between theparties and sets forth the entire agreement and understanding of the partieshereto with respect to the matters covered hereby, and may not otherwise beamended or modified except by written agreement executed by the Company and theExecutive. This Agreement shall be governed by and construed in accordance withthe laws of the State of California.

 

ThisAgreement has been executed on the date specified in the first paragraph.

 
|   | DeCRANE AIRCRAFT HOLDINGS, INC. |
|--------|---------------------------------|
|   |                            |
|   |                            |
|   | By:                             |   |   |
|   |                            | Authorized Signature |   |
|   |                            |
|   |                            |
|   | EXECUTIVE                       |
|   |                            |
|   |                            |   |
|   | [**Name**]                      |
|        |                                 |  |  |  |

 

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