10-K

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[ X ]	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
	SECURITIES EXCHANGE ACT OF 1934
	For the fiscal year ended December 31, 2008
[    ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
	THE SECURITIES EXCHANGE ACT OF 1934

Commission File No. 0-18348

BE AEROSPACE, INC.

 (Exact name of registrant as specified in its charter)

Delaware	06-1209796
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1400 Corporate Center Way, Wellington, Florida	33414
(Address of principal executive offices)	(Zip Code)
(561) 791-5000
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:  None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $.01 Par Value

(Title of Class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [X] No [   ].

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes [   ] No [X].

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:

Yes [X] No [   ].

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [X]  Accelerated filer [  ]  Non-accelerated filer (do not check if a smaller reporting company) [  ]

Smaller reporting company [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [   ] No [X].

The aggregate market value of the registrant's voting stock held by non-affiliates was approximately $2,169.0 million on June 30, 2008 based on the closing sales price of the registrant's common stock as reported on the Nasdaq National Market as of such date, which is the last business day of the registrant's most recently completed second fiscal quarter.  Shares of common stock held by executive officers and directors and persons who own 5% or more of outstanding common stock have been excluded since such persons may be deemed affiliates.  This determination of affiliate status is not a determination for any other purpose.  The number of shares of the registrant's common stock, $.01 par value, outstanding as of February 23, 2009 was 101,021,421 shares.

DOCUMENTS INCORPORATED BY REFERENCE

Certain sections of the registrant's Proxy Statement to be filed with the Commission in connection with the 2009 Annual Meeting of Stockholders are incorporated by reference in Part III of this Form 10-K.  With the exception of those sections that are specifically incorporated by reference in this Annual Report on Form 10-K, such Proxy Statement shall not be deemed filed as part of this Report or incorporated by reference herein.

INDEX

ITEM 1.	Business	1
ITEM 1A.	Risk Factors	14
ITEM 1B.	Unresolved Staff Comments	19
ITEM 2.	Properties	19
ITEM 3.	Legal Proceedings	19
ITEM 4.	Submission of Matters to a Vote of Security Holders	19
PART II
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder
	Matters and Issuer Purchases of Equity Securities	20
ITEM 6.	Selected Financial Data	21
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and
	Results of Operations	22
ITEM 7A.	Quantitative and Qualitative Disclosures about Market Risk	33
ITEM 8.	Financial Statements and Supplementary Data	33
ITEM 9.	Changes in and Disagreements with Accountants on Accounting and
	Financial Disclosure	33
ITEM 9A.	Controls and Procedures	33
PART III
ITEM 10.	Directors, Executive Officers and Corporate Governance	37
ITEM 11.	Executive Compensation	40
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management
	and Related Stockholder Matters	40
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	40
ITEM 14.	Principal Accounting Fees and Services	40
PART IV
ITEM 15.	Exhibits and Financial Statement Schedules	41
	Index to Exhibits	42
	Signatures	45
	Index to Consolidated Financial Statements and Schedule	F-1

FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act). Such forward-looking statements include, but are not limited to, all statements that do not relate solely to historical or current facts, including statements regarding implementation and expected benefits of lean manufacturing and continuous improvement plans, our dealings with customers and partners, the consolidation of facilities, reduction of our workforce, integration of acquired businesses, ongoing capital expenditures, our ability to grow our business, the impact of the large number of grounded aircraft on demand for our products and our underlying assets, the adequacy of funds to meet our capital requirements, the ability to refinance our indebtedness, if necessary, the reduction of debt, the potential impact of new accounting pronouncements, the global recession and the impact on our business of the recent and projected decreases in passenger traffic and the size of the airline fleet.  Such forward-looking statements include risks and uncertainties and our actual experience and results may differ materially from the experience and results anticipated in such statements. Factors that might cause such a difference include those discussed in our filings with the Securities and Exchange Commission (the SEC), under the heading "Risk Factors" in this Form 10-K, as well as future events that may have the effect of reducing our available operating income and cash balances, such as unexpected operating losses, the impact of rising fuel prices on our airline customers, outbreaks in national or international hostilities, terrorist attacks, prolonged health issues which reduce air travel demand (e.g., SARS), delays in, or unexpected costs associated with, the integration of our acquired or recently consolidated businesses, conditions in the airline industry, conditions in the business jet industry, problems meeting customer delivery requirements, our success in winning new or expected refurbishment contracts from customers, capital expenditures, increased leverage, possible future acquisitions, facility closures, product transition costs, labor disputes involving us, our significant customers or airframe manufacturers, the impact of a prolonged global recession, the possibility of a write-down of intangible assets, delays or inefficiencies in the introduction of new products, fluctuations in currency exchange rates or our inability to properly manage our rapid growth.

Except as required under the federal securities laws and rules and regulations of the SEC, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You are cautioned not to unduly rely on such forward-looking statements when evaluating the information presented herein. These statements should be considered only after carefully reading this entire Form 10-K.

Unless otherwise indicated, the industry data contained in this Form 10-K is from the January/February 2009 issue of the Airline Monitor, the December 2008 reports of the International Air Transport Association (IATA), the Boeing Current Market Outlook 2008, “The ACAS Database” or the Airbus and Boeing corporate websites.

PART 1

ITEM 1.  BUSINESS

Our Company

General

Based on our experience in the industry, we believe we are the world’s largest manufacturer of cabin interior products for commercial aircraft and business jets and the world’s leading distributor of aerospace fasteners and consumables. We sell our products directly to virtually all of the world’s major airlines and aerospace manufacturers.  In addition, through our consumables management (formerly distribution) segment, we sell a large and growing number of consumable parts to market participants in the defense industry.  Based on our experience, we believe that we have achieved leading global market positions in each of our major product categories, which include:

• a broad line of aerospace fasteners and consumables, consisting of over 275,000 Stock Keeping Units (SKUs) serving the aerospace, commercial aircraft, business jet and military and defense industries;

• commercial aircraft seats, including an extensive line of super first class, first class, business class, tourist class and regional aircraft seats;

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• a full line of aircraft food and beverage preparation and storage equipment, including next generation galley systems, coffeemakers, water boilers, beverage containers, refrigerators, freezers, chillers and ovens, including microwave, high efficiency convection and steam ovens;

• both chemical and gaseous aircraft oxygen storage, distribution and delivery systems, protective breathing equipment and lighting products; and

• business jet and general aviation interior products, including an extensive line of executive aircraft seats, direct and indirect overhead lighting systems, passenger and crew oxygen systems, air valve systems, high-end furniture and cabinetry.

We also provide comprehensive aircraft cabin interior reconfiguration and passenger-to-freighter conversion engineering services and component kits.

We were organized as a corporation in Delaware in 1987. We have substantially expanded the size, scope and nature of our business as a result of a number of acquisitions. Between 1989 and 2001, we completed 22 acquisitions, for an aggregate purchase price of approximately $1 billion. We believe these acquisitions enabled us to position ourselves as a preferred global supplier to our customers.  We have undertaken three major facility and product line consolidation efforts, eliminating 22 facilities, since 1992. We implemented lean manufacturing and continuous improvement programs which, together with our information technology investments, have significantly improved our productivity and allowed us to expand our operating margins.  During 2006, we completed two additional strategic acquisitions: Draeger GmbH (Draeger), which strengthened our commercial aircraft segment and New York Fasteners Corp. (New York Fasteners), which expanded the customer base and product line breadth of our consumables management segment. During 2008 we completed the acquisition of the Consumables Solutions distribution business (HCS) from Honeywell International Inc. (Honeywell).  HCS distributed fasteners, hardware, bearings, seals, gaskets and electrical components and other consumables to the global airline, aerospace, business jet and defense industries. The combination of HCS with our existing distribution business created the world’s leading distributor of aerospace fasteners and consumables.  The acquisition of HCS has allowed us to alter our business mix, such that approximately one-half of our business is related primarily to non-discretionary consumables and spares demand.

Our principal executive offices and corporate headquarters are located at 1400 Corporate Center Way, Wellington, Florida 33414 and our telephone number is 561-791-5000.

Industry Overview

The commercial and business jet aircraft cabin interior products industries encompass a broad range of products and services, including aircraft seating, passenger entertainment and service systems, food and beverage preparation and storage systems, passenger and crew oxygen storage, distribution and delivery systems, lavatories, lighting systems, evacuation equipment, and overhead bins, as well as passenger-to-freighter conversions, interior reconfiguration and a variety of other engineering design, integration, installation, retrofit and certification services.

Historically, the airline cabin interior products industry has derived revenues from five sources:

• New installation programs in which airlines purchase new equipment directly from interior equipment manufacturers to outfit these newly purchased aircraft;

• Retrofit programs in which airlines purchase new interior furnishings to upgrade the interiors of aircraft already in service;

• Refurbishment programs in which airlines purchase components and services to improve the appearance and functionality of their cabin interior equipment;

• Equipment to upgrade the functionality or appearance of the aircraft interior; and

• Replacement spare parts.

The retrofit and refurbishment cycles for commercial aircraft cabin interior products differ by product category. Aircraft seating typically has a refurbishment cycle of one to two years and a retrofit cycle of four to eight years. Food and beverage preparation and storage equipment is periodically upgraded or repaired, and requires a continual flow of spare parts, but may be retrofitted only once or twice during the useful life of an aircraft.

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There is a direct relationship between demand for fasteners and consumables products and fleet size, aircraft utilization and aircraft age. All aircraft must be serviced at prescribed intervals, which also drives aftermarket demand for aerospace fasteners and consumables.

Aerospace fastener and consumables revenues have been derived from the following sources:

• Mandated maintenance and replacement of specified parts;

• Demand for aerospace fasteners and other consumables for new build aircraft from the original equipment manufacturers (OEMs) and their suppliers;

• Aerospace and defense subcontractors, most of whom tend to purchase through distributors as a result of the channel shift due to outsourcing by aerospace and military aircraft OEMs; and

• Demand for structural modifications, cabin interior modifications and passenger-to-freighter conversions.

 Through the strategic acquisition of HCS we have created the worldwide leader in the distribution of aerospace fasteners and consumables.  The acquisition of HCS has allowed us to alter our business mix such that approximately one-half of our business is related primarily to non-discretionary consumables and spares demand.

Based on industry sources and studies, we estimate that during 2008, the commercial and business jet cabin interior products industry, for the principal products of the type which we manufacture, exclusive of service revenues, had annual sales of approximately $2.0 billion and the aerospace fastener and consumables industry had annual sales of approximately $4.5 billion.

Airline passenger traffic demonstrated strong continued growth over the past several years through the middle of 2008.  Airline traffic declined during the third and fourth quarters of 2008 as a result of the rapid deterioration in global economic conditions. As a result of the recession, global air traffic growth in 2008 increased by approximately 1.6% over 2007, whereas airline traffic in 2007 increased by 7.4% over 2006, following a 5.9% increase in 2006 over 2005. In addition, according to IATA, passenger traffic is expected to fall by approximately 3% in 2009.  Record fuel prices during most of 2008 and the global economic recession drove airlines to reduce fleet capacity, delay aircraft purchases, defer retrofit programs and deplete their existing inventories of spares and consumables.

The global recession and record fuel prices during most of the year generated significant operating losses for the global airline industry, including the U.S. airlines.  According to IATA, the worldwide airline industry generated approximately $5.0 billion of losses in 2008 and is expected to generate approximately $2.5 billion of losses in 2009.  However, since the U.S. airlines began cost reduction efforts during 2008, including fleet reductions, IATA anticipates that the U.S. airlines will generate profits during 2009.

The business jet industry also experienced resurgence in demand beginning in 2004 through 2008. Approximately 1,154 aircraft were delivered in 2008 versus approximately 1,039 aircraft in 2007 and approximately 840 aircraft in 2006.  Reflecting current economic conditions, industry experts expect deliveries to begin to decline significantly.

During the five year period ended December 31 2008, we experienced a surge in demand for our products, primarily from the large foreign international carriers.  Our backlog achieved record levels in both 2008 and 2007 growing by about 30% per year to $2.2 billion in 2007 and to approximately $2.9 billion in 2008.  Our book to bill ratio was 1.1:1 during 2008.  The vast majority of our backlog growth during 2008 was generated by foreign carriers; 9% of our backlog at December 31, 2008 was with domestic airlines.  At December 31, 2008, several large retrofit programs had been deferred until 2010 and 2011 as the airlines sought to conserve cash. Despite the near term impact of these retrofit program deferrals, which will negatively impact revenues and profits in 2009, we believe there are substantial long-term growth opportunities for retrofit and upgrade programs, particularly for the twin-aisle aircraft that service international routes.

Other factors expected to affect the industries we serve are the following:

Long Term Growth in Worldwide Fleet.  The size of the worldwide fleet is important to us since the proper maintenance of the fleet generates ongoing nondiscretionary demand for the fasteners and other consumable products that we distribute.  According to the Airline Monitor, while new aircraft deliveries are expected to decline in the near term, the worldwide fleet of passenger and cargo aircraft is expected to increase to approximately 33,200 aircraft by December 31, 2023 from approximately 19,400 aircraft at December 31, 2008.  Additionally, over the next 15 years, the Airline Monitor expects revenue passenger miles to increase at an annual rate of approximately 4.8%, increasing from 2.8 trillion miles in 2008 to approximately 5.7 trillion miles by 2023.

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Existing Installed Base.  Existing installed base of products typically generates continued retrofit, refurbishment and spare parts revenue as airlines maintain their aircraft interiors. According to industry sources, the world's active commercial passenger aircraft fleet consisted of approximately 17,540 aircraft as of December 31, 2008. Additionally, based on industry sources, there are approximately 15,600 business jets currently in service. Based on such fleet numbers, we estimate that the total worldwide installed base of commercial and general aviation aircraft cabin interior products, for the principal products of the type which we manufacture, valued at replacement prices, was approximately $16.1 billion as of December 31, 2008.  The increase in size of the installed base is expected to generate additional and continued demand for retrofit, refurbishment, consumables and spare parts.

Wide-Body Aircraft Deliveries.  The trend toward a global fleet with a higher percentage of wide-body aircraft is significant to us because wide-body aircraft require up to six to nine times the dollar value content for our products as compared to narrow-body aircraft. According to Airline Monitor wide-body aircraft deliveries are expected to grow at a nearly 15% compounded annual growth rate over the four year period ending 2012.  Deliveries of wide-body, long haul aircraft constitute an increasing share of total new aircraft deliveries and are an increasing percentage of the worldwide fleet. Wide-body aircraft represented approximately 21% of all new commercial aircraft (excluding regional jets) delivered in 2008.  Importantly, according to Airline Monitor, over the 2009 to 2012 time period, approximately 1,075 wide-body and super wide-body aircraft are expected to be delivered by Boeing and Airbus.  Wide-body aircraft currently carry up to three or four times the number of seats as narrow-body aircraft and have multiple classes of service, including luxurious super first class compartments, first class and business class configuration.  Our average revenue per aircraft on a wide-body aircraft is substantially higher than on a narrow-body aircraft.  In addition, aircraft cabin crews on wide-body aircraft flights today may make and serve between 300 and 900 meals and may brew and serve more than 2,000 cups of coffee and serve more than 200 glasses of wine on a single flight, thereby generating substantial demand for seating products and food and beverage preparation and storage equipment, as well as extensive oxygen storage, delivery distribution systems and lighting systems.

New Aircraft Deliveries.  The number of new aircraft delivered each year is generally regarded as cyclical in nature. According to Airline Monitor, new deliveries of large commercial jets during 2008, 2007 and 2006 were approximately 852, 888 and 820, respectively and the approximate amount of new deliveries is expected to remain at approximately the 2008 level in 2009, then decrease to approximately 768 in 2010.

Shift Toward Seller Furnished Equipment for Major Systems.  Commencing with the launch of the Boeing 787 and Airbus A350, both Boeing and Airbus began selecting manufacturers for certain cabin interior systems, for the production life of the aircraft.  To date, we have been selected by Boeing to manufacture our patented Pulse OxygenTM system and passenger service units for the B787, and we have been selected by Airbus to manufacture our Next Generation galley systems and our patented passenger oxygen delivery system for the A350 XWB. Traditionally, we have sold most of our products directly to the airlines.  This change toward seller furnished equipment for major systems is important to us as it adds a significant source of revenues over a long period of time.  These programs are currently valued at approximately $2.3 billion and are expected to significantly increase our content per wide-body aircraft.  However, only a small portion of these programs are included in our reported backlog at December 31, 2008.  We believe these programs provide an excellent platform for long term revenue stability over the coming years.

Growth in Passenger-to-Freighter Conversion Business.   Industry sources project that the size of the worldwide freighter fleet will almost double over the next twenty years, growing to almost 3,890 aircraft. Industry sources also estimate that during the period nearly 2,500 cargo aircraft will come from converting commercial passenger jets to be used as freighters. We have developed the engineering certification packages and kits to convert Airbus A300-600, B747-200, B767-200 and A300-B4 aircraft types to be used as freighters.

New Product Development.  The aircraft cabin interior products companies are engaged in extensive product development and marketing efforts for both new features on existing products and totally new products. These products include a broad range of amenities such as luxurious first class cabins with appointments such as lie-flat seating, mini-bars, closets, flat screen TVs and digital LED mood lighting.  Other recently introduced products include electric lie-flat first and business class seats, narrow and wide-body economy class seats, full face crew masks, Pulse Oxygen™ gaseous passenger oxygen systems for the Boeing 787 andAirbus A350 XWB, Next Generation galley systems for the Airbus A350 XWB, electric fully berthing business jet seating, a full range of business and executive jet seating and LED lighting products, protective breathing equipment, oxygen generating systems, new food and beverage preparation and storage equipment, kevlar barrier nets, de-icing systems and crew rests.

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Engineering Services Markets.  Historically, the airlines have relied primarily on their own in-house engineering resources to provide engineering, design, integration and installation services, as well as services related to repairing or replacing cabin interior products that have become damaged or otherwise non-functional. As cabin interior product configurations have become increasingly sophisticated and the airline industry increasingly competitive, the airlines have begun to outsource these services in order to increase productivity and reduce costs.

Outsourced services include:

• Engineering design, integration, project management, installation and certification services;

• Modifications and reconfigurations for commercial aircraft including passenger-to-freighter conversions and related kits; and

• Services related to the support of product upgrades.

We estimate that during 2008 the commercial and business jet cabin interior products industry, for the principal products of the type which we manufacture, exclusive of service revenues, had annual sales of approximately $2.0 billion and the aerospace fastener and consumables industry had annual sales of approximately $4.5 billion. We estimate that the total worldwide installed base of commercial and general aviation aircraft cabin interior products for the principal type of products which we manufacture, valued at replacement prices, was approximately $16.1 billion as of December 31, 2008.

Competitive Strengths

We believe that we have a strong competitive position attributable to a number of factors, including the following:

Large Installed Base.  We have a large installed base of commercial and general aviation cabin interior products, estimated to be valued at approximately $7.3 billion (for the principal type of products which we manufacture, valued at replacement prices) as of December 31, 2008. Based on our experience in the industry, we believe our installed base is substantially larger than that of our competitors. We believe that our large installed base is a strategic advantage as airlines tend to purchase aftermarket products and services, including spare parts, retrofit and refurbishment programs, from the original supplier of their equipment. As a result, we expect our large installed base to generate continued aftermarket revenue as airlines continue to maintain, evolve and reconfigure their aircraft cabin interiors.

Operating Leverage and Low Cost Producer.  Our ability to leverage our manufacturing and engineering capabilities has allowed us to expand operating margins. As a result of our cost savings programs implemented following the downturn in the airline industry in 2001, and through our ongoing continuous improvement, global sourcing and lean manufacturing programs, our operating margins have increased substantially. For example, our operating margin for the fiscal year ended December 31, 2008 (exclusive of goodwill and intangible asset impairment charges) of 16.8% improved by 800 basis points over the operating margin we realized for fiscal year ended 2004, reflecting ongoing manufacturing efficiencies and operating leverage at the higher volume of sales. In addition, our operating earnings have been increasing at a faster rate than our net sales. For example, for the year ended December 31, 2008, revenues grew 25.8% over revenues in 2007 while operating earnings (before goodwill and intangible asset impairment charges) increased by 43.2% during 2008 as compared to 2007.  

Focus on Innovation and New Product Development.  We believe, based on our experience in the industry, that we are a technological leader, with the largest research and development organization in the cabin interior products industry. As of December 31, 2008, we had 882 employees in engineering, research and development and program management. We believe our engineering, research and development effort and our on-site technicians at both the airlines and airframe manufacturers enable us to play a leading role in developing and introducing innovative products to meet emerging industry trends, and thereby gain early entrant advantages. Our strong focus and continued investment in research and development, even during the 2001-2003 industry downturn, allows us to compete favorably in winning new business awards. For example, we believe our technological leadership and new product development capabilities were a key factor in our ability to grow our backlog to approximately $2.9 billion at December 31, 2008, a 32% increase as compared to December 31, 2007 and a 163% increase as compared to December 31, 2005. Backlog growth has been driven primarily by international aftermarket demand for retrofit of existing aircraft, including program awards in the emerging international super first class cabin interiors market.  We believe these and other program awards, coupled with expected follow-on awards for other fleets of existing aircraft for product commonality and competitive purposes, will, subject to global economic conditions, drive sales growth and market share gains.  Introduction of new products has also led to improvements in the product mix of our current backlog, which, along with our continued focus on lean manufacturing processes and additional operating leverage, is expected to result in continued margin expansion.

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Exposure to International Markets.  Our overall net sales are diversified across multiple geographic regions. For 2008, approximately 24% of our sales were to European customers and approximately 29% of our sales were to customers in emerging markets such as the Asia/Pacific Rim and Middle East regions.  These emerging market customers account for approximately 31% of our current backlog with domestic airlines accounting for 9% of our total backlog at December 31, 2008.  We believe this geographic diversification makes us less susceptible to a downturn in a specific geographic region and allows us to take advantage of regional growth trends.

Diverse Product Offering and Broad Customer Base.  In addition to serving diverse geographic regions, we also provide a comprehensive line of products and services to a broad customer base. During the three year period ended December 31, 2008, no single customer accounted for more than 10% of our consolidated sales.  We have a broad range of over 200 principal customers, including all of the world’s major airlines. During the fiscal year ended December 31, 2008, approximately 6% of our sales were to Boeing and Airbus and approximately 9% were to business jet manufacturers for use in new business jets. Our broad product offering and customer base make us less susceptible to the loss of any one customer or program. We have continued to expand our available products and services based on our belief that the airline industry increasingly will seek an integrated approach to the design, development, integration, installation, testing and sourcing of aircraft cabin interior equipment. Based on our reputation for quality, service and product innovation, we believe that we are well positioned to serve the world’s airlines and aircraft manufacturers and owners and operators of business jets.

Experience with Complex Regulatory Environment.  The airline industry is heavily regulated. The Federal Aviation Administration (the FAA) prescribes standards and licensing requirements for aircraft components, including virtually all commercial airline and general aviation cabin interior products, and licenses component repair stations within the United States. Comparable agencies, such as the European Aviation Safety Agency (the EASA), the Japanese Civil Aviation Board (the JCAB), and the Civil Aviation Administration of China (the CAAC) regulate these matters in other countries.  In order to sell certain products or services, it is necessary to obtain the required licenses for the product or service under these various regulations. In addition, designing new products to meet existing regulatory requirements and retrofitting installed products to comply with new regulatory requirements can be both expensive and time consuming. We have a long history of experience with the complex regulatory environment in which we operate and believe this enables us to efficiently obtain the required approvals for new products and services.

Growth Opportunities

We believe that we will benefit from the following industry trends:

Worldwide Fleet Creates Demand for Aftermarket and Consumables Products.  Our substantial installed base provides significant ongoing revenues from replacements, upgrades, repairs and the sale of spare parts, as well as demand for nondiscretionary consumables to support the active fleets of commercial aircraft, business jets and military aircraft.  For each of the fiscal years ended December 31, 2008 and 2007 approximately 56% and 60% respectively, of our revenues were derived from aftermarket and military demand. In addition, aftermarket revenues are generally driven by aircraft usage, and as such, they have historically tended to recover more quickly than revenues from OEMs.  While worldwide air traffic is expected to decline by 3% in 2009, Airline Monitor forecasts that revenue passenger miles will grow at a 4.8% compound annual growth rate over the 2008-2023 period, increasing from 2.8 trillion miles in 2008 to 5.7 trillion miles by 2023.  We believe there are substantial growth opportunities for retrofit programs for the twin-aisle aircraft that service international routes and that the major U.S. airlines will need to invest in cabin interiors for their international fleets or face the prospect of losing market share on their international routes.

Opportunity to Substantially Expand Our Addressable Markets through our Consumables Management Business.  Our consumables distribution business leverages our key strengths, including marketing and service relationships with most of the world’s airlines, commercial aircraft OEMs and their suppliers, business jet OEMs and their suppliers, maintenance, repair and overhaul centers (MROs), and the military industry.  As approximately 56% of consumables demand is generated by the existing worldwide fleet, demand for aerospace hardware, fasteners, bearings, seals, gaskets, electrical components and other consumables is expected to increase over time as the fleet expands, similar to the market for cabin interior products.  The aerospace and military OEMs are increasingly outsourcing to sub-contract manufacturers, driving a channel shift, which is benefiting distributors such as our company, as many of these subcontractors tend to purchase through distributors.  

Record Backlog Driven by Aftermarket Demand from International Airlines Retrofitting Existing Fleets. We believe that substantially all of the major international airlines have begun upgrading, or plan to upgrade, their existing fleets of twin-aisle aircraft.  A number of our customers have deferred these retrofit programs until 2010 and 2011 in order to conserve cash during the current economic downturn.  This activity has been, and subject to economic conditions, is expected to continue to be driven by both the age of the existing cabin interiors as well as the desire by many of the leading international carriers to achieve a competitive advantage by investing in cabin interior products that incorporate leading comfort amenities, thereby improving passenger loads and yields, or that reduce airline operating costs by reducing maintenance costs and/or providing lower weight and fuel burn.  We believe that the life cycle of premium products, such as lie-flat international business class seats and the products comprising our super first class suites, will continue to compress as airlines seek greater competitive advantage through more frequent investments in cabin interior products.

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Growth of Wide-Body Aircraft Fleet.  According to Airline Monitor, new deliveries of wide-body aircraft totaled 182 in 2008 and are expected to total approximately 1,075 aircraft over the 2009-2012 period, averaging approximately 269 such aircraft per year or a 48% higher delivery level as compared to 2008. The Airline Monitor also predicts that nearly 3,875 twin-aisle aircraft will be delivered over the 2009-2018 timeframe or approximately 388 wide-body and super wide-body aircraft per year, which is 113% higher, on average, as compared to 2008.  We expect to benefit from this trend as wide-body aircraft generally carry more than six to nine times the dollar value of products of the type that we manufacture as compared to single-aisle, or narrow-body, aircraft.

Shift Toward Seller Furnished Equipment for Major Systems.  Commencing with the launch of the Boeing 787 and Airbus A350 XWB, both Boeing and Airbus began selecting exclusive manufacturers for certain cabin interior products for the production life of the aircraft.  To date, we have been selected by Boeing to manufacture our patented Pulse OxygenTM system and passenger service units for the 787, and we have been selected by Airbus to manufacture our Next Generation galley systems and our patented passenger oxygen delivery system for the A350 XWB.  Traditionally, we have sold our products directly to the airlines that purchased aircraft from Boeing or Airbus.  This change toward seller furnished equipment for major systems is important to us as it adds a significant source of revenue over a long period of time.  These programs are currently valued at approximately $2.3 billion and are expected to significantly increase our content per wide-body aircraft.  However, only a small portion of these programs were included in our reported backlog at December 31, 2008.  We believe these programs along with our many other awards provide an excellent platform for long term revenue stability over the coming years.

Growth of Worldwide Airline Fleet.  According to Airline Monitor, new deliveries of large commercial aircraft decreased to 852 aircraft in 2008, as compared to 888 aircraft in 2007 and 820 in 2006.  According to the Airline Monitor, new aircraft deliveries are expected to remain at approximately the 2008 level in 2009 and then decline to approximately 768 in 2010. The worldwide fleet of passenger and cargo aircraft was approximately 19,400 as of December 31, 2008 and, according to the Airline Monitor, is expected to increase to approximately 33,200 by December 31, 2023. As the size of the fleet expands, demand is also expected to grow for upgrade and refurbishment programs, for cabin interior products and for maintenance products, including consumables and spares.

Growth in New Aircraft Introductions Lead to New Cabin Interior Product Introductions and Major Retrofit Opportunities.  Through December 31, 2008, 16 customers have placed orders for 198 of the new Airbus A380 super wide-body aircraft and 56 customers have placed orders for 910 of the new Boeing 787 wide-body aircraft, which Boeing has indicated is its most successful new product launch in its history. In addition, 27 customers have placed 483 orders for the new A350 XWB.

Long Term Growth in Business Jet and VIP Aircraft Markets.  Business jet deliveries increased by 11% in 2008 as compared to 2007 and by 24% in 2007 as compared to 2006. While business jet deliveries are expected to decline significantly in the near term, we expect that over the longer term several larger business jet types, including the Boeing and Airbus Business Jet, the Bombardier Challenger, the Global Express and the Global 5000, the Gulfstream 450, 550 and 650, the Falcon 900, and the Falcon 2000 and 7x, the Cessna Columbus and Embraer Legacy 450 and Legacy 500 to be significant contributors to growth in new general aviation aircraft deliveries in the future. This is important to us because the typical cost of cabin interior products manufactured for a large business jet can be ten times more than the cost to equip the interior of a small jet. Advances in engine technology and avionics and the continued development of fractional ownership of executive aircraft are also important growth factors for the business jet market. In addition, because the average age of the more than 15,000 general aviation and VIP jet aircraft existing today is approximately 15 years, we believe significant cabin interior retrofit and upgrade opportunities exist.

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Business Strategy

Our business strategy is to maintain a leadership position and to best serve our customers by:

• Offering the broadest and most innovative products and services in the industry;

• Offering a broad range of engineering services including design, integration, installation and certification services, aircraft reconfiguration, and passenger-to-freighter conversion services;

• Pursuing the highest level of quality in every facet of our operations, from the factory floor to customer support;

• Aggressively pursuing continuous improvement initiatives in all facets of our businesses and in particular our manufacturing operations, to reduce cycle time, lower cost, improve quality and expand our margins; and

• Pursuing a worldwide marketing and product support approach focused by airline and general aviation airframe manufacturers and encompassing our entire product line.

Products and Services

We conduct our operations through strategic business units that have been aggregated under three reportable segments: consumables management, commercial aircraft and business jet.

The following is a summary of net sales for each of our segments:

	Fiscal Year Ended December 31,
	($ in millions)
	2008					2007					2006
	Net		% of			Net		% of			Net		% of
	Sales		Net Sales			Sales		Net Sales			Sales		Net Sales
Consumables
management	$	697.3		33.0	%	$	386.5		23.0	%	$	251.5		22.3	%
Commercial aircraft		1,138.7		54.0	%		1,098.1		65.5	%		729.2		64.6	%
Business jet		274.0		13.0	%		193.1		11.5	%		147.5		13.1	%
Net sales	$	2,110.0		100.0	%	$	1,677.7		100.0	%	$	1,128.2		100.0	%

Consumables Management Segment

In 2009 we aligned the legacy business names of our various distribution businesses to the consumables management segment.  We believe that we are the world’s leading distributor and value added service provider of aerospace fasteners and consumables and we believe we offer one of the broadest lines of aerospace hardware and inventory management services worldwide. Through the strategic acquisition of HCS and its integration with our existing consumables management segment we have created the worldwide leader in the distribution of aerospace fasteners and consumables.  The acquisition of HCS has allowed us to alter our business mix such that approximately one-half of our business is related to primarily non-discretionary consumables and spares demand. Approximately 56% of our fastener and consumables sales are to the aftermarket and military, and nearly 58% of our orders are shipped within 24 hours of receipt of the order. With over 275,000 SKUs and next-day service, we serve as a distributor for almost every major aerospace fastener manufacturer. Our service offerings include inventory management and replenishment, electronic data interchange, special packaging and bar-coding, parts kitting, quality assurance testing and purchasing assistance. Our seasoned purchasing and sales teams, coupled with state-of-the-art very effective information technology and automated retrieval systems, provide the basis for our reputation for high quality and overnight delivery.

Commercial Aircraft Segment

We believe, based on our experience in the industry, that we are the world's leading manufacturer of aircraft seats, offering a wide selection of first class, business class, tourist class and regional aircraft seats. A typical seat manufactured and sold by us includes the seat frame, cushions, armrests, tray table and a variety of optional features such as adjustable lumbar supports, footrests, reading lights, head/neck supports, and other comfort amenities.  We also integrate a wide variety of in-flight entertainment equipment into our seats, which is supplied to us by our customers or third party suppliers.

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First and Business Classes.  Based upon major airlines' program selection and our backlog, we believe we are the leading worldwide manufacturer of premium class seats. Our line of first class sleeper seats incorporates full electric actuation, an electric ottoman, privacy panels and sidewall-mounted tables. Our business class seats incorporate features developed over 25 years of seating design. The business class seats include electrical or mechanical actuation, PC power ports, telephones, leg rests, adjustable lumbar cushions, four-way adjustable headrests and fiber optic reading lights. The first and business class products are substantially more expensive than tourist class seats due to these luxury appointments.

Tourist Class and Regional Jet Seats.  We believe, based on our installed base, that we are a leading worldwide manufacturer of tourist class seats and regional aircraft seats. We believe our Spectrum® coach class seat has become the industry's most popular seat platform for single-aisle aircraft since its launch in late 2002.  We believe the seat improves comfort and offers significantly improved passenger living space as well as benefiting the airlines with simplified maintenance and spare parts purchasing. Spectrum® was engineered for use across the entire single-aisle aircraft fleet, including regional jets.

Spares.  Aircraft seats require regularly scheduled maintenance in the course of normal passenger use. Airlines depend on seat manufacturers and secondary suppliers to provide spare parts and kit upgrade programs. As a result, a significant market exists for spare parts and kit upgrades.

We believe, based on our experience in the industry, that we are the leading manufacturer of interior systems for both narrow and wide-body aircraft, offering a broad selection of coffee and beverage makers, water boilers, liquid containers, ovens, refrigeration equipment, oxygen delivery systems and a variety of other interior components.

Oxygen Delivery Systems.  We believe, based on our experience in the industry, that we are the leading manufacturer of oxygen storage, distribution and delivery systems for both commercial and business jet aircraft.  We have the capability to both produce all required components and to fully integrate overhead passenger service units with either chemical or gaseous oxygen equipment.  Our oxygen equipment has been approved for use on all Boeing and Airbus aircraft and is also found on essentially all general aviation and VIP aircraft.  The Boeing 787 will be the first aircraft equipped with a passenger oxygen system using our advanced Pulse OxygenTM  technology and passenger service units.  Airbus has also selected us to provide similar technology on its passenger and crew oxygen systems for the A350 XWB.

Coffee Makers/Water Boilers.  We believe, based on our experience in the industry, that we are the leading manufacturer of aircraft coffee and beverage makers.  We manufacture a broad line of coffee makers, including the Endura® beverage maker, coffee warmers and water boilers, and a Combi Unit® which will both brew coffee and boil water for tea while utilizing 25% less electrical power than traditional 5,000-watt water boilers.  We also manufacture a cappuccino/espresso maker.

Ovens.  We believe, based on our experience in the industry, that we are the leading manufacturer of a broad line of specialized ovens, including high efficiency convection ovens, and steam ovens and warming ovens.  Our DS Steam OvenTM uses a method of preparing in-flight food by maintaining constant temperature and moisture in the food.  Our DS Steam OvenTM addresses the airlines' need to provide a wider range of food offerings than can be prepared by convection ovens.

Refrigeration Equipment.  We believe, based on our experience in the industry, that we are the worldwide industry leader in the design, manufacture and supply of commercial aircraft refrigeration equipment.  We manufacture self-contained wine and beverage chillers, refrigerators/freezers and galley air chilling systems.

Engineering Design, Integration, Installation and Certification Services.  We believe, based on our experience in the industry, that we are a leader in providing engineering, design, integration, installation and certification services for commercial aircraft passenger cabin interiors. We also offer to our customers in-house capabilities to design, manage, integrate, test and certify reconfigurations and modifications for commercial aircraft and to manufacture related products, including engineering kits and interface components. We provide a broad range of interior reconfiguration services which allow airlines to change the size of certain classes of service, modify and upgrade the seating, install telecommunications and entertainment equipment, relocate galleys, lavatories and overhead bins, and install crew rest compartments.

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Passenger-to-Freighter Conversions.  We believe, based on our experience in the industry, that we are a leading supplier of structural design and integration services, including airframe modifications for passenger-to-freighter conversions. In addition, we have performed conversions for Airbus A300-600 and A300 B4 aircraft and Boeing 767, Boeing 747-200 Combi, Boeing 747-200 (exclusive of door surround). Freighter conversions require sophisticated engineering capabilities and very large and complex proprietary parts kits.

Crew Rest Compartments.  We believe, based on our experience in the industry, that we are a leader in the design, certification and manufacture of crew rest compartments. Long-haul international flights can carry two flight crews and the off-duty flight crew often utilizes crew rest compartments to sleep during the flight. A crew rest compartment is constructed utilizing lightweight cabin interior materials and incorporates seating, electrical, heating, ventilation and air conditioning and lavatory systems.

We estimate that as of December 31, 2008, we had an aggregate installed base of products produced by our commercial segment, valued at replacement prices, of approximately $6.1 billion.

Business Jet Segment

We believe, based on our experience in the industry, that we are the leading manufacturer of a broad product line of furnishings for business jets. Our products include a complete line of business jet seating and sofa products, including electric fully berthing lie flat seats, direct and indirect lighting, air valves and oxygen delivery systems as well as sidewalls, bulkheads, credenzas, closets, galley structures, lavatories and tables. We have the capability to provide complete interior packages for business jets and executive aircraft (i.e. head-of-state) interiors, including design services, interior components and program management services. We believe we are the preferred supplier of seating products and direct and indirect lighting systems for most business jet manufacturers.

Our business jet segment, which has had decades of experience in equipping VIP and head of state aircraft, is the leading manufacturer of super first class cabin interior products for commercial wide-body aircraft. Super first class products incorporate a broad range of amenities such as luxurious first class cabins with appointments such as lie-flat seating, mini-bars, closets, flat screen televisions and mood lighting, which, until recently, were found only in VIP and head-of-state aircraft.

We estimate that as of December 31, 2008, we had an aggregate installed base of business jet and super first class equipment, valued at replacement prices, of approximately $1.2 billion.

Research, Development and Engineering

We work closely with commercial airlines, business jet and aerospace manufacturers and global leasing companies to improve existing products and identify customers' emerging needs. Our expenditures in research, development and engineering totaled $131.4 million, $127.9 million and $88.6 million representing 6.2%, 7.6% and 7.9% of net sales for the years ending December 31, 2008, 2007 and 2006, respectively. We employed 882 professionals in engineering, research and development and program management as of December 31, 2008. We believe, based on our experience in the industry, that we have the largest engineering organization in the cabin interior products industry, with mechanical, electrical, electronic and software design skills, as well as substantial expertise in program management, materials composition and custom cabin interior layout design and certification.

Marketing and Customers

We market our aerospace fasteners and other consumables directly to the airlines, aircraft leasing companies, MROs, general aviation airframe manufacturers, first-tier suppliers to the commercial, military and defense airframe manufacturers, the airframe manufacturers and other distributors. We believe that our key competitive advantages are the breadth of our product offerings and our ability to deliver on a timely basis. We believe that our broad product offerings of aerospace fasteners and other consumables and our ability to deliver products on a next day basis and our core competencies in product information management, purchasing and logistics management provide strong barriers to entry.

We market and sell our commercial aircraft products directly to virtually all of the world's major airlines, aircraft leasing companies and airframe manufacturers. Airlines select manufacturers of cabin interior products primarily on the basis of custom design capabilities, product quality and performance, on-time delivery, after-sales customer service, product support and price. We believe that our large installed base, our timely responsiveness in connection with the custom design, manufacture, delivery and after-sales customer service and product support of our products, our broad product line and stringent customer and regulatory requirements, all present barriers to entry for potential new competitors in the cabin interior products market.

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We believe that airlines prefer our integrated worldwide marketing approach, which is focused by airline and encompasses our entire product line. Led by senior executives, teams representing each product line serve designated airlines that together accounted for the vast majority of the purchases of products manufactured by our commercial aircraft segment including our super first class product during the fiscal year ended December 31, 2008.  Our teams have developed customer-specific strategies to meet each airline's product and service needs. We also staff "on-site" customer engineers at major airlines and airframe manufacturers to represent our entire product line and work closely with the customers to develop specifications for each successive generation of products required by the airlines. These engineers help customers integrate our wide range of cabin interior products and assist in obtaining the applicable regulatory certification for each particular product or cabin configuration. Through our on-site customer engineers, we expect to be able to more efficiently design and integrate products that address the requirements of our customers. We provide program management services, integrating all on-board cabin interior equipment and systems, including installation and Federal Aviation Administration certification, allowing airlines to substantially reduce costs. We believe that we are the only supplier in the commercial aircraft cabin interior products industry with the size, resources, breadth of product line and global product support capability to operate in this manner.

Our program management approach assigns a program management team to each significant contract. The program management team leader is responsible for all aspects of the specific contract and profitability, including managing change orders, negotiating related up front engineering charges and monitoring the progress of the contract through its delivery dates. We believe that our customers benefit substantially from our program management approach, including better on-time delivery and higher service levels. We also believe our program management approach results in better customer satisfaction.

We market our business jet products directly to all of the world's general aviation airframe manufacturers, modification centers and operators. Business jet owners typically rely upon the airframe manufacturers and completion centers to coordinate the procurement and installation of their interiors. Business jet owners select manufacturers of business jet products on a basis similar to commercial aircraft interior products: customer design capabilities, product quality and performance, on-time delivery, after-sales customer service, product support and price. We believe that potential new competitors would face a number of barriers to entering the cabin interior products market. Barriers to entry include regulatory requirements, our large installed product base, our custom design capability, manufacturing capability, delivery, and after-sales customer service, product support and our broad product line.

As of December 31, 2008, our direct sales, marketing and product support organizations consisted of 606 persons. In addition, we currently retain 40 independent sales representatives. Our sales to non-U.S. customers were approximately $1.1 billion for the fiscal year ended December 31, 2008 and $928 million for the fiscal year ended December 31, 2007 or approximately 53% and 55%, respectively, of net sales during those periods. Approximately 65% of our total revenues were derived from airlines, aircraft leasing companies, MROs, and other commercial aircraft operators during each of the two fiscal years ended December 31, 2008. Approximately 56% and 60% of our revenues during the fiscal years ended December 31, 2008 and 2007, respectively, were from consumables, refurbishment, military, spares and upgrade programs. During the three years ended December 31, 2008, no single customer accounted for more than 10% of our consolidated sales. The portion of our revenues attributable to particular customers varies from year to year with the airlines' scheduled purchases of new aircraft and for retrofit and refurbishment programs for their existing aircraft.

Backlog

Our backlog achieved record levels in 2008, in spite of deteriorating global economic conditions. Our backlog at December 31, 2008 was $2.9 billion, as compared to $2.2 billion at December 31, 2007 and $1.7 billion at December 31, 2006.  Our backlog at December 31, 2008 increased by approximately 32% compared to December 31, 2007. Approximately 51% of our backlog at December 31, 2008 is scheduled to be deliverable within the next twelve months.  While 45% of our total backlog is with North American customers, only 9% of our total backlog is with domestic airlines.  Approximately 24% of our current backlog is with European customers.  Importantly, approximately 31% of backlog is with customers in emerging markets such as the Asia/Pacific Rim and the Middle East regions.  Our backlog includes backlog from all of our businesses. Our book to bill ratio was 1.1:1 during 2008.

Customer Service

We believe that our customers place a high value on customer service and product support and that this service level is a critical differentiating factor in our industry. The key elements of such service include:

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• Rapid response to requests for engineering design, proposal requests and technical specifications;

• Flexibility with respect to customized features;

• On-time delivery;

• Immediate availability of spare parts for a broad range of products; and

• Prompt attention to customer problems, including on-site customer training.

Customer service is particularly important to airlines due to the high cost to the airlines of late delivery, malfunctions and other problems.

Warranty and Product Liability

We warrant our products, or specific components thereof, for periods ranging from one to ten years, depending upon product and component type. We establish reserves for product warranty expense after considering relevant factors such as our stated warranty policies and practices, historical frequencies of claims to replace or repair products under warranty and recent sales and claims trends. Actual warranty costs reduce the warranty reserve as they are incurred. We periodically review the adequacy of accrued product warranty reserves and revisions of such reserves are recognized in the period in which such revisions are determined.

We also carry product liability insurance.  We believe that our insurance should be sufficient to cover product liability claims.

Competition

The commercial aircraft cabin interior products market is relatively fragmented, with a number of competitors in each of the individual product categories. Due to the global nature of the commercial aerospace industry, competition comes from both U.S. and foreign manufacturers. However, as aircraft cabin interiors have become increasingly sophisticated and technically complex, airlines have demanded higher levels of engineering support and customer service than many smaller cabin interior products suppliers can provide. At the same time, airlines have recognized that cabin interior product suppliers must be able to integrate a wide range of products, including sophisticated electronic components, such as video and live broadcast TV, particularly in wide-body aircraft. We believe that the airlines' increasing demands will result in a continuing consolidation of suppliers. We have participated in this consolidation through strategic acquisitions and we intend to continue to participate in the consolidation.

Our primary competitors in the aerospace hardware and consumables distribution market are Wesco Aircraft Hardware and Anixter Pentacon.  Our principal competitors for our commercial aircraft segment are Groupe Zodiac S.A., Keiper Recaro GmbH, JAMCO and Premium Aircraft Interiors Group (PAIG, formerly Britax). The market for business jet products is highly fragmented, consisting of numerous competitors, the largest of which is Decrane Aircraft Holdings.

Manufacturing and Raw Materials

Our manufacturing operations consist of both the in-house manufacturing of component parts and sub-assemblies and the assembly of our designed component parts that are purchased from outside vendors. We maintain up-to-date facilities, and we have an ongoing strategic manufacturing improvement plan utilizing lean manufacturing processes. We constantly strive for continuous improvement from implementation of these plans for each of our product lines. We have implemented common information technology platforms company-wide, as appropriate. These activities should lower our production costs, shorten cycle times and reduce inventory requirements and at the same time improve product quality, customer response and profitability. We do not believe we are materially dependent on any single supplier or assembler for any of our raw materials or specified and designed component parts and, based upon the existing arrangements with vendors, our current and anticipated requirements and market conditions, we believe that we have made adequate provisions for acquiring raw materials.

Government Regulation

The FAA prescribes standards and licensing requirements for aircraft components, and licenses component repair stations within the United States. Comparable agencies regulate such matters in other countries. We hold several FAA component certificates and perform component repairs at a number of our U.S. facilities under FAA repair station licenses. We also hold an approval issued by the EASA to design, manufacture, inspect and test aircraft seating products in Leighton Buzzard, England and to manufacture and ship from our Kilkeel, Northern Ireland facility. We also have the necessary approvals to design, manufacture, inspect, test and repair our interior systems products in Nieuwegein, the Netherlands.

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In March 1992, the FAA adopted Technical Standard Order C127, or TSO-C127, which provides a design approval that the FAA may issue to seat manufacturers for seats tested dynamically to meet the requirements of 14 CFR 25.562 (commonly referred to as “16G”).  We believe we have developed and certified more seat models that meet the requirements of TSO-C127 and TSO-C127a than our competitors.  The FAA and EASA also prescribe that seats meet certain flammability and electrical interference specifications.  In October 2005, the FAA adopted regulation 14 CFR 121.311(j), which requires dynamic testing of all seats installed in all new aircraft certified after January 1, 1988 and produced after October 27, 2009.  EASA is expected to establish a similar rule.  Our large installed base of 16G seats demonstrates our industry leadership in seat certification requirements.

In November 2002, our seating group became the first passenger seating supplier to sign a Partnership for Safety Plan (PSP) with the FAA. Based on established qualifications of personnel and systems, the PSP provides us with increased authority to approve test plans and reports, and to witness tests. The PSP provides us with a number of business benefits including greater planning flexibility, simplified scheduling and greater program control and eliminates variables such as FAA workload and priorities.

Environmental Matters

Our operations are subject to extensive and changing federal, state and foreign laws and regulations establishing health and environmental quality standards, including those governing discharges of pollutants into the air and water and the management and disposal of hazardous substances and wastes. We may be subject to liability or penalties for violations of those standards. We are also subject to laws and regulations, such as the Federal Superfund Law and similar state statutes, governing remediation of contamination at facilities that we currently or formerly owned or operated or to which we send hazardous substances or wastes for treatment, recycling or disposal. We believe that we are currently compliant, in all material respects, with applicable environmental laws and regulations. However, we could become subject to future liabilities or obligations as a result of new or more stringent interpretations of existing laws and regulations. In addition, we may have liabilities or obligations in the future if we discover any environmental contamination or liability relating to our facilities or operations.

Patents

We currently hold 242 U.S. patents and 274 international patents, as well as 136 U.S. patent applications and 205 foreign patent applications covering a variety of products. We believe that the termination, expiration or infringement of one or more of such patents would not have a material adverse effect on us.

Employees

As of December 31, 2008, we had approximately 6,485 employees. Approximately 68% of our employees are engaged in manufacturing/distribution operations and purchasing, 14% in engineering, research and development and program management, 9% in sales, marketing and product support and 9% in finance, information technology, legal and general administration. Unions represent approximately 13% of our worldwide employees. One domestic labor contract, representing approximately 5% of our employees, expires in May, 2009.  The labor contract with the only other domestic union, which represents approximately 2% of our employees, expires in June, 2010.  The balance of our union employees are located in the U.K., the Netherlands and Germany, which tend to have government mandated union organizations.  We consider our employee relations to be good.

Financial Information About Segments and Foreign and Domestic Operations

Financial and other information by segment and relating to foreign and domestic operations for the fiscal years ended December 31, 2008, 2007 and 2006, is set forth in Note 13 to our consolidated financial statements.

Available Information

Our filings with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, our Proxy Statement, current reports on Form 8-K and amendments to those reports, are available free of charge on our website as soon as reasonably practicable after they are filed with, or furnished to, the SEC. Our Internet website is located at http://www.beaerospace.com. Information included in or connected to our website is not incorporated by reference in this annual report.

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ITEM 1A.  RISK FACTORS

You should consider carefully the following risks and uncertainties, along with the other information contained in or incorporated by reference in this Form 10-K.  Additional risks and uncertainties that we do not presently know about or currently believe are not material may also adversely affect our business and operations.  If any of the following events actually occur, our business, financial condition and financial results could be materially adversely affected.

Risks Relating to Our Industry

The airline industry is heavily regulated and failure to comply with applicable laws could reduce our sales, or require us to incur additional costs to achieve compliance, which could reduce our results of operations.

The FAA prescribes standards and licensing requirements for aircraft components, including virtually all commercial airline and general aviation cabin interior products, and licenses component repair stations within the United States. Comparable agencies, such as the EASA, the CAAC and the JCAB, regulate these matters in other countries. If we fail to obtain a required license for one of our products or services or lose a license previously granted, the sale of the subject product or service would be prohibited by law until such license is obtained or renewed. In addition, designing new products to meet existing regulatory requirements and retrofitting installed products to comply with new regulatory requirements can be both expensive and time consuming.

From time to time these regulatory agencies propose new regulations. These new regulations generally cause an increase in costs to comply with these regulations. For example, the FAA dynamic testing requirements originally established in 1988 under 14 CFR 25.562 are currently required for certain new generation aircraft types.  The recent enactment of 14 CFR 121.311(j) will require dynamic testing of all seats installed in all new aircraft produced after October 27, 2009.  EASA is expected to establish a similar rule.  Compliance with this rule may require industry participants to expand engineering, plant and equipment to ensure that all products meet this rule.  Smaller seating companies may not have the resources, financial or otherwise, to comply with this rule and may be required to sell their business or cease operations.  To the extent the FAA implements rule changes in the future, we may incur additional costs to achieve compliance.

The airline industry is subject to extensive health and environmental regulations, any violation of which could subject us to significant liabilities and penalties.

We are subject to extensive and changing federal, state and foreign laws and regulations establishing health and environmental quality standards, and may be subject to liability or penalties for violations of those standards. We are also subject to laws and regulations governing remediation of contamination at facilities currently or formerly owned or operated by us or to which we have sent hazardous substances or wastes for treatment, recycling or disposal. We may be subject to future liabilities or obligations as a result of new or more stringent interpretations of existing laws and regulations. In addition, we may have liabilities or obligations in the future if we discover any environmental contamination or liability at any of our facilities, or at facilities we may acquire.

Risks Relating to Our Business

We are directly dependent upon the conditions in the airline and business jet industries and a severe and prolonged economic downturn could negatively impact our results of operations.

Global financial markets have experienced extreme volatility and disruption for more than twelve months. Since September 2008, this volatility has reached unprecedented levels as a result of a financial crisis affecting the banking system and participants in the global financial markets. Concerns over the tightening of the corporate credit markets, inflation, energy costs and the dislocation of the residential real estate and mortgage markets have contributed to the volatility in the global financial markets and, together with the global financial crisis, have diminished expectations for global economic conditions in the future.  The airline and business jet industries are particularly sensitive to changes in economic conditions.  Through 2008, the airline industry has been parking aircraft, delaying new aircraft purchases and delivery of new aircraft, deferring retrofit programs and depleting existing inventories. We also expect the business jet industry to be severely impacted by both the recession and by declining corporate profits.

Unfavorable economic conditions can also reduce spending for both leisure and business travel, negatively affecting the airline and business jet industries.  The weakened global economy caused rapid declines in global air travel during the latter portion of 2008.  According to IATA, the economic downturn, combined with the record fuel prices experienced during most of the year, contributed to the worldwide airline industry generating a loss of approximately $5.0 billion in 2008.  In addition, as a result of the decline in both traffic and airfares following the September 11, 2001 terrorist attacks, SARS and the onset of the Iraq war, and their aftermath, as well as other factors, such as increases in fuel costs and heightened competition from low-cost carriers, the world airline industry lost a total of approximately $33.7 billion in calendar years 2001-2008. The airline industry crisis also caused 47 airlines worldwide to declare bankruptcy or cease operations in the last seven years.

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We expect, based on current economic conditions, that air traffic will continue to decline in 2009. Declining air traffic has, and we expect it will continue to, negatively impact our customer base. A continued economic downturn would likely continue to negatively impact the airline and business jet industries, which could cause a significant negative impact on our future results of operations.

There are risks inherent in international operations that could have a material adverse effect on our business operations.

While the majority of our operations are based domestically, we have significant manufacturing operations based internationally with facilities in the United Kingdom, the Netherlands and Germany.  In addition, we sell our products to airlines all over the world. Our customers are located primarily in North America, Europe and the emerging markets including the Asia/Pacific Rim region, South America and the Middle East. As a result, 53% of our net sales for the year ended December 31, 2008 and 55% of our sales for the year ended December 31, 2007 were to customers located outside the United States.

In addition, we have a number of subsidiaries in foreign countries (primarily in Europe), which have sales outside the United States. Approximately 32% and 38%, respectively, of our sales during the fiscal years ended December 31, 2008 and 2007 came from our foreign operations. Fluctuations in the value of foreign currencies affect the dollar value of our net investment in foreign subsidiaries, with these fluctuations being included in a separate component of stockholders’ equity. At December 31, 2008, we reported a cumulative foreign currency translation adjustment of approximately $67.4 million in stockholders’ equity as a result of foreign currency adjustments, and we may incur additional adjustments in future periods.  In addition, operating results of foreign subsidiaries are translated into U.S. dollars for purposes of our statement of operations at average monthly exchange rates. Moreover, to the extent that our revenues are not denominated in the same currency as our expenses, our net earnings could be materially adversely affected. For example, a portion of labor, material and overhead costs for goods produced in our production facilities in the United Kingdom, Germany and the Netherlands are incurred in British pounds or euros, but the related sales revenues are generally denominated in U.S. dollars. Changes in the value of the U.S. dollar or other currencies could result in material fluctuations in foreign currency translation amounts or the U.S. dollar value of transactions and, as a result, our net earnings could be materially adversely affected.

Historically we have not engaged in hedging transactions. However, we may engage in hedging transactions in the future to manage or reduce our foreign exchange risk. Our attempts to manage our foreign currency exchange risk may not be successful and, as a result, our results of operations and financial condition could be materially adversely affected.

Our foreign operations could also be subject to unexpected changes in regulatory requirements, tariffs and other market barriers and political, economic and social instability in the countries where we operate or sell our products and offer our services. The impact of any such events that may occur in the future could subject us to additional costs or loss of sales, which could materially adversely affect our operating results.

If we make acquisitions, they may be less successful than we expect, which could have a material adverse effect on our financial condition.

We have made many acquisitions in the past.  We are currently in the process of integrating the HCS business which we acquired from Honeywell.  Successful integration of HCS's operations with those of our consumables management will depend on our ability to manage the combined operations, realize opportunities for revenue growth presented by broader product offerings and expanded geographic coverage, and to eliminate redundant and excess costs.

We may also consider future acquisitions, some of which could be material to us. We explore and conduct discussions with many third parties regarding possible acquisitions. Our ability to continue to achieve our goals may depend upon our ability to effectively acquire and integrate such companies, to achieve cost efficiencies and to manage these businesses as part of our company. For example, our acquisition of HCS involves the integration of the HCS business with our consumables management business. These two businesses were previously operated independently, sometimes competing in some of the same or similar aerospace hardware consumables distribution markets. If we cannot successfully integrate HCS operations with those of our consumables management, we may experience material negative consequences to our business, financial condition or results of operations. We may not be successful in implementing appropriate operational, financial and management systems and controls to achieve the benefits expected to result from these acquisitions. Our efforts to integrate these businesses could be materially adversely affected by a number of factors beyond our control, such as regulatory developments, general economic conditions, increased competition and the loss of certain customers resulting from the acquisitions. In addition, the process of integrating these businesses could cause difficulties for us, including an interruption of, or loss of momentum in, the activities of our existing business and the loss of key personnel and customers. Further, the benefits that we anticipate from these acquisitions may not develop. For example, we may not be able to realize the cost savings, synergies and revenue and earnings growth in our consumables management that we anticipate from the HCS acquisition and the costs of achieving these benefits may be higher than what we currently expect. Depending upon the acquisition opportunities available, we also may need to raise additional funds through the capital markets or arrange for additional bank financing in order to consummate such acquisitions.  We also may not be able to raise the substantial capital required for acquisitions and integrations on satisfactory terms, if at all.

15

Increased leverage could adversely impact our business and results of operations.

We may incur additional debt under our credit facility or through new borrowings to finance our operations or for future growth.  A high degree of leverage could have important consequences to us.  For example, it could:

• increase our vulnerability to adverse economic and industry conditions;

•  require us to dedicate a substantial portion of cash from operations to the payment of debt service, therebyreducing the availability of cash to fund working capital, capital expenditures and other general corporate purposes;

•  limit our ability to obtain additional financing for working capital, capital expenditures, general corporate purposes or acquisitions;

•  place us at a disadvantage compared to our competitors that are less leveraged; and

•  limit our flexibility in planning for, or reacting to, changes in our business and in our industry.

Our total assets include substantial intangible assets.  We have written off a significant portion of our intangible assets this year and subsequent write-offs of a significant portion of intangible assets would negatively affect our financial results.

Our total assets reflect substantial intangible assets. At December 31, 2008, goodwill and identified intangibles, net, represented approximately 35% of total assets. Intangible assets consist principally of goodwill and other identified intangible assets associated with our acquisitions. On at least an annual basis, we assess whether there has been an impairment in the value of goodwill and other intangible assets with indefinite lives. If the carrying value of the tested asset exceeds its estimated fair value, impairment is deemed to have occurred.  In this event, the amount is written down to fair value.  Under current accounting rules, this would result in a charge to operating earnings. Any determination requiring the write-off of a significant portion of unamortized goodwill and identified intangible assets would negatively affect our results of operations and total capitalization, which could be material.  For example, during the year ended December 31, 2008, in accordance with Statement of Financial Accounting Standards 142, “Goodwill and Other Intangible Assets,” we performed our annual testing of impairment of goodwill.  Adverse equity market conditions caused a decrease in current market multiples, including our fiscal year end market capitalization at December 31, 2008.  The fair value of our reporting units for goodwill impairment testing were determined using valuation techniques  based on estimates, judgments and assumptions we believe were appropriate under the circumstances.  The sum of the fair values of the reporting units were evaluated based on our market capitalization determined using average share prices within a reasonable period of time near December 31, 2008, plus an estimated control premium plus the fair value of our debt obligations.  The decrease in the current market multiples and our market capitalization resulted in a decline in the fair value of our reporting units as of December 31, 2008.  Accordingly, we recorded a pre-tax impairment charge related to goodwill and intangible assets of approximately $390.0 million. As of December 31, 2008 the remaining balances of goodwill and intangible assets were $663.6 million and $356.0 million, respectively.

We have significant financial and operating restrictions in our debt instruments that may have an adverse effect on our operations.

The credit agreement governing our senior bank borrowings contains numerous financial and operating covenants that limit our ability to incur additional or repay existing indebtedness, to create liens or other encumbrances, to make certain payments and investments, including dividend payments, to engage in transactions with affiliates, to engage in sale/leaseback transactions, to guarantee indebtedness and to sell or otherwise dispose of assets and merge or consolidate with other entities. Agreements governing future indebtedness could also contain significant financial and operating restrictions. A failure to comply with the obligations contained in any current or future agreement governing our indebtedness could result in an event of default under our current or any future bank credit facility, any future indentures or agreements governing our debt securities, which could permit acceleration of the related debt and acceleration of debt under other instruments that may contain cross-acceleration or cross-default provisions. We may not have, or may not be able to obtain, sufficient funds to make any required accelerated payments.

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We compete with a number of established companies, some of which have significantly greater financial, technological and marketing resources than we do, and we may not be able to compete effectively with these companies.

We compete with numerous established companies. Some of these companies, particularly in the passenger-to-freighter conversion business, have significantly greater financial, technological and marketing resources than we do. Our ability to be an effective competitor will depend on our ability to remain the supplier of retrofit and refurbishment products and spare parts on the commercial fleets on which our products are currently in service. It will also depend on our success in causing our products and the new products we may develop to be selected for installation in new aircraft, including next-generation aircraft, and in avoiding product obsolescence. Our ability to maintain or expand our market position in the passenger-to-freighter conversion business will depend on our success in being selected to convert specific aircraft, our ability to maintain and enhance our engineering design, our certification and program management capabilities and our ability to manufacture a broader range of structural components, connectors and other products used in this business.

Provisions in our charter documents may discourage potential acquisitions of our company, even those which the holders of a majority of our common stock may favor.

Our restated certificate of incorporation and by-laws contain provisions that may have the effect of discouraging a third party from making an acquisition of us by means of a tender offer, proxy contest or otherwise. Our restated certificate of incorporation and by-laws:

• classify the board of directors into three classes, with directors of each class serving for a staggered three-year period;

• provide that directors may be removed only for cause and only upon the approval of the holders of at least two-thirds of the voting power of our shares entitled to vote generally in the election of such directors;

• require at least two-thirds of the voting power of our shares entitled to vote generally in the election of directors to alter, amend or repeal the provisions relating to the classified board and removal of directors described above;

• permit the board of directors to fill vacancies and newly created directorships on the board;

• restrict the ability of stockholders to call special meetings; and

• contain advance notice requirements for stockholder proposals.

You may not receive cash dividends on our shares of common stock.

We have never paid a cash dividend and do not plan to pay cash dividends on our common stock in the foreseeable future.  We intend to retain our earnings to finance the development and expansion of our business and to repay indebtedness.  Also, our ability to declare and pay cash dividends on our common stock is restricted by customary covenants in our bank credit facility and may be restricted by customary covenants in our future agreements governing future debt.

If the price of our common stock continues to fluctuate significantly, you could lose all or part of any investment in our common stock.

The price of our common stock is subject to sudden and material increases and decreases, and decreases could adversely affect investments in our common stock.  For example from January 1, 2008 through December 31, 2008, the sale price of our common stock has ranged from a low of $5.37 to a high of $53.79.  The price of our common stock could fluctuate widely in response to:

• our quarterly operating results;

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• changes in earnings estimates by securities analysts;

• changes in our business;

• changes in the market’s perception of our business;

• changes in the businesses, earnings estimates or market perceptions of our competitors or customers;

• changes in airline industry or business jet industry conditions;

• changes in our key personnel;

• changes in general market or economic conditions; and

• changes in the legislative or regulatory environment.

In addition, the stock market has experienced extreme price and volume fluctuations in recent years that have significantly affected the quoted prices of the securities of many companies, including companies in our industry.  The changes often appear to occur without regard to specific operating performance.  The price of our common stock could fluctuate based upon factors that have little or nothing to do with our company and these fluctuations could materially reduce our stock price.

We have grown, and continue to grow, at a rapid pace.  Our inability to properly manage or support the growth may have a material adverse effect on our business, financial condition, and results of operations and could cause the market value of our common stock to decline.

We have experienced rapid growth in recent periods and intend to continue to grow our business both through acquisitions and internal expansion of products and services.  Our growth to date has placed, and could continue to place, significant demands on our management team and our operational, administrative and financial resources.  We may not be able to grow effectively or manage our growth successfully, and the failure to do so could have a material adverse effect on our business, financial condition, and results of operations and could cause the market value of our common stock to decline.

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ITEM 1B.  UNRESOLVED STAFF COMMENTS

None.

ITEM 2.  PROPERTIES

As of December 31, 2008, we had 25 principal operating facilities and one administrative facility, which comprised an aggregate of approximately 2.6 million square feet of space.  The following table describes the principal facilities and indicates the location, function, approximate size, and ownership status of each location.

Segment	Location	Purpose	Facility Size (Sq. Feet)		Ownership
Consumables Management	Miami, Florida	Distribution		355,800	Leased
	Roanoke, Texas	Distribution		208,000	Leased
	Hamburg, Germany	Distribution		67,300	Leased
	Carson, California	Distribution		56,500	Leased
	Earth City, Missouri	Distribution		47,000	Leased
	Hamburg, Germany	Distribution		44,000	Leased
	Stratford, Connecticut	Distribution		67,000	Leased
	Paramus, New Jersey	Distribution		36,000	Leased
	Wichita, Kansas	Distribution		49,000	Leased
Commercial Aircraft	Winston-Salem, North Carolina	Manufacturing		358,700	Leased
	Kilkeel, Ireland	Manufacturing		176,000	Leased/Owned
	Marysville, Washington	Manufacturing		155,000	Leased
	Lenexa, Kansas	Manufacturing		130,000	Leased
	Leighton Buzzard, England	Manufacturing		114,000	Owned
	Anaheim, California	Manufacturing		98,000	Leased
	Lubeck, Germany	Manufacturing		86,100	Leased
	Westminster, California	Manufacturing		70,000	Leased
	Compton, California	Manufacturing		63,400	Leased
	Nieuwegein, the Netherlands	Manufacturing		47,400	Leased
	Pacoima, California	Manufacturing		28,800	Leased
	Vista, California	Manufacturing		27,200	Leased
	Everett, Washington	Manufacturing		24,200	Leased
Business Jet	Miami, Florida	Manufacturing		129,600	Leased
	Holbrook, New York	Manufacturing		20,100	Leased
	Tucson, Arizona	Manufacturing		90,500	Leased
Corporate	Wellington, Florida	Administrative		23,100	Leased/Owned
				2,572,700

We believe that our facilities are suitable for their present intended purposes and adequate for our present and anticipated level of operations.

ITEM 3.  LEGAL PROCEEDINGS

We are a defendant in various legal actions arising in the normal course of business, the outcomes of which, in the opinion of management, neither individually nor in the aggregate are likely to result in a material adverse effect on our business, results of operations or financial condition.

There are no material pending legal proceedings, other than the ordinary routine litigation incidental to the business discussed above, to which we, or any of our subsidiaries, are a party or of which any of our property is the subject.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

During the last quarter of the fiscal year covered by this Form 10-K, we did not submit any matters to a vote of security holders, through the solicitation of proxies or otherwise.

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PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock is quoted on the Nasdaq National Market under the symbol "BEAV.”  The following table sets forth, for the periods indicated, the range of high and low per share sales prices for the common stock as reported by Nasdaq.

	Fiscal Year Ended December 31,
	(Amounts in Dollars)
	2008				2007
	High		Low		High		Low
First Quarter	$	53.79	$	30.41	$	33.80	$	25.56
Second Quarter		43.51		23.04		41.65		31.59
Third Quarter		28.70		12.50		44.69		32.20
Fourth Quarter		15.61		5.37		54.09		40.81

Based on published reports in the Wall Street Journal, we believe B/E Aerospace, Inc. was the best performing aerospace stock for the one, three, and five years ended December 31, 2008.  We believe year to date, through February 24, 2009, our shares have out performed the vast majority of all other U. S. aerospace stocks. During the latter portion of 2008, our share price declined significantly due to a number of factors unrelated to our operating performance including, but not limited to, the global credit crisis and global recession, negative industry information such as continued delays in the launch of the B787 Dreamliner, record fuel prices and an apparent shift in investor sentiment away from small-cap aerospace stocks.

On February 23, 2009, the last reported sale price of our common stock as reported by NASDAQ was $8.00 per share.  As of such date, based on information provided to us by Computershare, our transfer agent, we had approximately 1,453 registered holders, and because many of these shares are held by brokers and other institutions on behalf of the beneficial holders, we are unable to estimate the number of beneficial shareholders represented by these holders of record.  We have not paid any cash dividends in the past, and we have no present intention of doing so in the immediate future. Our board of directors intends, for the foreseeable future, to retain any earnings to reduce indebtedness and finance our future growth, but expects to review our dividend policy regularly. The credit agreement governing our bank credit facilities permit the declaration of cash dividends only in certain circumstances described therein.

The following line graph compares the annual percentage change in the Company’s cumulative total shareholder return on our common stock relative to the cumulative total returns of the NASDAQ Composite index, the Dow Jones US Airlines index and the Dow Jones US Aerospace & Defense index. An investment of $100 (with reinvestment of all dividends) is assumed to have been made in the Company's common stock and in each of the indexes on 12/31/2003 and its relative performance is tracked through 12/31/2008.

We made no repurchases of our common stock during the last quarter of 2008.

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ITEM 6.  SELECTED FINANCIAL DATA

(In millions, except per share data)

The financial data for each of the years in the five year period ended December 31, 2008 have been derived from financial statements that have been audited by our independent registered public accounting firm. The following financial information is qualified by reference to, and should be read in conjunction with, Item 7 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our historical financial statements, including notes thereto, which are included in Item 15 of this Form 10-K.  Our historical results are not necessarily indicative of our future results.

	Fiscal Year Ended December 31,
	2008 (1)			2007			2006			2005			2004
Statements of Earnings (Loss) Data:
Net sales	$	2,110.0		$	1,677.7		$	1,128.2		$	844.1		$	733.5
Cost of sales		1,386.5			1,107.6			731.7			548.5			494.8
Selling, general and administrative		238.3			195.2			159.6			136.4			119.2
Research, development and engineering		131.4			127.9			88.6			65.6			55.1
Asset impairment charge		390.0			--			--			--			--
Operating (loss) earnings		(36.2	)		247.0			148.3			93.6			64.4
Operating margin		(1.7	%)		14.7	%		13.1	%		11.1	%		8.8	%
Interest expense, net		48.0			20.9			38.9			59.3			76.1
Debt prepayment costs		3.6			11.0			19.4			--			8.8
(Loss) earnings before income taxes		(87.8	)		215.1			90.0			34.3			(20.5	)
Income tax expense (benefit)(2)		11.6			67.8			4.4			(50.3	)		1.5
Net (loss) earnings	$	(99.4	)	$	147.3		$	85.6		$	84.6		$	(22.0	)
Basic net earnings (loss) per share:
Net (loss) earnings	$	(1.05	)	$	1.67		$	1.11		$	1.44		$	(0.53	)
Weighted average common shares		94.3			88.1			77.1			58.8			41.7
Diluted net earnings (loss) per share:
Net (loss) earnings	$	(1.05	)	$	1.66		$	1.10		$	1.39		$	(0.53	)
Weighted average common shares		94.3			88.8			78.0			60.8			41.7
Balance Sheet Data (end of period):
Working capital	$	1,173.7		$	711.6		$	456.0		$	573.4		$	225.0
Goodwill, intangible and other assets, net		1,081.7			635.6			636.2			525.3			545.5
Total assets		2,930.1			1,772.0			1,497.7			1,426.5			1,024.8
Long-term debt, net of current portion		1,117.2			150.3			502.0			677.4			678.6
Stockholders' equity		1,266.5			1,258.1			706.0			569.6			182.8
Other Data:
Depreciation and amoritization	$	40.7		$	35.0		$	29.4		$	28.6		$	28.4

(1)  During the year ended December 31, 2008, in accordance with Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets,” we performed our annual testing of impairment of goodwill.  Adverse equity market conditions caused a decrease in current market multiples, including our fiscal year end market capitalization at December 31, 2008.  The fair value of our reporting units for goodwill impairment testing were determined using valuation techniques based on estimates, judgments and assumptions we believe were appropriate under the circumstances.  The sum of the fair values of the reporting units were evaluated based on our market capitalization determined using   average share prices within a reasonable period of time near December 31, 2008 plus an estimated control premium plus the fair value of our debt obligations.  The decrease in the current market multiples and our market capitalization resulted in a decline in the fair value of our reporting units as of December 31, 2008.  Accordingly, we recorded a pre-tax impairment charge related to goodwill and intangible assets of approximately $390.0 million. Exclusive of the goodwill and intangible assets impairment charge, which did not impact cash flows or our operations, operating earnings, earnings before income taxes, net earnings and net earnings per diluted share for 2008 would have been $353.8, $302.2, $200.6 and $2.12, respectively.

(2) During the year ended December 31, 2005 we reversed a significant portion of our valuation allowance on our U.S. deferred tax asset as a result of improved operating performance and outlook and expected reductions in interest costs resulting from note redemptions.

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ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

               (Dollars in millions, except per share data)

OVERVIEW

Based on our experience in the industry, we believe we are the world’s largest manufacturer of cabin interior products for commercial aircraft and business jets and the leading aftermarket distributor and value added service provider of aerospace fasteners and other consumables products. We sell our manufactured products directly to virtually all of the world’s major airlines and aerospace manufacturers.  In addition, based on our experience, we believe that we have achieved leading global market positions in each of our major product categories, which include:

• a broad line of aerospace fasteners, consisting of over 275,000 SKUs, serving the aerospace commercial aircraft,  business jet and military and defense industries;

• commercial aircraft seats, including an extensive line of super first class, first class, business class, tourist class and regional aircraft seats;

• a full line of aircraft food and beverage preparation and storage equipment, including coffeemakers, water boilers, beverage containers, refrigerators, freezers, chillers and a line of ovens which includes microwave, high heat convection and steam ovens;

• both chemical and gaseous aircraft oxygen delivery, distribution and storage systems, protective breathing equipment and lighting products; and

• business jet and general aviation interior products, including an extensive line of executive aircraft seats, direct and indirect overhead lighting systems, oxygen delivery systems, air valve systems, high-end furniture and cabinetry.

We also provide comprehensive aircraft cabin interior reconfiguration and passenger-to-freighter conversion engineering services and component kits.

We generally derive our revenues from refurbishment or upgrade programs for the existing worldwide fleets of commercial and general aviation aircraft and from the sale of our cabin interior equipment for new aircraft deliveries.  For the 2008, 2007 and 2006 fiscal years, approximately 56%, 60% and 60%, respectively, of our revenues were derived from our aftermarket and military products, with the remaining portions attributable to the sale of cabin interior equipment associated with new aircraft deliveries. We believe our large installed base of products, estimated to be approximately $7.3 billion as of December 31, 2008 (valued at replacement prices), gives us a significant advantage over our competitors in obtaining orders both for spare parts and for refurbishment programs, principally due to the tendency of the airlines to purchase equipment for such programs from the incumbent supplier.

We conduct our operations through strategic business units that have been aggregated under three reportable segments: consumables management, commercial aircraft and business jet.  In 2009 we aligned the legacy business names of our various distribution businesses to the consumables management segment.

Net sales by reportable segment for the years ended December 31, 2008, 2007 and 2006 were as follows:

	Fiscal Year Ended December 31,
	2008					2007					2006
	Net		% of			Net		% of			Net		% of
	Sales		Net Sales			Sales		Net Sales			Sales		Net Sales
Consumables
management	$	697.3		33.0	%	$	386.5		23.0	%	$	251.5		22.3	%
Commercial aircraft		1,138.7		54.0	%		1,098.1		65.5	%		729.2		64.6	%
Business jet		274.0		13.0	%		193.1		11.5	%		147.5		13.1	%
Net sales	$	2,110.0		100.0	%	$	1,677.7		100.0	%	$	1,128.2		100.0	%

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Net sales by domestic and foreign operations for the years ended December 31, 2008, 2007 and 2006 were as follows:

	Fiscal Year Ended December 31,
	2008		2007		2006
Domestic	$	1,428.8	$	1,036.6	$	732.9
Foreign		681.2		641.1		395.3
Total	$	2,110.0	$	1,677.7	$	1,128.2

Net sales by geographic segment (based on destination) for the years ended December 31, 2008, 2007 and 2006 were as follows:

	Fiscal Year Ended December 31,
	2008					2007					2006
	Net		% of			Net		% of			Net		% of
	Sales		Net Sales			Sales		Net Sales			Sales		Net Sales
U.S.	$	994.4		47.1	%	$	749.5		44.7	%	$	483.0		42.8	%
Europe		508.9		24.1	%		468.0		27.9	%		331.5		29.4	%
Asia, Pacific Rim,
Middle East and other		606.7		28.8	%		460.2		27.4	%		313.7		27.8	%
Total	$	2,110.0		100.0	%	$	1,677.7		100.0	%	$	1,128.2		100.0	%

Between 1989 and 2001, we substantially expanded the size, scope and nature of our business through 22 acquisitions for an aggregate purchase price of approximately $1 billion.  From 2002 through June 2006, essentially all of our revenue growth was organic since we did not make any significant acquisitions during that period.

During the third quarter of 2006, we acquired Draeger and New York Fasteners for, in the aggregate, approximately $147.0 in cash.  Draeger manufactures components and integrated systems to supply oxygen systems for both civil and military aircraft, with well-established strengths in both chemical and gaseous oxygen systems.  Draeger is the prime contractor for the oxygen systems in the Eurofighter Typhoon, and provides maintenance and repair services for Germany’s Air Force in-service oxygen systems.  The integration of Draeger with our existing oxygen business allows us to offer the broadest oxygen system product lines in the industry. New York Fasteners is a distributor of a wide variety of aerospace fasteners and hardware primarily to the military sector.  The integration of New York Fasteners into our consumables management segment has significantly expanded our overall penetration into the military and defense sector.

During the third quarter of 2008, we acquired Honeywell’s Consumable Solutions distribution business, for the aggregate purchase price of approximately $1,074.0.  The HCS business distributes consumables parts and supplies to aviation industry manufacturers, airlines, and aircraft repair and overhaul facilities.  The combination of HCS with our consumables management segment positioned us as the leading global distributor and value-added provider of aerospace fasteners and other consumable products.  The combined business serves as a distributor for every major aerospace fastener manufacturer in the world. The combination of HCS with our existing distribution business created the world’s leading distributor of aerospace fasteners and consumables thereby allowing us to alter our business mix, such that approximately one-half of our business is related to non-discretionary consumables and spares demand.

New product development is a strategic initiative for us. Our customers regularly request that we engage in new product development and enhancement activities. We believe that these activities protect and enhance our leadership position. We believe our investments in research and development over the past several years have been the driving force behind our ongoing market share gains.  Research, development and engineering spending was approximately 6.2% of sales during 2008 and is expected to remain at approximately that percentage of sales for the next several years.

We also believe in providing our businesses with the tools required to remain competitive. In that regard, we have invested, and will continue to invest in, property and equipment that enhances our productivity. Taking into consideration our record backlog, targeted capacity utilization levels, recent capital expenditure investments, recent acquisitions and current industry conditions, we expect that capital expenditures will be approximately $40 million over the next twelve months.

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International airline competition for higher margin international travelers and improved worldwide industry conditions through the third quarter of 2008 resulted in increasing demand for our products and services, as demonstrated by record bookings of approximately $2.2 billion during fiscal 2008.  At December 31, 2008, backlog was approximately $2.9 billion, an increase of approximately 32% as compared to our December 31, 2007 backlog.

The weakened global economy has caused rapid declines in global air travel during the latter portion of 2008.  We expect, based on current economic conditions, that air traffic will continue to decline in 2009.  Declining air traffic has, and we expect it will continue to, negatively impact our customer base.  The airline industry is parking aircraft, delaying new aircraft purchases and deliveries, deferring retrofit programs and depleting existing inventories. We also expect the business jet industry to be severely impacted by both the recession and by declining corporate profits. Despite these difficult industry conditions, we expect that our strategic decision to alter our business mix such that approximately one-half of our business is related to non-discretionary consumables and spares demand, as well as our strategic focus on OEM direct or seller furnished equipment programs will positively impact our business in the future.

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RESULTS OF OPERATIONS

Year Ended December 31, 2008 Compared to the Year Ended December 31, 2007

Record net sales for the year ended December 31, 2008 were $2.11 billion, an increase of 25.8% as compared to 2007.

Net sales for each of our segments are set forth in the following table:

	Fiscal Year Ended December 31,
							Percent
	2008		2007		Change		Change
Consumables management	$	697.3	$	386.5	$	310.8		80.4	%
Commercial aircraft		1,138.7		1,098.1		40.6		3.7	%
Business jet		274.0		193.1		80.9		41.9	%
Total sales	$	2,110.0	$	1,677.7	$	432.3		25.8	%

Consumables management segment revenues increased by 80.4% as compared with the prior year.  The higher level of revenues at the consumables management segment were the result of the acquisition of HCS, which accounted for $238.6 of the revenue increase and a broad-based increase in aftermarket revenues and investments in product line expansion, offset by a decrease in demand in the fourth quarter, as a result of the global recession.  Proforma revenue growth at the consumables management segment in 2008, reflecting the acquisition of HCS as if it had occurred as of the beginning of 2007, was 13.0%.  Commercial aircraft segment revenues increased 3.7% as compared with the prior year, reflecting lower demand in the second half of 2008, as a result of the global recession.  Business jet segment revenues increased by $80.9 or 41.9%, reflecting the higher level of new business jet deliveries and higher revenues from super first class products.

Cost of sales for the current period of $1,386.5, or 65.7% of net sales, increased by $278.9 compared to $1,107.6, or 66.0% of net sales in the prior year. The 30 basis point decrease in the current year is due to the change in business mix as a result of the acquisition of HCS, offset by margin expansion at both the commercial aircraft and business jet segments.

Selling, general and administrative expenses in 2008 were $238.3, or 11.3% of sales, compared to $195.2 or 11.6% in 2007.  The increase in spending is primarily due to the HCS acquisition ($28.9), and higher commissions, compensation and benefits ($13.7) associated with the 25.8% increase in revenues and a nearly 32% increase in backlog from December 31, 2007.  Selling, general and administrative expenses as a percentage of sales decreased by 30 basis points, reflecting the operating leverage in our business.

Research, development and engineering expenses for 2008 were $131.4, or 6.2% of sales, compared to $127.9 or 7.6% of sales in the prior year, and reflect the higher level of spending associated with customer specific engineering activities, new product development activities (primarily at the commercial aircraft segment), certification efforts related to a number of new products, including products for the new Boeing 787 Dreamliner Aircraft, Airbus A350 XWB, as well as new product spending for new business jet aircraft (Cessna Citation Columbus, Gulfstream 650, Dassault Falcon 7X and Embraer Legacy 450 and Legacy 500) and the super first class suite of products.  The 140 basis point decline in research, development and engineering expenses as a percentage of sales is due to the change in business mix as a result of the HCS acquisition.  During 2008, we applied for 98 U.S. and foreign patents versus 88 during 2007.

During the year ended December 31, 2008, in accordance with Statement of Financial Accounting Standard No. 142, “Goodwill and Other Intangible Assets,” we performed our annual testing of impairment of goodwill.  Adverse equity market conditions caused a decrease in current market multiples, including our fiscal year end market capitalization at December 31, 2008.  The fair value of our reporting units for goodwill impairment testing were determined using valuation techniques  based on estimates, judgments and assumptions that we believe were appropriate under the circumstances.  The sum of the fair values of the reporting units were evaluated based on our  market capitalization determined using average share prices within a reasonable period of time near December 31, 2008, plus an estimated control premium plus the fair value of our debt obligations.  The decrease in the current market multiples and our market capitalization resulted in a decline in the fair value of our reporting units as of December 31, 2008, we recorded a pre-tax asset impairment charge related to goodwill and intangible assets of approximately $390.0.

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    As a result of the $390.0 asset impairment charge, our 2008 operating loss was ($36.2) as compared to 2007 operating earnings of $247.0, or 14.7% of sales in 2007. Operating earnings, exclusive of the asset impairment charge, increased by 43.2% due to the 25.8% revenue growth and a 210 basis point expansion in operating margin to 16.8% of sales, reflecting our high in quality backlog.

The following is a summary of operating earnings performance by segment:

	As Reported											Excluding Asset Impairment Charge
	Fiscal Year Ended December 31,											Fiscal Year Ended December 31,
									Percent									Percent
	2008			2007		Change			Change			2008		2007		Change		Change
Consumables management	$	(151.7	)	$	85.5	$	(237.2	)		(277.4	)%	$	158.5	$	85.5	$	73.0		85.4	%
Commercial aircraft		78.2			141.8		(63.6	)		(44.9	)%		158.0		141.8		16.2		11.4	%
Business jet		37.3			19.7		17.6			89.3	%		37.3		19.7		17.6		89.3	%
Total operating (loss) earnings	$	(36.2	)	$	247.0	$	(283.2	)		(114.7	)%	$	353.8	$	247.0	$	106.8		43.2	%

Consumables management segment operating loss of ($151.7) in 2008 reflects $310.2 of goodwill and intangible asset impairment charges.  Exclusive of these charges, operating earnings would have been $158.5, representing an increase of $73.0, or 85.4%, due to an 80.4% increase in revenue and a 60 basis point increase in operating margin. Consumables management segment operating earnings in 2008 were also impacted by $9.7 of acquisition and integration costs related to the HCS acquisition and $21.2 of unfavorable contract accrual adjustments related to the HCS acquisition.  On a proforma basis, giving effect to the acquisition of HCS as if it occurred on January 1, 2007, and excluding the goodwill and asset impairment charges, revenues in 2008 of $1,043.6 would have increased by $120.0, or 13.0% as compared to proforma revenues in 2007 of $923.6, and proforma operating earnings would have increased by 41.2% to $198.5 (19.0% of sales), as compared to $140.6 in 2007.  Proforma operating earnings, including the goodwill and asset impairment charges incurred in 2008, would have been ($104.7) and $140.6, for the years ended December 31, 2008 and 2007, respectively.

For the year ended December 31, 2008, commercial aircraft segment operating earnings of $78.2 reflect $79.8 of goodwill and intangible asset impairment charges. Exclusive of these charges, 2008 operating earnings increased by $16.2, or 11.4% as compared to 2007, primarily due to a 100 basis point expansion in operating margin.  Excluding goodwill and asset impairment charges, operating margin at commercial aircraft segment expanded by 100 basis points during 2008 reflecting synergies associated with the Draeger acquisition, improved efficiencies associated with major seating programs and successful cost reduction initiatives.  Excluding goodwill and asset impairment charges, operating margin at commercial aircraft segment has expanded by 460 basis points over the 2005-2008 period.

Business jet segment’s 2008 operating earnings of $37.3 increased by $17.6, or 89.3%, as compared with the prior year, as a result of the 41.9% increase in revenue and the 340 basis point expansion in operating margin.  This margin expansion reflects substantially improved operating results for the super first class product line and operating leverage at the higher sales level.

We financed the acquisition of HCS (and refinanced $150.0 of existing indebtedness) by completing a new $525.0 term loan to banks, a $600.0 of senior unsecured notes offering and by issuing 6.0 million shares of our common stock to Honeywell at an agreed upon value of $26.38 per share.  See “Outstanding Debt and Other Financing Arrangements” below for additional information regarding our indebtedness.  Interest expense was $48.0 for 2008, an increase of $27.1 as compared to 2007 due to the debt incurred to finance the HCS acquisition.  During 2008 we recorded debt prepayment costs of $3.6, incurred in connection with the financing of the HCS acquisition.

Loss before income taxes in 2008 was ($87.8), as compared to earnings before income taxes of $215.1 in 2007.  Excluding the goodwill and intangible asset impairment charges, the 2008 earnings before income taxes were $302.2, an increase of $87.1 or 40.5% compared to 2007, due to factors described above.

A significant portion of the goodwill and intangible asset impairment charge was non-deductible for tax purposes, which resulted in income tax expense for 2008 of $11.6. Excluding the impact of the goodwill and intangible asset impairment charges, the Company’s tax expense was $101.6 for an effective tax rate of 33.6%. The Company’s tax expense of $67.8 for 2007 reflected a tax benefit for the recognition of our U.K. deferred tax asset in the amount of $8.7.

Net loss and net loss per diluted share in 2008 were ($99.4) and ($1.05), respectively.  Excluding the goodwill and intangible asset impairment charges, 2008 net earnings and net earnings per diluted share were $200.6 and $2.12, respectively, as compared to 2007 net earnings and net earnings per diluted share of $147.3 and $1.66, respectively.

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RESULTS OF OPERATIONS

Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006

Net sales for the year ended December 31, 2007 were $1,677.7, an increase of $549.5 or 48.7% as compared to the prior year.  Revenue growth was driven by robust market conditions and market share gains, and included strong retrofit program deliveries, as well as an increase in demand related to growth in new aircraft deliveries.

Net sales for each of our segments are set forth in the following table:

	Fiscal Year Ended December 31,
							Percent
	2007		2006		Change		Change
Consumables management	$	386.5	$	251.5	$	135.0		53.7	%
Commercial aircraft		1,098.1		729.2		368.9		50.6	%
Business jet		193.1		147.5		45.6		30.9	%
Total sales	$	1,677.7	$	1,128.2	$	549.5		48.7	%

The consumables management segment revenue growth of 53.7% reflects a higher level of revenues from first and second tier aerospace manufacturers and from higher military sales.

The 50.6% increase in revenue for the commercial aircraft segment reflects significant market share gains and was driven by a substantially higher level of aftermarket, retrofit and refurbishment activity, as well as demand created by new aircraft deliveries. Business jet segment revenue increased by $45.6 or 30.9%, reflecting the higher level of new business jet deliveries and higher revenues from super first class products.

Cost of sales for the current period of $1,107.6, or 66.0% of net sales, increased by $375.9 compared to $731.7, or 64.9% of net sales in the prior year.  The $375.9, or 51.4%, increase in cost of sales was primarily due to the 48.7% increase in net sales.  Cost of sales as a percentage of net sales increased by 110 basis points during the current year period primarily due to the higher level of commercial aircraft segment revenues, with gross margins lower than the Company’s average.  The balance was primarily related to the 2006 Draeger and New York Fasteners acquisitions and integration costs related thereto and start up and learning curve costs on major programs in the business jet and commercial aircraft segments.

Selling, general and administrative expenses in 2007 were $195.2, or 11.6% of sales, versus $159.6 or 14.1% in 2006 reflecting the higher level of selling, marketing and product support costs ($6.3), the acquisitions of Draeger and New York Fasteners ($6.1), higher commissions, compensation and benefits ($19.0) associated with the 48.7% increase in revenues and a nearly 30% increase in backlog from December 31, 2006.  Selling, general and administrative expenses as a percentage of sales decreased by 250 basis points, reflecting the operating leverage in our business.

Research, development and engineering expenses for 2007 were $127.9, or 7.6% of sales, versus $88.6 or 7.9% of sales in the prior year and reflect the higher level of spending associated with customer specific engineering activities, new product development activities (primarily at the commercial aircraft segment), certification efforts related to a number of new products including products for the new Boeing 787 Dreamliner Aircraft, Airbus A350 XWB, and acquisitions.  During 2007, we applied for 88 U.S. and foreign patents versus 73 during 2006.

    Operating earnings for 2007 were $247.0 or 66.6% greater than 2006.  The operating earnings growth was driven by the 48.7% revenue growth and a 160 basis point expansion in operating margin to 14.7% of sales reflecting the high in quality backlog and operating leverage at the higher revenue level, offset by the 2006 Draeger and New York Fasteners acquisitions and integration costs related thereto and learning curve costs in the commercial aircraft and business jet segments.  Operating earnings growth, exclusive of acquisitions was 68%.

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The following is a summary of operating earnings performance by segment:

	Fiscal Year Ended December 31,
							Percent
	2007		2006		Change		Change
Consumables management	$	85.5	$	50.4	$	35.1		69.6	%
Commercial aircraft		141.8		88.5		53.3		60.2	%
Business jet		19.7		9.4		10.3		109.6	%
Total	$	247.0		148.3		98.7		66.6	%

Consumables management segment operating earnings of $85.5 increased by $35.1, or 69.6%, due to a 53.7% increase in revenue and a 210 basis point increase in operating margin.  The consumables management segment operating margin of 22.1%, which reflects the segment’s highly efficient information technology and automated retrieval systems, was negatively impacted by the New York Fasteners acquisition and integration costs related thereto.

For the year ended December 31, 2007, commercial aircraft segment operating earnings of $141.8 increased by $53.3, or 60.2%, due to both a 50.6% increase in revenue and a 80 basis point expansion in operating margin.  The Draeger acquisition integration costs negatively impacted commercial aircraft segment margin.  The operating margins at the commercial aircraft segment are expected to significantly improve during 2008 and beyond due to their high in quality backlogs, operational efficiency initiatives, operating leverage and, with respect to interior systems, the now substantially complete Draeger integration activities.

Business jet segment operating earnings of $19.7, increased by $10.3, or 109.6%, as compared with the prior year, as a result of the 30.9% increase in revenue and the 380 basis point expansion in operating margin.  This margin expansion reflects substantially improved operating results for the super first class product line and operating leverage at the higher sales level.

Interest expense was $23.5 for 2007 and decreased by $19.3 as compared to 2006, due to the redemption of our $250 87/8% senior subordinated notes due 2011 and prepayment of $100 of bank term debt during 2007, which together generated $11.0 of debt prepayment costs.

Earnings before income taxes of $215.1 were $125.1, or 139.0% greater than in 2006.  The large increase in earnings before income taxes was due to the $98.7 or 66.6% increase in operating earnings and the $19.3 decrease in interest expense offset by $11.0 of debt prepayment costs.

The Company’s tax expense of $67.8 for 2007 reflects approximately $8.7 of tax benefits associated with one-time tax planning initiatives finalized during 2007.  The Company’s tax expense of $4.4 for 2006 reflected a tax benefit for the recognition of our U.K. deferred tax asset in the amount of $22.9.

Net earnings for 2007 of $147.3 were $61.7, or 72.1%, greater than net earnings of $85.6 in 2006.  Net earnings per diluted share for 2007 of $1.66 increased $0.56 per diluted share, or 50.9%, as compared to 2006, reflecting the $98.7, or 66.6%, increase in operating earnings in 2007, a 31.5% effective tax rate in 2007 versus a 4.9% effective tax rate in 2006, and a 14% increase in weighted average shares outstanding during 2007.

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LIQUIDITY AND CAPITAL RESOURCES

Current Financial Condition

Our liquidity requirements consist of working capital needs, ongoing capital expenditures and payments of interest and principal on our indebtedness. Our primary requirements for working capital are directly related to the level of our operations.  Working capital consists primarily of accounts receivable and inventories, which fluctuate with the sales of our products. Our working capital was $1,173.7 as of December 31, 2008, as compared to $711.6 as of December 31, 2007, consistent with the nearly 25.8% increase in revenues and the effects of the HCS acquisition.  Factors impacting the change in working capital include the HCS acquisition ($234.4), a $262.0 increase in inventories principally related to the product line expansion in the consumables management segment and to support the delivery of our record backlog, and a $53.4 increase in accounts receivable due to the increase in our revenues, somewhat offset by a $196.9 increase in accounts payable and accrued liabilities.  At December 31, 2008, reflecting the $390.0 pre-tax non-cash goodwill and intangible asset impairment charge, our net debt to net capital ratio was 43.0%.  Long term debt, less cash and cash equivalents, at December 31, 2008 was $955.1, which represents total debt of $1,123.2 less cash and cash equivalents of $168.1.  At December 31, 2008, there was $522.4 in term debt outstanding under the senior secured credit facility, which consists of a $350.0 revolving credit facility and a $525.0 term loan facility.  There were no borrowings outstanding under the revolving credit component of our senior secured credit facility.

Cash Flows

As of December 31, 2008, cash and cash equivalents were $168.1 as compared to $81.6 at December 31, 2007.  Cash provided by operating activities was $115.5 for the year ended December 31, 2008 as compared to $22.0 during the year ended December 31, 2007.  The primary sources of cash provided by operating activities during 2008 were net loss of $99.4 offset by a non-cash charge for goodwill and intangible asset impairment of $390.0, depreciation and amortization of $40.7, non-cash compensation of $15.5, and provision for doubtful accounts of $8.7.  The primary use of cash in operating activities during the year ended December 31, 2008 was $229.4 related to changes in our operating assets and liabilities, primarily related to a $262.0 investment in inventories, a $22.2 increase in accounts receivable, offset by a $50.9 increase in accounts payable and accruals and a $14.7 increase in deferred income taxes.  The primary source of cash provided by operating activities during 2007 were net earnings of $147.3 plus non-cash charges for depreciation and amortization of $35.0, a reduction in deferred income taxes totaling $58.5, non-cash compensation aggregating $11.0 plus the non-cash impact from loss on debt extinguishment of $11.0.  The primary use of cash in operating activities during the year ended December 31, 2007 was $241.9 related to changes in our operating assets and liabilities primarily related to investments in inventory, offset by an increase in our accounts payable.

The primary use of cash in investing activities during the years ended December 31, 2008 and 2007 was related to capital expenditures of $31.7 and $32.1, respectively.

During 2008, we prepaid $150.0 of our bank term loan with proceeds from the financing of the HCS acquisition.  During 2007, we redeemed $250.0 of our 87/8% senior subordinated notes and repaid $100.0 of our bank term loan with proceeds from our March 2007 common stock offering.

Capital Spending

Our capital expenditures were $31.7 and $32.1 during the years ended December 31, 2008 and 2007, respectively.  Taking into consideration our record backlog, targeted capacity utilization levels, recent capital expenditure investments, the HCS acquisition and current industry conditions, we anticipate capital expenditures of approximately $40.0 for the next twelve months.  We have no material commitments for capital expenditures. We have, in the past, generally funded our capital expenditures from cash from operations and funds available to us under bank credit facilities. We expect to fund future capital expenditures from cash on hand, from operations and from funds available to us under our senior secured credit facility.

Between 1989 and 2008, we completed 25 acquisitions for an aggregate purchase price of approximately $2.2 billion.  Following these acquisitions, we rationalized the businesses, reduced headcount by approximately 4,500 employees and eliminated 22 facilities.  We have financed these acquisitions primarily through issuances of debt and equity securities. As discussed above, we recently completed the HCS acquisition for $1,073.7.

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Outstanding Debt and Other Financing Arrangements

On July 1, 2008, we issued $600.0 aggregate principal amount of our 8½% Senior Notes due 2018 (the Senior Notes), in an offering registered pursuant to the Securities Act.  The net proceeds of our offering of Senior Notes were used, together with borrowings under the Term Loan Facility described below and an issuance of our common stock to Honeywell, to pay for the HCS acquisition, to repay approximately $150.0 outstanding under our Old Credit Agreement described below, and to pay transaction fees and expenses.

On July 28, 2008, we entered into a senior secured credit facility, dated as of July 28, 2008 (the Credit Agreement) consisting of (a) a five-year, $350.0 revolving credit facility (the Revolving Credit Facility) and (b) a six-year, $525.0 term loan facility (the Term Loan Facility).  Borrowings under the Revolving Credit Facility bear interest at an annual rate equal to the London interbank offered rate (LIBOR) plus 275 basis points or prime (as defined) plus 175 basis points. There were no amounts outstanding under the Revolving Credit Facility as of December 31, 2008.  Borrowings under the Term Loan Facility bear interest at an annual rate equal to LIBOR plus 275 basis points or prime (as defined) plus 175 basis points (5.82% at December 31, 2008).  $522.4 was outstanding under the Term Loan Facility as of December 31, 2008.  Letters of credit outstanding under the Credit Agreement aggregated approximately $24.7 as of December 31, 2008.

In connection with entering into the Credit Agreement, we prepaid approximately $150.0 outstanding under our Amended and Restated Credit Agreement, dated as of August 25, 2006 (the Old Credit Agreement).  The Old Credit Agreement was terminated as of July 28, 2008.

Contractual Obligations

The following charts reflect our contractual obligations and commercial commitments as of December 31, 2008. Commercial commitments include lines of credit, guarantees and other potential cash outflows resulting from a contingent event that requires performance by us or our subsidiaries pursuant to a funding commitment.

Contractual Obligations (1)	2009		2010		2011		2012		2013		Thereafter		Total
Long-term debt and other non-current liabilities	$	6.0	$	14.9	$	5.7	$	5.7	$	5.5	$	1,104.2	$	1,142.0
Operating leases		24.2		20.3		16.9		14.6		13.0		59.0		148.0
Purchase obligations (2)		42.5		19.9		9.8		6.7		3.9		1.3		84.1
Future interest payment on outstanding debt (3)		83.2		82.6		82.3		82.0		81.7		71.9		483.7
Total	$	155.9	$	137.7	$	114.7	$	109.0	$	104.1	$	1,236.4	$	1,857.8
Commercial Commitments
Letters of Credit	$	24.7		--		--		--		--		--	$	24.7

(1) Our liability for unrecognized tax benefits of $12.5 at December 31, 2008 has been omitted from the above table because we cannot determine with certainty when this liability will be settled.  It is reasonably possible that the amount of liability for unrecognized tax benefits will change in the next twelve months; however, we do not expect the change to have a material impact on our consolidated financial statements.

(2) Occasionally, we enter into purchase commitments for production materials and other items, which are reflected in the table above.  We also enter into unconditional purchase obligations with various vendors and suppliers of goods and services in the normal course of operations through purchase orders or other documentation or just with an invoice.  Such obligations are generally outstanding for periods less than a year and are settled by cash payments upon delivery of goods and services and are not reflected in purchase obligations.

(3) Interest payments include estimated amounts due on our outstanding term loan of our Senior Secured Credit Facility based on the actual interest rate at December 31, 2008 and based on the stated rate of 8½% on our senior unsecured notes.  Actual interest payments on our obligations under the Senior Secured Credit Facility will fluctuate based on LIBOR pursuant to the terms of the senior secured credit facility.

We believe that our cash flows, together with cash on hand and the availability under the Senior Secured Credit Facility, provide us with the ability to fund our operations, make planned capital expenditures and make scheduled debt service payments for at least the next twelve months. However, such cash flows are dependent upon our future operating performance, which, in turn, is subject to prevailing economic conditions and to financial, business and other factors, including the conditions of our markets, some of which are beyond our control. If, in the future, we cannot generate sufficient cash from operations to meet our debt service obligations, we will need to refinance such debt obligations, obtain additional financing or sell assets. We cannot assure you that our business will generate cash from operations, or that we will be able to obtain financing from other sources, sufficient to satisfy our debt service or other requirements.

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Off-Balance-Sheet Arrangements

Lease Arrangements

We finance our use of certain equipment under committed lease arrangements provided by various financial institutions.  Since the terms of these arrangements meet the accounting definition of operating lease arrangements, the aggregate sum of future minimum lease payments is not reflected in our consolidated balance sheet.  Future minimum lease payments under these arrangements aggregated approximately $148.0 at December 31, 2008.

Indemnities, Commitments and Guarantees

During the normal course of business, we made certain indemnities, commitments and guarantees under which we may be required to make payments in relation to certain transactions. These indemnities include non-infringement of patents and intellectual property indemnities to our customers in connection with the delivery, design, manufacture and sale of our products, indemnities to various lessors in connection with facility leases for certain claims arising from such facility or lease, and indemnities to other parties to certain acquisition agreements. The duration of these indemnities, commitments and guarantees varies, and in certain cases, is indefinite. We believe that substantially all of our indemnities, commitments and guarantees provide for limitations on the maximum potential future payments we could be obligated to make. However, we are unable to estimate the maximum amount of liability related to our indemnities, commitments and guarantees because such liabilities are contingent upon the occurrence of events which are not reasonably determinable. Management believes that any liability for these indemnities, commitments and guarantees would not be material to our accompanying consolidated financial statements.

Deferred Tax Assets

We maintained a tax valuation allowance of $6.9 as of December 31, 2008, primarily related to foreign tax credits and foreign operating losses.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions. We believe that our critical accounting policies are limited to those described below. For a detailed discussion on the application of these and other accounting policies, see Note 1 to our Consolidated Financial Statements.

Revenue Recognition

Sales of products are recorded when the earnings process is complete. This generally occurs when the products are shipped to the customer in accordance with the contract or purchase order, risk of loss and title has passed to the customer, collectibility is reasonably assured and pricing is fixed and determinable. In instances where title does not pass to the customer upon shipment, we recognize revenue upon delivery or customer acceptance, depending on the terms of the sales contract.

Service revenues primarily consist of engineering activities and are recorded when services are performed.

Revenues and costs under certain long-term contracts are recognized using contract accounting under the percentage-of-completion method in accordance with American Institute of Certified Public Accountants Statement of Position (SOP) 81-1, “Accounting for Performance of Construction –Type and Certain Production –Type Contracts,” with the majority of the contracts accounted for under the cost-to-cost method. Under the cost-to-cost method, the revenues related to the long-term contracts are recognized based on the ratio of actual costs incurred to total estimated costs to be incurred. The Company also uses the units-of-delivery method to account for certain of its contracts.  Under the units-of delivery method, revenues are recognized based on the contract price of units delivered.

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The percentage-of-completion method requires the use of estimates of costs to complete long-term contracts. Due to the duration of these contracts as well as the technical nature of the products involved, the estimation of these costs requires management judgment in connection with assumptions and projections related to the outcome of future events.  Management’s assumptions include future labor performance and rates and projections relative to material and overhead costs, as well as the quantity and timing of product deliveries. The Company reevaluates its contract estimates periodically and reflects changes in estimates in the current period using the cumulative catch-up method. Revenues associated with any contractual claims are recognized when it is probable that the claim will result in additional contract revenue and the amount can be reasonably estimated. Anticipated losses on contracts are recognized in the period in which the losses become probable and estimable.

Accounts Receivable

We perform ongoing credit evaluations of our customers and adjust credit limits based upon payment history and the customer's current creditworthiness, as determined by our review of their current credit information. We continuously monitor collections and payments from our customers and maintain an allowance for estimated credit losses based upon our historical experience and any specific customer collection issues that we have identified. If the actual uncollected amounts significantly exceed the estimated allowance, our operating results would be significantly adversely affected. While such credit losses have historically been within our expectations and the provisions established, we cannot guarantee that we will continue to experience the same credit loss rates that we have in the past.

Inventories

We value our inventories at the lower of cost to purchase, using FIFO or weighted average cost method, or market. The inventory balance, which includes the cost of raw material, purchased parts, labor and production overhead costs, is recorded net of a reserve for excess, obsolete or unmarketable inventories. We regularly review inventory quantities on hand and record a reserve for excess and obsolete inventories based primarily on historical usage and on our estimated forecast of product demand and production requirements. In accordance with industry practice, costs in inventory include amounts relating to long-term contracts with long production cycles and to inventory items with long procurement cycles, some of which are not expected to be realized within one year.  Demand for our products can fluctuate significantly. Our estimates of future product demand may prove to be inaccurate, in which case we may have understated or overstated the provision required for excess and obsolete inventories. In the future, if our inventories are determined to be overvalued, we would be required to recognize such costs in our cost of goods sold at the time of such determination. Likewise, if our inventories are determined to be undervalued, we may have over-reported our costs of goods sold in previous periods and would be required to recognize such additional operating income at the time of sale.

Long-Lived Assets and Goodwill

To conduct our global business operations and execute our strategy, we acquire tangible and intangible assets, which affect the amount of future period amortization expense and possible impairment expense that we may incur. The determination of the value of such intangible assets requires management to make estimates and assumptions that affect our consolidated financial statements. In accordance with Statement of Financial Accounting Standards No. 142, “Goodwill and Other Intangible Assets,” we assess potential impairment to goodwill of a reporting unit and other intangible assets on an annual basis or when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. Our judgment regarding the existence of impairment indicators and future cash flows related to intangible assets are based on operational performance of our acquired businesses, expected changes in the global economy, aerospace industry projections, discount rates and other judgmental factors. Future events could cause us to conclude that impairment indicators exist and that goodwill or other acquired tangible or intangible assets associated with our acquired businesses are impaired. Any resulting impairment loss could have an adverse impact on our results of operations.

During 2008, adverse equity market conditions caused a decrease in current market multiples, including our fiscal year end market capitalization at December 31, 2008.  The fair value of our reporting units for goodwill impairment testing were determined using valuation techniques based on estimates, judgments and assumptions we believe were appropriate under the circumstances.  The sum of the fair values of the reporting units were evaluated based on our market capitalization determined using average share prices within a reasonable period of time near December 31, 2008, plus an estimated control premium plus the fair value of our debt obligations.  The decrease in the current market multiples and our market capitalization resulted in a decline in the fair value of our reporting units.  Accordingly, as of December 31, 2008, we recorded a pre-tax impairment charge of $369.3 related to goodwill. Additionally, we recorded a pre-tax impairment charge of $20.7 related to an identified intangible asset.

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Accounting for Income Taxes

Significant management judgment is required in evaluating our tax positions and in determining our provision for income taxes, our deferred tax assets and liabilities and any valuation allowance recorded against our net deferred tax assets. We have recorded a valuation allowance of $6.9 as of December 31, 2008, due to uncertainties related to our ability to utilize our deferred tax assets, primarily consisting of our foreign net operating losses and foreign tax credit carryforwards. The valuation allowance is based on our estimates of taxable income by jurisdictions in which we operate and the period over which our deferred tax assets will be recoverable. In the event that actual results differ from these estimates, or we revise these estimates in future periods, we may need to adjust the valuation allowance which could materially impact our financial position and results of operations.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to a variety of risks, including foreign currency fluctuations and changes in interest rates affecting the cost of our variable-rate debt.

Foreign currency - We have direct operations in Europe that receive revenues from customers primarily in U.S. dollars and we purchase raw materials and component parts from foreign vendors primarily in British pounds or euros. Accordingly, we are exposed to transaction gains and losses that could result from changes in foreign currency exchange rates relative to the U.S. dollar. The largest foreign currency exposure results from activity in British pounds and euros.

From time to time, we and our foreign subsidiaries may enter into foreign currency exchange contracts to manage risk on transactions conducted in foreign currencies. At December 31, 2008, we had no outstanding foreign currency exchange contracts. In addition, we have not entered into any other derivative financial instruments.

Interest Rates - At December 31, 2008, we had adjustable rate debt of $522.4. The weighted average interest rate for the adjustable rate debt was approximately 5.8% at December 31, 2008. If interest rates on variable rate debt were to increase by 10% above current rates, the impact on our financial statements would be to reduce pre-tax income by $3.0. We do not engage in transactions intended to hedge our exposure to changes in interest rates.

As of December 31, 2008, we maintained a portfolio of securities consisting mainly of taxable, interest-bearing deposits with weighted average maturities of less than three months. If short-term interest rates were to increase or decrease by 10%, we estimate interest income would increase or decrease by approximately $0.1.

ITEM 8.     FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this section is set forth beginning from page F-1 of this Form 10-K.

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A.   CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness, as of December 31, 2008, of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act).  Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information required to be included in the Company’s periodic filings with the SEC and in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms.

33

Internal Control over Financial Reporting

There were no changes in the Company’s internal control over financial reporting that occurred during the fourth quarter of 2008 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

34

MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

     The management of BE Aerospace, Inc. and its subsidiaries (the Company) is responsible for establishing and maintaining adequate internal control over financial reporting for the Company.  Internal control over financial reporting is a process designed by, or under the supervision of the Company’s principal executive and principal financial officers, and effected by the Company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with generally accepted accounting principles.

 The Company’s internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records, that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2008. Management excluded from its assessment the internal control over financial reporting at Honeywell Consumables Solutions, which was acquired on July 28, 2008 and whose financial statements constitute 35.8% of total assets and 11.5% of revenues of the consolidated financial statement amounts as of and for the year ended December 31, 2008.   In making the assessment, the Company’s management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework.  Based on its assessment, management believes that, as of December 31, 2008, the Company’s internal control over financial reporting is effective.

 The registered public accounting firm that audited the financial statements included in this annual report has issued an attestation report on the Company’s internal control over financial reporting.

By:	/s/ Amin J. Khoury	By:	/s/ Thomas P. McCaffrey
	Amin J. Khoury		Thomas P. McCaffrey
	Chairman and Chief Executive Officer		Senior Vice President and Chief Financial Officer
	February 26, 2009		February 26, 2009

35

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

BE Aerospace, Inc.

Wellington, Florida

We have audited the internal control over financial reporting of BE Aerospace, Inc. and subsidiaries (the Company) as of December 31, 2008, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.  As described in Management’s Annual Report on Internal Control Over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Honeywell Consumables Solutions, which was acquired on July 28, 2008 and whose financial statements constitute 35.8% of total assets and 11.5% of revenues of the consolidated financial statement amounts as of and for the year ended December 31, 2008.  Accordingly, our audit did not include the internal control over financial reporting at Honeywell Consumables Solutions.  The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting.  Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the Company’s Board of Directors, management, and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2008, based on the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, 2008, of the Company and our report dated February 26, 2009, expressed an unqualified opinion on those consolidated financial statements and financial statement schedule and included an explanatory paragraph regarding the Company’s adoption of Financial Accounting Standards Board Interpretation No. 48, Accounting for Uncertainty in Income Taxes.

/s/  Deloitte & Touche LLP

Costa Mesa, California

February 26, 2009

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PART III

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth information regarding our directors and executive officers as of February 26, 2009. Officers of the Company are elected annually by the Board of Directors.

Title	Age		Position
Amin J. Khoury		69	Chairman of the Board and Chief Executive Officer
Charles L. Chadwell		68	Director(2), (3)
Jim C. Cowart		57	Director(1), (3)
Richard G. Hamermesh		61	Director(1), (3)
Robert J. Khoury		66	Director
Jonathan M. Schofield		68	Director(2), (3)
Arthur E. Wegner		71	Director(1), (3)
Michael B. Baughan		49	President and Chief Operating Officer
Thomas P. McCaffrey		54	Senior Vice President, Chief Financial Officer and Treasurer
Wayne R. Exton		45	Vice President and General Manager, Business Jet Segment
Werner Lieberherr		48	Vice President and General Manager, Commercial Aircraft Products Group
Robert A. Marchetti		66	Vice President and General Manager, Consumables Management
Edmund J. Moriarty		65	Vice President-Law, General Counsel and Secretary
Stephen R. Swisher		50	Vice President-Finance and Controller

________

(1)         Member, Audit Committee

(2)         Member, Compensation Committee

(3)         Member, Nominating and Governance Committee

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Director Classification

Our restated certificate of incorporation provides that the Board of Directors is to be divided into three classes, each nearly as equal in number as possible, so that each director (in certain circumstances after a transitional period) will serve for three years, with one class of directors being elected each year.  The Board is currently comprised of two Class I Directors (Jim C. Cowart and Arthur E. Wegner), two Class II Directors (Robert J. Khoury and Jonathan M. Schofield) and three Class III Directors (Amin J. Khoury, Charles L. Chadwell and Richard G. Hamermesh). The terms of the Class I, Class II and Class III Directors expire at the end of each respective three-year term and upon the election and qualification of successor directors at annual meetings of stockholders held at the end of each fiscal year. Our executive officers are elected annually by the Board of Directors following the annual meeting of stockholders and serve at the discretion of the Board of Directors.

Current Directors

Amin J. Khoury has been the Chairman of the Board since July 1987 when he founded the company.  Effective December 31, 2005, Mr. Amin J. Khoury was appointed Chief Executive Officer.  Mr. Amin J. Khoury also served as the company’s Chief Executive Officer until April 1, 1996.  Since 1986, Mr. Khoury has been a director of Synthes, Inc., the world’s leading manufacturer and marketer of orthopedic trauma implants and a leading global manufacturer and marketer of cranial-maxillofacial and spine implants. Mr. Khoury is a member of the board of directors of the Aerospace Industries Association.  Mr. Khoury is the brother of Robert J. Khoury.

Charles L. Chadwell has been a Director since January 2007.  He was the Vice President and General Manager, Commercial Engine Operations for GE Aircraft Engines, from which he retired in 2002.  After joining General Electric in 1965, he held a variety of management positions, including:  Program Manager, CF6-80C program; Plant Manager, GE Aircraft Engines’ Wilmington, North Carolina plant; General Manager, GE Aircraft Engines’ Sourcing Operations; General Manager; Production Operations, GE Aircraft Engines’ Lynn, Massachusetts plant; Vice President, GE Aircraft Engines Human Resources; and Vice President and General Manager, Production and Procurement, GE Aircraft Engines. Currently serves on the Boards of Spirit AeroSystems Holdings Inc., Parkway Products Inc. and Chairman of the Board, PaR Systems.

Jim C. Cowart has been a Director since November 1989.  Since September 2005, Mr. Cowart has been a Director of EAG, Inc., a privately held company, a predecessor of which was a company listed on the London Stock Exchange, and which provides microanalytic laboratory services including surface analysis and materials characterization.  Since September 2004, Mr. Cowart has been Chairman and Chief Executive Officer of Auriga Medical Products GmbH, a distributor of medical devices.  He is a Principal of Cowart & Co. LLC and Auriga Partners, Inc., private capital firms that provide strategic planning, competitive analysis, financial relations and other services.  From August 1999 to May 2001, he was Chairman of QualPro Corporation, an aerospace components manufacturing company.  From January 1993 to November 1997, he was the Chairman and CEO of Aurora Electronics Inc. Previously, Mr. Cowart was a founding general partner of Capital Resource Partners, a private investment capital manager, and held various positions in investment banking and venture capital with Lehman Brothers, Shearson Venture Capital and Kidder, Peabody & Co.

Richard G. Hamermesh has been a Director since July 1987. Dr. Hamermesh has been a Professor of Management Practice at Harvard Business School since July 1, 2002. From 1987 to 2001, he was a co-founder and a Managing Partner of The Center for Executive Development, an executive education and development consulting firm.  From 1976 to 1987, Dr. Hamermesh was a member of the faculty of Harvard Business School. He is also an active investor and entrepreneur, having participated as a principal, director and investor in the founding and early stages of more than 15 organizations.

Robert J. Khoury has been a Director since July 1987, when he co-founded the company.  On December 31, 2005, Mr. Khoury retired from service as the company’s President and Chief Executive Officer, a position he held since August 2000.  From April 1996 through August 2000, he served as Vice Chairman.  Mr. Khoury is the brother of Amin J. Khoury.

Jonathan M. Schofield has been a Director since April 2001. From December 1992 through February 2000, Mr. Schofield served as Chairman of the Board and CEO of Airbus North America Holdings, a subsidiary of Airbus Industries, a manufacturer of large civil aircraft, and served as Chairman from February 2000 until his retirement in March 2001. From 1989 until he joined Airbus, Mr. Schofield was President of United Technologies International Corporation. Mr. Schofield is currently a member of the board of directors of Aero Sat, Inc., Nordam Group and TurboCombustor Technology, Inc.; and is a trustee of LIFT Trust.

Arthur E. Wegner has been a Director since January 2007.  Mr. Wegner retired in 2000 as Executive Vice President of Raytheon Company and Chairman of Raytheon Aircraft.  He joined Raytheon Company in July 1993 as a Senior Vice President and was appointed Chairman and CEO of Raytheon’s Beech Aircraft Corporation.  In September 1994, he was appointed Chairman and CEO of Raytheon Aircraft, which was formed by the merger of Raytheon subsidiaries, Beech Aircraft and Raytheon Corporate Jets.  He became Chairman of Raytheon Aircraft in 2000.  He was elected an Executive Vice President of Raytheon Company in March of 1995.  Mr. Wegner came to Raytheon Company after 20 years with United Technologies Corporation (UTC), where he was Executive Vice President and President of UTC’s Aerospace and Defense Sector.  Prior to that he was President of UTC’s Pratt and Whitney Division.  Mr. Wegner is past Chairman of the Board of Directors of the General Aviation Manufacturers Association and the Aerospace Industries Association.

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Executive Officers

Michael B. Baughan has been President and Chief Operating Officer since December 31, 2005.  From July 2002 to December 31, 2005, Mr. Baughan served as Senior Vice President and General Manager of Commercial Aircraft Segment. From May 1999 to July 2002, Mr. Baughan was Vice President and General Manager of Seating Products. From September 1994 to May 1999, Mr. Baughan was Vice President, Sales and Marketing for Seating Products. Prior to 1994, Mr. Baughan held various positions including President of AET Systems, Manager of Strategic Initiatives at The Boston Company (American Express) and Sales Representative at Dow Chemical Company.

Thomas P. McCaffrey has been Senior Vice President and Chief Financial Officer since May 1993. From August 1989 through May 1993, Mr. McCaffrey was a Director with Deloitte & Touche LLP, and from 1976 through 1989 served in several capacities, including Audit Partner, with Coleman & Grant LLP.

Werner Lieberherr has been Vice President and General Manager, Commercial Aircraft Segment since July 2006.  Prior to joining our company, Mr. Lieberherr spent 20 years with  Alstom Power, Inc., where he served in various senior management positions in Europe, Asia, and North America, including President, Managing Director, Vice President Project Management Worldwide, and General Manager-Sales.

Wayne R. Exton has been Vice President and General Manager, Business Jet Segment since May 2006.  From November 2005 to April 2006, Mr. Exton served as Vice President and General Manager super first class division of the Business Jet Segment.  Prior to joining our company, Mr. Exton spent nine years at the PLC (formerly Britax PLC) Britax Automotive and Aerospace Divisions of Britax PLC, serving in a variety of senior management positions including President, Vice President Operations and Director of Global Marketing and Sales.  Before joining PLC, Mr. Exton held several senior management positions at Magneti Marelli (a division of Fiat), and Lucas Electrical.

Robert A. Marchetti has been Vice President and General Manager, Consumables Management Segment since April 2002. From February 2001 to April 2002, Mr. Marchetti was Vice President of Machined Products Group. From 1997 to January 2001 Mr. Marchetti was employed by Fairchild Corporation’s Fasteners Division with his last position being Senior Vice President and Chief Operating Officer. From 1990 to 1997, Mr. Marchetti served as a corporate officer of UNC Inc. where he held several senior positions such as Corporate VP of Marketing, President of Tri-Remanufacturing and Chief Operating Officer of the Accessory Overhaul Division. From 1989 to 1990, he served as President of AWA Incorporated. From 1986 through 1989, Mr. Marchetti was Vice President of Marketing at General Electric Aircraft Engines and General Manager for a Component Repair Division. From 1965 through 1986 he held several sales and general management positions with Copperweld Corporation and Carlisle Corporation.

Edmund J. Moriarty has been Vice President-Law, General Counsel and Secretary since November 1995. From 1991 to 1995, Mr. Moriarty served as Vice President and General Counsel to Rollins, Inc., a national service company. From 1982 through 1991, Mr. Moriarty served as Vice President and General Counsel to Old Ben Coal Company, a wholly owned coal subsidiary of The Standard Oil Company.

Stephen R. Swisher has been Vice President-Finance and Controller since August 1999. Mr. Swisher has been Controller since 1996 and served as Director, Finance from 1994 to 1996. Prior to 1994, Mr. Swisher held various management positions at Burger King Corporation and Deloitte & Touche LLP.

Audit Committee

We have a separately-designated standing Audit Committee established in accordance with section 3(a)(58)(A) of the Exchange Act.  Messrs. Cowart, Hamermesh and Wegner currently serve as members of the Audit Committee.  Under the current SEC rules and the rules of the Nasdaq, all of the members are independent. Our Board of Directors has determined that Mr. Cowart is an “audit committee financial expert” in accordance with current SEC rules.  Mr. Cowart is also independent, as that term is used in Item 407 of Regulation S-K of the federal securities laws.

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Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Exchange Act requires our directors and executive officers, and persons who own more than ten percent of a registered class of our equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock and other equity securities. Officers, directors and greater-than-ten-percent shareholders are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file.

To our knowledge, based solely on a review of the copies of such reports furnished to us and, with respect to our officers and directors, written representations that no other reports were required, during the fiscal year ended December 31, 2008, all Section 16(a) filing requirements applicable to our officers, directors and greater-than-ten-percent beneficial owners were complied with.

In making the above statements, we have relied on the written representations of our directors and officers and copies of the reports that have been filed with the SEC.

Code of Ethics

We have adopted a code of ethics, or Code of Business Conduct, to comply with the rules of the SEC and Nasdaq.  The Code of Business Conduct applies to our directors, officers and employees worldwide, including our principal executive officer and senior financial officers.  A copy of our Code of Business Conduct is maintained on our website at www.beaerospace.com.

ITEM 11.    EXECUTIVE COMPENSATION

Information set forth under the caption "Executive Compensation" in the Proxy Statement is incorporated by reference herein. The Compensation Committee Report will be included in the Proxy Statement and is not incorporated herein.

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information set forth under the captions "Security Ownership of Certain Beneficial Owners and Management" and “Equity Compensation Plan Information” in the Proxy Statement is incorporated by reference herein.

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Information set forth under the caption "Certain Relationships and Related Transactions" in the Proxy Statement is incorporated by reference herein.

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information set forth under the caption “Principal Accountant Fees and Services” in the Proxy Statement is incorporated by reference herein.

40

PART IV

ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of report on Form 10-K

1.	Financial Statements
	Report of Independent Registered Public Accounting Firm
	Consolidated Balance Sheets, December 31, 2008 and December 31, 2007
	Consolidated Statements of Earnings and Comprehensive Income for the Fiscal Years Ended December 31, 2008, 2007, and 2006
	Consolidated Statements of Stockholders' Equity for the Fiscal Years Ended December 31, 2008, 2007, and 2006
	Consolidated Statements of Cash Flows for the Fiscal Years Ended December 31, 2008, 2007, and 2006
	Notes to Consolidated Financial Statements for the Fiscal Years Ended December 31, 2008, 2007, and 2006
2.	Financial Statement Schedules
	Schedule II – Valuation and Qualifying Accounts
	All other consolidated financial statement schedules are omitted because such schedules are not required or the information required has been presented in the aforementioned consolidated financial statements.
3.	Exhibits – The exhibits listed in the following "Index to Exhibits" are filed with this Form 10-K or incorporated by reference as set forth below.

(b) The exhibits listed in the "Index to Exhibits" below are filed with this Form 10-K or incorporated by reference as set forth below.

(c) Additional Financial Statement Schedules – None.

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INDEX TO EXHIBITS

Exhibit
Number		Description
Exhibit 3	Articles of Incorporation and By-Laws
3.1	Amended and Restated Certificate of Incorporation (1)
3.2	Certificate of Amendment of the Restated Certificate of Incorporation (2)
3.3	Certificate of Amendment of the Restated Certificate of Incorporation (3)
3.4	Certificate of Amendment of the Restated Certificate of Incorporation (8)
3.5	Amended and Restated By-Laws (9)
3.6	Certificate of Amendment of the Restated Certificate of Incorporation (11)
Exhibit 4	Instruments Defining the Rights of Security Holders, including debentures
4.1	Specimen Common Stock Certificate (1)
4.2	Indenture, dated as of July 1, 2008, between the Registrant and Wilmington Trust Company, as Trustee (16)
4.3	First Supplemental Indenture, dated as of July 1, 2008, between the Registrant and Wilmington Trust Company, as Trustee (16)
Exhibit 10(i)	Material Contracts
10.1	Stock and Asset Purchase Agreement, dated June 9, 2008, between the Registrant and Honeywell International Inc. (15)
10.2	Commitment Letter, dated as of June 9, 2008, among the Registrant, JPMorgan Chase Bank, N.A., UBS Loan Finance LLC and Credit Suisse Securities (USA) LLC, as Initial Lenders, and J.P. Morgan Securities Inc., UBS Securities LLC and Credit Suisse Securities (USA) LLC, as Joint Lead Arrangers and Joint Bookrunners (17)
10.3	Supply Agreement, dated as of July 28, 2008, between the Registrant and Honeywell International Inc. (18)
10.4	License Agreement, dated as of July 28, 2008, between the Registrant and Honeywell International Inc. (18)
10.5	Stockholders Agreement, dated as of July 28, 2008, among the Registrant and Honeywell International Inc., Honeywell UK Limited, Honeywell Holding France SAS and Honeywell Deutschland GmbH (18)
10.6	Credit Agreement, dated as of July 28, 2008, among the Registrant, as Borrower, JPMorgan Chase Bank, N.A., as Administrative Agent, UBS Securities LLC and Credit Suisse Securities (USA) LLC, as Syndication Agents, The Royal Bank of Scotland plc and Wells Fargo Bank, N.A., as Documentation Agents, and certain lenders party thereto (18)
Exhibit 10(iii)	Management Contracts and Executive Compensation Plans, Contracts and Arrangements
10.7	Amended and Restated Employment Agreement for Amin J. Khoury dated as of December 31, 2008*
10.8	Amended and Restated Employment Agreement for Michael B. Baughan dated as of December 31, 2008*
10.9	Amended and Restated Employment Agreement for Thomas P. McCaffrey dated as of December 31, 2008*
10.10	Amended and Restated Employment Agreement for Werner Lieberherr dated as of December 9, 2008*
10.11	Amended and Restated Employment Agreement for Wayne R. Exton dated as of December 9, 2008*
10.12	Employment Agreement dated as of January 1, 2009 between the Registrant and Robert A. Marchetti*
10.13	Amended and Restated Employment Agreement for Stephen R. Swisher dated December 9, 2008*
10.14	Retirement Agreement dated as of November 19, 2008 between the Registrant and Edmund J. Moriarty*
10.15	Retirement Agreement dated as of December 31, 2005 between the Registrant and Robert J. Khoury (13)
10.16	Consulting Agreement dated as of December 31, 2005 between the Registrant and Robert J. Khoury (13)
10.17	United Kingdom 1992 Employee Share Option Scheme (2)
10.18	1996 Stock Option Plan (6)
10.19	Amendment No. 1 to the 1996 Stock Option Plan (4)
10.20	Amendment No. 2 to the 1996 Stock Option Plan (5)
10.21	2001 Stock Option Plan (7)
10.22	BE Aerospace, Inc. Management Incentive Plan (100%) – FY 2009*
10.23	BE Aerospace, Inc. Management Incentive Plan (80%) – FY 2009*
10.24	2005 Long-Term Incentive Plan (10)
10.25	Standard Form of Restricted Stock Award Agreement (14)
10.26	2007 Form of Restricted Stock Award Agreement for Robert A. Marchetti (14)

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10.27	Form of Restricted Stock Award Agreement for Amin J. Khoury (14)
10.28	Form of Restricted Stock Award Agreement for Thomas P. McCaffrey (14)
10.29	Form of Restricted Stock Award Agreement for Michael B. Baughan (14)
10.30	Restricted Stock Award Agreement, between Registrant and Robert A. Marchetti, dated August 5, 2008 (18)
10.31	Form of Performance-Based Restricted Stock Unit Award Agreement (18)
10.32	Form of Performance-Based Restricted Stock Award Agreement (18)
10.33	Form of Performance-Based Restricted Stock Award Agreement (Amin J. Khoury) (18)
10.34	Form of Performance-Based Restricted Stock Award Agreement (Thomas P. McCaffrey & Michael B. Baughan) (18)
10.35	Form of Performance-Based Restricted Stock Unit Agreement (Thomas P. McCaffrey & Michael B. Baughan) (18)
10.36	Amended and Restated 1994 Employee Stock Purchase Plan (12)
10.37	Amendment to 1994 Employee Stock Purchase Plan*
Exhibit 14	Code of Ethics
14.1	Code of Business Conduct (9)
Exhibit 21	Subsidiaries of the Registrant
21.1	Subsidiaries*
Exhibit 23	Consents of Experts and Counsel
23.1	Consent of Independent Registered Public Accounting Firm – Deloitte & Touche LLP*
Exhibit 31	Rule 13a-14(a)/15d-14(a) Certifications
31.1	Certification of Chief Executive Officer*
31.2	Certification of Chief Financial Officer*
Exhibit 32	Section 1350 Certifications
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350*
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350*

__________________

* Filed herewith.

(1) Incorporated by reference to the Company’s Registration Statement on Form S-1, as amended (No. 33-33689), filed with the Commission on March 7, 1990.

(2) Incorporated by reference to the Company’s Registration Statement on Form S-1, as amended (No. 333-54146), filed with the Commission on November 3, 1992.

(3) Incorporated by reference to the Company’s Registration Statement on Form S-3 (No. 333-60209), filed with the Commission on July 30, 1998.

(4) Incorporated by reference to the Company’s Registration Statement on Form S-8 (No. 333-89145), filed with the Commission on October 15, 1999.

(5) Incorporated by reference to the Company’s Registration Statement on Form S-8 (No. 333-30578), filed with the Commission on February 16, 2000.

(6) Incorporated by reference to the Company's Registration Statement on Form S-8 (No. 333-14037), filed with the Commission on October 15, 1996.

(7) Incorporated by reference to the Company's Registration Statement on Form S-8 (No. 333-71442), filed with the Commission on October 11, 2001.

(8) Incorporated by reference to the Company’s Registration Statement on Form S-3 (No. 333-112493), as amended, filed with the Commission on February 5, 2004.

(9) Incorporated by reference to the Company’s Transition Report on Form 10-K for the ten-month transition period ended December 31, 2002, filed with the Commission March 26, 2003.

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(10) Incorporated by reference to the Company’s Current Report on Form 8-K dated July 26, 2005, filed with the Commission on July 26, 2005.

(11) Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, filed with the Commission on August 7, 2006.

(12) Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2006, filed with the Commission on November 7, 2006.

(13) Incorporated by reference to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2005 filed with the Commission on March 15, 2006.

(14) Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, filed with the Commission on May 9, 2007.

(15) Incorporated by reference to the Company’s Current Report on Form 8-K dated June 9, 2008, filed with the Commission on June 11, 2008.

(16) Incorporated by reference to the Company’s Current Report on Form 8-K dated June 26, 2008, filed with the Commission on July 1, 2008.

(17) Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2008, filed with the Commission on August 7, 2008.

(18) Incorporated by reference to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, filed with the Commission on November 7, 2008.

44

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BE AEROSPACE, INC.
By:	/s/ Amin J. Khoury
	Amin J. Khoury
	Chairman and Chief Executive Officer

Date:  February 26, 2009

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Amin J. Khoury	Chairman and Chief Executive Officer	February 26, 2009
Amin J. Khoury
/s/ Thomas P. McCaffrey	Senior Vice President and Chief Financial Officer   (Principal Financial and Accounting Officer)	February 26, 2009
Thomas P. McCaffrey
/s/ Charles L. Chadwell	Director	February 26, 2009
Charles L. Chadwell
/s/ Jim C. Cowart	Director	February 26, 2009
Jim C. Cowart
/s/ Richard G. Hamermesh	Director	February 26, 2009
Richard G. Hamermesh
/s/ Robert J. Khoury	Director	February 26, 2009
Robert J. Khoury
/s/ Jonathan M. Schofield	Director	February 26, 2009
Jonathan M. Schofield
/s/ Arthur E. Wegner	Director	February 26, 2009
Arthur E. Wegner

45

ITEM 8.  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE

	Page
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Financial Statements:
Consolidated Balance Sheets, December 31, 2008 and 2007	F-3
Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss)	F-4
for the Fiscal Years Ended December 31, 2008, 2007 and 2006
Consolidated Statements of Stockholders' Equity	F-5
for the Fiscal Years Ended December 31, 2008, 2007 and 2006
Consolidated Statements of Cash Flows	F-6
for the Fiscal Years Ended December 31, 2008, 2007 and 2006
Notes to Consolidated Financial Statements	F-7
for the Fiscal Years Ended December 31, 2008, 2007 and 2006
Consolidated Financial Statement Schedule:
Schedule II - Valuation and Qualifying Accounts	F-25
for the Fiscal Years Ended December 31, 2008, 2007 and 2006

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

BE Aerospace, Inc.

Wellington, Florida

We have audited the accompanying consolidated balance sheets of BE Aerospace, Inc. and subsidiaries (the Company) as of December 31, 2008 and 2007, and the related consolidated statements of earnings (loss) and comprehensive income (loss), stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2008. Our audits also included the financial statement schedule listed in item 15(a)(2). These consolidated financial statements and the financial statement schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements and the financial statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of BE Aerospace, Inc. and subsidiaries as of December 31, 2008 and 2007, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2008, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

As discussed in Note 9 to the consolidated financial statements, in 2007 the Company adopted the provisions of Financial Accounting Standards Board Interpretation No. 48,“Accounting for Uncertainty in Income Taxes.”

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial reporting as of December 31, 2008, based on the criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26, 2009 expressed an unqualified opinion on the Company's internal control over financial reporting.

/s/ Deloitte & Touche LLP

Costa Mesa, California

February 26, 2009

F-2

CONSOLIDATED BALANCE SHEETS, DECEMBER 31, 2008 AND 2007

(In millions, except per share data)

	December 31,			December 31,
	2008			2007
ASSETS
Current assets:
Cash and cash equivalents	$	168.1		$	81.6
Accounts receivable trade, net		271.4			218.0
Inventories, net		1,197.0			636.3
Deferred income taxes, net		22.1			62.4
Other current assets		24.8			21.7
Total current assets		1,683.4			1,020.0
Property and equipment, net		115.8			116.4
Goodwill		663.6			467.2
Identifiable intangible assets, net		356.0			142.2
Deferred income taxes, net		49.2			--
Other assets, net		62.1			26.2
	$	2,930.1		$	1,772.0
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	274.5		$	192.1
Accrued liabilities		229.2			114.7
Current maturities of long-term debt		6.0			1.6
Total current liabilities		509.7			308.4
Long-term debt, net of current maturities		1,117.2			150.3
Deferred income taxes, net		5.4			34.9
Other non-current liabilities		31.3			20.3
Commitments, contingencies and off-balance sheet
arrangements (Note 8)
Stockholders' equity:
Preferred stock, $0.01 par value; 1.0 shares
authorized; no shares outstanding		--			--
Common stock, $0.01 par value; 200.0 shares
authorized; 101.1 shares issued and 101.0 shares
outstanding as of December 31, 2008, and 93.1 shares
issued and outstanding as of December 31, 2007		1.0			0.9
Additional paid-in capital		1,500.7			1,324.3
Accumulated deficit		(189.1	)		(89.7	)
Accumulated other comprehensive (loss) income		(44.8	)		22.6
Less 0.1 treasury shares in 2008, at cost		(1.3	)		--
Total stockholders' equity		1,266.5			1,258.1
	$	2,930.1		$	1,772.0

See accompanying notes to consolidated financial statements.

F-3

CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) AND COMPREHENSIVE INCOME (LOSS)

FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(In millions, except per share data)

	Fiscal Years Ended December 31,
	2008			2007		2006
Net sales	$	2,110.0		$	1,677.7	$	1,128.2
Cost of sales		1,386.5			1,107.6		731.7
Selling, general and administrative		238.3			195.2		159.6
Research, development and engineering		131.4			127.9		88.6
Asset impairment charge		390.0			--		--
Operating (loss) earnings		(36.2	)		247.0		148.3
Interest expense, net		48.0			20.9		38.9
Debt prepayment costs		3.6			11.0		19.4
(Loss) earnings before income taxes		(87.8	)		215.1		90.0
Income tax expense		11.6			67.8		4.4
Net (loss) earnings		(99.4	)		147.3		85.6
Other comprehensive (loss) income:
Foreign exchange translation
adjustment and other		(67.4	)		9.8		17.5
Comprehensive (loss) income	$	(166.8	)	$	157.1	$	103.1
Net (loss) earnings per share - basic	$	(1.05	)	$	1.67	$	1.11
Net (loss) earnings per share - diluted	$	(1.05	)	$	1.66	$	1.10
Weighted average common shares - basic		94.3			88.1		77.1
Weighted average common shares - diluted		94.3			88.8		78.0

See accompanying notes to consolidated financial statements.

F-4

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(In millions)

											Accumulated
					Additional						Other									Total
	Common Stock				Paid-in			Accumulated			Comprehensive			Treasury Stock						Stockholders'
	Shares		Amount		Capital			Deficit			Income (Loss)			Shares			Amount			Equity
Balance, December 31, 2005		74.3	$	0.7	$	894.0		$	(320.4	)	$	(4.7	)		--		$	--		$	569.6
Sale of stock under
employee stock purchase plan		0.1		--		2.6			--			--			--			--			2.6
Exercise of stock options		3.6		0.1		28.5			--			--			--			--			28.6
Restricted stock grants		1.5		--		2.2			--			--			--			--			2.2
Deferred income tax expense
from shared based payments		--		--		(0.7	)		--			--			--			--			(0.7	)
Net earnings		--		--		--			85.6			--			--			--			85.6
Foreign currency translation
adjustment and other		--		--		0.6			--			17.5			--			--			18.1
Balance, December 31, 2006		79.5		0.8		927.2			(234.8	)		12.8			--			--			706.0
Sale of common stock
under public offering, net		12.1		0.1		368.5			--			--			--			--			368.6
Sale of stock under
employee stock purchase plan		0.1		--		3.1			--			--			--			--			3.1
Exercise of stock options		1.0		--		14.8			--			--			--			--			14.8
Restricted stock grants		0.4		--		10.7			--			--			--			--			10.7
Net earnings		--		--		--			147.3			--			--			--			147.3
Foreign currency translation
adjustment and other		--		--		--			0.1			9.8			--			--			9.9
Impact of adoption of FIN 48		--		--		--			(2.3	)		--			--			--			(2.3	)
Balance, December 31, 2007		93.1		0.9		1,324.3			(89.7	)		22.6			--			--			1,258.1
Sale of stock under
employee stock purchase plan		0.2		--		3.1			--			--			--			--			3.1
Common stock issued
for acquistion		6.0		0.1		158.2			--			--			--			--			158.3
Purchase of treasury stock		--		--		--			--			--			(0.1	)		(1.3	)		(1.3	)
Exercise of stock options		0.1		--		0.7			--			--			--			--			0.7
Restricted stock grants		1.7		--		15.0			--			--			--			--			15.0
Deferred income tax expense
from shared based payments		--		--		(0.6	)		--			--			--			--			(0.6	)
Net loss		--		--		--			(99.4	)		--			--			--			(99.4	)
Foreign currency translation
adjustment and other		--		--		--			--			(67.4	)		--			--			(67.4	)
Balance, December 31, 2008		101.1	$	1.0	$	1,500.7		$	(189.1	)	$	(44.8	)		(0.1	)	$	(1.3	)	$	1,266.5

See accompanying notes to consolidated financial statements.

F-5

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(In millions)

	Fiscal Year Ended December 31,
	2008			2007			2006
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) earnings	$	(99.4	)	$	147.3		$	85.6
Adjustments to reconcile net (loss) earnings to
net cash flows provided by operating activities, net of
effects from acquisition:
Goodwill and intangible asset impairment charge		390.0			--			--
Depreciation and amortization		40.7			35.0			29.4
Deferred income taxes		(14.7	)		58.5			(1.3	)
Non-cash compensation		15.5			11.0			2.7
Provision for doubtful accounts		8.7			0.6			1.8
Loss on disposal of property and equipment		0.5			0.5			0.5
Debt prepayment costs		3.6			11.0			19.4
Changes in operating assets and liabilities:
Accounts receivable		(22.2	)		(43.2	)		(16.2	)
Inventories		(262.0	)		(212.9	)		(155.7	)
Other current assets and other assets		3.9			(19.2	)		8.3
Payables, accruals and other liabilities		50.9			33.4			66.5
Net cash flows provided by operating activities		115.5			22.0			41.0
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures		(31.7	)		(32.1	)		(24.1	)
Acquisitions, net of cash acquired and other		(912.7	)		(0.5	)		(145.3	)
Net cash flows used in investing activities		(944.4	)		(32.6	)		(169.4	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from common stock issued, net of expenses		3.4			386.1			30.0
Purchase of treasury stock		(1.3	)		--			--
Principal payments on long term debt		(152.8	)		(352.8	)		(549.5	)
Debt facility and debt prepayment costs		(50.3	)		(7.4	)		(19.2	)
Proceeds from long-term debt		1,124.1			--			373.6
Borrowings on line of credit		65.0			93.0			150.0
Repayments on line of credit		(65.0	)		(93.0	)		(150.0	)
Net cash flows provided by (used in) financing activities		923.1			25.9			(165.1	)
Effect of foreign exchange rate changes on cash and
cash equivalents		(7.7	)		1.3			2.5
Net increase (decrease) in cash and cash equivalents		86.5			16.6			(291.0	)
Cash and cash equivalents, beginning of year		81.6			65.0			356.0
Cash and cash equivalents, end of year	$	168.1		$	81.6		$	65.0
Supplemental disclosures of cash flow information:
Cash paid during period for:
Interest	$	19.2		$	26.6		$	49.0
Income taxes		17.7			8.0			1.6
Supplemental schedule of non-cash activitites:
Common stock issued in connection with acquisition	$	158.3		$	--		$	--

See accompanying notes to consolidated financial statements.

F-6

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(In millions, except share and per share data)

1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Basis of Presentation – BE Aerospace, Inc. and its wholly owned subsidiaries (the Company) designs, manufactures, sells and services commercial aircraft and business jet cabin interior products consisting of a broad range of seating, interior systems, including structures as well as all food and beverage storage and preparation equipment and distributes aerospace fasteners and consumables.  The Company’s principal customers are the operators of commercial and business jet aircraft and aircraft manufacturers.  As a result, the Company’s business is directly dependent upon the conditions in the commercial airline, business jet and aircraft manufacturing industries.  The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America.

Consolidation – The accompanying consolidated financial statements include the accounts of BE Aerospace, Inc. and its wholly owned subsidiaries.  All intercompany transactions and balances have been eliminated in consolidation.

Financial Statement Preparation – The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and related disclosures.  Actual results could differ from those estimates.

Revenue Recognition – Sales of products are recorded when the earnings process is complete. This generally occurs when the products are shipped to the customer in accordance with the contract or purchase order, risk of loss and title has passed to the customer, collectibility is reasonably assured and pricing is fixed and determinable. In instances where title does not pass to the customer upon shipment, we recognize revenue upon delivery or customer acceptance, depending on the terms of the sales contract.

Service revenues primarily consist of engineering activities and are recorded when services are performed.

Revenues and costs under certain long-term contracts are recognized using contract accounting under the percentage-of-completion method in accordance with American Institute of Certified Public Accountants Statement of Position (SOP) 81-1, “Accounting for Performance of Construction– Type and Certain Production –Type Contracts,” with the majority of the contracts accounted for under the cost-to-cost method. Under the cost-to-cost method, the revenues related to the long-term contracts are recognized based on the ratio of actual costs incurred to total estimated costs to be incurred. The Company also uses the units-of-delivery method to account for certain of its contracts.  Under the units-of delivery method, the revenues are recognized based on the contract price of units delivered.

The percentage-of-completion method requires the use of estimates of costs to complete long-term contracts. Due to the duration of these contracts as well as the technical nature of the products involved, the estimation of these costs requires management judgment in connection with assumptions and projections related to the outcome of future events.  Management’s assumptions include future labor performance and rates and projections relative to material and overhead costs, as well as the quantity and timing of product deliveries. The Company re-evaluates its contract estimates periodically and reflects changes in estimates in the current period using the cumulative catch-up method. Revenues associated with any contractual claims are recognized when it is probable that the claim will result in additional contract revenue and the amount can be reasonably estimated. Anticipated losses on contracts are recognized in the period in which the losses become probable and estimable.

Income Taxes – The Company provides deferred income taxes for temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax purposes.  Deferred income taxes are computed using enacted tax rates that are expected to be in effect when the temporary differences reverse.  A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion or the entire deferred tax asset will not be realized. The Company classifies interest and penalties related to income tax as income tax expense.

F-7

Cash Equivalents – The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable – The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customer's current creditworthiness, as determined by review of their current credit information.  The Company continuously monitors collections and payments from its customers and maintains a provision for estimated credit losses based upon historical experience and any specific customer collection issues that have been identified.  The allowance for doubtful accounts at December 31, 2008 and 2007 was $12.2 and $4.5, respectively.

Inventories – The Company values inventory at the lower of cost or market, using FIFO or weighted average cost method.  The Company regularly reviews inventory quantities on hand and records a provision for excess and obsolete inventory based primarily on historical demand, as well as an estimated forecast of product demand and production requirements.  Demand for the Company’s products can fluctuate significantly.  In accordance with industry practice, costs in inventory include amounts relating to long-term contracts with long production cycles and to inventory items with long procurement cycles, some of which are not expected to be realized within one year.

Property and Equipment–Property and equipment are stated at cost and depreciated generally under the straight-line method over their estimated useful lives of three to fifty years (or the lesser of the term of the lease for leasehold improvements, as appropriate).

Debt Issuance Costs – Costs incurred to issue debt are deferred and amortized as interest expense over the term of the related debt.

Goodwill and Intangible Assets – Under Statement of Financial Accounting Standards (SFAS) No. 142, "Goodwill and Other Intangible Assets,” (SFAS 142) goodwill and other intangible assets with indefinite lives are not amortized, but are reviewed at least annually for impairment.  Acquired intangible assets with definite lives are amortized over their individual useful lives.  Patents and other intangible assets are amortized using the straight-line method over periods ranging from one to thirty years (see Note 5).

On at least an annual basis, management assesses whether there has been any impairment in the value of goodwill or intangible assets with indefinite lives by comparing the fair value to the net carrying value of reporting units.  If the carrying value exceeds its estimated fair value, an impairment loss is recognized if the implied fair value of the asset being tested is less than its carrying value.  In this event, the asset is written down accordingly. The fair values of reporting units for goodwill impairment testing are determined using valuation techniques based on estimates, judgments and assumptions management believes are appropriate in the circumstances.  The sum of the fair values of the reporting units are evaluated based on market capitalization determined using average share prices within a reasonable period of time near the selected testing date (calendar year-end), plus an estimated control premium plus the fair value of the Company’s debt obligations.  Recent adverse equity market conditions caused a decrease in current market multiples, including the Company’s fiscal year end market capitalization at December 31, 2008.  The decrease in the current market multiples and the Company’s market capitalization resulted in a decline in the fair value of the Company’s reporting units as of December 31, 2008.  Accordingly, the Company recorded a pre-tax impairment charge related to goodwill of $369.3. Additionally, the Company recorded a pre-tax impairment charge of $20.7 related to an identified intangible asset. There were no impairment charges in 2007 or 2006.

Long-Lived Assets – The Company assesses potential impairments to its long-lived assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered.  An impairment loss is recognized when the undiscounted cash flows expected to be generated by an asset (or group of assets) is less than its carrying amount.  Any required impairment loss is measured as the amount by which the asset's carrying value exceeds its fair value and is recorded as a reduction in the carrying value of the related asset and a charge to operating results.

Product Warranty Costs – Estimated costs related to product warranties are accrued at the time products are sold.  In estimating its future warranty obligations, the Company considers various relevant factors, including the Company's stated warranty policies and practices, the historical frequency of claims and the cost to replace or repair its products under warranty.  Estimated warranty costs are embedded in the accrued liabilities balances on the consolidated balance sheet.  The following table provides a reconciliation of the activity related to the Company's accrued warranty expense:

F-8

	Fiscal Year Ended December 31,
	2008			2007			2006
Balance at beginning of period	$	20.6		$	18.4		$	14.3
Accruals for warranties issued during the period		29.9			24.5			12.7
Settlements of warranty claims		(28.1	)		(22.3	)		(9.2	)
Warranty liabilities assumed from acquistions		--			--			0.6
Balance at end of period	$	22.4		$	20.6		$	18.4

Accounting for Stock-Based Compensation – The Company accounts for share-based compensation arrangements in accordance with the provisions of Statement of Financial Accounting Standards (SFAS) No. 123(R), “Share Based Payment” (SFAS 123(R)), whereby stock-based compensation cost is measured on the date of grant, based on the fair value of the award, and is recognized over the requisite service period.

Compensation cost recognized during the three years ended December 31, 2008 related to grants of restricted stock and restricted stock units. No compensation cost related to stock options was recognized during those periods as the vesting of all remaining unvested awards was accelerated in December 2005 and no options were granted during the three year period ended December 31, 2008.

The Company has established a qualified Employee Stock Purchase Plan.  The Plan allows qualified employees (as defined in the plan) to participate in the purchase of designated shares of the Company's common stock at a price equal to 85% of the closing price for each semi-annual stock purchase period. The fair value of employee purchase rights represents the difference between the closing price of the Company’s shares on the date of purchase and the purchase price of the shares. The value of the rights granted during the years ended December 31, 2008, 2007 and 2006 was $0.5, $0.5 and $0.4, respectively.

Treasury Stock –The Company may periodically repurchase shares of its common stock from employees for the satisfaction of their individual payroll tax withholdings upon vesting of restricted stock and restricted stock units in connection with the Company’s Long Term Incentive Plan.The Company’s repurchases of common stock are recorded at the average cost of the common stock held in treasury and result in a reduction of stockholders’ equity.  

Research and Development – Research and development expenditures are expensed as incurred.

Foreign Currency Translation – The assets and liabilities of subsidiaries located outside the United States are translated into U.S. dollars at the rates of exchange in effect at the balance sheet dates.  Revenue and expense items are translated at the average exchange rates prevailing during the period.  Gains and losses resulting from foreign currency transactions are recognized currently in income, and those resulting from translation of financial statements are accumulated as a separate component of stockholders’ equity.  The Company's European subsidiaries utilize the British pound or the Euro as their local functional currency.

Concentration of Risk – The Company’s products and services are primarily concentrated within the aerospace industry with customers consisting primarily of commercial aircraft manufacturers, commercial airlines and a wide variety of business jet customers. In addition to the overall business risks associated with the Company’s concentration within the aerospace industry, the Company is exposed to a concentration of collection risk on credit extended to commercial aircraft manufacturers and commercial airlines.  The Company’s management performs ongoing credit evaluations on the financial condition of all of its customers and maintains allowances for uncollectible accounts receivable based on expected collectibility. Credit losses have historically been within management's expectations and the provisions established.

Significant customers change from year to year depending on the level of refurbishment activity and/or the level of new aircraft purchases by such customers. During the fiscal years ended December 31, 2008, 2007 and 2006 no single customer accounted for more than 10% of the Company’s consolidated net sales.

Recent Accounting Pronouncements

In April 2008, the Financial Accounting Standards Board (FASB) issued SFAS No. 142-3, “Determination of the Useful Life of Intangible Assets” (SFAS 142-3). SFAS 142-3 amends the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under SFAS 142.  The intent of SFAS 142-3 is to improve the consistency between the useful life of a recognized intangible asset under SFAS 142, the period of expected cash flows used to measure the fair value of the asset under SFAS No.141 (revised 2007), “Business Combinations” (SFAS 141(R)) and other U.S. generally accepted accounting principles.  SFAS 142-3 is effective for financial statements issued for interim periods and fiscal years beginning after December 15, 2008.  The Company is currently evaluating the impact, if any, that the adoption of SFAS 142-3 will have on the consolidated financial statements of the Company.

F-9

In December 2007, the FASB issued SFAS 141(R) and SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements, an amendment of ARB No. 51” (SFAS 160).  SFAS 141(R) will change how business acquisitions are accounted for and SFAS 160 will change the accounting and reporting for minority interests, which will be recharacterized as noncontrolling interests and classified as a component of equity.  Purchase price adjustments for acquisitions consummated before the effective date of SFAS 141(R) will be recognized under SFAS No. 141, “Business Combinations” (SFAS 141) with the exception of certain tax adjustments. SFAS 141(R) and SFAS 160 are effective for fiscal years beginning on or after December 15, 2008 (January 1, 2009 for the Company).  The adoption of SFAS 141(R) and SFAS 160 is not expected to have a material impact on the Company’s consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159 “The Fair Value Option for Financial Assets and Financial Liabilities, including an Amendment of FASB Statement No. 115” (SFAS 159).  SFAS 159 allows companies to measure at fair value most financial assets and liabilities that are currently required to be measured in a different manner, such as based on their carrying amount. SFAS 159 was effective for the Company's fiscal year 2008. Upon adoption, the Company chose not to elect the fair value option for its financial assets or financial liabilities. The adoption of SFAS 159 did not have a material impact on the Company’s consolidated financial statements.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements” (SFAS 157). SFAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS 157 applies under other accounting pronouncements that require or permit fair value measurements. SFAS 157 indicates that, among other things, a fair value measurement assumes that the transaction to sell an asset or transfer a liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. The Company adopted SFAS 157 in the fiscal year 2008. The adoption of this statement did not have a material impact on the Company’s consolidated financial statements. In February 2008, the FASB issued FASB Staff Position SFAS No. 157-2, “Effective Date of FASB Statement No. 157,” (SFAS 157-2)which delayed the effective date of SFAS 157 for all non-financial assets and liabilities, except those that are recognized or disclosed at fair value in the financial statements on a recurring basis, until January 1, 2009. The Company does not currently anticipate the implementation of the deferred portions of SFAS 157 will have a material impact on the consolidated financial statements. In October 2008, the FASB Issued FSP No. 157-3, “Determining the Fair Value of a Financial Asset When the Market for That Asset Is Not Active” (FSP 157-3).  FSP 157-3 clarifies the application of FASB Statement No. 157, “Fair Value Measures,” in a market that is not active and provides an example to illustrate key considerations in determining the fair value of a financial asset when the market for that financial asset is not active.  FSP 157-3 is effective upon issuance.  Based on the Company’s evaluation of FSP 157-3, the adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.

2.  BUSINESS COMBINATIONS

On July 28, 2008, the Company acquired from Honeywell International Inc. (Honeywell) its Consumables Solutions distribution business (HCS). The transaction was accounted for as a purchase under SFAS 141.  The assets purchased and liabilities assumed for this acquisition have been reflected in the accompanying consolidated balance sheet as of December 31, 2008 and results of operations for the acquisition are included in the accompanying consolidated statement of earnings (loss) from the date of acquisition.

The purchase price of $1,073.7 consisted of $903.1 in cash plus six million shares of the Company’s common stock valued at $158.3, or $26.38 per share plus transaction fees and expenses of $12.3.  For financial reporting purposes, the share price was based on the closing price of the Company’s common stock two business days before, including and after the measurement date (July 24, 2008). The HCS acquisition has been accounted for using the purchase method of accounting and has been included in the Company’s consolidated financial statements since July 28, 2008.

F-10

The HCS business distributes consumables parts and supplies to aviation industry manufacturers, airlines, and aircraft repair and overhaul facilities.  The combination of HCS with our consumables management segment positioned us as the premier global distributor and value-added provider of aerospace fasteners and other consumable products, thereby allowing the Company to alter its business mix, such that approximately one-half of its business is related to non-discretionary consumables and spares demand. The combined business serves as a distributor for every major aerospace fastener manufacturer in the world.

In connection with the HCS acquisition, the Company entered into a new senior secured credit facility on July 28, 2008, consisting of (a) a five-year, $350.0 revolving credit facility (the Revolving Credit Facility) and (b) a six-year, $525.0 term loan facility (the Term Loan Facility).  In addition, on July 1, 2008, the Company issued $600.0 aggregate principal amount of its 8 ½% Senior Notes due 2018 (the Senior Notes), in an offering registered pursuant to the Securities Act of 1933, as amended.

The Company used the net proceeds from the Senior Notes offering, together with borrowings under the Term Loan Facility, and six million shares of common stock to pay for the HCS acquisition, to repay approximately $150.0 of existing indebtedness under its Amended and Restated Credit Agreement, dated as of August 25, 2006 (2006 Senior Secured Credit Facility), which was terminated in connection with the repayment, and to pay transaction fees and expenses.

The estimated excess of the purchase price over the fair value of identifiable net tangible assets acquired was $824.1, of which $250.0 was allocated to intangible assets and $574.1 was allocated to goodwill.  Approximately $371.0 of the goodwill amount and all of the identifiable intangible assets of $250.0 are expected to be amortizable and deductible for tax purposes.

The Company has not yet completed the evaluation and allocation of the purchase price for the HCS acquisition as management’s assessment of the valuation of certain assets and liabilities is not yet complete. The Company does not believe that the final allocation will materially modify the preliminary purchase price allocation. The following table summarizes the preliminary estimates of fair values of assets acquired and liabilities assumed in accordance with SFAS 141, which are currently recorded based on management’s estimates as follows:

Accounts receivable trade	$	62.6
Inventories		329.6
Property and equipment		1.2
Goodwill		574.1
Identifiable intangible assets		250.0
Deferred income tax asset		20.6
Other assets		3.5
Accounts payable and accrued liabilities		(157.8	)
Other liabilities		(10.1	)
Total purchase price	$	1,073.7

In connection with the HCS acquisition, the Company entered into a 30-year license agreement (HCS License Agreement) to become Honeywell’s exclusive licensee with respect to the sale to the global aerospace industry of Honeywell proprietary fasteners, seals, bearings, gaskets and electrical components associated with Honeywell’s engines, APU’s, avionics, wheels and brakes.  The Company also entered into the supply agreement (Honeywell Supply Agreement), under which it became the exclusive supplier of both Honeywell proprietary consumables and standard consumables to support the internal manufacturing needs of Honeywell Aerospace.  Pricing under the contract is adjusted annually, beginning in 2010, to reflect changes in market conditions. The HCS License Agreement, the Honeywell Supply Agreement, along with the various acquired original equipment manufacturer customer contracts and relationships, were valued at $250.0 and are being amortized over their respective useful lives, ranging 8-30 years.

Included in accounts payable and accrued liabilities at the date of acquisition were $71.5 related to unfavorable customer contracts assumed in connection with the HCS acquisition which were priced below market and a portion of which were generating gross margin losses. The accrual for unfavorable contracts was determined by the Company through a study of product pricing as of the acquisition date for similar type contracts and products and a forecast of sales through the remaining contract term which was based on historical sales levels as adjusted for expected changes in demand under market conditions that existed as of the acquisition date. The unfavorable contracts have durations of up to three years. To the extent that the profitability of these contracts is improved either through contract renegotiations, cost decreases, or price increases, these effects will be reflected when realized, and to the extent that the profitability on these contracts is not improved, the accrual will be amortized until the termination of the contracts.

F-11

Consolidated unaudited proforma results for fiscal years 2008 and 2007, presented below, reflect the impact of the HCS acquisition if it had occurred as of January 1, 2008 and 2007.  Consolidated unaudited 2008 proforma results exclude goodwill and intangible asset impairment charges.

	2008		2007
Net sales	$	2,455.8	$	2,214.5
Operating earnings		400.8		314.1
Net earnings		209.4		153.4
Net earnings per diluted share		2.21		1.62

3.         INVENTORIES

Finished goods and work-in-process inventories include material, labor and manufacturing overhead costs.  Finished goods inventories primarily consist of aftermarket fasteners. Inventories consist of the following:

	December 31,		December 31,
	2008		2007
Purchased materials and component parts	$	150.8	$	132.2
Work-in-process		36.8		37.7
Finished goods		1,009.4		466.4
	$	1,197.0	$	636.3

4. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	Useful Life		December 31,			December 31,
	(Years)		2008			2007
Land, buildings and improvements		5 - 50	$	45.1		$	48.2
Machinery		5 - 20		69.7			69.0
Tooling		3 - 20		28.9			30.2
Computer equipment and software		3 - 15		118.8			113.1
Furniture and equipment		3 - 15		15.9			14.5
				278.4			275.0
Less accumulated depreciation				(162.6	)		(158.6	)
			$	115.8		$	116.4

Depreciation expense was $25.7, $23.9 and $19.1 for the fiscal years ended December 31, 2008, 2007 and 2006, respectively.

F-12

5.         GOODWILL AND INTANGIBLE ASSETS

The following sets forth the intangible assets by major asset class, all of which were acquired through business purchase transactions:

			December 31, 2008									December 31, 2007
										Net						Net
	Useful Life		Original		Accumulated		Impairment			Book		Original		Accumulated		Book
	(Years)		Cost		Amortization		Charge			Value		Cost		Amortization		Value
Acquired technologies		10-40	$	101.2	$	33.5	$	--		$	67.7	$	100.2	$	29.7	$	70.5
Trademarks and patents		1-20		28.2		17.3		--			10.9		28.8		17.0		11.8
Trademarks and tradenames     (non-amortizing)		--		20.7		--		(20.7	)		--		20.7		--		20.7
Technical qualifications, plans
and drawings		18-30		30.2		20.6		--			9.6		31.7		20.3		11.4
Replacement parts annuity
and product approvals		18-30		39.2		30.0		--			9.2		42.9		30.9		12.0
Customer contracts and relationships		8-30		250.0		4.3		--			245.7		--		--		--
Covenants not to compete and
other identified intangibles		3-14		27.1		14.2		--			12.9		27.6		11.8		15.8
			$	496.6	$	119.9	$	(20.7	)	$	356.0	$	251.9	$	109.7	$	142.2

Subsequent to the HCS acquisition, the Company recorded a pre-tax impairment charge of $20.7 related to an intangible asset which was determined to have no future use.

Amortization expense of intangible assets was $15.0, $11.1 and $10.2 for the fiscal years ended December 31, 2008, 2007 and 2006, respectively.  Amortization expense associated with identified intangible assets is expected to be approximately $20 in each of the next five years. The future amortization amounts are estimates.  Actual future amortization expense may be different due to future acquisitions, impairments, changes in amortization periods, or other factors.

In accordance with SFAS 142, goodwill and indefinite life intangible assets are not amortized, but are subject to an annual impairment test.  During the year ended December 31, 2008, the Company performed its annual testing of impairment of goodwill.  Adverse equity market conditions caused a decrease in current market multiples, including the Company’s fiscal year end market capitalization at December 31, 2008.  The fair value of the reporting units for goodwill impairment testing were determined using valuation techniques based on estimates, judgments and assumptions management believes were appropriate in the circumstances.  The sum of the fair values of the reporting units were evaluated based on the Company’s market capitalization determined using average share prices within a reasonable period of time near December 31, 2008, plus an estimated control premium plus the fair value of its debt obligations.  The decrease in the current market multiples and the Company’s market capitalization resulted in a decline in the fair value of the reporting units as of December 31, 2008.  Accordingly, the Company recorded a pre-tax impairment charge related to goodwill of $369.3 million.

F-13

The changes in the carrying amount of goodwill for the fiscal years ended December 31, 2008 and 2007 are as follows:

	Consumables			Commerical			Business
	Management			Aircraft			Jet			Total
Balance as of December 31, 2006	$	150.6		$	218.0		$	88.6		$	457.2
Inter-segment transfers		(18.0	)		18.0			--			--
Effect of foreign currency translation		0.2			7.6			0.2			8.0
Purchase accounting adjustments		0.4			1.6			--			2.0
Balance as of December 31, 2007		133.2			245.2			88.8			467.2
Acquisition of HCS		574.1			--			--			574.1
Impairment charge		(290.7	)		(78.6	)		--			(369.3	)
Effect of foreign currency translation		(0.1	)		(8.1	)		(0.2	)		(8.4	)
Balance as of December 31, 2008	$	416.5		$	158.5		$	88.6		$	663.6

6. ACCRUED LIABILITIES

Accrued liabilities consist of the following:

	December 31,		December 31,
	2008		2007
Accrued salaries, vacation and related benefits	$	40.3	$	34.2
Accrued product warranties		22.4		20.6
Accrued interest		27.7		1.2
Deferred revenue		12.9		12.7
Deferred taxes		1.9		0.2
HCS acquisition accruals		42.5		--
Other accrued liabilities		81.5		45.8
	$	229.2	$	114.7

7. LONG-TERM DEBT

Long-term debt consists of the following:

	December 31,			December 31,
	2008			2007
Senior Notes	$	600.0		$	--
Bank credit facilities		522.4			150.0
Other long-term debt		0.8			1.9
		1,123.2			151.9
Less current portion of long-term debt		(6.0	)		(1.6	)
	$	1,117.2		$	150.3

Senior Notes

On July 1, 2008, the Company issued $600.0 aggregate principal amount of the 8½% Senior Notes due 2018 (the Senior Notes).  The Company used the net proceeds, together with borrowings under the Term Loan Facility described below and an issuance of its common stock to Honeywell to pay for the HCS acquisition, to refinance approximately $150.0 of indebtedness under its 2006 Senior Secured Credit Facility and to pay transaction fees and expenses.

F-14

Bank Credit Facilities

In connection with the closing of the HCS acquisition, the Company entered into a senior secured credit facility, dated as of July 28, 2008 (the Credit Agreement) consisting of (a) a five-year, $350.0 revolving credit facility (the Revolving Credit Facility) and (b) a six-year, $525.0 term loan facility (the Term Loan Facility).   Borrowings under the Revolving Credit Facility bear interest at an annual rate equal to the London interbank offered rate (LIBOR) plus 275 basis points or prime (as defined) plus 175 basis points. There were no amounts outstanding under the Revolving Credit Facility as of December 31, 2008.  Borrowings under the Term Loan Facility bear interest at an annual rate equal to LIBOR plus 275 basis points or prime (as defined) plus 175 basis points (5.82% at December 31, 2008).  $522.4 was outstanding under the Term Loan Facility as of December 31, 2008.  Letters of credit outstanding under the Credit Agreement aggregated $24.7 at December 31, 2008.

The Credit Agreement contains an interest coverage ratio financial covenant (as defined in the Credit Agreement) that currently must be maintained at a level greater than 2.25 to 1 through December 31, 2008 and 2.50 to 1, thereafter.  The Credit Agreement also contains a total leverage ratio covenant (as defined in the Credit Agreement) which limits net debt to a 4.25 to 1 multiple of EBITDA (as defined in the Credit Agreement) through December 31, 2008 and 4.00 to 1 thereafter.  The Credit Agreement is collateralized by substantially all of the Company’s assets and contains customary affirmative covenants, negative covenants and conditions precedent for borrowings, all of which were met as of December 31, 2008.

Maturities of long-term debt are as follows:

Fiscal Year Ending December 31,
2009	$	6.0
2010		5.3
2011		5.3
2012		5.3
2013		5.2
Thereafter		1,096.1
Total	$	1,123.2

Interest expense amounted to $49.7 for the year ended December 31, 2008, $23.5 for the year ended December 31, 2007 and $42.8 for the ended December 31, 2006.

8. COMMITMENTS, CONTINGENCIES AND OFF-BALANCE-SHEET ARRANGEMENTS

Lease Commitments – The Company finances its use of certain facilities and equipment under committed lease arrangements provided by various institutions.  Since the terms of these arrangements meet the accounting definition of operating lease arrangements, the aggregate sum of future minimum lease payments is not reflected on the consolidated balance sheets.  At December 31, 2008, future minimum lease payments under these arrangements approximated $148.0, of which $132.9 is related to long-term real estate leases.

F-15

Rent expense for the years ended December 31, 2008, 2007 and 2006 was $22.1, $20.4 and $16.8, respectively.  Future payments under operating leases with terms greater than one year as of December 31, 2008 are as follows:

Fiscal Year Ending December 31,
2009	$	24.2
2010		20.3
2011		16.9
2012		14.6
2013		13.0
Thereafter		59.0
Total	$	148.0

Litigation – The Company is a defendant in various legal actions arising in the normal course of business, the outcomes of which, in the opinion of management, neither individually nor in the aggregate are likely to result in a material adverse effect on the Company's consolidated financial statements.

Indemnities, Commitments and Guarantees – During its normal course of business, the Company has made certain indemnities, commitments and guarantees under which it may be required to make payments in relation to certain transactions.  These indemnities include non-infringement of patents and intellectual property indemnities to the Company's customers in connection with the delivery, design, manufacture and sale of its products, indemnities to various lessors in connection with facility leases for certain claims arising from such facility or lease and indemnities to other parties to certain acquisition agreements.  The duration of these indemnities, commitments and guarantees varies, and in certain cases, is indefinite.  Substantially all of these indemnities, commitments and guarantees provide for limitations on the maximum potential future payments the Company could be obligated to make. However, the Company is unable to estimate the maximum amount of liability related to its indemnities, commitments and guarantees because such liabilities are contingent upon the occurrence of events which are not reasonably determinable.  Management believes that any liability for these indemnities, commitments and guarantees would not be material to the accompanying condensed consolidated financial statements.  Accordingly, no significant amounts have been accrued for indemnities, commitments and guarantees.

Employment Agreements – The Company has employment and compensation agreements with three key officers of the Company.  Agreements for one of the officers provides for the officer to earn a minimum of $1.0 per year through a three-year period ending from any date after which it is measured, adjusted annually for changes in the consumer price index (as defined) or as determined by the Company's Board of Directors, as well as a retirement compensation equal to 1.5 times the base salary.

Two other agreements provide for the officers to each receive annual minimum compensation of $0.5 per year through a three-year period ending from any date after which it is measured, adjusted annually for changes in the consumer price index (as defined) or as determined by the Company's Board of Directors, as well as a retirement compensation equal to 50% of each officer’s average three years' annual salary (as defined).

Retirement compensation has been accrued as provided for under the above-mentioned employment agreements.  Through December 31, 2008, the Company fully funded these and other retirement compensation obligations, through grantor trusts on behalf of the individuals. In addition, the Company has employment agreements with certain other key members of management expiring on various dates through the year 2009.  The Company's employment agreements generally provide for certain protections in the event of a change of control.  These protections generally include the payment of severance and related benefits under certain circumstances in the event of a change of control, and for the Company to reimburse such officers for the amount of any excise taxes associated with such benefits.

F-16

9. INCOME TAXES

The components of earnings (loss) before incomes taxes were:

	Fiscal Year Ended December 31,
	2008			2007		2006
Earnings (loss) before income taxes
United States	$	(119.4	)	$	127.3	$	43.0
Foreign		31.6			87.8		47.0
Earnings (loss) before income taxes	$	(87.8	)	$	215.1	$	90.0

Income tax expense consists of the following:

	Fiscal Year Ended December 31,
	2008			2007		2006
Current:
Federal	$	1.9		$	2.1	$	--
State		2.9			--		--
Foreign		24.1			7.2		5.6
		28.9			9.3		5.6
Deferred:
Federal		(15.5	)		34.7		16.4
State		(4.4	)		5.1		2.9
Foreign		2.6			18.7		(20.5	)
		(17.3	)		58.5		(1.2	)
Total income tax expense	$	11.6		$	67.8	$	4.4

The difference between income tax expense and the amount computed by applying the statutory U.S. federal income tax rate (35%) to the pre-tax earnings consists of the following:

	Fiscal Year Ended December 31,
	2008			2007			2006
Statutory federal income tax expense	$	(30.7	)	$	75.3		$	31.5
U.S. state income taxes		(1.2	)		5.9			2.9
Dividend income from foreign affiliate		--			2.5			0.4
Foreign tax rate differential		(17.9	)		(6.3	)		(1.2	)
Non-deductible charges/losses and other		10.2			3.9			2.4
Research and development credit		(1.9	)		(5.3	)		(4.2	)
Goodwill and intangible asset impairment charge		54.6			--			--
Extra-territorial income exclusion		(1.5	)		(8.2	)		--
Change in valuation allowance		--			--			(27.4	)
	$	11.6		$	67.8		$	4.4

During 2006 the Company reversed $27.4 of its valuation allowance on its U.S. and U.K. deferred tax assets as a result of improved performance and outlook for its operations and expected reductions in interest costs resulting from note redemptions.

F-17

The tax effects of temporary differences and carryforwards that give rise to deferred income tax assets and liabilities consist of the following:

	December 31,			December 31,
	2008			2007
Deferred tax assets:
Inventory reserves	$	11.8		$	10.2
Warranty reserves		6.4			5.0
Accrued liabilities		12.1			7.9
Net operating loss carryforward		24.4			58.6
Federal capital loss carryforward		--			7.3
Research and development
credit carry forward		22.4			19.2
Alternative minimum
tax credit carryforward		3.9			2.0
Intangible assets		22.7			--
Depreciation		--			1.3
HCS purchase accounting
book to tax differences		12.7			--
Other		6.7			6.2
	$	123.1		$	117.7
Deferred tax liabilities:
Acquisition accruals	$	(13.7	)	$	(13.4	)
Book to tax revenue differences		(30.8	)		--
Intangible assets		--			(61.5	)
Depreciation		(3.1	)		--
Software development costs		(4.6	)		(5.7	)
		(52.2	)		(80.6	)
Net deferred tax asset before valuation
allowance		70.9			37.1
Valuation allowance		(6.9	)		(9.8	)
Net deferred tax asset	$	64.0		$	27.3

The Company maintained a valuation allowance of $6.9 as of December 31, 2008 primarily related to foreign tax credits and foreign net operating losses.  During 2008 the Company’s valuation allowance decreased due to the expiration of the federal capital loss carryforward.

As of December 31, 2008, the Company had federal, state and foreign net operating loss carryforwards of approximately $123.0, $83.0 and $11.0, respectively.  The federal and state net operating loss carryforwards begin to expire in 2012 and 2009, respectively.  As of December 31, 2008, the Company had federal and state research and development tax credit carryforwards of $22.4 which expire through 2023.

The Company has not provided for any residual U.S. income taxes on the approximately $125.4 of earnings from its foreign subsidiaries because such earnings are intended to be indefinitely reinvested.  Such residual U.S. income taxes, if provided for, would not be material.

Through 2008, the Company recognized cumulative tax deductions of $75.2 related to stock option exercises and vested restricted shares.  In accordance with the Company’s methodology for determining when these deductions are deemed realized under SFAS No. 123(R), the Company assumes that it utilizes its net operating loss carryforwards to reduce its taxes payable rather than these deductions.  Pursuant to SFAS 123(R), these deductions are not deemed realized until they reduce taxes payable.  The Company expects to record a credit to additional paid-in capital of $29.2 to the extent deductions of $75.2 are treated as reducing taxes payable in the future.

F-18

The Company adopted the provisions of FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes,” on January 1, 2007.  Upon the adoption, the liability for unrecognized tax benefits at January 1, 2007 was $4.9, which was accounted for as a $2.3 increase to accumulated deficit, a $2.3 increase in long-term deferred tax assets, and a $0.3 reduction in income taxes payable.  This liability, if recognized, would affect the Company’s effective tax rate.  It is reasonably possible that the amount of liability for unrecognized tax benefits will change in the next twelve months; however, the Company does not expect the change to have a material impact on the Company’s consolidated financial statements.

A reconciliation of the beginning and ending amounts of gross unrecognized tax benefit are as follows:

	2008			2007
Balance, beginning of the period	$	11.8		$	7.4
Additions for current year tax positions		3.1			1.6
Additions for tax positions of prior years		0.7			2.5
Currency fluctuations		(0.5	)		0.3
Balance, end of the period	$	15.1		$	11.8

The difference between the gross uncertain tax position of $15.1 and the liability for unrecognized tax benefits of $12.5 is due to the netting of certain items when calculating the liability for unrecognized tax benefits.

The Company is currently undergoing a U.S. federal income tax examination as well as an examination in one of its non-U.S. jurisdictions.  With minor exceptions, the Company is currently open to audit by the tax authorities for the four tax years ending December 31, 2008.

The Company classifies interest and penalties related to income tax as income tax expense.  The amount included in the Company’s liability for unrecognized tax benefits for interest and penalties as of the date of adoption was under $1.0 and this amount did not materially change as of December 31, 2008.

10. EMPLOYEE RETIREMENT PLANS

The Company sponsors and contributes to a qualified, defined contribution savings and investment plan, covering substantially all U.S. employees.  The BE Aerospace Savings and Investment Plan was established pursuant to Section 401(k) of the Internal Revenue Code.  Under the terms of this plan, covered employees may contribute up to 100% of their pay, limited to certain statutory maximum contributions for 2008.  Participants are vested in matching contributions immediately and the matching percentage is 100% of the first 3% of employee contributions and 50% on the next 2% of employee contributions.  Total expense for the plan was $6.9, $5.6 and $3.9 for the calendar years ended December 31, 2008, 2007 and 2006, respectively.

In addition, the Company contributes to the BE Aerospace, Inc. Hourly Tax-Sheltered Retirement Plan. This plan was established pursuant to Section 401(k) of the Internal Revenue Code and covers certain U.S. union employees.  Under terms of this plan, covered employees may contribute from 1% to 20% of their compensation, limited to certain statutory maximum contributions for 2008.  The Company matches 50% of employee contributions, up to 8% of a participant’s compensation.  Participants become fully vested in the Company’s contributions after six years of service with the Company.  Total expense for the plan was $0.3, $0.2 and $0.3 for the calendar years ended December 31, 2008, 2007 and 2006, respectively.

The Company also has two defined benefit plans which were adopted by the Company when the related subsidiary companies were acquired.  Under terms of these plans participants are entitled to certain defined benefits upon retirement.  283 employees were covered by these plans as of December 31, 2008.  The Company’s funding contribution to these plans was $0.1, $0.5 and $0.2 for the calendar years ended December 31, 2008, 2007 and 2006, respectively.

In addition, the Company and its subsidiaries participate in government-sponsored programs in certain European countries.  The Company funds these plans based on legal requirements, tax considerations, local practices and investment opportunities.

F-19

11. STOCKHOLDERS' EQUITY

Earnings (Loss) Per Share - Basic net (loss) earnings per common share is computed using the weighted average of common shares outstanding during the year.  Diluted net (loss) earnings per common share reflects the potential dilution from assumed conversion of all dilutive securities such as stock options and unvested restricted stock using the treasury stock method. When the effects of the outstanding stock options are anti-dilutive, they are not included in the calculation of diluted earnings per common share. For the years ended December 31, 2008, 2007 and 2006, anti-dilutive securities totaling approximately 0.9, 0.1, and 0.3 million shares, respectively, were excluded from the determination of diluted earnings per common share because the effect would have been antidultive.

The following table sets forth the computation of basic and diluted net earnings per share for the fiscal years ended December 31, 2008, 2007 and 2006:

	Fiscal Year Ended December 31,
	2008			2007		2006
Numerator: net (loss) earnings	$	(99.4	)	$	147.3	$	85.6
Denominator:
Denominator for basic earnings per share -		94.3			88.1		77.1
Weighted average shares (in millions)
Effect of dilutive securities -
Dilutive securities		--			0.7		0.9
Denominator for diluted earnings per share -
Adjusted weighted average shares (in millions)		94.3			88.8		78.0
Basic net (loss) earnings per share	$	(1.05	)	$	1.67	$	1.11
Diluted net (loss) earnings per share	$	(1.05	)	$	1.66	$	1.10

Long Term Incentive Plan - - The Company has a Long Term Incentive Plan (LTIP) under which the Company’s Compensation Committee may grant stock options, stock appreciation rights, restricted stock, restricted stock units or other forms of equity based or equity related awards.  The LTIP replaced the Company’s 2001 Stock Option Plan, the 1996 Stock Option Plan, the United Kingdom 1992 Employee Share Option Scheme and the Company’s Amended and Restated 1989 Stock Option Plan (collectively, the “Prior Plans”).  24,933 shares were available for grant under the LTIP as of December 31, 2008.

During 2007 and 2008, the Company granted restricted stock and restricted stock units to certain members of the Company’s Board of Directors and management.  Restricted stock grants vest over periods ranging from two to four years and are granted at the discretion of the Compensation Committee of the Board of Directors.  Compensation cost is recorded on a straight-line basis over the vesting term of the shares based on the grant date value using the closing trading price.  Share based compensation of $15.1 and $10.3 was recorded during 2008 and 2007, respectively.  Unrecognized compensation cost related to these grants was $51.5 and $41.0 at December 31, 2008, and December 31, 2007, respectively.

 The following table summarizes shares of restricted stock that were granted, forfeited and outstanding:

	December 31, 2008							December 31, 2007
						Weighted							Weighted
				Weighted		Average					Weighted		Average
				Average		Remaining					Average		Remaining
	Shares			Grant Date		Vesting Period		Shares			Grant Date		Vesting Period
	(in thousands)			Fair Value		( in years)		(in thousands)			Fair Value		( in years)
Outstanding, beginning of
period		1,458		$	31.18		3.1		1,423		$	26.13		3.7
Shares granted		1,764			11.85		--		454			42.43		--
Shares vested		(452	)		30.09		--		(355	)		26.14		--
Shares forfeited		(43	)		33.17		--		(64	)		27.30		--
Outstanding, end of period		2,727			18.82		3.1		1,458			31.18		3.1

During the year ended December 31, 2008, the Company granted 909,773 restricted stock units of which 1,843 units were forfeited during the year. As of December 31, 2008, the weighted average remaining vesting period for these units was 3.89 years.

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No stock options were granted during the three years ended December 31, 2008 and no related stock compensation was recognized as the Company accelerated the vesting of all such awards in 2005.  Outstanding stock options at December 31, 2008, 2007 and 2006 totaled approximately 184,000, 245,000, and 1,170,000, all of which were exercisable. During the years ended December 31, 2008, 2007 and 2006, 0.1, 0.9 and 3.6 million stock options were exercised with an aggregate intrinsic value of $0.4, $20.8 and $62.6 determined as of the date of option exercise.  The aggregate intrinsic value of outstanding options as of December 31, 2008 was $0.2.

12. EMPLOYEE STOCK PURCHASE PLAN

The Company has established a qualified Employee Stock Purchase Plan, the terms of which allow for qualified employees (as defined in the Plan) to participate in the purchase of designated shares of the Company's common stock at a price equal to 85% of the closing price at the end of each semi-annual stock purchase period.  The Company issued approximately 286,000, 67,000 and 110,000 shares of common stock during the fiscal years ended December 31, 2008, 2007 and 2006, respectively, pursuant to this plan at a weighted average price per share of $9.26, $39.46, and $20.51, respectively.

13. SEGMENT REPORTING

The Company is organized based on the products and services it offers.  Following the acquisition of HCS described in Note 2, the Company revised its reportable segments to reflect three reportable segments which align with the Company’s post-acquisition organizational structure: consumables management, commercial aircraft and business jet. Each segment regularly reports its results of operations and makes requests for capital expenditures and acquisition funding to the Company’s chief operational decision-making group.  This group is presently comprised of the Chairman and Chief Executive Officer, the President and Chief Operating Officer, and the Senior Vice President and Chief Financial Officer.  Each operating segment has separate management teams and infrastructures dedicated to providing a full range of products and services to their commercial, business jet, military, MRO, aircraft leasing and aircraft manufacturing customers. Segment information for prior periods has been presented on a consistent basis.  

The following table presents net sales and other financial information by business segment:

	Fiscal Year Ended December 31, 2008
	Consumables			Commercial		Business
	Management			Aircraft		Jet		Consolidated
Net sales	$	697.3		$	1,138.7	$	274.0	$	2,110.0
Operating (loss) earnings (1)(2)		(151.7	)		78.2		37.3		(36.2	)
Total assets(3)		1,830.9			827.6		271.6		2,930.1
Goodwill		416.5			158.5		88.6		663.6
Capital expenditures		6.9			20.7		4.1		31.7
Depreciation and amortization		10.1			24.7		5.9		40.7

	Fiscal Year Ended December 31, 2007
	Consumables		Commercial		Business
	Management		Aircraft		Jet		Consolidated
Net sales	$	386.5	$	1,098.1	$	193.1	$	1,677.7
Operating earnings (2)		85.5		141.8		19.7		247.0
Total assets (3)		575.2		940.4		256.4		1,772.0
Goodwill		133.2		245.2		88.8		467.2
Capital expenditures		4.4		22.7		5.0		32.1
Depreciation and amortization		4.3		25.2		5.5		35.0

F-21

	Fiscal Year Ended December 31, 2006
	Consumables		Commercial		Business
	Management		Aircraft		Jet		Consolidated
Net sales	$	251.5	$	729.2	$	147.5	$	1,128.2
Operating earnings (2)		50.4		88.5		9.4		148.3
Total assets (3)		492.9		753.2		251.6		1,497.7
Goodwill		150.6		218.0		88.6		457.2
Capital expenditures		3.3		15.7		5.1		24.1
Depreciation and amortization		3.5		21.7		4.2		29.4

(1)  The 2008 information includes goodwill and intangible asset impairment charge of $310.2 at consumables management segment and $79.8 at commercial aircraft segment.  Excluding such charges, operating earnings for 2008 would have been $158.5 at consumables management segment and $158.0 at commercial aircraft segment.

(2)  Operating earnings (loss) includes an allocation of corporate IT costs, employee benefits and general and administrative costs based on the proportion of each segments’ systems users, number of employees and sales, respectively.

(3)  Corporate assets (including cash and cash equivalents) of $256.7, $139.2 and $117.7 at December 31, 2008, 2007 and 2006, respectively, have been allocated to the above segments based on each segments respective percentage of total assets.  During 2007 certain operations with total assets of approximately $31.5 were transferred from consumable management to commercial aircraft segments.

Net sales for these business segments for the fiscal years ended December 31, 2008, 2007 and 2006 are presented below:

	Fiscal Year Ended December 31,
	2008					2007					2006
	Net		% of			Net		% of			Net		% of
	Sales		Net Sales			Sales		Net Sales			Sales		Net Sales
Consumables management	$	697.3		33.0	%	$	386.5		23.0	%	$	251.5		22.3	%
Commercial aircraft		1,138.7		54.0	%		1,098.1		65.5	%		729.2		64.6	%
Business jet		274.0		13.0	%		193.1		11.5	%		147.5		13.1	%
Net sales	$	2,110.0		100.0	%	$	1,677.7		100.0	%	$	1,128.2		100.0	%

Geographic Information

The Company operated principally in three geographic areas, the United States, Europe (primarily the United Kingdom) and emerging markets, i.e., Asia, Pacific Rim, Middle East, etc. during the fiscal years ended December 31, 2008, 2007 and 2006.  There were no significant transfers between geographic areas during these periods.

The following table presents net sales and operating earnings based on the originating location for the fiscal years ended December 31, 2008, 2007 and 2006. Additionally, it presents all identifiable assets related to the operations in each geographic area as of December 31, 2008 and 2007:

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	Fiscal Year Ended December 31,
	2008			2007		2006
Net sales:
Domestic	$	1,428.8		$	1,036.6	$	732.9
Foreign		681.2			641.1		395.3
	$	2,110.0		$	1,677.7	$	1,128.2
Operating earnings (loss):
Domestic	$	(129.7	)	$	159.1	$	100.7
Foreign		93.5			87.9		47.6
	$	(36.2	)	$	247.0	$	148.3
	December 31,
Identifiable assets:	2008			2007
Domestic	$	2,386.9		$	1,306.6
Foreign		543.2			465.4
	$	2,930.1		$	1,772.0

Net sales by geographic area, (based on destination), for the fiscal years ended December 31, 2008, December 31, 2007, and 2006 were as follows:

	Fiscal Year Ended December 31,
	2008					2007					2006
	Net		% of			Net		% of			Net		% of
	Sales		Net Sales			Sales		Net Sales			Sales		Net Sales
U.S.	$	994.4		47.1	%	$	749.5		44.7	%	$	483.0		42.8	%
Europe		508.9		24.1	%		468.0		27.9	%		331.5		29.4	%
Asia, Pacific Rim,
Middle East and other		606.7		28.8	%		460.2		27.4	%		313.7		27.8	%
	$	2,110.0		100.0	%	$	1,677.7		100.0	%	$	1,128.2		100.0	%

Export sales from the United States to customers in foreign countries amounted to $566.9, $437.1 and $307.6 in the fiscal years ended December 31, 2008, 2007 and 2006, respectively.

14. FAIR VALUE INFORMATION

The following disclosure of the estimated fair value of financial instruments at December 31, 2008 and 2007 is made in accordance with the requirements of SFAS No. 107, "Disclosures about Fair Value of Financial Instruments.”  The estimated fair value amounts have been determined by the Company using available market information and appropriate valuation methodologies; however, considerable judgment is required in interpreting market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.

The carrying amounts of cash and cash equivalents, accounts receivable-trade, and accounts payable and term debt are a reasonable estimate of their fair values as interest is based upon floating market rates. The fair value of the Company’s 8½% Senior Notes, based on market prices for publically traded debt, was $540.0 as of December 31, 2008.

The fair value information presented herein is based on pertinent information available to management at December 31, 2008 and December 31, 2007, respectively. Although management is not aware of any factors that would significantly affect the estimated fair value amounts, such amounts have not been comprehensively revalued for purposes of these consolidated financial statements since those dates, and current estimates of fair value may differ significantly from the amounts presented herein.

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15.           SELECTED QUARTERLY DATA (Unaudited)

Summarized quarterly financial data for the fiscal years ended December 31, 2008 and December 31, 2007 are as follows:

	Fiscal Year Ended December 31, 2008
	First		Second		Third		Fourth
	Quarter		Quarter		Quarter		Quarter
Net sales	$	473.2	$	522.2	$	587.8	$	526.8
Gross profit		169.1		179.8		193.4		181.2
Net earnings (loss) (1)		48.5		53.9		51.8		(253.6	)   (2)
Basic net earnings (loss) per share (1)		0.53		0.59		0.54		(2.59	)   (2)
Diluted net earnings (loss) per share (1)		0.53		0.59		0.54		(2.59	)   (2)

	Fiscal Year Ended December 31, 2007
	First		Second		Third		Fourth
	Quarter		Quarter		Quarter		Quarter
Net sales	$	387.8	$	398.2	$	428.2	$	463.5
Gross profit		134.3		140.6		146.7		148.5
Net earnings		32.1		28.4		44.5		42.3
Basic net earnings per share (1)		0.41		0.31		0.49		0.46
Diluted net earnings per share (1)		0.40		0.31		0.48		0.46

(1) Net earnings (loss) per share are computed individually for each quarter presented.  Therefore, the sum of the quarterly net earnings per share may not necessarily equal the total for the year.

(2) The fourth quarter information includes $390.0 of pre-tax goodwill and intangible asset impairment charges, ($300.0 on an after tax basis).  Excluding such charges, operating earnings, net earnings, basic net earnings per share and diluted net earnings per share would have been $90.8, $46.4, $0.47 and $0.47, respectively.

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SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

FOR THE FISCAL YEARS ENDED DECEMBER 31, 2008, 2007 AND 2006

(In millions)

	Balance
	At										Balance
	Beginning								Write-		At End
	Of								Offs/		Of
	Period		Expenses			Other			Disposals		Period
Deducted From Assets:
Allowance for doubtful accounts:
Fiscal year ended December 31, 2008	$	4.5	$	8.7		$	(0.3	)	$	0.7	$	12.2
Fiscal year ended December 31, 2007		4.7		0.6			--			0.8		4.5
Fiscal year ended December 31, 2006		2.9		1.4			1.6			1.2		4.7
Reserve for obsolete inventories:
Fiscal year ended December 31, 2008		32.2		11.0			--			2.2		41.0
Fiscal year ended December 31, 2007		29.1		8.1			--			5.0		32.2
Fiscal year ended December 31, 2006		27.1		3.3			2.6			3.9		29.1
Deferred tax asset valuation allowance:
Fiscal year ended December 31, 2008		9.8		--			(2.9	)		--		6.9
Fiscal year ended December 31, 2007		15.5		--			(5.7	)		--		9.8
Fiscal year ended December 31, 2006		40.5		(27.4	)		2.4			--		15.5

F-25

EX-10.7

EXHIBIT 10.7

EXECUTION COPY

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Agreement (this “Agreement”) dated as of December 31, 2008, is between BE Aerospace, Inc., a Delaware corporation (the “Company”), and Amin J. Khoury (“Executive”).

WHEREAS, Executive and the Company entered into an amended and restated Employment Agreement dated as of April 27, 2006 (the “Employment Agreement”); and

WHEREAS,  Executive, having provided services to the Company since August 1, 1987, agrees to continue to provide services for an additional period as provided herein, and the Company wishes to procure such services; and

WHEREAS, Executive and the Company wish to further amend and restate the Employment Agreement in its entirety in the manner set forth herein.

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth, the parties agree as follows:

1.   REFERENCE TO EMPLOYMENT AGREEMENT.

The Employment Agreement is hereby restated, superseded and replaced in its entirety by this Agreement.

2.   ARRANGEMENT.

Executive shall provide to the Company, and the Company shall accept from Executive, the services set forth in Section 4.2 below, subject to the terms and conditions set forth in this Agreement.

3.   TERM.

Executive shall provide to the Company services hereunder during the term of this Agreement which, unless otherwise terminated pursuant to the provisions of Article 7 hereof, shall be the period ending three (3) years from any date as of which the term is being determined (the “Employment Term”).  The date on which the Employment Term ends, including any extensions thereof, is sometimes hereinafter referred to as the “Expiration Date.”  Pursuant to, and in accordance with, Section 7.7 hereof, the Company is required to engage Executive to render consulting services to the Company after Executive ceases to be employed by the Company.

4.   CAPACITY, SERVICES AND PERFORMANCE.

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 time determine.

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.

5.   COMPENSATION AND BENEFITS.

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.

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.

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.

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.

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.

6.   PROPRIETARY RIGHTS AND NON-COMPETITION.

Executive acknowledges that the Company is engaged in a continuous program of research, development and production in connection with its business, present and future, and hereby covenants as follows:

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.

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.

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.

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 Proprietary Information.

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.

6.6   Acts to Secure Proprietary Rights.

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.

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.

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.

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 specific performance.

7.   TERMINATION AND CHANGE OF CONTROL.

7.1   Termination Date; Termination or Resignation other than Contemporaneously with a Change of Control.

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.

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.

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.

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 Termination Date.

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.

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.

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.

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;

(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;

(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 Termination Date;

(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;

(v)    the Company shall continue to provide medical, dental and health benefits as provided in Section 5.3 hereof; and

(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.

Any dispute between the Compensation Committee and Executive with respect to Executive’s Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the Compensation Committee and Executive or his personal representative, whose decision shall be binding on all parties.

7.4   Change of Control; Definitions.

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;

(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

(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.

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:

 (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;

(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;

(iii)    continue to provide medical, dental and health benefits as provided in Section 5.3 hereof;

(iv)    engage Executive to render consulting services to the Company in accordance with Section 7.7 hereof; and

(v)    pay to Executive the Severance Payment pursuant to Section 7.5 hereof.

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For purposes of this Agreement, a termination by the Company will be deemed to be made “contemporaneously” with a Change of Control if (A) it is made pursuant to at least 120 days’ prior written notice from the Company to Executive and (B) it is effective as of the Change of Control Date.

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.

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 or bankruptcy.

7.4.5  Definitions.

(i)    For purposes of this Agreement, a “Change of Control” means:

(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;

(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

(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:

(1)    A shareholder of the Company in exchange for or with respect to its stock;

(2)    Any Majority Owned Entity, as defined below, of the Company;

(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.

(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 the Company.

(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.

(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.

(v)    For purposes of this Agreement, “Good Reason” means:

(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;

(B)    Any change in Executive’s responsibilities, positions, duties, status, title or reporting relationships;

(C)    Executive ceasing to be the Chief Executive Officer of a publicly traded company pursuant to this Agreement;

(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

(E)    A material breach by the Company of any term of this Agreement;

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provided that Executive has given notice thereof to the Company and the Company has not cured the Good Reason within thirty (30) days after receiving such notice.

7.5   Severance Payment.

If Executive’s employment with the Company is terminated for any reason, other than due to (i) Executive’s death pursuant to Section 7.2 hereof, or (ii) Executive’s Incapacity pursuant to Section 7.3 hereof, then on the Termination Date, the Company shall pay to Executive a lump-sum amount equal to the Salary in effect on the Termination Date, which lump-sum shall not be pro-rated (the “Severance Payment”).  The obligations of the Company pursuant to this Section 7.5 are in addition to any other obligations under Section 7 hereof.

7.6   Retirement Compensation.

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.

7.6.2  Payment of Retirement Compensation.

(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.

(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.

(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.

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-Up Payment.

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 the Company,

(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;

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.  Without limitation on the foregoing provisions of this Section 7.8.3, the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Executive to pay such claim and sue for a refund, to the extent permitted by law, the Company shall advance the amount of such payment to Executive, on an interest-free basis and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount.  Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

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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.

8.   WITHHOLDING.

Without limiting the effect of Sections 7.8 and 12, all payments made by the Company under this Agreement shall be reduced by any amounts in respect of income, social security, FICA and other similar taxes at the then-prevailing rates required to be withheld by the Company under applicable law.

9.   INDEMNIFICATION.

To the maximum extent permitted under Floridalaw as from time to time in effect, and subject to any mandatory exclusion of indemnification under Delaware law applicable to the indemnification of Executive under this Section 9, the Company hereby agrees to indemnify Executive and hold him harmless from, against and in respect of any and all damages, deficiencies, actions, suits, proceedings, demands, assessments, judgments, claims, losses, costs, expenses, obligations and liabilities arising from or related to the performance of the services under this Agreement by  Executive.

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10.   LEGAL FEES.

In the event of a dispute between the parties with respect to any payments due hereunder in connection with a Change of Control, the Company will pay the costs of any legal fees and related expenses incurred in connection with such dispute for a period of up to twenty (20) years.  Such costs and expenses shall be advanced to Executive currently as reasonably required to continue such action or proceeding.

11.   UNFUNDED STATUS.

This Agreement is intended to constitute an unfunded plan for incentive compensation.  Except with respect to the Retirement Compensation, nothing contained herein shall give Executive any rights that are greater than those of a general unsecured creditor of the Company.  In its sole discretion, the Compensation Committee may authorize the creation of trusts, acquisition of life insurance policies or other arrangements to meet the obligations created under this Agreement.

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 the Code.

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.

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.

Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that  Executive or the Company may have hereunder shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

14.   SEVERABILITY.

If any part of this Agreement is found to be invalid or unenforceable, that part will be deemed amended to achieve as nearly as possible the same economic effect as the original provision, and the remainder of this Agreement will remain in full force and effect.

15.   NOTICES.

Any notice or other communication in connection with this Agreement shall be deemed to be delivered if in writing, addressed as provided below (or to such other Person or address as to which either party may notify the other in accordance with this Section 15) and actually delivered at said address:

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If to Executive, to him at:

Amin J. Khoury

149 South Beach Road

Hobe Sound, FL  33455

If to the Company, to it at:

BE Aerospace, Inc.

1400 Corporate Center Drive

Wellington, FL  33414

Attention:  General Counsel

16.   SURVIVAL.

The provisions of Sections 5.3 and 6 through 17 inclusive hereof shall each survive any termination or expiration of this Agreement.

17.   MISCELLANEOUS.

This Agreement, including the attached exhibits, constitutes the entire understanding of the parties with respect to the subject matter hereof, and supersedes all prior and contemporaneous understandings and agreements, whether oral or written, regarding such subject matter.  This Agreement may be amended or modified only by a written instrument signed by Executive and by a duly authorized representative of the Company.  This Agreement may be executed in any number of counterparts, which together shall constitute one and the same instrument. Except as otherwise provided in this Agreement,this Agreement shall be governed by and construed in accordance with the laws (other than the conflicts of law rules) of the State of Florida.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and permitted assigns.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have hereunto set their hands, as of the date first above written.

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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Exhibit A

Death Benefit Agreement

A-1

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Exhibit B

Consulting Terms

B-1

EX-10.8

EXHIBIT 10.8

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AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement") is made as of this 31st day of December, 2008, by and between BE Aerospace, Inc., a Delaware corporation (the "Company") and Michael B. Baughan ("Executive").

RECITALS

WHEREAS, Executive and the Company are parties to an amended and restated employment agreement, dated as of April 27, 2007 (the "Employment Agreement"), pursuant to which Executive serves as the Company's President and Chief Operating Officer;

WHEREAS, Executive, having provided services to the Company since May 28, 1999, agrees to continue to provide services for an additional period as provided herein and the Company wishes to procure such services; and

WHEREAS, Executive and the Company wish to amend and restate the Employment Agreement in its entirety.

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth, the parties agree as follows:

1.Reference to Prior Employment Agreement.  The Employment Agreement is hereby restated, superseded and replaced in its entirety by this Agreement.

2.Employment.  Unless otherwise terminated pursuant to the provisions of Section 5 hereof, Executive shall provide to the Company services hereunder during the term of his employment under this Agreement, which shall be the period ending three (3) years from any date as of which the term is being determined (the "Employment Term").  The date on which the Employment Term ends, including any extensions thereof, is sometimes hereinafter referred to as the "Expiration Date."

3.Position and Duties.  Executive shall serve the Company in the capacity of President and Chief Operating Officer, or in such other positions as the Chief Executive Officer of the Company, his designee or the Board of Directors of the Company (the "Board") may designate from time to time, and shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as the Chief Executive Officer of the Company, his designee or the Board shall determine in its sole discretion.  Executive shall report directly to the Chief Executive Officer of the Company.  Executive shall perform and discharge, faithfully, diligently and to the best of his ability, such duties and responsibilities.  Executive shall devote substantially all of his working time and efforts to the business and affairs of the Company.  Consistent with the Company's practices, Executive's performance will be reviewed by the Chief Executive Officer on at least an annual basis.

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4.Compensation.

(a)Salary.  During the Employment Term, Executive shall receive a salary (the "Salary") payable at the rate of five hundred thirty four thousand five hundred and eight dollars ($534,508) per annum.  Such rate shall be subject to adjustment from time to time by the Compensation Committee of the Board (the "Compensation Committee"); provided, however, that it shall at no time be adjusted below the Salary for the preceding year.  On July 1st of each year during the Employment Term, the Salary shall be increased by an amount not less than the amount determined by applying to the Salary then in effect 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 twelve (12) month period (July through June) immediately preceding such July 1st.  If the Index is no longer issued, the Compensation Committee and Executive shall agree upon a substitute adjustment index issued by such agency that 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, less all required deductions.

(b)Incentive Bonus.  During the Employment Term, Executive will be eligible to receive an incentive bonus (the "Bonus") of up to 120% of the Salary for each fiscal year or portion thereof during which Executive has been employed hereunder as determined by the Compensation Committee at the end of the applicable fiscal year in its sole discretion.  The 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 the Bonus.

(c)Expenses.  Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him during the Employment Term on behalf of the Company in accordance with the Company's policies in effect from time to time.

(d)Benefits.  During the Employment Term, Executive shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement, accident, and other employee benefit plans, programs and arrangements made generally available by the Company to its executives, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements.  In accordance with the Company policies as in effect from time to time, Executive shall also be entitled to paid vacation in any fiscal year during the Employment Term as well as all paid holidays given by the Company to its employees.  In addition, upon Executive's Separation from Service (as defined in Section 15(c)) due to his death, Incapacity (as defined in Section 5(c)) or contemporaneously with a Change of Control (as defined in Section 5(f)), Executive and his spouse and eligible dependents shall be entitled, on similar terms and conditions as active executives, from the Termination Date until the second (2nd) anniversary of the Termination Date to participate in all medical, dental and health benefit plans available to the Company's executive officers from time to time.    To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A ("Section 409A") of the Internal Revenue Code of 1986, as amended and the rules, regulations and guidance promulgated thereunder (the "Code"), the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company's practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

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(e)Automobile.  During the Employment Term, Executive shall be furnished with an automobile allowance (an "Automobile Allowance") of one thousand one hundred dollars ($1,100) per month, payable in accordance with Company policy; but in no event later than March 15th of the year following the year in which the Automobile Allowance will accrue.

(f)Equity Awards.  During the employment term, Executive shall be eligible to participate in the Company's equity award program with the timing and amount of equity awards determined by the Compensation Committee in its sole discretion.  Notwithstanding any provision in the applicable award documents, Executive's equity awards will immediately become fully vested and unrestricted and settle within thirty (30) days following (i) the Termination Date (as defined in Section 5(a)) in the event of Executive's Separation from Service by the Company without Cause or due to Executive's death or Incapacity or (ii) a Change of Control (as defined in Section 5(f)).

5.Termination and Compensation Thereon.

(a)Termination.  Subject to the terms and conditions of this Agreement, Executive's employment pursuant to this Agreement may be terminated either by Executive or the Company at any time and for any reason.  The term "Termination Date"shall mean if Executive's employment is terminated (i) by his death, the date of his death or (ii) for any other reason, the date on which Executive incurs a Separation from Service (as defined in Section 15(c) below).

(b)Death.

(i)Executive's employment hereunder shall terminate upon his death.  In such event, the Company shall, within thirty (30) days following the Termination Date, 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 (A) the Salary (at the rate in effect as of the Termination Date) that would have been due to Executive had this Agreement been in effect and he remained employed from the Termination Date until the Expiration Date, (B) any accrued and unpaid Salary and benefits through the Termination Date, and (C) any bonuses declared to be payable to Executive for any fiscal periods of the Company ending prior to his date of death;

(ii)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 $1.5 million in accordance with the Death Benefit Agreement attached as Exhibit A hereto;

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(iii)Following Executive's death, his spouse and eligible dependents shall be entitled to continuation of medical, dental and health benefits for two (2) years pursuant to Section 4(d) hereof;

(iv)Upon Executive's death, the Retirement Compensation shall vest in full and the Company shall, within thirty (30) days following the Termination Date, 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 the entire remaining unpaid balance of the Retirement Compensation accrued through Termination Date; and

(v)Upon Executive's death, 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, 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.

(c)Incapacity.  If, in the reasonable judgment of the Compensation Committee, as a result of Executive's incapacity due to physical or mental illness, Executive shall have been absent from his full-time duties as described hereunder for the entire period of twenty-nine (29) consecutive months ("Incapacity"), Executive's employment shall terminate at the end of the twenty-nine (29)-month period.  Any dispute between the Board and Executive with respect to Executive's Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the Board and Executive, whose decision shall be binding on all parties.  In addition, in the event of a termination for Incapacity:

(i)the Company shall pay to Executive within thirty (30) days following 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 declared to be payable to Executive for any fiscal periods ending prior to the Termination Date;

(ii)the Company shall pay to Executive within thirty (30) days following the Termination Date a lump-sum amount equal to the Salary and Automobile Allowance (at the rates in effect as of the Termination Date) that he would have received had he remained employed during the period from the Termination Date through the Expiration Date;

(iii)the Retirement Compensation shall vest in full and the Company shall pay to Executive a lump-sum amount equal to the entire remaining unpaid balance of the Retirement Compensation accrued through such Termination Date;

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(iv)the Company shall provide Executive and his spouse and eligible dependents with continuation of medical, dental and health benefits for two (2) years pursuant to Section 4(d)hereof; and

(v)upon a termination due to Incapacity, 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.

Any dispute between the Compensation Committee and Executive with respect to Executive's Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the Compensation Committee and Executive or his personal representative, whose decision shall be binding on all parties.

(d)Termination by the Company for Cause; Resignation by Executive.  If Executive's employment is terminated by the Company for Cause or Executive resigns his employment for any reason, the Company shall have no further obligations to Executive hereunder after the Termination Date, except for payment of any accrued and unpaid Salary and benefits accrued through the Termination Date.  If Executive's employment is (i) terminated for Cause at any time or (ii) Executive resigns his employment for any reason prior to the Vesting Date (as defined in Section 5(h)(ii)), Executive shall immediately forfeit all rights to the Retirement Compensation provide for in Section 5(h).  For purposes of this Agreement, "Cause" shall mean (i) Executive's material failure, refusal or neglect to perform and discharge his duties and responsibilities hereunder (including duties prescribed by the Board pursuant to Section 3), other material breach of the terms hereof, or breach of any fiduciary duties he may have because of any position he holds with the Company or any subsidiary or affiliate thereof or (ii) a felony conviction or a conviction for any crime involving Executive's personal dishonesty or moral turpitude.

(e)Termination Without Cause.  The Company may terminate Executive's employment hereunder at any time without Cause.  In such event:

(i)the Company shall pay to Executive, a lump-sum amount equal (A) to any accrued and unpaid Salary and benefits through the Termination Date and (B) any bonuses declared to be payable to Executive for any fiscal periods ending prior to the Termination Date within thirty (30) days following the Termination Date;

(ii)the Company shall pay to Executive a lump-sum amount equal to the  Salary (at the rate in effect as of the Termination Date) that he would have received had he remained employed during the period from the Termination Date through the Expiration Date;

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(iii)the Retirement Compensation shall vest in full and the Company shall pay to Executive a lump-sum amount equal to the entire remaining unpaid balance of the Retirement Compensation accrued through such Termination Date;

(iv)the Company shall provide Executive and his spouse and eligible dependents with continuation of medical, dental and health benefits for two (2) years pursuant to Section 4(d) hereof; and

(v)Equity Awards granted to Executive that would not vest on or prior to the Termination Date shall vest, settle 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.

(f)Change of Control.

(i)Upon a "Change of Control", the Retirement Compensation shall vest in full.  In addition, if contemporaneously with a Change of Control, Executive's employment is terminated without Cause, within thirty (30) days after the Termination Date, the Company or its successor in interest shall (A) pay to Executive, a lump-sum amount equal to (x) any accrued and unpaid Salary and benefits through the Termination Date and (y) any bonuses declared to be payable to Executive for any fiscal periods ending prior to the Termination Date;  (B) pay to Executive a lump-sum amount equal to three (3) times the  Salary (at the rate in effect as of the Termination Date) which lump-sum amount shall not be pro-rated; (C) provide Executive and his spouse and eligible dependents with continuation of medical, dental and health benefits for two (2) years pursuant to Section 4(d) hereof; (D) pay to Executive a lump-sum amount equal to the entire remaining unpaid balance of the Retirement Compensation accrued through such Termination Date; and (E) 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 (x) the Change of Control Date and (y) 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.

(ii)For purposes of this Agreement, a "Change of Control" shall mean a "change in control event" within the meaning of the default rules under Section 409A.   For purposes of this Agreement, a termination will be deemed to be made "contemporaneously" with a Change of Control if (A) it is made pursuant to at least one hundred and twenty (120) days prior written notice from the Company to Executive, and (B) it is effective as of the Change of Control Date.

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(iii)The obligations of the Company pursuant to this Section 5(f) shall survive any termination of this Agreement or Executive's employment or any resignation of such employment by Executive pursuant to this Section 5(f).

(iv)If, at any time during the Employment Term the Board determines that a Change of Control is likely to occur, the Company hereby agrees to establish a grantor 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.  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.  Notwithstanding the establishment of a trust, the Company's obligation upon a Change of Control may be paid from the general assets of the Company or from assets of the 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 or bankruptcy.

(g)Certain Additional Payments by the Company.

(i)Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, distribution or other 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) including, without limitation any additional payments required under this Section 5(g) (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 rate of 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 rates 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 taxes.  The Gross-Up Payment shall be paid to Executive no later than the end of the taxable year next following the taxable year in which Executive remits the taxes related to the Gross-Up Payment.

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(ii)Subject to the provisions of paragraph (iii) of this Section 5(g) all determinations required to be made under this Section 5(g), 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) 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 5(g), 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 5(g) 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 Executive remits the taxes.  The previous sentence shall apply mutatis mutandis to any overpayment of the Gross-Up Payment.

(iii)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) daysafter 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) dayperiod following the date on which Executive 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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(A)give the Company any information reasonably requested by the Company relating to such claim;

(B)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 the Company;

(C)cooperate with the Company in good faith in order effectively to contest such claim; and

(D)permit the Company to participate in any proceedings relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.  Without limitation on the foregoing provisions of this Section 5(g)(iii), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Executive to pay such claim and sue for a refund, to the extent permitted by law, the Company shall advance the amount of such payment to Executive, on an interest-free basis and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and provided further that any extension of the statute of limitations relating to payment of taxes for the taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount.  Furthermore, the Company's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

(iv)If, after the receipt by Executive of an amount advanced by the Company pursuant to Section 5(g)(iii), 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 5(g)(iii)) 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 5(g)(iii), 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.

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(h)Retirement Compensation

(i)Subject to vesting pursuant to Section 5(h)(ii), if Executive's employment is terminated for any reason other than Cause, the Company shall pay to Executive a lump-sum amount equal to the amount by which (A) the product of (x) one-half (1/2) multiplied by Executive's average annual salary for the three (3)-year period preceding the Termination Date times (y) the number of years (including any partial year) since April 27, 2007 (the "Retirement Compensation") exceeds (B) the sum of any amounts previously distributed to Executive pursuant to Sections 5(h)(iii) and (iv).  The lump-sum amount to be paid shall not be present-valued or otherwise reduced by use of any other discount or discounting method.

(ii)The Retirement Compensation will vest in full on April 26, 2012 (the "Vesting Date") provided that Executive remains continuously employed through the Vesting Date.  In addition the Retirement Compensation will vest in full upon (i) Executive's termination of employment due to (A) death, (B) Incapacity or (C) by the Company without Cause and (ii) a Change of Control.  Except as otherwise provided herein, prior to vesting pursuant to this Section 5(h)(ii), Executive's rights to the Retirement Compensation shall be the mere contractual right of an unsecured creditor.  Prior to the Vesting Date the Company may elect to establish a grantor 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.  Any trust so established and any assets held therein will be subject to the claims of the Company's creditors.

(iii)Within ninety (90) business days following the Vesting Date, the Company shall establish a trust (the "Retirement Trust") for the remaining duration of the Employment Term, and, commencing on the Vesting Date and on a quarterly basis, thereafter (each a "Contribution Date") the Company shall contribute to the Retirement Trust for the benefit of Executive an amount equal to (A) the Retirement Compensation that would be payable to Executive under Section 5(h)(i) 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)-dayperiod beginning on the date on which he receives notice from the Company that the Company has made a contribution pursuant to this Section 5(h)(iii), 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 5(h)(iii), shall be payable to Executive, and that prior to payment of such retirement compensation, the assets of the Retirement Trust shall be exempt from the claims of the Company's creditors.

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(iv)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 5(h)(iii).  As of the last day of each calendar quarter ending on or after the Vesting Date, during the Employment Term, the trustee of the Retirement Trust shall be required to distribute to Executive 25% of the amount of the Assumed Taxes that the Company reasonably estimates will be payable by Executive for the calendar year for which the distribution is being made and as a result of his beneficial interest in the Retirement Trust.  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 tax rates.

6.Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

7.Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Company, to it at:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention: Chief Executive Officer

with a copy to:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention:  General Counsel

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If to Executive, to him at

Michael B. Baughan

343 Fairfax Drive

Winston-Salem, NC  27104

8.Unfunded Status.  This Agreement is intended to constitute an unfunded plan for incentive compensation.  Except with respect to the Retirement Compensation following the Vesting Date, nothing contained herein shall give Executive any rights that are greater than those of a general unsecured creditor of the Company.  In its sole discretion, the Compensation Committee of the Board may authorize the creation of trusts, acquisition of life insurance policies or other arrangements to meet the obligations created under this Agreement.

9.Entire Agreement.  This Agreement (including the Exhibits attached hereto) constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties; provided, however, that this Agreement shall not supersede the Proprietary Rights Agreement between Executive and the Company attached as Exhibit B which is incorporated herein by reference

10.Headings.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.

11.Counterparts.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument.

12.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.

13.Withholding.  Without limiting the effect of Sections 5(g) and 15 hereof, all payment made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

14.Legal Fees.  In the event of a dispute between the parties with respect to any payments due hereunder in connection with a Change of Control, the Company will pay the costs of any legal fees and related expenses incurred in connection with such dispute for a period of up to twenty (20) years.  Such costs and expenses shall be advanced to Executive currently as reasonably required to continue such action or proceeding.

15. Section 409A.

(a)If any amounts that become due under Section 5 (other than Section 5(g)) of this Agreement constitute "nonqualified deferred compensation" within the meaning of Section 409A, payment of such amounts shall not commence until 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.

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(b)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 Executive's Separation from Service for any reason other than death or (ii) Executive's date of death.  The provisions of this Section 15(b) shall only apply if required to comply with Section 409A.

(c)For purposes of this Agreement, "Separation from Service" shall have the meaning set forth in Section 409A(a)(2)(A)(i) and determined in accordance with the default rules under Section 409A.  "Specified Employee" shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(d)It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without Executive's consent, modify the Agreement to:  (i) comply with, or avoid being subject to, Section 409A, (ii) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (iii) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 15(d) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(e)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 Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

(f)The provisions of Section 5(g) of this Agreement, mutatis mutandis, shall apply to any imposition of taxes on Executive under Section 409A so that Executive shall be fully grossed up for the amount of, and shall not be adversely affected by, such taxes.

16.Enforceability; Waiver.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  Executive's or the Company's failure to insist upon strict compliance with any provision hereof or the failure to assert any right that Executive or the Company may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

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17.Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and permitted assigns.  This Agreement may be assigned by the Company.  Executive may not assign or delegate his duties under this Agreement without the Company's prior written approval.

18.Survival.  The entitlement of Executive and the obligations of the Company pursuant to Sections 5 and 15 hereof and the provisions of Sections 6 through 13 and 15 through 18 hereof shall each survive any termination or expiration of this Agreement, or any termination or resignation of Executive's employment, as the case may be.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

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

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Exhibit A

Death Benefit Agreement

Exhibit B

Proprietary Rights Agreement

EX-10.9

EXHIBIT 10.9

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AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this “Agreement”) is made as of December 31, 2008 by and between BE Aerospace, Inc., a Delaware corporation (the “Company”), and Thomas P. McCaffrey (“Executive”).

RECITALS

WHEREAS, Executive and the Company entered into an Amended and Restated Employment Agreement dated as of April 27, 2007 (the “Employment Agreement”); and

WHEREAS, Executive, having provided services to the Company since May 1, 1993, agrees to continue to provide services for an additional period as provided herein and the Company wishes to procure such services; and

WHEREAS, Executive and the Company wish to further amend and restate the Employment Agreement in its entirety in the manner set forth herein.

NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth, the parties agree as follows:

1. Reference to Employment Agreement.  The Employment Agreement is hereby restated, superseded and replaced in its entirety by this Agreement.

2. Term.  Unless otherwise terminated pursuant to the provisions of Section 5 hereof, Executive shall provide to the Company services hereunder during the term of his employment under this Agreement, which shall be the period ending three (3) years from any date as of which the term is being determined (the “Employment Term”).  The date on which the Employment Term ends, including any extensions thereof, is sometimes hereinafter referred to as the “Expiration Date.”

3. Position and Duties.  Executive shall serve the Company in the capacity of Senior Vice President of Administration and Chief Financial Officer, or in such other position as the Chief Executive Officer of the Company, his designee or the Board of Directors of the Company (the “Board”) may designate from time to time, and shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as the Chief Executive Officer of the Company, his designee or the Board shall determine. Executive shall perform and discharge, faithfully, diligently and to the best of his ability, such duties and responsibilities.  Executive shall devote substantially all of his working time and efforts to the business and affairs of the Company.

4. Compensation.

(a) Salary.  During the Employment Term, Executive shall receive an annual salary (the “Salary”) payable at the rate of four hundred ninety thousand five hundred dollars ($490,500) per annum.  Such rate shall be subject to adjustment from time to time by the Compensation Committee of the Board (the “Compensation Committee”) as hereinafter provided; provided, however, that it shall at no time be adjusted below the Salary for the preceding year.  On July 1st of each year during the Employment Term, the Salary shall be increased by an amount not less than the amount determined by applying to the Salary then in effect 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 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 adjustment index issued by such agency that 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, less all required deductions.

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(b) Incentive Bonus.  So long as employed, Executive may receive an incentive bonus for each fiscal year or portion thereof during which Executive has been employed hereunder as determined by the Compensation Committee at the end of the applicable fiscal year.  The incentive bonus, if any, shall be paid in accordance with Company policy, but in any event, no later than March 15th of the year following the year in respect of which Executive earned such bonus.

(c) Expenses.  Executive shall be entitled to receive prompt payment of, or reimbursement for, all reasonable business expenses incurred by him during the Employment Term on behalf of the Company.

(d) Benefits.  During the Employment Term, 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 accordance with Company policy, Executive shall also be entitled to paid vacation in any fiscal year during the Employment Term as well as all paid holidays given by the Company to its employees.  In addition, upon termination of Executive’s employment with the Company due to his death or Incapacity, Executive and his eligible dependents shall be entitled on similar terms and conditions as active executives, for a period of two (2) years, to participate in all medical, dental and health benefit plans available to the Company’s executive officers from time to time.  If any reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A of the Internal Revenue Code of 1986, as amended and the regulations and guidance promulgated thereunder (the “Code”), the Company shall reimburse such medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

(e) Automobile.  So long as employed, Executive shall receive an automobile either owned or leased by the Company or a monthly automobile allowance of $1,100 per month (the “Automobile Allowance”), at the discretion of the Company.  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 it shall accrue.

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(f) Equity Compensation.  So long as employed, Executive shall be eligible to participate in any applicable equity compensation program of the Company in effect from time to time on the terms set forth by the Compensation Committee in its sole discretion.

5. Termination and Compensation Thereon.

(a) Termination Date.  The term “Termination Date” shall mean the earlier of (i) Executive’s date of death and (ii) date on which Executive incurs a Separation from  Service (as defined below) with the Company and its subsidiaries and affiliates for any reason.

(b) Death.

(i) 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 natural person, trust, corporation, limited liability company, limited or general partnership, or any other entity (each a “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) the entire remaining unpaid balance of the Retirement Compensation as provided in Section 5(g) below, determined as of the Termination Date and (B) a lump-sum payment amount equal to 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.

(ii) 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 one (1) million dollars in accordance with the Death Benefit Agreement attached as Exhibit A hereto.

(iii) Upon Executive’s death, 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 amount equal to (A) any accrued and unpaid Salary and benefits through the date of death, and (B) any bonuses declared to be payable to Executive for any fiscal periods of the Company ending prior to the date of death.

(iv) Following Executive’s death, his eligible dependents shall be entitled to continuation of medical, dental and health benefits for two (2) years in accordance with Section 4(d) hereof.

(v) In addition, upon Executive’s death, 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, 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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(c) Incapacity.  If, in the reasonable judgment of the Compensation Committee, as a result of Executive’s Incapacity due to a medically determinable physical or mental illness, Executive shall have been absent from his full-time duties as described hereunder for the entire period of twenty-nine (29) consecutive months (“Incapacity”), Executive’s employment shall terminate at the end of the twenty-nine (29)-month period as provided in this Section 5(c).  In such event:

(i) the Company shall give prompt notice to Executive of any such termination;

(ii) within thirty (30) days following the Termination Date, the Company shall pay to Executive a lump-sum amount equal to the Salary and Automobile Allowance (at the rate in effect on the Termination Date) that he would have received had he remained employed during the period from the Termination Date until the Expiration Date;

(iii) the Company shall provide Executive and his eligible dependents with continuation of medical, dental and health benefits for two (2) years in accordance with Section 4(d) hereof;

(iv) the Company shall pay to Executive the entire remaining unpaid balance of the Retirement Compensation as provided in Section 5(g) below, determined as of the Termination Date;

(v) the Company shall pay to Executive within thirty (30) days after the Termination Date (A) any accrued and unpaid Salary and benefits through the Termination Date and (B) any bonuses declared to be payable to Executive for any fiscal periods of the Company ending prior to the Termination Date; and

(vi) upon a termination due to Incapacity, all 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.

Any dispute between the Compensation Committee and Executive with respect to Executive's Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the Compensation Committee and Executive or his personal representative, whose decision shall be binding on all parties.

(d) Termination by the Company or Executive.

(i) Termination by the Company for Cause.  The Company may, at any time, terminate Executive’s employment hereunder for “Cause.”  Upon a termination for Cause, the Company shall have no further obligations to Executive hereunder, except for payment of any accrued and unpaid Salary and benefits through the Termination Date.  For purposes of this Agreement, “Cause” shall mean any of the following:

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(A) the willful and continued (after a reasonable period following such demand) failure by Executive to substantially perform his duties hereunder (other than (1) any such willful or continued failure resulting from his Incapacity due to physical or mental illness or physical injury or (2) any such actual or anticipated failure after the issuance of a notice of termination by Executive for Good Reason (as defined below)), after written demand for substantial performance is delivered by the Company to Executive that specifically identifies the manner in which the Company believes Executive has not substantially performed his duties;

(B) the willful engaging by Executive in misconduct which is materially injurious to the Company, monetarily or otherwise; or

(C) the conviction of Executive of a felony by a court of competent jurisdiction in a judgment which has become final and nonappealable if such conviction would render it impossible for Executive to perform his obligations hereunder or if the reputation of the Company would be materially damaged by the continuance of Executive’s employment hereunder.

For purposes of this Section 5(d)(i) no act, or failure to act, on the part of Executive shall be considered “willful” unless done or omitted to be done by him in bad faith and without reasonable belief that his action or omission was in the best interest of the Company.  If Executive’s employment is terminated by the Company for Cause pursuant to this Section 5(d)(i), the Company shall have no further obligations to Executive hereunder after the Termination Date, except for the payment of any unpaid Salary and benefits accrued through the Termination Date.

(ii) Termination without Cause or for Good Reason other than Contemporaneously with a Change of Control.

(A) The Company may, at any time, terminate Executive’s employment hereunder without Cause and Executive may terminate Executive’s employment hereunder with “Good Reason” (as defined below).

(B) If Executive’s employment is terminated by the Company without Cause or by Executive with Good Reason other than contemporaneously with a Change of Control (as defined below), then, on the Termination Date, Executive shall receive payment of:

    (1) any accrued and unpaid Salary through the Termination Date;

    (2) any bonuses declared to be payable to Executive for any fiscal periods of the Company ending prior to the Termination Date;

    (3) a lump-sum amount equal to his Salary that Executive would have received had he remained employed during the period from the Termination Date through the Expiration Date;

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              (4) the entire remaining unpaid balance of the Retirement Compensation pursuant to Section 5(g) hereof, determined as of the

         Expiration Date; and

      (5) the Severance Payment pursuant to Section 5(f)(i) hereof.

(C) In addition, upon a termination without Cause or for Good Reason other than contemporaneously with a Change of Control, 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.

(iii) Termination by Executive without Good Reason.  Executive may terminate his employment hereunder without Good Reason.  If Executive’s employment is terminated by Executive without Good Reason, then, on the Termination Date, Executive shall receive payment of (A) any accrued and unpaid Salary through the Termination Date, (B) any bonuses declared to be payable to Executive for any fiscal periods of the Company ending prior to the Termination Date, (C) the entire remaining unpaid balance of the Retirement Compensation pursuant to Section 5(g) hereof, determined as of the Termination Date; and (D) the Severance Payment pursuant to Section 5(f)(ii) hereof.

(e) Change of Control.

(i) If a “Change of Control” (as defined in Section 5(e)(iii)) of the Company occurs, the Company will be obligated as provided in this Section 5(e).  For purposes of determining the Company’s obligations under this Section 5(e), 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:

(A) pay to Executive, the amount of any Gross-Up Payment payable by the Company to Executive under Section 5(h) hereof in accordance with the payment terms therein;

(B) provide that any Equity Awards granted to Executive that would not vest on or prior to the Change of Control Date shall vest and, if applicable, be exercisable upon the earlier of (x) the Change of Control Date and (y) 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.

(ii) Termination Contemporaneously with a Change of Control.  If Executive’s employment is terminated for any reason contemporaneously with a Change of Control, the Company shall pay to Executive (i) 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, (ii) the entire remaining unpaid balance of the Retirement Compensation, as provided in Section 5(g) below determined as of the Termination Date; and (iii) the Severance Payment pursuant to Section 5(f)(i) hereof.

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(iii) For purposes of this provision, a “Change of Control” means:

(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;

(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;

(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

(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:

   (1)           A shareholder of the Company in exchange for or with respect to

   its stock;

   (2)           Any Majority Owned Entity, as defined below, of the Company;

   (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.

(iv) For the purposes of this Section 5(e), 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 the Company.

(v) For the purposes of this Section 5(e), 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.

(vi) A Change of Control shall occur on the effective date of any event specified in Section 5(e)(iii) above.  In connection with any determination of ownership for purposes of Section 5(e)(iii) above, the attribution rules of Section 318(a) of the Code shall apply.

(vii) For purposes of this Agreement, a termination will be deemed to be made “contemporaneously” with a Change of Control if (A) it is made pursuant to at least one hundred and twenty (120) days’ prior written notice from the Company to Executive, and (B) it is effective as of the Change of Control Date.

(viii) For purposes of this Agreement, “Good Reason” means:

(A) a decrease in Executive’s Salary or a failure by the Company to pay material compensation due and payable to Executive in connection with his employment;

(B) a change in Executive’s responsibilities, positions, duties, status, title or reporting relationships;

(C) Executive ceasing to be the Senior Vice President of Administration and Chief Financial Officer of a publicly traded company pursuant to this Agreement (or such other positions Executive holds (1) immediately prior to the Change of Control Date, if applicable, or (2), solely for purposes of Section 5(d), thirty (30) days prior to the Termination Date);

(D) the Company’s requiring Executive to be based at any office or location that is anywhere other than Executive’s principal place of employment (1) immediately prior to the Change of Control Date, if applicable, or (2), solely for purposes of Section 5(d), thirty (30) days prior to the Termination Date; or

(E) a material breach by the Company of any term or provisions of this Agreement;

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provided that Executive has given notice thereof to the Company and the Company has not cured the Good Reason within thirty (30) days after receiving such notice.

(f) Severance Payment.  Executive is eligible to receive a Severance Payment (the “Severance Payment”) within thirty (30) days following the Termination Date as follows:

(i) If Executive’s employment hereunder is terminated at any time (A) by the Company without Cause, (B) by Executive for Good Reason, or (C) contemporaneously with a Change of Control, then on the Termination Date, the Company shall pay to Executive a lump-sum amount equal to two (2) times the Salary (at the rate in effect as of the Termination Date), which lump-sum shall not be pro-rated.

(ii) If Executive’s employment hereunder is terminated by Executive without Good Reason, then on the Termination Date, the Company shall pay to Executive a lump-sum amount equal to one (1) times the Salary (at the rate in effect as of the Termination Date), which lump-sum shall not be pro-rated.  For the avoidance of doubt, the Severance Payment pursuant to this Section 5(f)(ii) shall be payable upon Executive’s retirement in accordance with Company policy.

(g) Retirement Compensation.

(i) If Executive’s employment is terminated for any reason other than Cause, the Company shall pay to Executive a lump-sum amount equal to the amount by which (A) the product of (1) one-half (1/2) multiplied by Executive’s average annual salary for the three (3)-year period preceding the Termination Date times (2) the number of years (including any partial year) since May 1, 1993 (the “Retirement Compensation”) exceeds (B) the sum of any amounts previously distributed to Executive pursuant to Sections 5(g)(ii), 5(g)(iii) and 5(g)(iv).  The lump-sum amount to be paid shall not be present-valued or otherwise reduced by use of any other discount or discounting method.  The payment will be made to Executive within five (5) business days following the Termination Date.

(ii) Within five (5) 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 in a lump-sum the amount of Retirement Compensation that would have been payable to Executive under Section 5(g)(i) as of the Distribution Date.

(iii) Within ninety (90) business days following the Distribution Date, the Company shall establish a trust for the duration of the Employment Term, and, commencing on the Distribution 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 5(g)(i) 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)-dayperiod beginning on the date on which he receives notice from the Company that the Company has made a contribution pursuant to this Section 5(g)(iii), 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 5(g)(iii), shall be payable to Executive, and that prior to payment of such retirement compensation, the assets of the Retirement Trust shall be exempt from the claims of the Company’s creditors.

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(iv) 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 5(g)(ii).  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 of the Assumed Taxes that the Company reasonably estimates will be payable by Executive for the calendar year for which the distribution is being made and as a result of his beneficial interest in the Retirement Trust.  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 tax rates.

(h) Certain Additional Payments by the Company.

(i) 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 5(h)) (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 rate of 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 rates 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 taxes.  The Gross-Up Payment shall be paid to Executive no later than the end of the taxable year next following the taxable year in which Executive remits the taxes related to the Gross-Up Payment.

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(ii) Subject to the provisions of paragraph (iii) of this Section 5(h) all determinations required to be made under this Section 5(h), 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) 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 5(h), 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 5(h) 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 Executive remits the taxes.  The previous sentence shall apply mutatis mutandis to any overpayment of the Gross-Up Payment.

(iii) 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) daysafter 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)-dayperiod following the date on which Executive 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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(A) give the Company any information reasonably requested by the Company relating to such claim;

(B) 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 the Company;

(C) cooperate with the Company in good faith in order effectively to contest such claim; and

(D) permit the Company to participate in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax (including interest and penalties with respect thereto) imposed as a result of such representation and payment of costs and expenses.  Without limitation on the foregoing provisions of this Section 5(h)(iii), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Executive to pay such claim and sue for a refund, to the extent permitted by law, the Company shall advance the amount of such payment to Executive, on an interest-free basis and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or penalties with respect thereto) imposed with respect to such advance or with respect to any imputed income with respect to such advance; and provided further that any extension of the statute of limitations relating to payment of taxes for the taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount.  Furthermore, the Company’s Control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority.

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(iv) If, after the receipt by Executive of an amount advanced by the Company pursuant to Section 5(h)(iii), 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 5(h)(iii)) 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 5(h)(iii), 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.

(i) Restricted Stock Award.  On July 31, 2006, the Company granted to Executive, without payment by Executive, 104,242 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 5(i) 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 on each anniversary thereafter, provided that Executive is employed by the Company 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 termination due to death or Incapacity, (iii) upon the termination of Executive’s employment by the Company without Cause, or (iv) upon the termination by Executive with Good Reason.  For the avoidance of doubt, all vesting of the Restricted Stock pursuant to this Section 5(i) shall be subject to the provisions of Sections 5(h) and 12 of this Agreement.

(j) 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 grantor 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.  Notwithstanding the establishment of a trust, the Company’s obligation upon a Change of Control may be paid from the general assets of the Company or from assets of the 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 or bankruptcy.

6. Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

7. Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three (3) days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

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If to the Company, to it at:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention:  General Counsel

If to Executive, to him at:

Thomas P. McCaffrey

4821 South Flagler Drive

West Palm Beach, FL  33405

8. Entire Agreement.  This Agreement (including the Exhibits attached hereto) constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties; provided, however, that this Agreement shall not supersede the Proprietary Rights Agreement between Executive and the Company attached as Exhibit B which is incorporated herein by reference.

9. Withholding.  Without limiting the effect of Sections 5(h) and 12, all payments made by the Company under this Agreement shall be reduced by any amounts in respect of income, social security, FICA and other similar taxes at the then-prevailing rates required to be withheld by the Company under applicable law.

10. Legal Fees.  In the event of a dispute between the parties with respect to any payments due hereunder in connection with a Change of Control, the Company will pay the costs of any legal fees and related expenses incurred in connection with such dispute for a period of up to twenty (20) years.  Such costs and expenses shall be advanced to Executive currently as reasonably required to continue such action or proceeding.

11. Unfunded Status.  This Agreement is intended to constitute an unfunded plan for incentive compensation.  Except with respect to the Retirement Compensation, nothing contained herein shall give Executive any rights that are greater than those of a general unsecured creditor of the Company.  In its sole discretion, the Compensation Committee may authorize the creation of trusts, acquisition of life insurance policies or other arrangements to meet the obligations created under this Agreement.

12. Section 409A.

(a) If any amounts that become due under Section 5 (other than Section 5(h)) of this Agreement constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code, payment of such amounts shall not commence until 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.

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(b) 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 Executive’s Separation from Service for any reason other than death or (ii) Executive’s date of death.  The Company shall establish a grantor 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 12.1 that otherwise would be immediately payable to  Executive.  The provisions of this Section 12(b) shall only apply if required to comply with Section 409A of the Code.

(c) 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.

(d) 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 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 the Code.

(e) 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 Group 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.

(f) The provisions of Section 5(h) of this Agreement, mutatis mutandis, shall apply to any imposition of taxes on Executive under said 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. Miscellaneous.

(a) Enforceability.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument and shall be governed by and construed in accordance with the laws (other than the conflict of laws rules) of the State of Florida.

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(b) Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and permitted assigns.  This Agreement may be assigned by the Company.  Executive may not assign or delegate Executive’s duties under this Agreement without the Company’s prior written approval.

(c) Waiver.  Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that Executive or the Company may have hereunder, including, without limitation, the right of Executive to terminate employment for Good Reason pursuant to Section 5(d)(ii) of this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

(d) Survival.  The provisions of Sections 4, 5, 6 and 7 through 13 inclusive hereof shall each survive any termination or expiration of this Agreement.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto execute this Agreement as of the date first written above.

EXECUTIVE
/s/ Thomas P. McCaffrey
Thomas P. McCaffrey
BE AEROSPACE, INC.
By:	/s/ Amin J. Khoury
Name:	Amin J. Khoury
Title:	Chairman and Chief Executive Officer

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Exhibit A

Death Benefit Agreement

A-1

EXECUTION COPY

Exhibit B

Proprietary Rights Agreement

B-1

EX-10.10

EXHIBIT 10.10

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this “Agreement”)ismade as of this 9th day of December 2008, by and between BE Aerospace, Inc., a Delaware corporation (the “Company”)and Werner Lieberherr (the “Executive”).

RECITALS

WHEREAS, the Company wishes to employ the Executive and the Executive wishes to accept such employment on the terms and conditions hereafter set forth; and

WHEREAS, the Company wishes to make secure for itself the experience, abilities and services of the Executive and to prevent the loss of such experience, services and abilities; and

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto, each intending to be legally bound, do hereby agree as follows:

1.Employment.  The Company shall employ the Executive, and the Executive shall perform services for and continue in the employment of the Company, for an initial period of one (1) year commencing on July 5, 2006 and ending on July 4, 2007; provided, however, that the Executive’s employment hereunder shall automatically be extended from year to year for additional one (1)-year periods on and after July 5, 2007, until either the Company or the Executive gives the other party at least ninety (90) days written notice prior to the then-applicable “Expiration Date” (as hereinafter defined) of its or his desire to terminate this Agreement, unless the Executive’s employment is terminated earlier pursuant to this Agreement.  For purposes of this Agreement (i) the term “Employment Term”shall mean the initial one (1) year period and all automatic one (1) year extensions thereof, and (ii) the term “Expiration Date”shall mean July 4 of calendar year 2007 or any subsequent calendar year if the Employment Term is extended on and after July 4, 2007.

2.Position and Duties.  The Executive shall serve the Company in the capacity of Vice President and General Manager, Commercial Aircraft Products Group, and shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as may from time to time be prescribed by the President and Chief Operating Officer of the Company, or his designee.  The Executive shall perform and discharge, faithfully, diligently and to the best of his ability, such powers, duties and responsibilities.  The Executive shall devote all of his working time and efforts to the business and affairs of the Company.

3.Compensation.

(a)Salary.  During the Employment Term, the Executive shall receive a salary (the “Salary”)payable at the rate of $416,000 per annum.  Such rate shall be subject to adjustment from time to time by the Compensation Committee of the Board of Directors (the “Compensation Committee”); provided, however, that it shall at no time be adjusted below the Salary then in effect.  The Salary shall be payable biweekly or in accordance with the Company’s current payroll practices, less all required deductions.  The Salary shall be pro-rated for any period of service less than a full year.

(b)Incentive Bonus.  During the Employment Term, the Executive may receive an incentive performance bonus in accordance with the Company’s executive bonus plan then in effect, as determined by the Compensation Committee in its sole discretion.  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 which it is earned.

(c)Expenses.  During the Employment Term, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him on behalf of the Company in accordance with the Company’s policies in effect from time to time.

(d)Benefits.  During the Employment Term, the Executive shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement, accident, and other employee benefit plans, programs and arrangements made generally available by the Company to its employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements in effect from time to time.  In accordance with the Company’s policies in effect from time to time, the Executive shall also be entitled to paid vacation in any fiscal year during the Employment Term as well as all paid holidays given by the Company to its employees.

(e)Automobile.  During the Employment Term, the Executive shall receive an automobile allowance (the “Automobile Allowance”) of $1,100 per month less applicable taxes, payable in accordance with Company policy, but in no event later than March 15th of the year following the year in which the Automobile Allowance will accrue.

4.Termination and Compensation Thereon.

(a)Termination.  Subject to the terms and conditions of this Agreement, the Executive’s employment pursuant to this Agreement may be terminated either by the Executive or the Company at any time and for any reason.  The term “Termination Date”shall mean if the Executive’s employment is terminated (i) by his death, the date of his death or (ii) for any other reason, the date on which the Executive incurs a Separation from Service, (as defined below).

(b)Death.  The 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 the 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 the Salary and Automobile Allowance (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.

(c)Incapacity.  If, in the reasonable judgment of the President and Chief Operating Officer, as a result of the Executive’s incapacity due to physical or mental illness, the Executive shall have been absent from his full-time duties as described hereunder for the entire period of six (6) consecutive months (“Incapacity”), the Executive’s employment shall terminate at the end of the six (6)-month period.  In such event, upon the Termination Date, the Company shall pay to the Executive a lump sum payment equal to the Salary and Automobile Allowance (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Executive signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date. If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(c) or 4(g).  The Company’s obligation to pay the Executive his Salary and Automobile Allowance (to the extent not previously paid) shall terminate if the Executive subsequently takes other employment to the extent of the Executive’s salary and benefits from such subsequent employment.  Any dispute between the President and Chief Operating Officer and the Executive with respect to the Executive’s Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the President and Chief Operating Officer and the Executive, whose decision shall be binding on all parties.

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(d)Termination by the Company for Cause; Resignation by the Executive.

(i)If the Company terminates the Executive’s employment for Cause or the Executive resigns his employment for any reason (other than pursuant to Section 4(f)), the Company shall have no further obligations to the Executive hereunder after the Termination Date, except for unpaid Salary and benefits accrued through the Termination Date.

(ii)For purposes of this Agreement, “Cause” shall mean (i) the Executive’s material failure, refusal or neglect to perform and discharge his powers, duties and responsibilities hereunder (including duties prescribed by the President and Chief Operating Officer pursuant to Section 2 above), other material breach of the terms hereof, or breach of any fiduciary duties Executive may have because of any position Executive holds with the Company or any subsidiary or affiliate thereof; or (ii) a felony conviction or a conviction for any crime involving the Executive’s personal dishonesty or moral turpitude.

(e)Termination Without Cause.  The Company may terminate the Executive’s employment hereunder at any time without Cause.  In such event, the Company shall pay to the Executive a lump sum payment equal to the Salary payable during the period from the Termination Date through the first anniversary of the Expiration Date. The lump sum payment shall be made within sixty (60) days following the Termination Date provided that prior to the payment date the Executive signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date. If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(e) or 4(g).

(f)Change of Control.

(i)If a “Change of Control” occurs during the Employment Period and following, or in connection with such Change of Control, the Executive’s employment is terminated by the Company for any reason (other than Cause), or the Executive resigns his employment because any of the Executive’s position, location, powers, duties or responsibilities under Section 2 above are materially reduced without his agreement, any compensation or benefit payable or otherwise extended to the Executive hereunder (including without limitation Salary, incentive bonus and fringe benefits as set forth in Section 3 above) is eliminated or materially reduced, the Company or its successor in interest shall give prompt notice to the Executive of any such elimination or reduction and pay to the Executive a lump sum amount equal to:

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(x)    the Executive’s Salary (at the rate in effect as of the Termination Date), which  amount shall not be pro-rated and shall be paid in addition to the Salary due and payable under (y) below; and

(y)   the Salary (at the rate in effect as of the date of the Change of Control) payable during the period from the Termination Date through the Expiration Date.

The lump sum payment shall be made within thirty (30) days following the Termination Date.

(ii)For purposes of this Agreement, a “Change of Control” shall mean a “change in control event” within the meaning of the default rules under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (the “Code”).  The obligations of the Company pursuant to this Section 4(f) shall survive any termination of this Agreement or the Executive’s employment or any resignation of such employment by the Executive pursuant to this Section 4(f).

(g)Benefit Continuation.  If the Executive's employment is terminated pursuant to Sections 4(c), 4(e) or 4(f), the Company shall provide the Executive and his eligible dependents with continued participation in medical, dental and health benefit plans available to the Company’s executive officers on similar terms and conditions as active executives, from the Termination Date until the earlier of (i) the Expiration Date and (ii) the date the Executive becomes eligible for comparable benefits provided by a third party; provided,however,that the continuation of such benefits shall be subject to the respective terms of the applicable plan, in effect from time to time, and the timely payment by the Executive of his applicable share of the applicable premiums in effect from time to time.  To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A, the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

5.Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

6.Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

4

If to the Company, to it at:

BE Aerospace, Inc.

1455 Fairchild Road

Winston Salem, NC 27105

Attention:  President and Chief Operating Officer

with a copy to:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL 33414

Attention:  General Counsel

If to the Executive, to him at:

Werner Lieberherr

255 Belleford Court

Louisville NC 27023

7.Entire Agreement.  This Agreement and the Proprietary Rights Agreement attached hereto as Exhibit A constitute the entire agreement among the parties hereto pertaining to the subject matter hereof and supersede all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties.

8.Headings.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.

9.Counterparts.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument.

10.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws (other than the conflict of laws rules) of the State of Florida.

11.Withholding.  All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

12.Section 409A.

(a)If any amounts that become due under Section 4 of this Agreement constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code  (“Section 409A”), 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.

5

(b)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 (1) months after the Executive’s Separation from Service for any reason other than death or (ii) the Executive’s date of death.  The provisions of this Section 12(b) shall only apply if required to comply with Section 409A.

(c)For purposes of this Agreement, “Separation from Service” shall have the meaning set forth in Section 409A(a)(2)(A)(i) and determined in accordance with the default rules under Section 409A.  “Specified Employee” shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(d)It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without the Executive’s consent, modify the Agreement to:  (i) comply with, or avoid being subject to, Section 409A, (ii) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (iii) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 12(d) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(e)Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to the Executive pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

13.Enforceability; Waiver.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  The Executive’s or the Company’s failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that the Executive or the Company may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

14.Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.  This Agreement may be assigned by the Company.  The Executive may not assign or delegate his duties under this Agreement without the Company’s prior written approval.

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15.Survival.  The entitlement of the Executive and the obligations of the Company pursuant to Section 4 hereof shall each survive any termination or expiration of this Agreement, or any termination or resignation of the Executive’s employment, as the case may be.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

EXECUTIVE

/s/ Werner Lieberherr

Werner Lieberherr

BE AEROSPACE, INC.

/s/ Thomas P. McCaffrey

Thomas P. McCaffrey

Senior Vice President and Chief Financial Officer

7

Exhibit A

Proprietary Rights Agreement

EX-10.11

EXHIBIT 10.11

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement") is made as of this 9th day of December, 2008, by and between BE Aerospace, Inc., a Delaware corporation (the "Company") and Wayne Exton (the "Employee").

RECITALS

WHEREAS, the Company wishes to employ the Employee and the Employee wishes to accept such employment on the terms and conditions hereafter set forth; and

WHEREAS, the Company wishes to make secure for itself the experience, abilities and services of the Employee and to prevent the loss of such experience, services and abilities; and

WHEREAS, the Employee has successfully completed drug/substance abuse testing, and the Company has received the results of such testing;

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto, each intending to be legally bound, do hereby agree as follows:

l.  Employment.  The Company shall employ the Employee, and the Employee shall perform services for and continue in the employment of the Company, for an initial period of one (1) year commencing on May 1, 2006, and ending on April 30, 2007, whereupon the Employee’s employment hereunder shall automatically be extended from year to year for additional one (1)-year periods on and after May 1, 2007, until either the Company or the Employee gives the other party at least thirty (30) days written notice prior to the then-applicable "Expiration Date" (as hereinafter defined) of its or his desire to terminate this Agreement, unless the Employee’s employment is terminated earlier pursuant to this Agreement as hereinafter set forth.  For purposes of this Agreement (i) the term "Employment Period" shall mean the initial one (1) year period and all extensions thereof, if any, as aforesaid, and (ii) the term "Expiration Date" shall mean April 30 of either calendar year 2007 or any subsequent calendar year if the Employment Period is extended on and after April 30,  2007.

2.  Position and Duties.  The Employee shall serve the Company in the capacity of Group Vice President and General Manager, Business Jet Segment and, shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as may from time to time be prescribed by the President and Chief Operating Officer of the Company, or his designee.  The Employee shall perform and discharge, faithfully, diligently and to the best of his ability, such powers, duties and responsibilities.  The Employee shall devote all of his working time and efforts to the business and affairs of the Company.

3.  Compensation.

(a)  Salary.  During the Employment Period, the Employee shall receive a salary (the "Salary") payable at the rate of $335,010 per annum.  Such rate may be adjusted from time to time by the President and Chief Operating Officer provided, however, that it shall at no time be adjusted below the Salary then in effect.  The Salary shall be payable biweekly or in accordance with the Company’s current payroll practices, less all required deductions.  The Salary shall be pro-rated for any period of service less than a full year.

(b)  Incentive Bonus.  During the Employment Period, the Employee may receive an incentive bonus in accordance with the Company's executive bonus plan then in effect, as determined by the Company in its sole discretion.  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 which it is earned.

(c)  Expenses.  During the Employment Period, the Employee shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him on behalf of the Company in accordance with the Company’s policies in effect from time to time.

(d)  Benefits.  During the Employment Period, the Employee shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement, accident and other employee benefit plans, programs or arrangements made generally available by the Company to its employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements in effect from time to time.  In accordance with the Company's policies in effect from time to time, the Employee shall also be entitled to paid vacation in any fiscal year during the Employment Period as well as all paid holidays given by the Company to its employees.

(e)  Automobile.  During the Employment Period, the Employee shall receive an automobile allowance of $1,100 per month, payable in accordance with Company policy but in no event later than March 15th of the year following the year in which it shall accrue.

4.  Termination and Compensation Thereon.  

(a)  Termination Date.  Subject to the terms and conditions of this Agreement, the Employee’s employment pursuant to this Agreement may be terminated either by the Employee or the Company at any time and for any reason.  The term "Termination Date" shall mean (i) if the Employee’s employment is terminated (x) by his death, the date of his death, or (y) for any other reason, the date on which the Employee incurs a Separation from Service.

(b)  Death.  The Employee’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 the Employee 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 the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.

(c)   Incapacity.  If, in the reasonable judgment of the President and Chief Operating Officer, as a result of the Employee’s incapacity due to physical or mental illness, the Employee shall have been absent from his full-time duties as described hereunder for the entire period of six (6) consecutive months ("Incapacity"), the Employee’s employment shall terminate at the end of the six (6)-month period.  In such event, upon the Termination Date, the Company shall pay to the Employee a lump sum payment equal to the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Employee signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(c) or 4(g).  The Company’s obligation to pay the Employee his Salary and benefits (to the extent not previously paid) shall terminate if the Employee subsequently takes other employment to the extent of the Employee’s salary and benefits from such subsequent employment.  Any dispute between the President and Chief Operating Officer and the Employee with respect to the Employee’s Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the President and Chief Operating Officer and the Employee, whose decision shall be binding on all parties.

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(d)   Termination by the Company for Cause; Resignation by the Employee.   

(i)   If the Employee’s employment is terminated by the Company for Cause or the Employee resigns his employment for any reason (other than pursuant to Section 4(f)), the Company shall have no further obligations to the Employee hereunder after the Termination Date, except for unpaid Salary and benefits accrued through the Termination Date.

(ii)   For purposes of this Agreement, "Cause" shall mean (i) the Employee’s material failure, refusal or neglect to perform and discharge his powers, duties and responsibilities hereunder (including duties prescribed by the President and Chief Operating Officer pursuant to Section 2), other material breach of the terms hereof, or breach of any fiduciary duties he may have because of any position he holds with the Company or any subsidiary or affiliate thereof or (ii) a felony conviction or a conviction for any crime involving the Employee’s personal dishonesty or moral turpitude.

(e)   Termination Without Cause.  The Company may terminate the Employee’s employment hereunder at any time without Cause.  In such event, the Company shall pay to the Employee a lump sum payment equal to one (1) year’s salary at the rate in effect on the Termination Date; provided, however, that if, during the one (1)-year period following his termination of employment, the Employee accepts employment elsewhere, the amount of the lump sum payment will be reduced by an amount equal to his Salary divided by the number of days between the Termination Date and the date on which the Employee commences subsequent employment.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Employee signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(e) or 4(g).  

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(f)   Change of Control.  

(i)   If a "Change of Control" occurs during the Employment Period and, following or in connection with such Change of Control, this Agreement or the Employee’s employment is terminated for any reason (other than Cause), or the Employee resigns his employment because the Employee’s title and duties under Section 2 above are materially reduced without his agreement, or any compensation or benefit payable or otherwise extended to the Employee hereunder (including without limitation Salary, incentive bonus and benefits set forth in Section 3 above) is eliminated or materially reduced, the Company or its successor in interest shall give prompt notice to the Employee of any such  elimination or reduction and pay to the Employee a lump sum amount equal to:

(x) the Employee’s Salary (at the rate in effect as of the Termination Date), payable during the period from the Termination Date through the Expiration Date; and

(y) the Salary (at the rate in effect as of the date of the Change of Control).

The lump sum payment shall be made within thirty (30) days following the Termination Date.

(ii)   For purposes of this Agreement, a "Change of Control" shall mean a "change in control event" within the meaning of the default rules under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder ("Section 409A").  The obligations of the Company pursuant to this Section 4(f) shall survive any termination of this Agreement or the Employee’s employment or any resignation of such employment by the Employee pursuant to this Section 4(f).

(g)   Benefit Continuation.  If the Employee's employment is terminated pursuant to Sections 4(c), 4(e) or 4(f), the Company shall provide the Employee and his eligible dependents with continued participation in medical, dental and health benefit plans available to the Company’s executive officers on similar terms and conditions as active executives, from the Termination Date until the earlier of (i) the Expiration Date and (ii) the date the Employee becomes eligible for comparable benefits provided by a third party; provided, however, that the continuation of such benefits shall be subject to the respective terms of the applicable plan, in effect from time to time, and the timely payment by the Employee of his applicable share of the applicable premiums in effect from time to time.  To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A, the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

5.   Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

6.   Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

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If to the Company, to it at:

BE Aerospace, Inc.

1455 Fairchild Road

Winston-Salem, NC  27105

Attention: President and Chief Operating Officer

with a copy to:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention:  General Counsel

If to the Employee, to him at:

Becoplage Apartments

100 Lincoln Road, Apt. 628

Miami Beach, FL  33139

7.   Entire Agreement.  This Agreement constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties; provided, however, that this Agreement shall not supersede the Proprietary Rights Agreement dated as of the date hereof between the Employee and the Company attached as Exhibit A, which is incorporated herein by reference.

8.   Headings.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.  

9.  Counterparts.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument.

10.  Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Florida.  

11.  Withholding.  All payment made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

12.  Section 409A.  

(a)   If any amounts that become due under Section 4 of this Agreement constitute "nonqualified deferred compensation" within the meaning of Section 409A, payment of such amounts shall not commence until the Employee 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.

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(b)   Notwithstanding any provision of this Agreement to the contrary, if the Employee 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 Employee’s Separation from Service for any reason other than death or (ii) the Employee’s date of death.  The provisions of this Section 12(b) shall only apply if required to comply with Section 409A.

(c)   For purposes of this Agreement, "Separation from Service" shall have the meaning set forth in Section 409A(a)(2)(A)(i) and determined in accordance with the default rules under Section 409A.  "Specified Employee" shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(d)   It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without the Employee’s consent, modify the Agreement to:  (i) comply with, or avoid being subject to, Section 409A, (ii) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (iii) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 12(d) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(e)   Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to the Employee pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

13.  Enforceability; Waiver.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  The Employee's or the Company's failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that the Employee or the Company may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

14.   Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.  This Agreement may be assigned by the Company.  The Employee may not assign or delegate his duties under this Agreement without the Company’s prior written approval.

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15.   Survival.  The entitlement of the Employee and the obligations of the Company pursuant to Section 4 hereof shall each survive any termination or expiration of this Agreement, or any termination or resignation of the Employee’s employment, as the case may be.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

EMPLOYEE

/s/ Wayne Exton

Wayne Exton

BE AEROSPACE, INC.

/s/ Thomas P. McCaffrey  

Thomas P. McCaffrey

Senior Vice President and Chief Financial Officer

Exhibit A

Proprietary Rights Agreement

EX-10.12

EXHIBIT 10.12

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is made as of this 1st day of January, 2009, by and between BE Aerospace, Inc., a Delaware corporation (the “Company”) and Robert A. Marchetti (the “Executive”).

RECITALS

WHEREAS, the Company wishes to employ the Executive and the Executive wishes to accept such employment on the terms and conditions hereafter set forth; and

WHEREAS, the Company wishes to make secure for itself the experience, abilities and services of the Executive and to prevent the loss of such experience, services and abilities; and

WHEREAS, the Executive has successfully completed drug/substance abuse testing, and the Company has received the results of such testing;

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto, each intending to be legally bound, do hereby agree as follows:

1.Employment.  The Company shall employ the Executive, and the Executive shall perform services for and continue in the employment of the Company, for a period of two (2) years (the “Employment Period”) commencing on January 1, 2009, and ending on December 31, 2010 (the “Expiration Date”).

2.Position and Duties.  The Executive shall serve the Company in the capacity of Vice President and General Manager, Distribution Segment, and shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as may from time to time be prescribed by the President and Chief Operating Officer of the Company, or his designee.  The Executive shall perform and discharge, faithfully, diligently and to the best of his ability, such powers, duties and responsibilities.  The Executive shall devote all of his working time and efforts to the business and affairs of the Company.

3.Compensation.

(a)Salary.  During the Employment Period, the Executive shall receive a salary (the “Salary”) payable at the rate of $415,000 per annum.  Such rate may be adjusted from time to time by the Compensation Committee of the Board of Directors (the “Compensation Committee”); provided, however, that it shall at no time be adjusted below $415,000.  The Salary shall be payable biweekly or in accordance with the Company’s current payroll practices, less all required deductions.  The Salary shall be pro-rated for any period of service less than a full year.

(b)Incentive Bonus.  During the Employment Period, the Executive may receive an incentive performance bonus in accordance with the Company’s executive bonus plan then in effect from time to time, as determined by the Compensation Committee in its sole discretion.  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 which it shall accrue.

(c)Expenses.  During the Employment Period, the Executive shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him on behalf of the Company in accordance with the Company’s policies in effect from time to time.

(d)Benefits.  During the Employment Period, the Executive shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement, accident and other employee benefit plans, programs and arrangements made generally available by the Company to its employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements as in effect from time to time.  In accordance with the Company’s policies as in effect from time to time, the Executive shall also be entitled to paid vacation in any fiscal year during the Employment Period as well as all paid holidays given by the Company to its employees.

(e)Automobile.  During the Employment Period, the Executive shall be furnished with an automobile allowance of $1,100 per month less applicable taxes, payable in accordance with Company policy, but in no event later than March 15th of the year following the year in which the Automobile Allowance will accrue.

4.Termination and Compensation Thereon.

(a)Termination.  Subject to the terms and conditions of this Agreement, the Executive’s employment pursuant to this Agreement may be terminated either by the Executive or the Company at any time and for any reason with or without Cause.  The term “Termination Date” shall mean the earlier of (i) the Expiration Date; or (ii) if the Executive’s employment is terminated (x) by his death, the date of his death, or (y) for any other reason, the date on which the Executive incurs a Separation from Service (as defined below).

(b)Death.  The Executive’s employment hereunder shall terminate upon his death.  In such event, the Company shall within thirty (30) days following his date of death pay to such person as the 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 the Salary (at the rate in effect as of the Termination Date) that would have been due to the Executive had this Agreement been in effect and he remained employed from the date of his death until the Expiration Date.

(c)Incapacity.  If, in the reasonable judgment of the President and Chief Operating Officer, as a result of the Executive’s incapacity due to physical or mental illness, the Executive shall have been absent from his full-time duties as described hereunder for the entire period of six (6) consecutive months (“Incapacity”), the Executive’s employment shall terminate at the end of the six (6)-month period.  In such event, upon the Termination Date, the Company shall pay to the Executive a lump sum payment equal to the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.  The lump sum payment shall be made within sixty (60) days following the Termination Date provided that prior to the payment date the Executive signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to this Section 4(c).  The Company’s obligation to pay the Executive his Salary shall terminate if the Executive subsequently takes other employment to the extent of the Executive’s salary and benefits from such subsequent employment.  Any dispute between the President and Chief Operating Officer and the Executive with respect to the Executive’s Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the Senior Vice President and the Executive, whose decision shall be binding on all parties.

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(d)Termination by the Company for Cause; Resignation by the Executive.

(i) If the Executive’s employment is terminated by the Company for Cause or the Executive resigns his employment for any reason (other than pursuant to Section 4(f) , the Company shall have no further obligations to the Executive hereunder after the Termination Date, except for unpaid Salary and benefits accrued through the Termination Date.

(ii)For purposes of this Agreement, “Cause” shall mean (i) the Executive’s material failure, refusal or neglect to perform and discharge his powers, duties and responsibilities hereunder (including duties prescribed by the President and Chief Operating Officer pursuant to Section 3), other material breach of the terms hereof, or breach of any fiduciary duties he may have because of any position he holds with the Company or any subsidiary or affiliate thereof or (ii) a felony conviction or a conviction for any crime involving the Executive’s personal dishonesty or moral turpitude.

(e)Full Term Payment.  If the Executive remains employed through the Expiration Date,he shall be entitled to a lump sum cash payment of $415,000 (the “Full Service Payment”).  The Full Service Payment shall be made in a cash lump sum on the second (2nd) anniversary of the Expiration Date.  Notwithstanding the forgoing, if the Company terminates the Executive’s employment hereunder without Cause prior to the Expiration Date the Full Service Payment shall be made within sixty (60) days following the Termination Date.  Payment of the Full Service Payment is conditioned upon the Executive signing a waiver and release agreement in the form provided by the Company and such waiver and release agreement becoming effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the applicable payment date set forth in this Section 4(e), the Company shall have no further obligations pursuant to this Section 4(e).  To the extent the Executive is eligible to receive a payment pursuant to Section 4(f), he shall not be entitled to a payment pursuant to this Section 4(e).

(f)Change of Control.

(i)If a “Change of Control” occurs during the Employment Period and, in connection with or within two years following such Change of Control the Executive’s employment is terminated by the Company without Cause, or the Executive resigns his employment because the Executive’s title and duties under Section 2 above are materially reduced without his agreement, or any compensation or benefit payable or otherwise extended  to the Executive hereunder (including without limitation Salary, incentive bonus and benefits set forth in Section 3 above) is eliminated or reduced, the Company or its successor  in interest shall: give prompt notice to the Executive of any such termination, elimination or reduction and pay to the Executive a lump sum payment equal to:

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(x)           the Executive’s Salary (at the rate in effect as of the Termination Date), which amount shall not be pro-rated and shall be paid in addition to the Salary due and payable under (y) below;

(y)           the Salary (at the rate in effect as of the date of the Change of Control) payable during the period from the Termination Date through the Expiration Date; and

(z)           his target incentive bonus for the year in which the Termination Date occurs.

The lump sum payment shall be made within sixty (60) days following the Termination Date; provided that prior to the payment date the Executive signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant this Section 4(f).

(ii)For purposes of this Agreement, a “Change of Control” shall mean a “change in control event” within the meaning of the default rules under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (the “Code”).  The obligations of the Company pursuant to this Section 4(f) shall survive any termination of this Agreement or the Executive’s employment or any resignation of such employment by the Executive pursuant to this Section 4(f).

(g)Benefit Continuation.  If the Executive's employment is terminated pursuant to Sections 4(c), 4(e) or 4(f), the Company shall provide the Executive and his eligible dependents with continued participation in medical, dental and health benefit plans available to the Company’s executive officers on similar terms and conditions as active executives, from the Termination Date until the earlier of (i) the second (2nd) anniversary of the Expiration Date and (ii) the date the Executive becomes eligible for comparable benefits provided by a third party; provided,however,that the continuation of such benefits shall be subject to the respective terms of the applicable plan, as in effect from time to time, and the timely payment by the Executive of his applicable share of the applicable premiums in effect from time to time.  To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A, the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

5.Consulting Arrangement.

(a)Consulting Services.  Upon the Expiration Date, the Company shall engage the Executive to provide consulting services to the Company for a period of two (2) Years (the “Consulting Period”).  During the Consulting Period, the Executive shall provide advice and consultation to the Company and such other services mutually agreed to by the Executive and the Company (the “Consulting Services”).  At all times the Consulting Services shall be nonexclusive and the Executive shall only be required to devote so much time as is reasonably necessary to discharge the Consulting Services.If the Executive incurs a Separation from Service for any reason prior to the Expiration Date, the Company shall not be obligated to engage the Executive to provide the Consulting Services pursuant to this Section 5.

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(b)Service Standards.  The Executive shall perform the Consulting Services in a commercially reasonable manner.  In no event shall the Executive have any liability to the Company arising out of or related to the Executive’s performance of the Consulting Services except to the extent it arises directly by reason of the Executive’s gross negligence or willful misconduct in performing such Consulting Services.

(c)Consulting Fees.  During the Consulting Period, the executive shall receive a monthly consulting fee $21,067payable in monthly installments in arrears on the last day of the month (pro-rated for partial months).  

(d)Expenses.  During the Consulting Period the Company shall pay or reimburse the Executive for reasonable out-of-pocket expenses incurred in connection with the Executive’s performance of the Consulting Services in accordance with past practices.

(e)Independent Contractor.  The Executive acknowledges that the Consulting Services shall be performed in the capacity of an “independent contractor,” that the Executive is solely responsible for the Executive’s actions or inactions, and that nothing in this Agreement shall be construed to create an employment relationship between the parties during the Consulting Period.  The Executive agrees that, with respect to the Consulting Services provided hereunder, the Executive is not an employee of the Company for any purpose, including, without limitation: (i) for federal, state or local tax, employment, withholding or reporting purposes; or (ii) for eligibility or entitlement to any benefit under any of the Company’s employee benefit plans (including, without limitation, those plans that are subject to the Employee Retirement Income Security Act of 1974, as amended), incentive compensation or other employee programs or policies.

(f)Code of Conduct.  During the Consulting Period, the Executive shall comply with the Company’s Code of Conduct and its Delegations of Authority, each as in effect from time to time (as if he was a non-management employee with respect to the Delegation of Authority Policy).

(g)Indemnification.  To the fullest extent permitted under applicable laws, rules and regulations and the Company’s applicable corporate governance documents, the Company agrees to indemnify and hold the Executive harmless from any loss or liability, cost and expense (including, but not limited to, reasonable attorney’s fees) incurred by the Executive as a result of his being made a party to any action or proceedings by reason of his provision of the Consulting Services.

(h)Payment of Taxes.  The Executive shall be responsible for and shall maintain adequate records of expenses that he incurs in the course of performing the Consulting Services hereunder and shall be solely responsible for and shall file, on a timely basis, tax returns and payments required to be filed with or made to any federal, state or local tax authority with respect to his performance of the Consulting Services.  Neither federal, state nor local income tax of any kind shall be withheld or paid by the Company with respect to any amount paid to the Executive pursuant to this Consulting Agreement.  The Executive agrees that he is responsible for withholding and paying all employment taxes and income withholding taxes as required.

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(i)Proprietary Rights Agreement.  The Proprietary Rights Agreement dated as of [-----] between the Executive and the Company attached as Exhibit A  shall remain in full force and effect during the Consulting Period.

6.Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

7.Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Company, to it at

BE Aerospace, Inc.

1455 Fairchild Road

Winston-Salem, NC  27105

Attention: President and Chief Operating Officer

With a copy to:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention:  General Counsel

If to the Executive, to him at:

2499 Eagle Watch Lane

Weston, FL 33327

8.Entire Agreement.  This Agreement constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties; provided, however, that this Agreement shall not supersede the Proprietary Rights Agreement between the Executive and the Company attached as Exhibit A which is incorporated herein by reference.

9.Headings.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.

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10.Counterparts.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument.

11.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws (other than the conflict of laws rules) of the State of Florida.

12.Withholding.  All payments made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

13.Section 409A.

(a)If any amounts that become due under Section 4 of this Agreement constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code and the regulations promulgated thereunder (“Section 409A”), 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.

(b)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) the Executive’s date of death.  The provisions of this Section 13(b) shall only apply if required to comply with Section 409A.

(c)For purposes of this Agreement, “Separation from Service” shall have the meaning set forth in Section 409A(a)(2)(A)(i) and determined in accordance with the default rules under Section 409A.  “Specified Employee” shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(d)It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without the Executive’s consent, modify the Agreement to:  (i) comply with, or avoid being subject to, Section 409A, (ii) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (iii) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 13(d) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(e)Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to the Executive pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

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14.Enforceability; Waiver.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  The Executive's or the Company's failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that the Executive or the Company may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

15.Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.  This Agreement may be assigned by the Company.  The Executive may not assign or delegate his duties under this Agreement without the Company’s prior written approval.

16.Survival.  The entitlement of the Executive and the obligations of the Company pursuant to Section 4 hereof shall each survive any termination or expiration of this Agreement, or any termination or resignation of the Executive’s employment, as the case may be.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

EXECUTIVE

/s/ Robert A. Marchetti

Robert A. Marchetti

BE AEROSPACE, INC.

/s/ Thomas P. McCaffrey

Thomas P. McCaffrey

Senior Vice President and Chief Financial Officer

Exhibit A

Proprietary Rights Agreement

EX-10.13

EXHIBIT 10.13

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this "Agreement") is made as of this 9th. day of December, 2008, by and between BE Aerospace, Inc., a Delaware corporation (the "Company") and Stephen R. Swisher (the "Employee").

RECITALS

WHEREAS, the Company wishes to employ the Employee and the Employee wishes to accept such employment on the terms and conditions hereafter set forth; and

WHEREAS, the Company wishes to make secure for itself the experience, abilities and services of the Employee and to prevent the loss of such experience, services and abilities; and

WHEREAS, the Employee has successfully completed drug/substance abuse testing, and the Company has received the results of such testing;

NOW THEREFORE, for good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto, each intending to be legally bound, do hereby agree as follows:

l.  Employment.  The Company shall employ the Employee, and the Employee shall perform services for and continue in the employment of the Company, for an initial period of one (1) year commencing on July 1, 1998, and ending on June 30, 1999, whereupon the Employee’s employment hereunder shall automatically be extended from year to year for additional one (1)-year periods on and after July 1, 1999, until either the Company or the Employee gives the other party at least thirty (30) days written notice prior to the then-applicable "Expiration Date" (as hereinafter defined of its or his desire to terminate this Agreement, unless the Employee's employment is terminated earlier pursuant to this Agreement as hereinafter set forth.  For purposes of this Agreement (i) the term "Employment Period" shall mean the initial one (1) year period and all extensions thereof, if any, as aforesaid, and (ii) the term "Expiration Date" shall mean June 30 of either calendar year 1999 or any subsequent calendar year if the Employment Period is extended on and after July 1, 1999.

2.  Position and Duties.  The Employee shall serve the Company in the capacity of Vice President-Finance and Corporate Controller of the Company and, shall be accountable to, and shall have such other powers, duties and responsibilities, consistent with this capacity, as may from time to time be prescribed by the Senior Vice President and Chief Financial Officer of the Company, or his designee.  The Employee shall perform and discharge, faithfully, diligently and to the best of his ability, such powers, duties and responsibilities.  The Employee shall devote all of his working time and efforts to the business and affairs of the Company.

3.  Compensation.

(a)  Salary.  During the Employment Period, the Employee shall receive a salary (the "Salary") payable at the rate of $272,506 per annum.  Such rate may be adjusted from time to time by the Senior Vice President and Chief Financial Officer; provided, however, that it shall at no time be adjusted below the Salary then in effect.  The Salary shall be payable biweekly or in accordance with the Company’s current payroll practices, less all required deductions.  The Salary shall be pro-rated for any period of service less than a full year.

(b)  Incentive Bonus.  During the Employment Period, the Employee may receive a performance bonus of up to eighty (80%) percent, as determined by the Company in its sole discretion.  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 which it is earned.

(c)  Expenses.  During the Employment Period, the Employee shall be entitled to receive prompt reimbursement for all reasonable business expenses incurred by him on behalf of the Company in accordance with the Company's policies in effect from time to time.

(d)  Fringe Benefits.  During the Employment Period, the Employee shall be entitled to participate in or receive benefits under any life or disability insurance, health, pension, retirement and accident plans or arrangements made generally available by the Company to its employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements in effect from time to time.  In accordance with the Company's policies in effect from time to time, the Employee shall also be entitled to paid vacation in any fiscal year during the Employment Period as well as all paid holidays given by the Company to its employees.

4.  Termination and Compensation Thereon.

(a)  Termination Date.  Subject to the terms and conditions of this Agreement, the Employee's employment pursuant to this Agreement may be terminated either by the Employee or the Company at any time and for any reason.  The term "Termination Date" shall mean (i) if the Employee’s employment is terminated (x) by his death, the date of his death; or (y) for any other reason, the date on which the Employee incurs a Separation from Service.

(b)  Death.  The Employee’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 the Employee 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 the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.

(c)   Incapacity.  If, in the reasonable judgment of the President and Chief Operating Officer, as a result of the Employee’s incapacity due to physical or mental illness, the Employee shall have been absent from his full-time duties as described hereunder for the entire period of six (6) consecutive months ("Incapacity"), the Employee’s employment shall terminate at the end of the six (6)-month period.  In such event, upon the Termination Date, the Company shall pay to the Employee a lump sum payment equal to the Salary (at the rate in effect as of the Termination Date) payable during the period from the Termination Date through the Expiration Date.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Employee signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(c) or 4(g).  The Company’s obligation to pay the Employee his Salary and benefits (to the extent not previously paid) shall terminate if the Employee subsequently takes other employment to the extent of the Employee’s salary and benefits from such subsequent employment.  Any dispute between the President and Chief Operating Officer and the Employee with respect to the Employee’s Incapacity shall be settled by reference to a competent medical authority mutually agreed to by the President and Chief Operating Officer and the Employee, whose decision shall be binding on all parties.

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(d)   Termination by the Company for Cause; Resignation by the Employee.

(i)  If the Employee's employment is terminated by the Company for Cause or the Employee resigns his employment for any reason (other than pursuant to Section 4(f)), the Company shall have no further obligations to the Employee hereunder after the Termination Date, except for unpaid Salary and benefits accrued through the Termination Date.

(ii)  For purposes of this Agreement, "Cause" shall mean (i) the Employee's material failure, refusal or neglect to perform and discharge his powers, duties and responsibilities hereunder (including duties prescribed by the President and Chief Operating Officer pursuant to Section 2), other material breach of the terms hereof, or breach of any fiduciary duties he may have because of any position he holds with the Company or any subsidiary or affiliate thereof; or (ii) a felony conviction or a conviction for any crime involving the Employee's personal dishonesty or moral turpitude.

(e)  Termination Without Cause.  The Company may terminate the Employee’s employment hereunder at any time without Cause.  In such event, the Company shall pay to the Employee a lump sum payment equal to one (1) year’s salary at the rate in effect on the Termination Date; provided, however, that if, during the one (1)-year period following his termination of employment, the Employee accepts employment elsewhere, the amount of the lump-sum payment will be reduced by an amount equal to his Salary divided by the number of days between the Termination Date and the date on which the Employee commences subsequent employment.  The lump sum payment shall be made within sixty (60) days following the Termination Date, provided that prior to the payment date the Employee signs a waiver and release agreement in the form provided by the Company and such waiver and release becomes effective and irrevocable in its entirety prior to such date.  If the waiver and release does not become effective and irrevocable on or prior to the payment date set forth in the preceding sentence, the Company shall have no further obligations pursuant to Sections 4(e) or 4(g).

(f)   Change of Control.

(i)  If a "Change of Control" occurs during the Employment Period and, following or in connection withsuch Change of Control, this Agreement or the Employee’s employment is terminated for any reason (other than for Cause), or the Employee resigns his employment because any of the Employee’s position, powers, duties or responsibilities under Section 2 above are materially reduced without his agreement, or any compensation or benefit payable or otherwise extended  to the Employee hereunder (including without limitation Salary, incentive bonus and fringe benefits set forth in Section 3 above) is eliminated or materially reduced, the Company or its successor  in interest shall give prompt notice to the Employee of any such elimination or reduction and pay to the Employee a lump sum amount equal to:

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(x) the Employee’s Salary (at the rate in effect as of the Termination Date), payable during the period from the Termination Date through the Expiration Date; and

(y) the Salary (at the rate in effect as of the date of the Change of Control).

The lump sum payment shall be made within thirty (30) days following the Termination Date.

(ii)  For purposes of this Agreement, a "Change of Control" shall mean a "change in control event" within the meaning of the default rules under Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder ("Section 409A").  The obligations of the Company pursuant to this Section 4(f) shall survive any termination of this Agreement or the Employee's employment or any resignation of such employment by the Employee pursuant to this Section 4(f).

(g)   Benefit Continuation.  If the Employee's employment is terminated pursuant to Sections 4(c), 4(e) or 4(f), the Company shall provide the Employee and his eligible dependents with continued participation in medical, dental and health benefit plans available to the Company’s executive officers on similar terms and conditions as active executives, from the Termination Date until the earlier of (i) the Expiration Date and (ii) the date the Employee becomes eligible for comparable benefits provided by a third party; provided, however, that the continuation of such benefits shall be subject to the respective terms of the applicable plan, in effect from time to time, and the timely payment by the Employee of his applicable share of the applicable premiums in effect from time to time.  To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A, the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

5.   Amendments.  No amendment to this Agreement or any schedule hereto shall be effective unless it shall be in writing and signed by each party hereto.

6.   Notices.  All notices and other communications hereunder shall be in writing and shall be deemed given when delivered personally or sent by telecopy or three days after being mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

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 If to the Company, to it at:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention: Senior Vice President & CFO

with a copy to:

BE Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attention:  General Counsel

If to the Employee, to him at:

14643 Draft Horse Lane

Wellington, FL  33414

7.   Entire Agreement.  This Agreement constitutes the entire agreement among the parties hereto pertaining to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties; provided, however, that this Agreement shall not supersede the Proprietary Rights Agreement dated as of the date hereof between the Employee and the Company attached as Exhibit A, which is incorporated herein by reference.

8.   Headings.  The headings in this Agreement are for convenience of reference only and shall not alter or otherwise affect the meaning hereof.

9.  Counterparts.  This Agreement may be executed in any number of counterparts which together shall constitute one instrument.

10.  Governing Law.  This Agreement shall be governed by and construed in accordance with the laws (other than the conflict of laws rules) of the State of Florida and shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.

11.  Withholding.  All payment made by the Company under this Agreement shall be reduced by any tax or other amounts required to be withheld by the Company under applicable law.

12.  Section 409A.

(a)  If any amounts that become due under Section 4 of this Agreement constitute "nonqualified deferred compensation" within the meaning of Section 409A, payment of such amounts shall not commence until the Employee 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.

(b)  Notwithstanding any provision of this Agreement to the contrary, if the Employee 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 Employee’s Separation from Service for any reason other than death or (ii) the Employee’s date of death.  The provisions of this Section 12(b) shall only apply if required to comply with Section 409A.

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(c)  For purposes of this Agreement, "Separation from Service" shall have the meaning set forth in Section 409A(a)(2)(A)(i) and determined in accordance with the default rules under Section 409A.  "Specified Employee" shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(d)  It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without the Employee’s consent, modify the Agreement to:  (i) comply with, or avoid being subject to, Section 409A, (ii) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (iii) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 12(d) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(e)  Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to the Employee pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

13.  Enforceability; Waiver.  The invalidity and unenforceability of any term or provision hereof shall not affect the validity or enforceability of any other term or provision hereof.  The Employee's or the Company's failure to insist upon strict compliance with any provision hereof or any other provision of this Agreement or the failure to assert any right that the Employee or the Company may have hereunder, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.  Similarly, the waiver by any party hereto of a breach of any provision of this Agreement by the other party will not operate or be construed as a waiver of any other or subsequent breach by such other party.

14.  Assignment.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.  This Agreement may be assigned by the Company.  The Employee may not assign or delegate his duties under this Agreement without the Company’s prior written approval.

15.  Survival.  The entitlement of the Employee and the obligations of the Company pursuant to Section 4 hereof shall each survive any termination or expiration of this Agreement, or any termination or resignation of the Employee’s employment, as the case may be.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

EMPLOYEE

/s/ Stephen R. Swisher

Stephen R. Swisher

BE AEROSPACE, INC.

/s/ Thomas P. McCaffrey

Thomas P. McCaffrey

Senior Vice President and Chief Financial Officer

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Exhibit A

Proprietary Rights Agreement

EX-10.14

EXHIBIT 10.14

EXECUTION COPY

RETIREMENT AGREEMENT

THIS RETIREMENT AGREEMENT, dated as of November 19, 2008 (the “Agreement”), by and between BE Aerospace, Inc., a Delaware corporation (the “Company”) and Edmund J. Moriarty (the “Executive”).

WHEREAS, the Company and the Executive are parties to a certain Employment Agreement, dated as of September 18, 1995, as amended January 1, 1996 (the “Employment Agreement”); and

WHEREAS, the Company and the Executive have agreed to the Executive’s retirement as an employee and an officer of the Company; and

WHEREAS, in consideration for the Executive’s long service with the Company and his agreement to the covenants and restrictions set forth herein, the Company has agreed to enter into this Agreement which provides the Executive with certain payments and benefits to which he is not otherwise entitled; and

WHEREAS, except as otherwise set forth herein, the parties intend that this Agreement shall set forth the terms of the Executive’s retirement and that this Agreement shall supersede all prior agreements between the parties regarding the subject matter contained herein, including, without limitation, the Employment Agreement.

NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth in this Agreement, the parties hereto hereby agree as follows:

1. Continued Employment.  From the date hereof through June 30, 2009, (the “Effective Date”), the Executive shall remain employed as the Vice President–Law, General Counsel and Secretary of the Company.  During the period commencing on the date hereof and ending on the Effective Date, the Executive (i) shall be entitled to the compensation and benefits set forth in Section 3 of his Employment Agreement (as in effect on the date hereof) and (ii) shall be obligated to perform the duties set forth in Section 2 of the Employment Agreement.

2. Retirement.  Effective as of the Effective Date, the Executive shall retire from his position as the Vice President–Law, General Counsel and Secretary of the Company and from all other positions and offices with the Company and any of its subsidiaries or affiliates (collectively, the “Company Group”).

3. Severance Payments and Benefits.  In consideration of  the covenants set forth herein, and the waiver and release of claims set forth below and provided that the Executive does not revoke this Agreement during the applicable Revocation Period (as defined in Section 12 below), the Company shall provide the Executive with the following severance payments and benefits:

a. Accrued Amounts.  The Executive shall receive a lump sum payment within thirty (30) days following the Effective Date equal to (1) any earned but unpaid salary through the Effective Date; (2) any earned but unpaid annual bonus for any fiscal year that ended prior to the Effective Date; and (3) reimbursement of approved expenses due to the Executive pursuant to the Company’s policies in effect from time to time.

b. Initial Severance Payments.  During the period commencing on the Effective Date and ending on the six (6) month anniversary of the Effective Date (the “Initial Severance Period”), the Executive shall receive payment of an amount (the “Initial Severance”) equal to $172,250.  Payment of the Initial Severance shall commence on the date the Release becomes effective and shall be paid in equal installments through the remainder of the Initial Severance Period in accordance with the Company’s payroll practices in effect on the Effective Date.  The Initial Severance is intended to constitute a “separation payment plan” for purposes of Section 409A of the U.S. Internal Revenue Code and the Regulations and guidance promulgated thereunder (“Section 409A”).  Notwithstanding the forgoing, payment of the Initial Severance will be conditioned upon the Executive signing a waiver and release of claims with the same terms as set forth in Section 10 hereof and such waiver and release becoming effective and irrevocable on or prior to the second (2nd) month anniversary of the Effective Date (the “Final Release”).

c. Additional Severance Payment.  During the two (2) year period commencing on the first business day following the expiration of the Initial Severance Period and ending on December 31, 2011 (the “Additional Severance Period”) the Executive shall receive payment of an amount (the “Additional Severance”) equal to $516,758.30.  The Additional Severance shall be paid in equal installments through the Additional Severance Period in accordance with the Company’s payroll practices in effect on the Effective Date subject to the Final Release becoming effective and irrevocable.

d. Death.  In the event that the Executive dies during the Initial Severance Period or the Additional Severance Period, the Company shall pay to such person as the 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 the payments that would have been due to the Executive under this Agreement from the date of his death until the end of the Additional Severance Period.

e. Continuation of Health Insurance.  During the period commencing on the Effective Date and ending on the earlier of (i) the second (2nd) anniversary of the Effective Date and (ii) the date on which the Executive begins receiving comparable coverage from another entity, the Company shall continue to provide the Executive with all medical, dental and health benefits available from time to time to the Company’s executive officers under the Company’s medical, dental and health benefits plans, including, without limitation, the benefits available under the Company’s executive medical reimbursement plan in effect as of January 1, 1998;  provided,however,that the continuation of such benefits shall be subject to the respective terms of the applicable plan, as in effect from time to time, and the timely payment by the Executive of his applicable share of the applicable premiums in effect from time to time.  To the extent that reimbursable medical and dental care expenses constitute deferred compensation for purposes of Section 409A, the Company shall reimburse the medical and dental care expenses as soon as practicable consistent with the Company’s practice, but in no event later than the last day of the calendar year next following the calendar year in which such expenses are incurred.

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f. Accrued Vacation.  The Company shall pay the Executive a lump sum cash payment equal to $50,816.00 which represents forty (40) days of accrued but unused vacation.  Such payment shall be made within thirty (30) days following the Effective Date.

g. Treatment of Stock Options.  As of the Effective Date, the Executive has two thousand (2,000) vested and outstanding stock options with a grant date of November 24, 2004, an expiration date of November 23, 2014, and a strike price of $10.42 (the “Options”) which were granted to the Executive under the Company’s 2001 Stock Option Plan of the Company (together with the individual grant documents, the “Stock Option Plan”).  The Options shall continue in effect after the Effective Date and remain exercisable by the Executive at any time on or before November 23, 2014 pursuant to the terms and conditions of the Stock Option Plan.

h. ATS Stock.  On the Effective Date the Company shall pay to Executive a lump sum amount of $5,200.00 for the Company’s purchase of Executive’s twenty thousand (20,000) shares of common stock of Advanced Thermal Sciences Corporation owned by Executive as of the Effective Date; provided that such shares continue to be held by the Executive on such date.

i. Restricted Stock.  The Company agrees that, notwithstanding any other agreement or equity plan providing to the contrary, on the Effective Date all awards of restricted stock of the Company granted to the Executive on or before June 30, 2009, shall vest and shall no longer be subject to forfeiture or restrictions on transfer.  Such awards are listed on Appendix A attached hereto and made a part hereof.

4. Consulting Services.

a. Consulting Services.  During the Initial Severance Period and the Additional Severance Period (the “Consulting Period”), the Executive shall provide advice and consultation to the Company and such other services mutually agreed to by the Executive and the Company (the “Consulting Services”).  At all times the Consulting Services shall be nonexclusive and the Executive shall only be required to devote so much time as is reasonably necessary to discharge the Consulting Services; provided, however, that in no event shall the Consulting Services represent more than twenty percent (20%) of the average level of bona fide services the Executive provided to the Company Group over the thirty-six (36) month period prior to the Effective Date.

b. Service Standards.  The Executive shall perform the Consulting Services in a commercially reasonable manner.  In no event shall the Executive have any liability to the Company arising out of or related to the Executive’s performance of the Consulting Services except to the extent it arises directly by reason of the Executive’s gross negligence or willful misconduct in performing such Consulting Services.

c. Expenses.  During the Consulting Period the Company shall pay or reimburse the Executive for reasonable out-of-pocket expenses incurred in connection with the Executive’s performance of the Consulting Services in accordance with past practices.

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d. Independent Contractor.  The Executive acknowledges that the Consulting Services shall be performed in the capacity of an “independent contractor,” that the Executive is solely responsible for the Executive’s actions or inactions, and that nothing in this Agreement shall be construed to create an employment relationship between the parties during the Consulting Period.  The Executive agrees that, with respect to the Consulting Services provided hereunder, the Executive is not an employee of the Company for any purpose, including, without limitation: (i) for federal, state or local tax, employment, withholding or reporting purposes; or (ii) for eligibility or entitlement to any benefit under any of the Company’s employee benefit plans (including, without limitation, those plans that are subject to the Employee Retirement Income Security Act of 1974, as amended), incentive, compensation or other employee programs or policies.

e. Code of Conduct.  During the Consulting Period, the Executive shall comply with the Company’s Code of Conduct and its Delegations of Authority, each as in effect from time to time (as if he was a non-management employee with respect to the Delegation of Authority Policy).

f. Indemnification.  To the fullest extent permitted under applicable laws, rules and regulations and the Company’s applicable corporate governance documents, the Company agrees to indemnify and hold the Executive harmless from any loss or liability, cost and expense (including, but not limited to, reasonable attorney’s fees) incurred by the Executive as a result of his being made a party to any action or proceedings by reason of his provision of the Consulting Services.

5. Return of Property.  Except as otherwise provided in this Section 5, on or prior to the Effective Date, the Executive shall surrender to the Company all property of the Company in the Executive’s possession and all property made available to the Executive in connection with his employment by the Company Group.  On and after the Effective Date, the Executive shall retain the handheld wireless devices (including, without limitation, the Blackberry and other mobile phones), computer, computer monitor, printer, docking station, keyboard, and all other related hardware and peripheral equipment, including, without limitation, CD-ROM and floppy disk drives, connecting cables, power plugs and batteries, made available to the Executive in connection with his employment by the Company.

6. Cooperation.  From and after the Effective Date, the Executive shall cooperate at no expense to Executive in all reasonable respects with any member of the Company Group and their respective directors, officers, attorneys and experts in connection with the conduct of any action, proceeding, investigation or litigation involving any member of the Company Group, including, without limitation, any such action, proceeding, investigation or litigation in which the Executive is called to testify.

7. Unfavorable Comments; Confidentiality of this Agreement.

a. Public Comments by the Executive.  The Executive agrees to refrain from making, directly or indirectly, now or at any time in the future, whether in writing, orally or electronically: (i) any derogatory comment concerning any member of the Company Group or any of their current or former directors, officers, employees or shareholders, or (ii) any other comment that could reasonably be expected to be detrimental to the business or financial prospects or reputation of any member of the Company Group.

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b. Confidentiality of this Agreement.  The parties agree that the terms of this Agreement (other than the fact of the Executive’s retirement from the Company and the date thereof) are “Confidential Information” as defined in Section 8.a. below, and that neither party may disclose any of such terms to any other person other than their attorneys, financial or tax advisers, accountants or spouses.  The parties agree that they shall instruct their attorneys, financial and tax advisers, accountants and spouses not to disclose such terms to any other person.  Notwithstanding anything herein to the contrary, the Executive and the Executive’s representatives may consult any tax advisor regarding the tax treatment and tax structure of the retirement arrangement set forth in this Agreement and may disclose to any person, without limitation of any kind, the tax treatment and tax structure of such arrangement and all materials (including opinions or other tax analyses) that are provided relating to such treatment or structure.

c. Permitted Disclosure.  The provisions of this Section 7 shall not preclude a party from:  (i) providing any information required by law or any regulations of any securities exchange, (ii) disclosing any information necessary to prepare a defense of any claim, or (iii) responding to any statement made by the other party hereto in contravention of this Section 7.

8. Confidentiality; Noncompetition; Nonsolicitation.

a. Confidential Information.  Except as otherwise provided in Sections 7.b. and 7.c. hereof, the Executive agrees that he will not at any time, except with the prior written consent of the Company, which consent shall not be unreasonably withheld or delayed, directly or indirectly, reveal to any person, entity or other organization (other than a member of the Company Group or their respective employees, officers, directors, shareholders or agents) or use for Executive’s own benefit any information reasonably deemed to be confidential by any member of the Company Group (“Confidential Information”) relating to the assets, liabilities, employees, goodwill, business or affairs of any member of the Company Group including, without limitation, any information concerning past, present or prospective customers, manufacturing processes, marketing data, or other confidential information used by, or useful to, any member of the Company Group and known (whether or not known with the knowledge and permission of any member of the Company Group and whether or not at any time prior to the Executive’s employment with the Company developed, devised, or otherwise created in whole or in part by the efforts of the Executive) to the Executive by reason of the Executive’s employment by, shareholdings in or other association with any member of the Company Group.  The term Confidential Information shall not include information that (i) is or becomes generally available to the public other than as a result of a disclosure by, or at the direction of, the Executive, (ii) was within the Executive’s possession prior to its being furnished to the Executive by or on behalf of any member of the Company Group, provided that the source of such information was not known by the Executive to be bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to any member of the Company Group with respect to such information or (iii) becomes available to the Executive on a non-confidential basis from a source other than any member of the Company Group or any of its representatives; provided that such source is not known to the Executive to be bound by a confidentiality agreement with or other contractual, legal or fiduciary obligation of confidentiality to Company Group with respect to such information.  Notwithstanding anything in this Section 8.a. to the contrary, in the event that the Executive becomes legally compelled to disclose any Confidential Information, the Executive shall provide the Company with prompt written notice so that the Company Group may seek a protective order or other appropriate remedy.  In the event that such protective order or other remedy is not obtained, the Executive shall furnish only that portion of such Confidential Information or take only such action as is legally required by the subject subpoena or binding order and shall exercise his reasonable efforts to obtain reliable assurance that confidential treatment shall be accorded any such Confidential Information.  The Company shall promptly pay (upon receipt of invoices and any other reasonably related, non-privileged documentation as may be requested by the Company) all reasonable expenses and fees incurred by the Executive, including, without limitation, reasonable attorneys’ fees, in connection with his compliance with the immediately preceding sentence.

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b. Noncompetition.  The Executive agrees that for a two (2) year period commencing on the Effective Date (the “Restricted Period”), the Executive shall not, without the prior written consent of the Company, directly or indirectly, and whether as principal or investor or as an employee, officer, director, manager, partner, consultant, agent or otherwise, alone or in association with any other person, firm, corporation or other business organization, carry on a Competing Business (as hereinafter defined) in any geographic area in which any member of the Company Group has engaged, is engaged, or will engage during such period, in a Competing Business (including, without limitation, any area in which any customer of any member of the Company Group may be located).  For purposes of this Section 8.b., carrying on a “Competing Business” means to engage in any business engaged in by any member of the Company Group during the one (1) year period prior to the Effective Date; provided, however, that nothing herein shall limit the Executive’s right to own not more than one percent (1%) of any of the debt or equity securities of any business organization that is then filing reports with the Securities and Exchange Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended.

c. Non-Solicitation.  The Executive agrees that during the Restricted Period, the Executive shall not directly or indirectly (i) interfere with or attempt to interfere with any person who is, or was during the then most recent twelve (12) month period, an employee, officer, director, representative or agent of any member of the Company Group, or solicit, induce or attempt to solicit or induce any of them to leave the employ or service of the Company Group or violate the terms of their contracts, or any service arrangements, with such entities; (ii) induce or attempt to induce any employee of any member of the Company Group to leave the employ of any member of the Company Group, or interfere in any way with the relationship between any member of the Company Group and any employee of any member of the Company Group; or (iii) induce or attempt to induce any customer, supplier, licensee or other business relation of any member of the Company Group to cease doing business with any member of the Company Group, or in any way interfere with the relationship between Company Group and any customer, supplier, licensee or other business relation of any member of the Company Group.  As used herein, the term “indirectly” shall include, without limitation, the Executive’s permitting the use of the Executive’s name by any competitor of any member of the Company Group to induce or interfere with any employee or business relationship of any member of the Company Group.

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9. Certain Remedies.

a. Remedies.  Without intending to limit the remedies available to the Company Group, including, but not limited to, those set forth in Section 9.b. hereof, the Executive agrees that a breach of any of the covenants contained in this Agreement may result in material and irreparable injury to the Company Group for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely and that, in the event of such a breach or threat thereof, the Company and/or any member of the Company Group shall be entitled to seek a temporary restraining order or a preliminary or permanent injunction, or both, without bond or other security, restraining the Executive from engaging in activities prohibited by the covenants contained in this Agreement or such other relief as may be required specifically to enforce any of the covenants contained in this Agreement.  Such injunctive relief in any court shall be available to any member of the Company Group in lieu of, or prior to or pending determination in, any arbitration proceeding.

b. Cessation of Payments.  In the event that the Executive (i) files any charge, claim, demand, action or arbitration with regard to the Executive’s employment, compensation or termination of employment under any federal, state, local or foreign law, rule or regulation, or an arbitration under any industry regulatory entity, except in either case for a claim for breach of this Agreement or failure to honor the obligation set forth herein, or (ii) willfully breaches any of the covenants contained in this Agreement, the Company shall be entitled to cease making any payments due hereunder.

10. Release.

a. General Release by Executive.  In consideration of the payments and benefits provided to the Executive under this Agreement and after consultation with counsel, the Executive, and each of the Executive’s respective, heirs, executors, administrators, representatives, agents, successors and assigns (collectively, the “Releasors”) hereby irrevocably and unconditionally release and forever discharge the Company Group and each of their respective officers, employees, directors, shareholders and agents from any and all claims, actions, causes of action, rights, judgments, obligations, damages, demands, accountings or liabilities of whatever kind or character (collectively, “Claims”), including, without limitation, any Claims under any federal, state, local or foreign law that the Releasors may have, or in the future may possess, arising out of (i) the Executive’s employment relationship with and service as an employee, officer or director of any member of the Company Group, and the termination of such relationship or service, (ii) the Employment Agreement, or (iii) any event, condition, circumstance or obligation that occurred, existed or arose on or prior to the date the Executive signs this Agreement; provided, however, that the release set forth in this Section 10.a. shall not apply to (A) the obligations of the Company under this Agreement and (B) any indemnification rights the Executive may have in accordance with the governance instruments of any member of the Company Group or under any director and officer liability insurance maintained by any member of the Company Group with respect to liabilities arising as a result of the Executive’s service as an officer, director or employee of any member of the Company Group.  The Releasors further agree that the payments and benefits described in this Agreement shall be in full satisfaction of any and all Claims for payments or benefits, whether express or implied, that the Releasors may have against the Company Group arising out of the Executive’s employment relationship or the Executive’s service as an employee and officer of any member of the Company Group and the termination thereof.

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b. Specific Release of ADEA Claims by Executive.  In further consideration of the payments and benefits provided to the Executive under this Agreement, the Releasors hereby unconditionally release and forever discharge the Company Group, and each of their respective officers, employees, directors, shareholders and agents from any and all Claims that the Releasors may have as of the date the Executive signs this Agreement arising under the Federal Age Discrimination in Employment Act of 1967, as amended, and the applicable rules and regulations promulgated thereunder (“ADEA”).  By signing this Agreement, the Executive hereby acknowledges and confirms the following:  (i) the Executive was advised by the Company in connection with his retirement to consult with an attorney of his choice prior to signing this Agreement and to have such attorney explain to the Executive the terms of this Agreement, including, without limitation, the terms relating to the Executive release of claims arising under ADEA and, the Executive has in fact consulted with an attorney; (ii) the Executive was given a period of not fewer than twenty-one (21) days to consider the terms of this Agreement and to consult with an attorney of his choosing with respect thereto; (iii) the Executive is providing the release and discharge set forth in this Section 10.b., only in exchange for consideration in addition to anything of value to which the Executive is already entitled; and (iv) that the Executive knowingly and voluntarily accepts the terms of this Agreement.

c. Release by the Company.  The Company, on behalf of itself and the Company Group, in exchange for the consideration embodied in this Agreement, hereby unconditionally and irrevocably waives, releases, and forever discharges the Executive from all Claims which the Company Group may have or in the future may possess against the Executive arising out of the Executive’s employment relationship with and service as an employee, officer or director of the Company and its subsidiaries and affiliates, and the termination of such relationship or service; provided, however, that the Company Group does not waive any rights under this Agreement.

d. No Assignment.  The Executive and the Company each represent and warrant that they have not assigned any of the Claims being released under this Section 10.

e. Claims.  The Executive and the Company each agree that they have not instituted, assisted or otherwise participated in connection with, any action, complaint, claim, charge, grievance, arbitration, lawsuit, or administrative agency proceeding, or action at law or otherwise against any member of the Company Group or any of their respective officers, employees, directors, shareholders or agents, with respect to the matters being released.

11. Miscellaneous.

a. Entire Agreement.  This Agreement, including the provisions incorporated herein, sets forth the entire agreement and understanding of the parties hereto with respect to the matters covered hereby and supersedes and replaces any express or implied, written or oral, prior agreement, plan or arrangement with respect to the terms of the Executive’s employment and the termination thereof which the Executive may have had with the Company Group (including, without limitation, the Employment Agreement), but excluding the Stock Option Plan, the Consulting Agreement and any of the plans referenced in Section 2, of this Agreement.  Except as set forth in Section 11.b (ii) hereof, this Agreement may be amended only by a written document signed by the parties hereto.

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b. Section 409A.

(i) If any amounts that become due under Section 3 of this Agreement constitute “nonqualified deferred compensation” within the meaning of Section 409A, 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.

(ii) 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 (A) 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 (B) the Executive’s date of death.  The provisions of this Section 11.b. (ii) shall only apply if required to comply with Section 409A.

(iii) For purposes of this Agreement, “Separation from Service” shall have the meaning set forth in Section 409A (a) (2)(A)(i) and determined in accordance with the default rules under Section 409A.  “Specified Employee” shall have the meaning set forth in Section 409A(a)(2)(B)(i), as determined in accordance with the uniform methodology and procedures adopted by the Company and then in effect.

(iv) It is intended that the terms and conditions of this Agreement comply with Section 409A.  If any provision of this Agreement contravenes any regulations or Treasury guidance promulgated under Section 409A, or could cause any amounts or benefits hereunder to be subject to taxes, interest and penalties under Section 409A, the Company may, in its sole discretion and without the Executive’s consent, modify the Agreement to:  (x) comply with, or avoid being subject to, Section 409A, (y) avoid the imposition of taxes, interest and penalties under Section 409A, and/or (z) maintain, to the maximum extent practicable, the original intent of the applicable provision without contravening the provisions of Section 409A. This Section 11.b.(iv) does not create an obligation on the part of the Company to modify this Agreement and does not guarantee that the amounts or benefits owed under this Agreement will not be subject to interest and penalties under Section 409A.

(v) Anything in this Agreement to the contrary notwithstanding, no reimbursement payable to the Executive pursuant to any provisions of this Agreement or pursuant to any plan or arrangement of the Company Group 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.  No amount reimbursed during any calendar year shall affect the amounts eligible for reimbursement in any other calendar year.

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c. Certain Additional Payments.

(i) In the event that any amount or benefit paid, distributed or otherwise provided to the Executive by the Company pursuant to this Agreement determined without regard to any additional payment required under this Section 13 (the “Covered Payments”), would be subject to the excise tax imposed by Section 409A  or any interest or penalties payable with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then the Executive shall be entitled to receive from the Company an additional payment (the “Gross-Up Payment,”) in an amount that shall fund the payment by the Executive of any Excise Tax on the Covered Payments, as well as all income and employment taxes on the Gross-Up Payment, any Excise Tax imposed on the Gross-Up Payment and any interest or penalties imposed with respect to income and employment taxes imposed on the Gross-Up Payment.  For this purpose, all income taxes will be assumed to apply to the Executive at the highest marginal rate.

(ii) A nationally recognized firm of independent accountants, selected by the Company shall perform the foregoing calculations.  The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder.  Such accounting firm shall apply the provisions of this Section 11.c. in a reasonable manner and in good faith in accordance with then prevailing practices in the interpretation and application of Section 409A.  For purposes of applying the provisions of this Section 11.c., the Company shall be entitled to rely on the written advice of legal counsel or such accounting firm as to whether one or more Covered Payments is subject to the provisions of Section 409A.

(iii) The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to the Company and the Executive within thirty (30) calendar days after the date that such accounting firm has been engaged to make such determinations or such other time as requested by the Company or the Executive.  If the accounting firm determines that no Excise Tax is payable with respect to a Covered Payment, it shall furnish the Company and the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to such Covered Payment.  Any good faith determinations of the accounting firm made hereunder shall be final, binding, and conclusive upon the Company and the Executive.

(iv) The Gross-Up Payment shall be paid within thirty (30) days after such amount is determined by the Company in accordance with the provisions of this Section 11.c., but in no event later than the last day of the calendar year following the calendar year in which the Executive remits the Excise Tax.

d. Withholding Taxes.  Any payments made or benefits provided to the Executive under this Agreement shall be reduced by any applicable withholding taxes.

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e. Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of Florida, without giving effect to the conflicts of laws principles thereof.

f. Waiver.  The failure of any party to this Agreement to enforce any of its terms, provisions or covenants shall not be construed as a waiver of the same or of the right of such party to enforce the same.  Waiver by any party hereto of any breach or default by another party of any term or provision of this Agreement shall not operate as a waiver of any other breach or default.

g. Severability.  In the event that any one or more of the provisions of this Agreement shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remainder of the Agreement shall not in any way be affected or impaired thereby.  Moreover, if any one or more of the provisions contained in this Agreement shall be held to be excessively broad as to duration, activity or subject, such provisions shall be construed by limiting and reducing them so as to be enforceable to the maximum extent allowed by applicable law.

h. Notices.  Any notices required or made pursuant to this Agreement shall be in writing and shall be deemed to have been given when delivered or mailed by United States certified mail, return receipt requested, postage prepaid, as follows:

if to EXECUTIVE:

Edmund J. Moriarty

P.O. Box 210337

West Palm Beach, FL  33421

if to the COMPANY:

B/E Aerospace, Inc.

1400 Corporate Center Way

Wellington, FL  33414

Attn:  General Counsel

or to such other address as either party may furnish to the other in writing in accordance with this Section 11.h.  Notices of change of address shall be effective only upon receipt.

i. Descriptive Headings.  The paragraph headings contained herein are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement.

j. Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, together, shall constitute one and the same agreement.

k. Successors and Assigns.  Except as otherwise provided herein, this Agreement shall inure to the benefit of and be enforceable by the Executive and the Company and their respective heirs, executors, administrators, representatives, agents, successors and assigns.

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l. Litigation.  Each of the Executive and the Company submits to the  jurisdiction of any federal court sitting in the State of Florida, County of Palm Beach (or if such federal court does not have or declines jurisdiction, in a state court of competent jurisdiction sitting in the State of Florida, County of Palm Beach) in any action or proceeding arising out of or relating to this Agreement and agrees that all claims in respect of the action or proceeding shall be heard and determined exclusively in any such court.  Each of the Executive and the Company also agrees not to bring any action or proceeding arising out of or relating to this Agreement in any other court or forum.  Each of the Executive and the Company waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety, or other security that might be required of the other party with respect thereto. Each party agrees that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by a suit on the judgment or in any other manner provided by law or at equity.  For purposes of this Agreement, a “final judgment” shall mean a judgment that cannot be appealed or is not appealed in the applicable time period.

12. Revocation.  The Executive shall have the right to revoke this Agreement during the seven (7) day period (the “Revocation Period”) commencing immediately following the date the Executive signs and delivers this Agreement to the Company.  The Revocation Period shall expire at 5:00 p.m. Eastern Standard Time on the last day of the Revocation Period; provided, however, that if such seventh day is not a business day, the Revocation Period shall extend to 5:00 p.m. Eastern Standard Time on the next succeeding business day.  If the Company does not receive written revocation from the Executive within such seven (7) day period, this Agreement shall become effective upon expiration of such seven (7) day period.  In the event Executive revokes this Agreement, all obligations of the parties under this Agreement shall terminate and be of no further force and effect as of the date of such revocation.  No such revocation by the Executive shall be effective unless it is in writing and signed by the Executive and received by the Company prior to the expiration of the Revocation Period.

13. Effective Date of Agreement.  This Agreement shall not become effective until the day following the last day of the Revocation Period.

IN WITNESS WHEREOF, the Company has executed this Agreement as of the date first set forth above and the Executive has executed this Agreement as of the date set forth below (or, if the Executive does not include a date under the Executive’s signature line, the date set forth shall be the date this Agreement, signed by the Executive, is received by the Company).

BE Aerospace, Inc.
By:	/s/ Thomas P. McCaffrey
Name:	Thomas P. McCaffrey
Title:	Senior Vice President and Chief Financial Officer

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THE EXECUTIVE HEREBY ACKNOWLEDGES THAT (I) HE HAS CAREFULLY READ THIS AGREEMENT AND HE FULLY KNOWS, UNDERSTANDS AND APPRECIATES ITS CONTENT AND THE BINDING EFFECT OF THE RELEASE OF CLAIMS CONTAINED HEREIN; (II) HE HEREBY ENTERS INTO THIS AGREEMENT VOLUNTARILY AND OF HIS OWN FREE WILL; (III) HE HAS NOT RELIED UPON ANY REPRESENTATION OR STATEMENT, WRITTEN OR ORAL, NOT SET FORTH IN THIS AGREEMENT; AND (IV) HE HAS BEEN GIVEN THE OPPORTUNITY AND ENCOURAGED TO CONSULT WITH AN ATTORNEY.

ACCEPTED AND AGREED:
	BE Aerospace, Inc.
/s/ Edmund J. Moriarty	/s/ Thomas P. McCaffrey
Edmund J. Moriarty	Thomas P. McCaffrey
	Senior Vice President and Chief Financial Officer
Date:

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Appendix A

AWARD DATE	RESTRICTED SHARES	VESTING DATE
Nov. 15, 2006	5,335	Nov. 15, 2009
Nov. 15, 2006	5,336	Nov. 15, 2010
Nov. 15, 2007	1,392	Nov. 15, 2009
Nov. 15, 2007	1,392	Nov. 15, 2010
Nov. 15, 2007	1,391	Nov. 15, 2011

A-1

EX-10.22

Exhibit 10.22

B/E AEROSPACE, INC,

MANAGEMENT INCENTIVE PLAN (100%) – FY 2009

I.  Purpose

The purpose of this Management Incentive Plan (the “Plan”) is to reward and encourage significant contributions to the success of BE Aerospace, Inc. (the “Corporation”) and its respective businesses.

II.  Eligibility

Eligibility for participation in this Plan is determined by the following senior executives:  the Chairman & CEO, the President & COO, the Sr. Vice President & CFO and the Vice President of Human Resources.  This Plan primarily includes the Chairman & CEO, the President & COO and the Sr. Vice President & CFO.  The Vice President of Human Resources will ensure administration throughout the Corporation.

III.  Plan Approval

The financial and strategic business objectives (both criteria and targets) (the “Objectives”) will be established for the Corporation and the Segments/Business Units at the beginning of the fiscal year.  These Objectives are reviewed by the Chairman & CEO, the President & COO and the Sr. Vice President & CFO and then submitted for approval to the Compensation Committee of the Board of Directors (the “Committee”).

IV.  Plan Participation Level

The maximum potential incentive compensation for each executive is 100% of the executive’s base salary (“Maximum Award”), which is determined based on the level of achievement of the applicable Objectives and strategic initiatives.  Individual awards are targeted at 85% of the maximum award (or 85% of base salary) (“Target Award”).  Individuals who achieve each of the target levels of the applicable Objectives and strategic initiatives are eligible to receive the Target Award.  Actual individual awards can be increased by the Committee in its sole discretion up to the Maximum Award or decreased down to zero based on an individual’s performance and his/her contribution related to the business unit to which the individual was assigned during the performance period (e.g., site/segment/Corporation).

The Target Award of 85% (e.g., 85% of base salary) contemplates:

·   100% achievement of the targets for the Financial Objectives and Strategic initiatives.

The Maximum Award of 100% (e.g., 100% of base salary) contemplates:

·   110% achievement of the targets for the Financial Objectives and Strategic initiatives.

Page 1 of 5

Exhibit 10.22

In extraordinary cases, an award of up to an additional 20% of base salary can be achieved if the following criteria are met:

·   The site, segment and Corporation exceed all financial and strategic goals by 110% or greater, and

·   Individual performance is at a superior level as determined by the executive’s immediate supervisor, upon recommendation by the Chairman & CEO, the President & COO and the Sr. Vice President & CFO and as approved by the Committee, subject to the Corporation’s ability to pay.

For more detailed information about how the bonus payouts are calculated, please refer to Sections VI and VII, and the examples shown on page 4.

V.  Allocation of Awards

The Plan features two components, the Financial Objectives, or financial metrics, and Strategic Initiatives, which are collectively used to determine the incentive payout amount:

· Financial Objectives – Eighty percent (80%) of the potential incentive payment amount is based on the attainment of specified levels of four financial metrics weighted as set forth below:

1.   EBIT (earnings before interest and taxes) –  weighed at 30%

2.   Operating Cash Flow (EBITDA) – weighed at 30%, defined as earnings before interest, taxes, depreciation and amortization, plus or minus the change in working capital and related operating non-current assets and liabilities (exclusive of cash) less capital expenditures.

3.   Operating Expense Reductions – weighed at 20%

4.   Operating Margin – weighed at 20%

·   Strategic Initiatives – Twenty percent (20%) of the potential incentive payment amount is based on the level of attainment of the business unit meeting its strategic objectives as well as the individual achieving his/her specified strategic initiatives.

The percent of the incentive payment amount attributed to each Financial Objective and the strategic initiatives is determined independent of the other Financial Objectives and/or strategic initiatives.

Page 2 of 5

Exhibit 10.22

VI.  Financial Metrics Plan Design (80% Weighting)

Incentive payouts with respect to each Financial Objective will only occur if at least eighty percent (80%) of the target levels of the Objective are achieved (the “Minimum Threshold”).  The Target Award is paid out upon 100% achievement of each Objective and the Maximum Award is paid out upon 110% of achievement of each Objective.  The payout percentage of base salary for each level of achievement between 80% and 110% is shown on the chart below for each Objective.

Exhibit 1:

	EBIT (30%)		OPERATING CASH FLOW (30%)		OPERATING EXPENSE REDUCTIONS (20%)		OPERATING MARGIN (20%)
	% of plan realized	% of base	% of plan realized	% of base	% of plan realized	% of base	% of plan realized	% of base	Total % of Base
Minimum Threshold	80%	0.24%	80%	0.24%	80%	0.16%	80%	0.16%	0.80%
	81%	0.46%	81%	0.46%	81%	0.30%	81%	0.30%
	82%	0.67%	82%	0.67%	82%	0.45%	82%	0.45%
	83%	0.89%	83%	0.89%	83%	0.59%	83%	0.59%
	84%	1.10%	84%	1.10%	84%	0.74%	84%	0.74%
	85%	1.32%	85%	1.32%	85%	0.88%	85%	0.88%
	86%	1.54%	86%	1.54%	86%	1.02%	86%	1.02%
	87%	1.75%	87%	1.75%	87%	1.17%	87%	1.17%
	88%	1.97%	88%	1.97%	88%	1.31%	88%	1.31%
	89%	2.18%	89%	2.18%	89%	1.46%	89%	1.46%
	90%	2.40%	90%	2.40%	90%	1.60%	90%	1.60%
	91%	3.60%	91%	3.60%	91%	2.40%	91%	2.40%
	92%	4.80%	92%	4.80%	92%	3.20%	92%	3.20%
	93%	6.00%	93%	6.00%	93%	4.00%	93%	4.00%
	94%	7.20%	94%	7.20%	94%	4.80%	94%	4.80%
	95%	8.40%	95%	8.40%	95%	5.60%	95%	5.60%
	96%	10.80%	96%	10.80%	96%	7.20%	96%	7.20%
	97%	13.20%	97%	13.20%	97%	8.80%	97%	8.80%
	98%	15.60%	98%	15.60%	98%	10.40%	98%	10.40%
	99%	18.00%	99%	18.00%	99%	12.00%	99%	12.00%
Target Award (85%)	100%	20.40%	100%	20.40%	100%	13.60%	100%	13.60%	68.0%
	101%	20.76%	101%	20.76%	101%	13.84%	101%	13.84%
	102%	21.12%	102%	21.12%	102%	14.08%	102%	14.08%
	103%	21.48%	103%	21.48%	103%	14.32%	103%	14.32%
	104%	21.84%	104%	21.84%	104%	14.56%	104%	14.56%
	105%	22.20%	105%	22.20%	105%	14.80%	105%	14.80%
	106%	22.56%	106%	22.56%	106%	15.04%	106%	15.04%
	107%	22.92%	107%	22.92%	107%	15.28%	107%	15.28%
	108%	23.28%	108%	23.28%	108%	15.52%	108%	15.52%
	109%	23.64%	109%	23.64%	109%	15.76%	109%	15.76%
Maximum Award (100%)	110%	24.00%	110%	24.00%	110%	16.00%	110%	16.00%	80.0%

Page 3 of 5

Exhibit 10.22

VII.  Strategic Initiatives Plan Design   (20% Weighting)

A target payout of 17.0% of base salary (85% target X 100% plan X 20% weighting = 17.0%) is available for individuals who fully achieve all of their strategic initiatives as well as the business unit achieving its strategic initiatives.  Lesser payouts for lesser levels of performance are available at the discretion of management.  A maximum payout of up to 20% is available in recognition of superior performance.

Examples:

1.   2009 projected bonus payment calculations - Assumes 2009 Plan targets achieved at 100% and 100% credit on individual strategic initiatives.

NAME	(A) SALARY	(B) Maximum   Award	Target Award at 85%	(C) (80% weighted) % earned   FINANCIAL METRICS	(D) (20% weighted)  % earned STRATEGIC INITIATIVES	(E) of Award Earned	(F) $ award Earned
Doe, John	$400,000	100%	85%	68.0%	17.0%	85%	$340,000

2.   2009 projected bonus payment calculations – Assumes 100% EBIT, 95% Cash Flow, 110% Operating Expense Reductions, 98% Operating Margin; and partial credit on achievement of individual strategic initiatives.

NAME	(A) SALARY	(B) Maximum   Award	Target Award at 85%	(C) (80% weighted) % earned  FINANCIAL METRICS	(D) (20% weighted) % earned STRATEGIC INITIATIVES	(E) % Award Earned	(F)  $ award Earned
Doe, John	$400,000	100%	85%	55.2%	15.0%	70.2%	$280,800

VIII.  Administration of the Plan

·  Business unit/site awards are based on performance independent of segment or corporate performance.  The actual amount or percentage of incentive compensation, if any, will be based upon achievement of the Objectives outlined in Section VI and the strategic initiatives outlined in Section VII.  Furthermore, the actual amount of individual awards is subject to individual performance and its effect on the achievement of these business goals, as bonus payments are not guaranteed.  The Corporation reserves the right to increase or reduce the amount of the incentive compensation paid under this Plan in its sole discretion notwithstanding the level of attainment of the specified Objective or strategic initiatives. 

· The Committee, respective Segment Vice President & General Manager, Sr. Vice President & CFO, the President & COO, and the Chairman & CEO will review attainment of the business plan goals and objectives at the close of the fiscal year.  Awards will be paid in cash as soon as practicable after the Corporation has publicly reported its fiscal year results and in no event later than March 15, 2010.

Page 4 of 5

Exhibit 10.22

· Exceptions and adjustments to the Plan and the awards may be made at the discretion of the Committee upon the recommendation of the Chairman & CEO, President & COO and Sr. Vice President & CFO.

· Participants in the Plan who enter after the start of the fiscal year may receive a prorated award.

· Employee Benefits, Taxes and Deductions - Awards paid under this Plan are subject to applicable taxes, withholding as required by law, 401(k) contributions and other payroll deductions.

· Transfer or Change of Assignment - A participant transferring into or out of qualifying positions during the fiscal year may receive a prorated award based on a share of time spent in the qualifying assignment.

·  Termination of Employment - Any participant who resigns or is dismissed from employment with the Corporation and its subsidiaries and affiliates for any reason other than by retiring from the Corporation or who is not on the active payroll on the date that the award is paid, will not be eligible for an award. It is expressly understood that a participant who officially retires from the Company after age 60 with ten or more years of service shall be eligible to receive a prorated award for the period such employee worked as an eligible participant in the Plan.

Nothing in this Plan will be construed to give any employee any right to continue in the employment of the Corporation and its subsidiaries and affiliates or to continue on any assignment.  Further, nothing in this Plan will interfere in any way with the right of the Corporation to terminate the employment of any employee affected by this Plan at any time and for any reason.

Participation in the Plan is discretionary.  Nothing in this Plan will interfere in any way with the right of the Corporation to (i) change or modify the terms and conditions of this Plan or (ii) reassign a participant to a different incentive plan for future years.  In addition, nothing in the Plan confers on a participant the right or entitlement to receive compensation or bonus in any specific amount for any future fiscal year.  Moreover, the awards under the Plan do not constitute wages, or regular, recurrent or contractual compensation and will have no effect on the determination of employee-related rights or benefits under law or any plan of the Corporation or its subsidiaries and affiliates.

The benefits provided pursuant to the awards are in no way secured, guaranteed or warranted by the Corporation.

Page 5 of 5

EX-10.23

Exhibit 10.23

B/E AEROSPACE, INC,

MANAGEMENT INCENTIVE PLAN (80%) – FY 2009

I.  Purpose

The purpose of this Management Incentive Plan (the “Plan”) is to reward and encourage significant contributions to the success of BE Aerospace, Inc. (the “Corporation”) and its respective businesses.

II.  Eligibility

Eligibility for participation in this Plan is determined by the following senior executives:  the Chairman & CEO, the President & COO, the Sr. Vice President & CFO and the Vice President of Human Resources.  This Plan primarily includes all Segment Vice President and General Managers and Corporate Vice Presidents reporting directly to the President & COO or Sr. Vice President & CFO.  The Vice President of Human Resources will ensure consistent eligibility requirements and administration throughout the Corporation.

III.  Plan Approval

The financial and strategic business objectives (both criteria and targets) (the “Objectives”) will be established for the Corporation and the Segments/Business Units at the beginning of the fiscal year.  These Objectives are reviewed by the Chairman & CEO, the President & COO and the Sr. Vice President & CFO and then submitted for approval to the Compensation Committee of the Board of Directors (the “Committee”).

IV.  Plan Participation Level

The maximum potential incentive compensation for each executive is 80% of the executive’s base salary (“Maximum Award”), which is determined based on the level of achievement of the applicable Objectives and strategic initiatives.  Individual awards are targeted at 85% of the maximum award (or 68% of base salary) (“Target Award”).  Individuals who achieve each of the target levels of the applicable Objectives and strategic initiatives are eligible to receive the Target Award.  Actual individual awards can be increased by the Committee in its sole discretion up to the Maximum Award or decreased down to zero based on an individual’s performance and his/her contribution related to the business unit to which the individual was assigned during the performance period (e.g., site/segment/Corporation).

The Target Award of 85% (e.g., 68% of base salary) contemplates:

·   100% achievement of the targets for the Financial Objectives and Strategic initiatives.

The Maximum Award of 100% (e.g., 80% of base salary) contemplates:

·   110% achievement of the targets for the Financial Objectives and Strategic initiatives.

In extraordinary cases, an award of up to an additional 20% of base salary can be achieved if the following criteria are met:

·   The site, segment and Corporation exceed all financial and strategic goals by 110% or greater, and

·   Individual performance is at a superior level as determined by the executive’s immediate supervisor, upon recommendation by the Chairman & CEO, the President & COO and the Sr. Vice President & CFO and as approved by the Committee, subject to the Corporation’s ability to pay.

Page 1 of 5

Exhibit 10.23

For more detailed information about how the bonus payouts are calculated, please refer to Sections VI and VII, and the examples shown on page 4.

V.  Allocation of Awards

The Plan features two components, the Financial Objectives, or financial metrics, and Strategic Initiatives, which are collectively used to determine the incentive payout amount:

·   Financial Objectives – Eighty percent (80%) of the potential incentive payment amount is based on the attainment of specified levels of four financial metrics weighted as set forth below:

1.   EBIT (earnings before interest and taxes) –  weighed at 30%

2.   Operating Cash Flow (EBITDA) – weighed at 30%, defined as earnings before interest, taxes, depreciation and amortization, plus or minus the change in working capital and related operating non-current assets and liabilities (exclusive of cash) less capital expenditures.

3.   Operating Expense Reductions – weighed at 20%

4.   Operating Margin – weighed at 20%

·   Strategic Initiatives – Twenty percent (20%) of the potential incentive payment amount is based on the level of attainment of the business unit meeting its strategic objectives as well as the individual achieving his/her specified strategic initiatives.

The percent of the incentive payment amount attributed to each Financial Objective and the strategic initiatives is determined independent of the other Financial Objectives and/or strategic initiatives.

Page 2 of 5

Exhibit 10.23

VI.  Financial Metrics Plan Design (80% Weighting)

Incentive payouts with respect to each Financial Objective will only occur if at least eighty percent (80%) of the target levels of the Objective are achieved (the “Minimum Threshold”).  The Target Award is paid out upon 100% achievement of each Objective and the Maximum Award is paid out upon 110% of achievement of each Objective.  The payout percentage of base salary for each level of achievement between 80% and 110% is shown on the chart below for each Objective.

Exhibit 1:

	EBIT (30%)		OPERATING CASH FLOW (30%)		OPERATING EXPENSE REDUCTIONS (20%)		OPERATING MARGIN (20%)
	% of plan realized	% of base	% of plan realized	% of base	% of plan realized	% of base	% of plan realized	% of base	Total % of Base
Minimum Threshold	80%	0.19%	80%	0.19%	80%	0.13%	80%	0.13%	0.64%
	81%	0.36%	81%	0.36%	81%	0.24%	81%	0.24%
	82%	0.54%	82%	0.54%	82%	0.36%	82%	0.36%
	83%	0.71%	83%	0.71%	83%	0.47%	83%	0.47%
	84%	0.88%	84%	0.88%	84%	0.59%	84%	0.59%
	85%	1.06%	85%	1.06%	85%	0.70%	85%	0.70%
	86%	1.23%	86%	1.23%	86%	0.82%	86%	0.82%
	87%	1.40%	87%	1.40%	87%	0.93%	87%	0.93%
	88%	1.57%	88%	1.57%	88%	1.05%	88%	1.05%
	89%	1.75%	89%	1.75%	89%	1.16%	89%	1.16%
	90%	1.92%	90%	1.92%	90%	1.28%	90%	1.28%
	91%	2.88%	91%	2.88%	91%	1.92%	91%	1.92%
	92%	3.84%	92%	3.84%	92%	2.56%	92%	2.56%
	93%	4.80%	93%	4.80%	93%	3.20%	93%	3.20%
	94%	5.76%	94%	5.76%	94%	3.84%	94%	3.84%
	95%	6.72%	95%	6.72%	95%	4.48%	95%	4.48%
	96%	8.64%	96%	8.64%	96%	5.76%	96%	5.76%
	97%	10.56%	97%	10.56%	97%	7.04%	97%	7.04%
	98%	12.48%	98%	12.48%	98%	8.32%	98%	8.32%
	99%	14.40%	99%	14.40%	99%	9.60%	99%	9.60%
Target Award (85%)	100%	16.32%	100%	16.32%	100%	10.88%	100%	10.88%	54.4%
	101%	16.61%	101%	16.61%	101%	11.07%	101%	11.07%
	102%	16.90%	102%	16.90%	102%	11.26%	102%	11.26%
	103%	17.18%	103%	17.18%	103%	11.46%	103%	11.46%
	104%	17.47%	104%	17.47%	104%	11.65%	104%	11.65%
	105%	17.76%	105%	17.76%	105%	11.84%	105%	11.84%
	106%	18.05%	106%	18.05%	106%	12.03%	106%	12.03%
	107%	18.34%	107%	18.34%	107%	12.22%	107%	12.22%
	108%	18.62%	108%	18.62%	108%	12.42%	108%	12.42%
	109%	18.91%	109%	18.91%	109%	12.61%	109%	12.61%
Maximum Award (100%)	110%	19.20%	110%	19.20%	110%	12.80%	110%	12.80%	64.0%

Page 3 of 5

Exhibit 10.23

VII.  Strategic Initiatives Plan Design   (20% Weighting)

A target payout of 13.6% of base salary (85% target X 80% plan X 20% weighting = 13.6%) is available for individuals who fully achieve all of their strategic initiatives as well as the business unit achieving its strategic initiatives.  Lesser payouts for lesser levels of performance are available at the discretion of management.  A maximum payout of up to 16% is available in recognition of superior performance.

Examples:

1.   2009 projected bonus payment calculations - Assumes 2009 Plan targets achieved at 100% and 100% credit on individual strategic initiatives.

NAME	(A) SALARY	(B) Maximum   Award	Target Award at 85%	(C) (80% weighted) % earned   FINANCIAL METRICS	(D) (20% weighted)  % earned STRATEGIC INITIATIVES	(E) % Award Earned	(F) $ award Earned
Doe, John	$200,000	80%	68%	54.4%	13.6%	68%	$136,000

2.   2009 projected bonus payment calculations – Assumes 100% EBIT, 95% Cash Flow, 110% Operating Expense Reductions, 98% Operating Margin; and partial credit on achievement of individual strategic initiatives.

NAME	(A) SALARY	(B) Maximum   Award	Target Award at 85%	(C) (80% weighted) % earned   FINANCIAL METRICS	(D) (20% weighted)  % earned STRATEGIC INITIATIVES	(E) % Award Earned	(F) $ award Earned
Doe, John	$200,000	80%	68%	44.16%	8.0%	52.16%	$104,320

VIII.  Administration of the Plan

·  Business unit/site awards are based on performance independent of segment or corporate performance.  The actual amount or percentage of incentive compensation, if any, will be based upon achievement of the Objectives outlined in Section VI and the strategic initiatives outlined in Section VII.  Furthermore, the actual amount of individual awards is subject to individual performance and its effect on the achievement of these business goals, as bonus payments are not guaranteed.  The Corporation reserves the right to increase or reduce the amount of the incentive compensation paid under this Plan in its sole discretion notwithstanding the level of attainment of the specified Objective or strategic initiatives. 

· The Committee, respective Segment Vice President & General Manager, Sr. Vice President & CFO, the President & COO, and the Chairman & CEO will review attainment of the business plan goals and objectives at the close of the fiscal year.  Awards will be paid in cash as soon as practicable after the Corporation has publicly reported its fiscal year results and in no event later than March 15, 2010.

Page 4 of 5

Exhibit 10.23

· Exceptions and adjustments to the Plan and the awards may be made at the discretion of the Committee upon the recommendation of the Chairman & CEO, President & COO and Sr. Vice President & CFO.

· Participants in the Plan who enter after the start of the fiscal year may receive a prorated award.

· Employee Benefits, Taxes and Deductions - Awards paid under this Plan are subject to applicable taxes, withholding as required by law, 401(k) contributions and other payroll deductions.

· Transfer or Change of Assignment - A participant transferring into or out of qualifying positions during the fiscal year may receive a prorated award based on a share of time spent in the qualifying assignment.

· Termination of Employment - Any participant who resigns or is dismissed from employment with the Corporation and its subsidiaries and affiliates for any reason other than by retiring from the Corporation or who is not on the active payroll on the date that the award is paid, will not be eligible for an award. It is expressly understood that a participant who officially retires from the Company after age 60 with ten or more years of service shall be eligible to receive a prorated award for the period such employee worked as an eligible participant in the Plan.

Nothing in this Plan will be construed to give any employee any right to continue in the employment of the Corporation and its subsidiaries and affiliates or to continue on any assignment.  Further, nothing in this Plan will interfere in any way with the right of the Corporation to terminate the employment of any employee affected by this Plan at any time and for any reason.

Participation in the Plan is discretionary.  Nothing in this Plan will interfere in any way with the right of the Corporation to (i) change or modify the terms and conditions of this Plan or (ii) reassign a participant to a different incentive plan for future years.  In addition, nothing in the Plan confers on a participant the right or entitlement to receive compensation or bonus in any specific amount for any future fiscal year.  Moreover, the awards under the Plan do not constitute wages, or regular, recurrent or contractual compensation and will have no effect on the determination of employee-related rights or benefits under law or any plan of the Corporation or its subsidiaries and affiliates.

The benefits provided pursuant to the awards are in no way secured, guaranteed or warranted by the Corporation.

Page 5 of 5

EX-10.37

EXHIBIT 10.37

INTERPRETIVE AMENDMENT TO THE

BE AEROSPACE, INC.

1994 EMPLOYEE STOCK PURCHASE PLAN

(Amended and Restated as of January 1, 2006)

THIS INTERPRETATIVE AMENDMENT, (this “Amendment”) is made as of the 23rd day of December, 2008 and amends the BE Aerospace, Inc. 1994 Employee Stock Purchase Plan (the “Plan”).

WHEREAS, BE Aerospace, Inc. (the “Company”) maintains the Plan;

WHEREAS, pursuant to Section 16 of the Plan, the Compensation Committee (the “Committee”) of the Board of Directors of the Company (the “Board”) has the authority to administer the Plan and to determine any questions that may arise regarding the interpretation and application of the provisions of the Plan;

WHEREAS, the Committee has delegated it authority to make such interpretive decisions to the BE Aerospace, Inc. Benefits Committee (the “Benefits Committee”);

WHEREAS, the Benefits Committee has determined that the provisions of Sections 3 and 6 of the Plan contain inconsistent provisions with respect to the calculation of the share maximum with respect to any option granted under the Plan and the effective date of grant of options granted under the Plan;

WHEREAS, since the adoption of the Plan, the US Internal Revenue Service has issued proposed regulations under Section 423 of the U.S. Internal Revenue Code of 1986 that clarifies the definition of “date of grant” for purposes of plans governed thereby, including the Plan;

NOW THEREFORE BE IT RESOLVED, that the Benefits Committee hereby interprets the Plan to provide that the effective date of grant of options granted thereunder shall be the date on which the option is exercised;

FURTHER RESOLVED, that in order to affect the forgoing resolution, the third sentence of Section 6 of the Plan is hereby replaced by the following sentence:

“For purposes of the preceding sentence, the share maximum with respect to any Option for any Option Period shall be the largest whole number of shares which, when multiplied by the fair market value of a share of Stock on the last day of the Option Period, produces a dollar amount of $12,500 or less.”

FURTHER RESOLVED, that this Amendment shall apply with respect to all options exercises on and after the date hereof;

FURTHER RESOLVED, that the Benefits Committee shall submit this Amendment to the Board for ratification and approval at its next regularly scheduled meeting.

The undersigned has hereby approved this Amendment to the Plan as of the day and year first above written.

/s/ R.J. Landry 

R.J. Landry

/s/ Thomas P. McCaffrey 

Thomas P. McCaffrey

/s/ Edmund J. Moriarty

Edmund J. Moriarty

/s/ Stephen R. Swisher 

Stephen R. Swisher

EX-21.1

List of Subsidiaries Exhibit 21.1

NAME	JURISDICTION
BE AEROSPACE, INC.
Acurex, LLC	Delaware
B/E Aerospace International Ltd.	Barbados
Nordskog Industries, Inc.	California
BEA Holding Services LLC	Delaware
Advanced Thermal Sciences Corporation	Delaware
ATS Japan Corporation	Japan
Advanced Thermal Sciences Taiwan Corporation	Taiwan
Advanced Thermal Sciences Korea	Korea
Advanced Thermal Sciences Shanghai Corporation	China
Modoc Engineering Corporation	California
Aerospace Lighting Corporation	New York
BE Aerospace Australia, Inc.	Delaware
BE Aerospace Canada, Inc.	Delaware
B/E Aerospace (Canada) Company	Canada
BE Aerospace El Salvador, Inc.	Delaware
BE Aerospace El Salvador, Sociedad Anonima de Capital Variable	El Salvador
BE Aircraft Mexico, LLC	Delaware
B/E Aerospace Development Corporation	Delaware
BE Intellectual Property, Inc.	Delaware
B/E Aerospace Machined Products, Inc.	Delaware
BE Aerospace (France) SARL	France
Burns Aerospace Europe (SARL)	France
Bomhoff Acquisition, Inc.	Delaware
C2 Composite Limited	United Kingdom
Composite Specialties, Inc.	California
DMGI, LLC	California
Denton Jet Interiors, LLC	Texas
Flight Structures, Inc.	Washington
BEA Europe Holding LLC	Delaware
Maynard Precision, LLC	California
Modern Metals, LLC	California
Nelson Aerospace, LLC	California
NYF Corp.	New Jersey
Jay Cee Fastener Corp.	New Jersey
NYFCZ S.R.O.	Czech Republic
NYF Poska Sp.z.o.o.	Poland
M & M Aerospace Hardware, Inc.	Florida
M & M Aerospace Hardware SARL	France
Honeywell Consumables Solutions S.A.S.	France
M&M Deutschland GmbH	Germany
M & M Aerospace Hardware GmbH	Germany
Honeywell Consumables Solutions GmbH	Germany
M & M Aerospace Hardware Ltd.	United Kingdom
M & M Aerospace Hardware Ptc. Ltd.	Singapore
CMP SAS	France
T.L. Windust Machine, LLC	California
BE Aerospace Holdings CV	The Netherlands
BEA Holding (USA) LLC	Delaware
BE Aerospace Europe Holding LLP	United Kingdom
BE Aerospace Investments I Ltd.	Cayman Islands
BE Aerospace Investments II Ltd.	Cayman Islands
BE Aerospace (UK) Europe Holdings Ltd.	United Kingdom
BE Aerospace (UK) Holdings Ltd.	United Kingdom
BE Aerospace (Germany) GmbH	Germany
BE Aerospace (UK) Limited	United Kingdom
BE Aerospace (Netherlands) BV	The Netherlands
BE Aerospace (Services) BV	The Netherlands
Koninklijke Fabriek Inventum BV	The Netherlands
Dae Systems Holding GmbH	Germany
DAe Systems GmbH	Germany
Avox Hispania S.L., Spain	Spain
Special Parachute Equipment and Logistics	Germany
Consortium GbR

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement Nos. 333-89145, 333-30578, 333-14037, 333-71442, 333-49806, 333-67825, 333-35527, 333-104129, 333-110422, 333-120183, 33-82894, 333-130675, and 333-136974 on Form S-8; No. 333-66934 on Form S-4; and Nos. 333-141393 and 333-112493 on Form S-3 of BE Aerospace, Inc. of our reports dated February 26, 2009, relating to the consolidated financial statements and financial statement schedules of BE Aerospace, Inc., and management’s report on the effectiveness of internal control over financial reporting, appearing in this Annual Report on Form 10-K of BE Aerospace, Inc. for the year ended December 31, 2008.

/s/ Deloitte & Touche LLP

Costa Mesa, California

February 26, 2009

EX-31.1

BE AEROSPACE, INC.

EXHIBIT 31.1

CERTIFICATIONS

I, Amin J. Khoury, certify that:

1.   I have reviewed this annual report on Form 10-K of BE Aerospace, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.  evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and

d.  disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.   The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.  all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 26, 2009	By:	/s/ Amin J. Khoury
		Amin J. Khoury
		Chairman and Chief Executive Officer

EX-31.2

BE AEROSPACE, INC.

EXHIBIT 31.2

CERTIFICATIONS

I, Thomas P. McCaffrey, certify that:

1.   I have reviewed this annual report on Form 10-K of BE Aerospace, Inc.;

2.   Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.   Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.   The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.  designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.  evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and

d.  disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.  all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:  February 26, 2009	By:	/s/ Thomas P. McCaffrey
	Thomas P. McCaffrey
	Senior Vice President and
	Chief Financial Officer

EX-32.1

BE AEROSPACE, INC.

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS REQUIRED BY

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BE Aerospace, Inc. (the “Company”) on Form 10-K for the fiscal year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Amin J. Khoury, Chairman and Chief Executive Officer of the Company, certify that to the best of my knowledge:

1.   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: February 26, 2009	By:	/s/ Amin J. Khoury
	Amin J. Khoury
	Chairman and Chief Executive Officer

EX-32.2

BE AEROSPACE, INC.

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS REQUIRED BY

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BE Aerospace, Inc. (the “Company”) on Form 10-K for the fiscal year ended December 31, 2008, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas P. McCaffrey, Senior Vice President and Chief Financial Officer of the Company, certify that to the best of my knowledge:

1.   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: February 26, 2009	By:	/s/ Thomas P. McCaffrey
	Thomas P. McCaffrey
	Senior Vice President and
	Chief Financial Officer