Exhibit 10.7

POWELL INDUSTRIES, INC.

2014 EQUITY INCENTIVE PLAN

NOTICE OF STOCK APPRECIATION RIGHT AWARD

Subject to the terms and conditions of this Notice of Stock Appreciation Right
Award (this "Notice"), the Stock Appreciation Right Award Agreement attached
hereto (the "Award Agreement"), and the Powell Industries, Inc. 2014 Equity
Incentive Plan (the "Plan"), the below individual (the "Participant") is hereby
granted the below number of Stock Appreciation Rights (the "SARs") in Powell
Industries, Inc. (the "Company").  Unless otherwise specifically indicated, all
terms used in this Notice shall have the meaning as set forth in the Award
Agreement or the Plan.

 

Participant Name:

 

 

Date of Grant:

 

 

and Address:

 

 

Number of SARs:

 

 

 

 

 

Vesting Commencement Date:

 

 

Vesting Schedule:

Subject to the Participant’s continuous status as a Service Provider, and the
terms of the Plan and this Award Agreement, the SARs shall vest in accordance
with the following vesting schedule (the "Vesting Schedule"):

[INSERT VESTING SCHEDULE]

[SIGNATURES ON NEXT PAGE]

 

 

 

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By your signature and the signature of the Company's representative below, the
Participant and the Company agree that the SARs granted are governed by the
terms and conditions of this Notice, the Award Agreement and the Plan.

 

POWELL INDUSTRIES, INC.

 

 

 

By:

 

 

 

 

 

Its:

 

 

 

 

 

Dated:

 

 

PARTICIPANT ACKNOWLEDGMENT

The Participant acknowledges receipt of a copy of this Notice, the Award
Agreement and the Plan, and represents that he or she is familiar with the
provisions thereof, and hereby accepts the SARs subject to all of the terms and
provisions hereof and thereof.  The Participant has reviewed this Notice, the
Award Agreement and the Plan in their entirety, has had an opportunity to obtain
the advice of legal counsel prior to executing this Notice, the Award Agreement,
and fully understands all provisions of this Notice, the Award Agreement and the
Plan.  The Participant hereby agrees that all questions of interpretation and
administration relating to this Notice, the Award Agreement and the Plan shall
be resolved by the Committee.

The Participant hereby acknowledges that he or she has had the opportunity to
review with his or her own tax advisors the tax consequences of receiving this
Notice, the Award Agreement and the Plan, and the transactions contemplated
thereby, including any U.S. federal, state and local tax laws, and any other
applicable taxing jurisdiction, prior to executing this Notice.  The Participant
attests that he or she is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents or
affiliates.  Further, the Participant hereby acknowledges and understands that
he or she (and not the Company) shall be solely responsible for his or her tax
liability that may arise as a result of receiving this Notice and the Award
Agreement.

 

PARTICIPANT:

 

 

 

Signature:

 

 

 

 

 

Print Name:

 

 

 

 

 

Dated:

 

 

 

 

 

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POWELL INDUSTRIES, INC.

2014 EQUITY INCENTIVE PLAN

STOCK APPRECIATION RIGHT AWARD AGREEMENT

Subject to the terms and conditions of the Notice of Stock Appreciation Right
Award (the "Notice"), this Stock Appreciation Right Award Agreement (the "Award
Agreement"), and the Powell Industries, Inc. 2014 Equity Incentive Plan (the
"Plan"), the individual set forth in the Notice (the "Participant") is hereby
granted Stock Appreciation Rights (the "SARs") in Powell Industries, Inc. (the
"Company").  Unless otherwise specifically indicated, all terms used in this
Award Agreement shall have the meaning as set forth in the Notice or the Plan.

1.Number and Purpose of SARs.  Participant has been awarded the number of SARs
as set forth in the Notice.  Subject to the terms and conditions contained in
the Notice and this Award Agreement, the general purpose of the SARs is to
provide Participant with the prospective ability to receive a cash payment equal
in value to the appreciation of the Company's common stock from the Date of
Grant to the conversion and payment set forth in Section 3, below.

2.Vesting Schedule and Risk of Forfeiture.  

(a)Vesting Schedule.  Subject to the Participant's continuous service with the
Company as a Service Provider, and any other limitations set forth in the Notice
or this Award Agreement, the SARs shall vest in accordance with the Vesting
Schedule provided in the Notice.

(b)Risk of Forfeiture. The SARs shall be subject to a risk of forfeiture until
such time the risk of forfeiture lapses in accordance with the above Vesting
Schedule.  All or any portion of the SARs subject to a risk of forfeiture shall
automatically be forfeited and immediately returned to the Company if
Participant's continuous status as a Service Provider is interrupted or
terminated for any reason other than as permitted under the Plan.  Additionally,
and notwithstanding anything in the Notice or this Award Agreement to the
contrary, the vested and unvested SARs shall be forfeited if the Participant’s
continuous service as a Service Provider is terminated for Cause or if the
Participant breaches (as determined by the Board) any provisions of the Notice,
this Award Agreement or the Plan.  The Company shall implement any forfeiture
under this Section 2 in a unilateral manner, without Participant's consent, and
with no payment to Participant, cash or otherwise, for the forfeited SARs.

3.Conversion, Payment of SARs.  Subject to the terms of this Award Agreements,
on the Vesting Date, the portion of the SARs that became vested shall
automatically and immediately be converted to the right to receive a [payment of
Shares (or cash equivalent)] from the Company in an amount equal to the positive
difference (if any) between the Fair Market Value of the Company's common stock
as of the Vesting Date and the Fair Market Value of the Company's common stock
as of the Date of Grant and immediately thereafter shall be made to the
Participant.

4.Taxes.  

(a)Tax Liability.  Participant is ultimately liable and responsible for all
taxes owed by Participant in connection with his or her receipt of SARs and
payments made under this Award Agreement, regardless of any action the Company
takes with respect to any tax withholding obligations arising hereunder.  The
Company makes no representation or undertaking regarding the treatment of any
tax withholding in connection with the grant of SARs or payments made pursuant
to this Award Agreement.  The Company does not commit and is under no obligation
to structure the SARs to reduce or eliminate Participant’s tax liability.

(b)Payment of Withholding Taxes.  Participant authorizes the Company to withhold
from the cash payable to Participant upon any payment made pursuant to this
Award Agreement an amount sufficient to satisfy any tax withholding obligation,
whether federal, state, local or non-U.S., including any employment tax
obligation.  Notwithstanding anything in this Award Agreement to the contrary,
the Company’s obligation to provide any payment under this Award Agreement shall
immediately cease if Participant refuses after reasonable notice to make
arrangements with the Company to satisfy any tax withholding obligations imposed
upon the Company.

(c)No Application of Section 409A.  The SARs and this Award Agreement are
intended to avoid the application of Section 409A of the Code ("Section 409A")
because there is no deferral arrangement.  Notwithstanding any other provision
in the Plan or this Award Agreement to the contrary, the Committee shall have
the right, in its sole discretion, to adopt such amendments to the Plan or this
Award Agreement or take such other actions (including amendments and actions
with retroactive effect) as the Committee determines are necessary or
appropriate for the SARs to comply with Section 409A.

5.Transferability of SARs.  The SARs may not be transferred in any manner other
than by will or by the laws of descent and distribution.  Notwithstanding the
foregoing, Participant may designate one or more beneficiaries of Participant's
SARs in

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the event of Participant's death on a beneficiary designation form provided by
the Committee.  The terms of this Award Agreement shall be binding upon the
executors, administrators, heirs, successors and transferees of Participant.

6.Rights as a Shareholder of the Company.  Participant’s receipt of the grant of
SARs pursuant to the Notice and this Award Agreement shall provide and confer no
rights to or status as a shareholder or equity holder of the Company.  Without
limiting the foregoing, the holding of SARs shall NOT confer any right to: (i)
vote; (ii) bring derivative actions; (iii) inspect books and records of the
Company; (iv) receive dividends or other distributions except as provided in
Section 3; or (v) have any other rights accorded owners of the Company’s
shareholders or equity holders.

7.Legality of Initial Issuance.  No Shares of Common Stock shall be issued in
accordance with Section 3 of this Award Agreement unless and until the Committee
has determined that: (i) the Company and Participant have taken all actions
required to register the Shares of Common Stock under the Securities Act or to
perfect an exemption from the registration requirements thereof, if applicable;
(ii) all applicable listing requirements of any stock exchange or other
securities market on which the Shares of Common Stock are listed has been
satisfied; and (iii) any other applicable provision of state or U.S. federal law
or other applicable law has been satisfied.

8.Notice.  Any notice required by the terms of this Award Agreement shall be
given in writing and shall be deemed effective upon personal delivery or upon
deposit with the U.S. Postal Service, by registered or certified mail, with
postage and fees prepaid.  Notice shall be addressed to the Company at its
principal executive office and to the Participant at the address that he or she
most recently provided to the Company.

9.Spousal Consent.  To the extent Participant is married, Participant agrees to
(i) provide Participant's spouse with a copy of this Award Agreement prior to
its execution by Participant and (ii) obtain such spouse’s consent to this Award
Agreement as evidenced by such spouse’s execution of the Spousal Consent
attached hereto as EXHIBIT A.

10.Successors and Assigns.  Except as provided herein to the contrary, this
Award Agreement shall be binding upon and inure to the benefit of the parties to
this Award Agreement, their respective permitted successors and assigns.

11.No Assignment.  Except as otherwise provided in this Award Agreement,
Participant shall not assign any of his rights under the Notice or this Award
Agreement without the prior written consent of the Company, which consent may be
withheld in its sole discretion.  The Company shall be permitted to assign its
rights or obligations under the Notice and this Award Agreement, but no such
assignment shall release the Company of any obligations pursuant to the Notice
or this Award Agreement.

12.Severability.  The validity, legality or enforceability of the remainder of
this Award Agreement shall not be affected even if one or more of the provisions
of this Award Agreement shall be held to be invalid, illegal or unenforceable in
any respect.

13.Amendment.  Any provision of this Award Agreement may be amended and the
observance thereof may be waived (either generally or in a particular instance
and either retroactively or prospectively) only by a written instrument signed
by the parties hereto.

14.Administration and Interpretation.  Any question or dispute regarding the
interpretation of the Notice or this Award Agreement or the receipt of SARs
hereunder shall be submitted by Participant to the Company’s board of
directors.  The resolution of such a dispute by the Company’s board of directors
shall be final and binding on all parties.

15.Headings.  The section headings in this Award Agreement are inserted only as
a matter of convenience, and in no way define, limit or interpret the scope of
this Award Agreement or of any particular section.

16.Counterparts.  The Notice may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  Any counterpart or other
signature delivered by facsimile shall be deemed for all purposes as being a
good and valid execution and delivery of the Notice by that party.

17.Entire Agreement; Governing Law.  Except as otherwise provided herein, this
Award Agreement, together with the Notice and the Plan, constitute the entire
agreement of the parties with respect to the subject matter hereof and supersede
in their entirety all prior undertakings, representation and agreements of the
Company and Participant (whether oral or written, and whether express or
implied) with respect to the subject matter hereof.  This Award Agreement,
together with the Notice and the Plan, are to be construed in accordance with
and governed by the federal laws of the United States of America and by the
internal laws of the State of Texas without giving effect to any choice of law
rule that would cause the application of the laws of any other jurisdiction.

18.Venue.  The Company and Participant agree that any suit, action or proceeding
arising out of or related to the Notice or this Award Agreement shall be brought
in the United States District Court for the Southern District of Texas (or
should such court

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lack jurisdiction to hear such action, suit or proceeding, in a Texas state
court in Harris County), and that all parties shall submit to the jurisdiction
of such court.  The parties irrevocably waive, to the fullest extent permitted
by law, any objection the party may have to the laying of venue for any such
suit, action or proceeding brought in such court.  If any one or more provisions
of this Section 18 shall for any reason be held invalid or unenforceable, it is
the specific intent of the parties that such provisions shall be modified to the
minimum extent necessary to make it or its application valid and enforceable.

19.No Guarantee of Service Provider Status. PARTICIPANT ACKNOWLEDGES AND AGREES
THAT THE VESTING OF SARs PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY
BY CONTINUOUS SERVICE AS A SERVICE PROVIDER AND AT THE WILL OF THE COMPANY (NOT
THROUGH THE ACT OF BEING HIRED OR BEING GRANTED SARs).  PARTICIPANT FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AWARD AGREEMENT, THE RIGHT GRANTED HEREUNDER,
THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH IN
THIS AWARD AGREEMENT DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH PARTICIPANT’S RIGHT
OR THE COMPANY’S/AFFILIATE’S RIGHT TO TERMINATE PARTICIPANT’S RELATIONSHIP AS A
SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

20.Unsecured General Creditor.  Participant shall have no legal or equitable
rights, interests or claims in any property or assets of the Company due to the
Notice, this Award Agreement and the grant of SARs hereunder.  For purposes of
the payment of benefits under the Notice and this Award Agreement, Participant
shall have no more rights than those of a general creditor of the Company.  The
Company’s obligation under the Notice and this Award Agreement shall be that of
a conditional unfunded and unsecured promise to pay money or property in the
future.

21.Waiver.  Failure to insist upon strict compliance with any of the terms,
covenants, or conditions hereof will not be deemed a waiver of such term,
covenant, or condition, nor will any waiver or relinquishment of, or failure to
insist upon strict compliance with, any right or power hereunder at any one or
more times be deemed a waiver or relinquishment of such right or power at any
other time or times.

 

*     *     *     *     *

 

 

 

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EXHIBIT A

POWELL INDUSTRIES, INC.

2014 EQUITY INCENTIVE PLAN

STOCK APPRECIATION RIGHT AWARD AGREEMENT

SPOUSAL CONSENT

I, the undersigned, hereby certify that:

1. I am the spouse of ________________________________________________.

2.Each of the undersigned and the undersigned’s spouse is a resident of
__________________________________________________________________________.

3.I have read the Powell Industries, Inc. 2014 Equity Incentive Plan (the
"Plan") and the Stock Appreciation Right Award Agreement (the "Award
Agreement"), by and between Powell Industries, Inc. (the "Company"), and my
spouse.  I have had the opportunity to consult independent legal counsel
regarding the contents of the Award Agreement and the Plan.

4.I understand the terms and conditions of the Award Agreement and the Plan.

5.I hereby consent to the terms of the Award Agreement and the Plan and to their
application to and binding effect upon any community property or other interest
I may have in the SARs (it being understood that this Spousal Consent shall in
no way be construed to create any such interest).  I agree that I will take no
action at any time to hinder the operation of the transactions contemplated in
and by the Award Agreement and the Plan.

IN WITNESS WHEREOF, this Spousal Consent has been executed as of _____________.

 

SPOUSE:

 

 

Signature:

 

 

Print Name:

 

 

 

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