exv10w1






Exhibit 10.1



CONSULTING AGREEMENT




     THIS CONSULTING AGREEMENT (“Agreement”) by and between POWELL INDUSTRIES, INC. (the “Company”)
and THOMAS W. POWELL (“Mr. Powell”);



W I T N E S S E T H:




     WHEREAS, Mr. Powell has most recently been the Company’s Chief Executive Officer; and



     WHEREAS, the Company recognizes the more than forty-four (44) years of exemplary service by
Mr. Powell to the Company.



     WHEREAS, the Company and Mr. Powell are desirous of establishing the financial and other terms
of Mr. Powell’s transition from the Company as Chief Executive Officer to that of a consulting
relationship with the Company;



     NOW, THEREFORE, for and in consideration of the compensation to be paid Mr. Powell under this
Agreement and the mutual promises, covenants and undertakings contained in this Agreement, and for
other good and valuable consideration, the receipt of which is hereby acknowledged, and intending
to be legally bound hereby, the Company and Mr. Powell agree as follows:



     1. Resignation as Director and Officer. Mr. Powell has resigned his position as Chief
Executive Officer of the Company as well as any other offices, positions or directorships he holds
with the Company and its affiliates (other than his position as a director of the Company (the
"Board”) effective as of September 30, 2008. Mr. Powell shall provide services to the Company, in
accordance with the terms of this Agreement.



 









 





     2. Consulting Arrangement.



     (a) Services Period. The Company hereby engages Mr. Powell to provide advice
and consulting services during the period commencing October 1, 2008 and ending September
30, 2010, provided that such period may be earlier terminated as provided herein (the
“Services Period”). The Services Period will terminate immediately upon Mr. Powell’s death
or resignation, or, at the election of the Company, (i) if Mr. Powell materially breaches
any of his material obligations under this Agreement and such material breach is not cured
within a period of 30 days after written notice from the Company to Mr. Powell specifying
the breach, or (ii) upon written notice to Mr. Powell in the event Mr. Powell accepts other
employment or a consulting arrangement (inclusive of service on corporate boards) that
cumulatively impairs, as determined in good faith by the Board, Mr. Powell’s ability to
serve the interests of the Company 30 days after notice thereof to Mr. Powell and his
failure to terminate such arrangement.



     (b) Extent of Services. During the Services Period, Mr. Powell shall provide
advice and consulting services to the Company as to such strategic initiatives and special
projects, and such other reasonable services as may be requested by the Company. It is
contemplated that during the Services Period Mr. Powell would, to the extent requested by
the Company, provide advice or assistance with respect to strategic planning, identifying
and evaluating business development and strategic opportunities (including mergers and
acquisitions) and customer and investor relations. During the Services Period Mr. Powell
shall carry out his duties under this Agreement under the direction of the Company. In
providing his advice and consulting services, Mr. Powell shall not be required to maintain
any specific work schedule and will devote such time that is







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reasonable and necessary to appropriately address those assignments as received from
the Company.




     In connection with Mr. Powell’s services hereunder, Mr. Powell specifically agrees that
during the term of this Agreement that the Company shall have the right in its marketing and
investor relations efforts, as well as in its public information releases, to be able to use
Mr. Powell’s name, photographic image and to reasonably request quotes from Mr. Powell
regarding the Company, its business and the power industry.



     (c) Confidential Information. Mr. Powell recognizes and acknowledges that in
his past executive capacity he has had, and during the Services Period he will have, access
to Confidential Information (as hereinafter defined) of the Company, its collaborators and
third parties with which the Company has established a relationship of confidentiality, and
that such information is a valuable, special and unique asset of the Company or such
collaborators or third parties. Therefore, as part of this Agreement, Mr. Powell agrees
that he will not, during or for a period of five (5) years after the term of the Services
Period, disclose any Confidential Information he obtains from the Company, as well as
Confidential Information developed as a result of services rendered hereunder, to any
person, firm, corporation or other entity for any improper reason or purpose nor use any
such Confidential Information for any purpose other than those contemplated by this
Agreement without the prior express written consent of the Company. As used in this
Agreement, the term “Confidential Information” will mean any and all confidential
information provided by the Company to Mr. Powell in the course of his prior and future
services to the Company, as well as Confidential Information developed as a result of
services rendered hereunder. Confidential Information includes, but is not limited to,







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confidential information about the Company’s products, product development strategy and
timelines, processes and procedures, equipment, engineering designs and capabilities,
research efforts, marketing research and plans, financial data and projections, know-how,
trade secrets, inventions (whether or not patentable), ideas and other information of a
technical, scientific, strategic, legal or economic nature, relating to the future, present
or past business, operations, plans or assets of the Company, its collaborators or third
parties with which the Company has established a relationship of confidentiality, which
information has been or is provided by the Company to Mr. Powell during the course of Mr.
Powell’s prior or future services to the Company, or are generated or identified by Mr.
Powell in connection with his services hereunder; provided, however, that Confidential
information will not include the following:





     (1) information that at the time of disclosure to Mr. Powell is in the public
domain, or information that later becomes part of the public domain through no act
or omission of Mr. Powell in breach of his obligations hereunder;




     (2) information received by Mr. Powell from a third party who did not acquire
such information on a confidential basis, either directly or indirectly, from the
Company and is not under a confidentiality agreement with the Company;




     (3) information which Mr. Powell is compelled to disclose by operation of law.


In the event that Mr. Powell is requested by subpoena, civil investigation demand or similar
process to disclose any Confidential Information of the Company, he will provide prompt
notice of such potential disclosure to the Company so that an appropriate protective order
may be sought or a waiver of compliance with the provisions of this








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Agreement may be granted. If, in the absence of a protective order or the receipt of a
waiver hereunder, Mr. Powell is nonetheless legally required to disclose Confidential
Information, then in such event Mr. Powell may disclose such information without liability
hereunder, provided that the Company has been given such opportunity as may be reasonable
under the circumstances to review the text of such disclosure before it is made.




     (d) Noncompetition. Mr. Powell agrees that to protect the Company’s
Confidential Information, it is necessary to enter into the following restrictive covenants
which are ancillary to the enforceable promises between the Company and Mr. Powell in
Paragraph 2(c). Mr. Powell acknowledges that the business of designing, engineering,
manufacturing, distributing and servicing complex, custom-engineered solutions for power and
other critical process systems, in which the Company is engaged is very competitive. Mr.
Powell further acknowledges that the Company’s operations are global, and the Company has
competitors and/or potential competitors throughout the world. Thus, the covenants in this
Paragraph 2(d) are intended to be worldwide restrictions. Accordingly, Mr. Powell hereby
agrees that, to protect the Company’s Confidential Information, during the greater of the
Services Period or the period ending five (5) years after the Services Period hereof (the
“Restrictive Period”), he will not be engaged, directly or indirectly, as an executive,
director, consultant or an employee of an enterprise in the business of designing,
engineering, manufacturing, marketing, selling or developing products that are directly
competitive with those the Company was researching, developing or selling as of September,
2008 (collectively “Company Products”). Mr. Powell further agrees that during the
Restrictive Period he will not take







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any action intended to induce any employee of the Company or any affiliate of the
Company, to terminate his or her employment.




     During the Restrictive Period, Mr. Powell shall provide the Company with written notice
and obtain Board approval (which will not be unreasonably withheld) prior to engaging in any
activity, as an employee, director, consultant or in any capacity, on Mr. Powell’s behalf or
for any person, association, or entity, that a reasonable person would view as being
competitive with the business of the Company.



     Mr. Powell agrees that the restrictions stated in this provision are reasonably
required to protect the goodwill and other legitimate business interests of the Company,
given the Confidential Information of the Company that he possesses and shall possess in the
future as a result of his service under this Agreement. In addition, the restrictions are
narrowly tailored such that they are no greater than necessary to protect the goodwill and
other legitimate business interests of the Company.



     (e) Work Product. Mr. Powell agrees that any design, invention, copyright or
trademark materials made or created as a result of or in connection with his duties
hereunder shall be the sole and exclusive property of the Company, and he hereby assigns and
transfers to the Company his entire right, title and interest in and to the foregoing. Mr.
Powell further agrees that, at the Company’s request and expense, he will execute any deeds,
assignments or other documents necessary to transfer any such design, invention, copyright
or trademark materials to the Company and will cooperate with the Company or its nominee in
perfecting the Company’s title (or the title of the Company’s designee) in such materials.
During the term of this Agreement, Mr. Powell shall keep the Company informed of the
development of all designs, inventions or copyright materials







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made, conceived or reduced to practice by him, in whole or in part, alone or with
others, that either result from any work he may do for or at the request of the Company or
any affiliate of the Company or are related to the present or contemplated activities,
investigations or obligations of the Company or any affiliate of the Company. If any such
design, invention, or copyright material relating in any manner to the business of the
Company or any research and development of the Company or any affiliate of the Company is
disclosed by Mr. Powell within six (6) months after the termination of this Agreement, it
shall be presumed that such design, invention, copyright or trademark materials resulted or
were conceived from developments made during the period of this Agreement, and Mr. Powell
agrees that any such design, invention, copyright or trademark materials shall belong to the
Company.




     (f) Compliance With Company’s Code of Business Conduct and Company Policies.
During the Services Period Mr. Powell will comply with the Company’s Code of Business
Conduct and, during the Services Period, will comply with the provisions of the Company’s
Employee Handbook that are not in conflict with the terms hereof.



3. Compensation and Benefits.




     (a) Base Compensation. The Company agrees to pay Mr. Powell for the services
provided under this Agreement compensation of $240,000. This annual compensation shall be
paid in consecutive and equal quarterly installments of $60,000 each during the term hereof.



     (b) Office and Administrative Support. During the Services Period, the
Company, at the Company’s sole cost and expense, will provide Mr. Powell with executive
office space, customary office equipment and reasonable information







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technology resources at the Company’s offices, and secretarial assistance. During the
Services Period, Mr. Powell will be entitled to use of a Company owned or leased automobile
of substantially the same quality and on substantially the same terms as provided to Mr.
Powell during his employment with the Company as its Chief Executive Officer.




     (c) Expenses. Mr. Powell will be entitled to reimbursement from the Company
for reasonable business and travel expenses that are incurred in connection with the
performance of his duties under this Agreement. Mr. Powell’s expenses shall be reimbursed
to him at the end of each quarter during the term hereof.



     (d) Services as a Director. Mr. Powell’s continuing service as a
non-executive member of the Board of the Company, including as Chairman, shall not in any
way be affected as a result of any compensation he receives under the terms of this, or any
other agreement with the Company, and he shall continue to be entitled to all compensation
and benefits as received by other members of the Board.



4. General.




     (a) Notices. Any notice required or permitted to be given under this Agreement
will be sufficient if in writing and sent by certified mail, return receipt requested, to
the respective address of each of the parties on the signature page hereof and if to the
Company, to the attention of the President.



     (b) No Waiver. No failure by either party hereto at any time to give notice of
any breach by the other party of, or to require compliance with, any condition or provision
of this Agreement will be deemed a waiver of similar or dissimilar provisions or conditions
at the same time or at any prior or subsequent time.







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     (c) Successor Obligations and Assignment. The rights and obligations of the
Company under this Agreement will inure to the benefit of and be binding upon the successors
and assigns of the Company. Mr. Powell cannot assign any of his rights, benefits or
obligations under this Agreement, except for any assignment of any of the rights to receive
payments and benefits hereunder in connection with family financial planning by Mr. Powell,
which assignment shall be subject to the prior written consent of the Company and which
consent will not be unreasonably withheld. Mr. Powell’s rights and benefits under this
Agreement will not be subject to involuntary assignment, alienation or transfer, whether by
operation of law or otherwise, without the prior written consent of the Company.
Notwithstanding the foregoing, Mr. Powell may assign his rights and obligations under this
Agreement to a corporation or limited liability company owned and controlled by him;
provided that all services shall be performed on behalf of such corporation or company by
Mr. Powell, and no such assignment shall relieve Mr. Powell from personal responsibility and
liability for his covenants and obligations hereunder.



     (d) Amendment. This Agreement may not be modified or any provision hereof
waived or amended except by an agreement in writing executed by both the Company and Mr.
Powell.



     (e) Governing Laws. This Agreement will be subject to and governed by the laws
of the State of Texas without regard to any laws relating to choice or conflicts of laws and
shall be payable and performable in Houston, Harris County, Texas.







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     (f) Withholding of Taxes. The Company may withhold from any compensation,
payments or benefits under this Agreement all federal, state or other taxes as may be
required pursuant to any law or governmental regulation or ruling.



     (g) Headings. The Paragraph headings have been inserted for purposes of
convenience and will not be used for interpretive purposes.



     (h) Severability. If, as the result of the determination of a court of
competent jurisdiction, it is determined that any provision of this Agreement is invalid or
unenforceable, then the invalidity or unenforceability of that provision will not affect the
validity or enforceability of any other provision of this Agreement, and all other
provisions will remain in full force and effect.



     (i) If a dispute arises out of or related to this Agreement and the dispute cannot be
settled through direct discussions, the Company and Mr. Powell agree that they will first
endeavor to settle the dispute in an amicable fashion through the use of a mediator. The
mediator will be mutually agreed to by the parties and each party will pay an equal share of
the cost of such mediator. If such efforts fail to resolve the dispute, then any and all
claims, demands, causes of action, disputes, controversies and other matters in question
arising out of or relating to this Agreement, any of its provisions, or the relationship or
the separation of the relationship, between the parties, whether sounding in contract, tort
or otherwise, whether provided by statute or the common law, for damages or any other relief
(all of which are referred to herein for purposes of Paragraph 5(i) as “Disputes”), will be
resolved by binding arbitration. The demand for arbitration will be made within a
reasonable period of time after the Dispute has arisen and prior to the time such Dispute
would be barred by the applicable statute of limitations







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for legal or equitable proceedings. The arbitration proceeding will be conducted in
Houston, Texas, by a panel of three arbitrators. Each party will select one arbitrator, and
the two selected arbitrators will select the third arbitrator. If for any reason, all three
arbitrators are not selected pursuant to the foregoing process, the American Arbitration
Association will select the arbitrator(s) necessary to complete the panel. The enforcement
of this agreement to arbitrate, the validity, construction and interpretation of this
agreement to arbitrate will be governed by the Federal Arbitration Act and the Commercial
Arbitration Rules then in effect with the American Arbitration Association.




     IN WITNESS WHEREOF, the parties have executed this Agreement in multiple counterparts each of
which constitute the original as of the 18th day of July, 2008.



	 	 	 	 	 
	 	POWELL INDUSTRIES, INC.

 	 
	 	By:  	/s/
 Patrick L. McDonald	 
	 	 	Name:  	Patrick L. McDonald 	 
	 	 	Title:  	President 	 
	 



				
	 	Address:	 	8550 Mosley

Houston, Texas 77075



	 	 	 	 	 
	 	 	 
	 	/s/  Thomas
W. Powell 	 
	 	Thomas W. Powell 	 
	 	 	 	 



				
	 	Address:	 	1386 CR 224

Giddings, TX 78942










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