Document:

exv10w3

Exhibit 10.3

NON-EMPLOYEE DIRECTOR RESTRICTED STOCK PLAN

     The Powell Industries, Inc. Non-Employee Director Restricted Stock Plan was adopted by the
Board of Directors (“Board”) of Powell Industries, Inc., a Delaware corporation (“Company”),
effective as of December 17, 2004 and approved by the stockholders of the Company at its annual
meeting of stockholders held on April 15, 2005.

PURPOSE AND TERM

     Purpose. The Powell Industries, Inc. Non-Employee Director Restricted Stock Plan (the “Plan”)
is for the benefit of members of the Board who, at the time of their service, are not employees of
the Company or any of its affiliates (each a “Participant” and collectively the “Participants”), to
encourage ownership of the Company’s common stock (the “Stock”) by the Participants, thereby
advancing the best interests of the Company by increasing the proprietary interest of the
Participants in the success of the Company and encouraging them to continue in their present
capacity.

     Term. Unless sooner terminated by the Board, the Plan will terminate at the close of business
on December 16, 2014 and no further grants shall be made under the Plan after such date. Awards
granted before such date shall continue to be subject to the terms and conditions of the Plan and
the respective agreements pursuant to which they were granted.

ADMINISTRATION

     Administration of the Plan. The Plan shall be administered by the Compensation Committee of
the Board (“Committee”) or, if there is no Compensation Committee, the Plan shall be administered
by the Board and all references to the Committee in this Plan shall refer to the Board. All
questions of interpretation of the Plan or of any restricted stock agreement governing any grant
under this Plan (“Restricted Stock Agreement”) shall be determined by the Committee, and such
determination shall be final and binding upon all persons having an interest in the Plan or such
Restricted Stock Agreement. The Chief Executive Officer, the Chief Financial Officer, the President
and any Vice President of the Company shall have the authority to act on behalf of the Company with
respect to any matter, right, obligation, determination or election which is the responsibility of
or which is allocated to the Company in this Plan.

     Powers of the Committee. In addition to any other powers set forth in the Plan and subject to
the provisions of the Plan, the Committee shall have the full and final power and authority, in its
sole discretion:

     to determine the terms, conditions and restrictions applicable to each grant (which need not
be identical) under this Plan (“Award”), the method for satisfaction of any tax withholding
obligation arising in connection with an Award or vesting of the Stock granted pursuant to the
Award (“Restricted Stock”), the effect on the Award or the vesting of such Restricted Stock of
termination of the status of a Participant as a director of the Company and all other terms,
conditions and restrictions applicable to the Award or Restricted Stock not inconsistent with the
terms of the Plan,

     to approve one or more forms of Restricted Stock Agreement,

     to accelerate, continue, extend or defer the vesting of any Restricted Stock,

     to prescribe, amend or rescind rules, guidelines and policies necessary or advisable in the
administration of the Plan, and

 

 

     to correct any defect, supply any omission or reconcile any inconsistency in the Plan or any
Restricted Stock Agreement and to make all other determinations and take such other actions with
respect to the Plan as the Committee may deem advisable to the extent consistent with the Plan and
applicable law.

SHARES SUBJECT TO PLAN OR AWARDS

AND ADJUSTMENTS THEREOF

     Maximum Number of Shares Issuable. Subject to Section 3.2, the maximum aggregate number of
shares of Stock that may be issued under the Plan shall be 150,000 and shall consist of authorized
but unissued or reacquired shares of Stock or any combination thereof. If a share of Restricted
Stock is forfeited for any reason, such share shall again be available for issuance under the Plan.
During the term of this Plan, the Company shall at all times reserve and keep available that number
of shares of Stock sufficient to satisfy the requirements of the Plan.

     Changes in Capital Structure. If, at any time while the Plan is in effect or shares of
Restricted Stock are outstanding, there shall be any increase or decrease in the number of issued
and outstanding shares of Stock resulting from (i) the declaration or payment of a stock dividend,
(ii) any recapitalization resulting in a stock split-up, combination or exchange of shares of Stock
or (iii) any other increase or decrease in such shares of Stock effected without receipt of
consideration by the Company, then and in such event:

     an appropriate adjustment shall be made in the maximum number of shares of Stock then subject
to being granted under the Plan so that the same proportion of the Company’s issued and outstanding
shares of Stock shall continue to be subject to being granted under the Plan; and

     appropriate adjustments shall be made in the number of outstanding shares of Restricted Stock.

     Any fractional share resulting from an adjustment under this Section 3.2 shall be rounded up
to the nearest whole number. Except as otherwise expressly provided in the Plan, the issuance by
the Company of shares of its capital stock of any class, or securities convertible into or
exercisable for shares of capital stock or any class, either in connection with direct sale or upon
the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or
obligations of the Company convertible into such shares or other securities, shall not affect, and
no adjustment by reason thereof shall be made with respect to, the number of outstanding shares of
Restricted Stock.

     Notice of Adjustment. Upon the occurrence of each event requiring an adjustment with respect
to any Restricted Stock, the Company shall mail to each affected Participant its computation of
such adjustment, which shall be conclusive and shall be binding upon each Participant.

AWARDS OF RESTRICTED STOCK

     Eligibility. The persons who shall be eligible to receive Restricted Stock under the Plan
shall be each member of the Board who is not an employee of the Company or any affiliate of the
Company.

     Awards. On the day of each June Board meeting (or the next regular meeting of the Board, if
there is no June meeting), each Participant who is continuing to serve as a director shall receive
a grant of 2,000 shares of Stock. If a Participant is first elected or appointed to the Board
(whichever is applicable) other than at a June meeting, the Participant shall receive a grant of
that number of shares of Stock (rounded up to the nearest whole share) determined by multiplying
2,000 shares by a fraction, the numerator of which is the number of months until the next June
meeting (or meeting held in lieu of the

 

 

June meeting and counting the month in which the Participant became a director) and the denominator
of which is 12. The intent of this initial grant is to provide the new director with a prorated
grant for the partial year served before the new director receives the annual grant.

     Restricted Stock Agreement. The prospective recipient of a grant of Stock shall not have any
rights with respect to such grant until such prospective recipient has executed a Restricted Stock
Agreement and delivered a fully executed copy thereof to the Company within a period of sixty days
(or such other period as the Committee shall specify) after the date of the grant. The Restricted
Stock Agreement shall set forth the number of shares of Stock granted to the Participant and all
other terms, limitations, restrictions and conditions to which such Stock is subject. To the extent
any such terms, limitations, restrictions or conditions are inconsistent with the terms of the
Plan, the terms of the Plan shall control.

     Share Certificates. Each Participant shall be issued a stock certificate or certificates
representing the shares of Restricted Stock granted to such Participant. Such certificate or
certificates shall be registered in the name of the Participant and shall bear an appropriate
legend referring to the terms, limitations, restrictions and conditions applicable to such
Restricted Stock substantially as provided in Section 4.5 below. The Committee may require that the
stock certificates evidencing the shares of Restricted Stock be held in the custody of the Company
until the restrictions thereon shall have lapsed and that the Participant deliver to the Committee
a stock power or stock powers, endorsed in blank, relating to the shares of Restricted Stock.

     Legends. Each certificate representing shares of Restricted Stock issued to a Participant
shall bear the following legend or a similar legend deemed by the Company to constitute an
appropriate notice of the provisions hereof and each Restricted Stock Agreement shall provide that
any such certificate not having such legend shall be surrendered upon demand of the Company
therefor and so endorsed:

     On the face of the certificate:

     “Transfer of this stock is restricted in accordance with conditions printed on the reverse of
this certificate.”

     On the reverse of the certificate:

“The shares of stock evidenced by this certificate are subject to and transferable only in
accordance with that certain Powell Industries, Inc. Non-Employee Director Restricted Stock Plan, a
copy of which is on file at the principal office of the Company in Houston, Texas. No transfer or
pledge of the shares evidenced hereby may be made except in accordance with and subject to the
provisions of the Plan. By acceptance of this certificate, any holder, transferee or pledgee hereof
agrees to be bound by all of the provisions of the Plan.

     And, if the shares were not issued in a transaction registered under the applicable federal
and state securities laws:

“Shares of stock represented by this certificate have been acquired by the holder for investment
and not for resale, transfer or distribution, have been issued pursuant to exemptions from the
registration requirements of applicable state and federal securities laws and may not be offered
for sale, sold or transferred other than pursuant to effective registration under such laws or in
transactions otherwise in compliance with such laws, and upon evidence satisfactory to the Company
of compliance with such laws, as to which the Company may require and rely upon an opinion of
counsel satisfactory to the Company.”

A copy of this Plan shall be kept on file in the principal office of the Company in Houston, Texas.

 

 

     Restrictions and Conditions. Shares of Restricted Stock shall be subject to the following
restrictions and conditions:

     Subject to the provisions of the Plan and the Restricted Stock Agreement governing the grant
of Restricted Stock, during such period or periods as may be established by the Committee beginning
on the date of the Award (“Restricted Period”), the Participant shall not be permitted to sell,
transfer, pledge or assign shares of Restricted Stock granted under the Plan; provided, however,
that the Committee may, in its sole discretion, provide for the lapse of such restrictions in
installments and may accelerate or waive such restrictions in whole or in part based on such
factors and such circumstances as the Committee may determine, in its sole discretion, including
without limitation the attainment of certain performance-related goals, the death or Disability of
the Participant or the Participant’s otherwise ceasing to serve as a director of the Company.

     During the Restricted Period, the Participant shall have the rights of a shareholder with
respect to any shares of Restricted Stock, except as otherwise stated in the Plan or the Restricted
Stock Agreement governing the grant of Restricted Stock.

     For purposes of the Plan, the term “Disability” shall mean the determination by the Board,
upon the advice of an independent qualified physician, that the Participant has become physically
or mentally incapable of performing his duties as a director and such disability has disabled the
Participant for a period of at least 180 days in any twelve-calendar-month period.

ADDITIONAL PROVISIONS

     Amendment or Discontinuation. Except as set otherwise set forth in this Section 5.1, the Board
may at any time and from time to time, without the consent of the Participants, alter, amend,
revise, suspend or discontinue the Plan in whole or in part, provided, however, that to the extent
required to qualify the Plan under Rule 16b-3 promulgated under Section 16 of the Securities
Exchange Act of 1934, as amended, no amendment shall be made more than once every six months that
would change the amount, price or timing of the initial and annual grants, other than to comport
with changes in the Internal Revenue Code of 1986, as amended; and provided, further, that to the
extent required to qualify the Plan under Rule 16b-3, no amendment that would (a) materially
increase the number of shares of the Stock that may be issued under the Plan, (b) materially modify
the requirements as to the eligibility for participation in the Plan, or (c) otherwise materially
increase the benefits accruing to Participants under the Plan, shall be made without the approval
of the Company’s stockholders. Any such amendment shall, to the extent deemed necessary or
advisable by the Committee, be applicable to any outstanding Restricted Stock previously granted
under the Plan with respect to which the Restricted Period has not yet expired, notwithstanding any
contrary provisions contained in any Restricted Stock Agreement. In the event of any such amendment
to the Plan, the holder of any Restricted Stock outstanding under the Plan shall, upon the request
of the Committee, execute a conforming amendment to the applicable Restricted Stock Agreement in
the form prescribed by the Committee. Notwithstanding anything contained in the Plan to the
contrary, unless required by law, no action contemplated or permitted by this Section 5.1 shall
adversely affect any rights of a Participant or obligations of the Company to Participants with
respect to any Restricted Stock with respect to which the Restricted Period has expired without the
consent of the affected Participant.

 

 

     Investment Intent and Other Representations. The Company may require that there be presented
to and filed with it by any Participant under the Plan such evidence as it may deem necessary to
establish that the shares of Restricted Stock are being acquired for investment and not with a view
to their distribution and such other representations and warranties of a Participant which the
Company considers necessary or appropriate.

     Indemnification of Board and Committee. With respect to administration of the Plan, the
Company shall indemnify each present and future member of the Committee against, and each member of
the Committee shall be entitled without further act on his part to indemnity from the Company for,
all expenses (including the amount of judgments and the amount of approved settlements made with a
view to the curtailment of costs of litigation, other than amounts paid to the Company itself)
reasonably incurred by him in connection with or arising out of any action, suit, or proceeding in
which he may be involved by reason of his being or having been a member of the Committee, whether
or not he continues to be a member of the Committee at the time of incurring the expenses. However,
this indemnity shall not include any expenses incurred by any member of the Committee (a) in
respect of matters as to which he shall be finally adjudged in any action, suit or proceeding to
have been guilty of gross negligence or willful misconduct in the performance of his duty as a
member of the Committee, or (b) in respect of any matter in which any settlement is effected, to an
amount in excess of the amount approved by the Company on the advice of its legal counsel. In
addition, no right of indemnification under this Plan shall be available to or enforceable by any
member of the Committee unless, within 60 days after the institution of any action, suit or
proceeding, he shall have offered the Company, in writing, the opportunity to handle and defend the
same at its own expense. This right of indemnification shall inure to the benefit of the heirs,
executors or administrators of each member of the Committee and shall be in addition to all other
rights to which a member of the Committee may be entitled as a matter of law, contract or
otherwise.

     Effect of the Plan. Neither the adoption of the Plan nor any action of the Committee shall be
deemed to give any person any rights except as may be evidenced by a Restricted Stock Agreement or
any amendment thereto duly authorized by the Committee and executed on behalf of the Company, and
then only to the extent and upon the terms and conditions expressly set forth therein.

     Compliance with Other Laws and Regulations. Nothing in this Plan shall be construed to require
the Company to issue any shares of Stock under the Plan if issuing that Stock would constitute or
result in a violation by the Participant or the Company of any provision of any law, statute or
regulation of any governmental authority or any national securities exchange or inter-dealer
quotation system or other forum in which the shares of Stock are or may be quoted or traded
(including without limitation Section 16 of the Securities Exchange Act of 1934). Specifically, in
connection with any applicable statute or regulation relating to the registration of securities,
the Company shall not be required to issue any Stock unless the Company has received evidence
satisfactory to it to the effect that the Participant will not transfer the Stock except in
accordance with applicable law, including receipt of an opinion of counsel satisfactory to the
Company to the effect that any proposed transfer complies with applicable law. The determination by
the Company on this matter shall be final, binding and conclusive. The Company may, but shall in no
event be obligated to, register any Stock covered by this Plan pursuant to applicable securities
laws of any country or any political subdivision. If the Stock is not registered, the Company may
imprint on the certificate evidencing the Stock any legend that counsel for the Company considers
necessary or advisable to comply with applicable law.

     Tax Requirements. The Company shall have the right pursuant to any arrangement it deems
appropriate to deduct from all Awards hereunder any federal, state or local taxes required by law
to be withheld with respect to such payments.

 

 

     THE UNDERSIGNED, being the duly elected Secretary of the Company, does hereby certify that the
foregoing is a true and correct copy of the Powell Industries, Inc. Restricted Stock Plan, adopted
by the Board of Directors of Powell Industries, Inc. at the meeting thereof duly called and held on
December 17, 2004 and approved by the stockholders of the Company at its annual meeting of
stockholders held on April 15, 2005.

	 	 	 	 	 

	 

	 	/s/ DON R. MADISON
 

Don R. Madison, Secretary
	 	 

 

 

FORM OF RESTRICTED STOCK AGREEMENT

     Pursuant to the Powell Industries, Inc. Non-Employee Director Restricted Stock Plan (“Plan”),
this Restricted Stock Agreement (“Agreement”) is made as of ___, ___ (“Effective Date”) by and
between Powell Industries, Inc., a Delaware corporation (“Company”), and ___ (“Grantee”).

     The parties agree as follows:

	 	1.	 	Grant of Stock. The Company hereby grants to Grantee and Grantee hereby accepts 2,000 shares
of the Company’s common stock (“Shares”).
	 
	 	2.	 	Vesting.

          The Shares shall become fully vested and shall no longer be subject to forfeiture as follows:

fifty per cent on the first anniversary of the Effective Date, and

fifty per cent on the second anniversary of the Effective Date.

Notwithstanding the foregoing, the Shares shall, to the extent not then fully
vested, become fully vested and shall no longer be subject to forfeiture:

upon the retirement of the Grantee from the Board of Directors of the Company (“Board”), but only
with respect to grants of Shares made before the annual shareholder meeting immediately preceding
such retirement;

upon the occurrence of a “Liquidation Event” as such term is defined in Section 2(c) below; or

upon the death or Disability (as defined in the Plan) of the Grantee.

          As used in this Agreement, “Liquidation Event” shall mean the occurrence of
either of the following:
a merger, reorganization or consolidation of the Company with or into one or more corporations,
limited liability companies or partnerships in which the Company is not the surviving entity and
stockholders of the Company receive cash or freely salable securities; or
the sale of all or substantially all of the Company’s assets in one or more transactions for cash
or freely salable securities and a subsequent liquidation of the Company, in which its stockholders
receive liquidating distributions of such proceeds of sale after payment or provision for the valid
debts, liabilities and taxes of the Company.

	 	3.	 	Forfeiture of Unvested Shares Upon Termination or Attempted Transfer.
Upon the occurrence of (i) Grantee’s ceasing to be a director of the
Company for any or no reason except death or Disability of the Grantee
or, with respect to Shares granted after the annual stockholder
meeting immediately preceding such retirement, the retirement of
Grantee from the Board or (ii) any attempted transfer by the Grantee
to a third party of Shares that are not yet fully vested and no longer
subject to forfeiture, the Company shall, upon the date of such
termination or attempted transfer (as such date is reasonably fixed

 

 

	 	 	 	and determined by the Company) cancel such portion of the
Shares as are not fully vested in accordance with Section 2
above (“Forfeited Shares”), and Grantee shall forfeit and
have no further right to or interest in or claim regarding
the Forfeited Shares. Upon such cancellation and
forfeiture, Grantee, or Grantee’s representative, shall
immediately surrender to the Company for cancellation the
share certificate(s) representing the Forfeited Shares.
Notwithstanding Grantee’s failure to surrender for
cancellation the share certificate(s) representing the
Forfeited Shares, Grantee hereby grants to the Secretary of
the Company all right, power and authority on behalf of
Grantee to cause, and the Secretary of the Company shall
cause, the Forfeited Shares to be cancelled on the official
stock register of the Company, which stock register shall
be conclusive evidence of ownership of any and all of the
Company’s outstanding capital stock, including the Shares
as applicable.
	 
	 	4.	 	Restrictions on Transfer.
	 
	 	 	 	Grantee shall not transfer, encumber or otherwise dispose
of any of the Shares (or any beneficial interest therein)
in any way until the date such Shares are fully vested and
no longer subject to forfeiture.
	 
	 	 	 	Notwithstanding Section 5(a) above, Grantee shall not
transfer or dispose of the shares unless (i) there is then
in effect a registration statement under the Securities Act
of 1933 or any successor thereto (“Securities Act”)
covering such proposed disposition and such disposition is
made in accordance with such registration statement or (ii)
Grantee shall have notified the Company of the proposed
disposition and shall have furnished the Company with a
detailed statement of the circumstances surrounding the
proposed disposition, and if reasonably requested by the
Company, such Grantee shall have furnished the Company with
an opinion of counsel, reasonably satisfactory to the
Company, that such disposition will be exempt from
registration under the Securities Act.
	 
	 	5.	 	Legends. The share certificate evidencing the Shares issued
hereunder shall be endorsed with the following legends (in
addition to any other legends required by the Plan or under
applicable federal and state securities laws):

     “THE SHARES OF STOCK EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO AND TRANSFERABLE ONLY IN
ACCORDANCE WITH THAT CERTAIN POWELL INDUSTRIES, INC. RESTRICTED STOCK PLAN, A COPY OF WHICH IS ON
FILE AT THE PRINCIPAL OFFICE OF THE COMPANY IN HOUSTON, TEXAS. NO TRANSFER OR PLEDGE OF THE SHARES
EVIDENCED HEREBY MAY BE MADE EXCEPT IN ACCORDANCE WITH AND SUBJECT TO THE PROVISIONS OF THE PLAN.
BY ACCEPTANCE OF THIS CERTIFICATE, ANY HOLDER, TRANSFEREE OR PLEDGEE HEREOF AGREES TO BE BOUND BY
ALL OF THE PROVISIONS OF THE PLAN.”

     “THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS
SET FORTH IN A RESTRICTED STOCK AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL HOLDER OF THESE
SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE COMPANY’S PRINCIPAL EXECUTIVE OFFICES. SUCH TRANSFER
RESTRICTIONS ARE BINDING ON TRANSFEREES OF THESE SHARES.”

Grantee shall surrender, upon demand of the Company therefor, any certificate
evidencing the Shares that does not bear any legend required hereunder or by
the Plan so

 

 

	 	 	 	that such legend may be placed on such certificate or a new
certificate issued bearing the required legends.
	 
	 	6.	 	Tax Withholding and Other Tax Matters. The Company shall
have the right to withhold from any issuance of Shares all
federal, state, city or other taxes as may be required
pursuant to any statute or governmental regulation or
filing. In connection with such withholding, the Company
may make any arrangement it deems appropriate. Grantee
acknowledges its obligations to review with Grantee’s own
tax advisors the federal, state, local and foreign tax
consequences of this grant and the transactions
contemplated by this Agreement and particularly the
consequences with regard to making any election under
Section 83(b) of the Internal Revenue Code. Grantee is
relying solely on such advisors and not on any statements
or representations of the Company or any of its agents.
Grantee understands that Grantee (and not the Company)
shall be responsible for Grantee’s own tax liability that
may arise as a result of this grant or the transactions
contemplated by this Agreement and shall be required to pay
to the Company any such liability.

     IF GRANTEE DESIRES TO MAKE A SECTION 83(b) ELECTION UNDER SECTION 83(b) OF THE INTERNAL
REVENUE CODE, GRANTEE ACKNOWLEDGES THAT IT IS GRANTEE’S SOLE RESPONSIBILITY, AND NOT THE COMPANY’S,
TO FILE TIMELY THE ELECTION UNDER SECTION 83(b), EVEN IF GRANTEE REQUESTS THE COMPANY OR ITS
REPRESENTATIVES TO MAKE THIS FILING ON GRANTEE’S BEHALF. GRANTEE SHALL DELIVER A COPY OF ANY SUCH
FILING TO THE COMPANY PROMPTLY UPON THE FILING THEREOF.

	 	7.	 	General Provisions.
	 
	 	 	 	THIS AGREEMENT SHALL BE GOVERNED IN ALL RESPECTS BY THE
INTERNAL LAWS OF THE STATE OF TEXAS (WITHOUT GIVING EFFECT
TO ITS CHOICE OF LAW PROVISIONS) AS SUCH LAWS ARE APPLIED
TO AGREEMENTS BETWEEN TEXAS RESIDENTS ENTERED INTO AND TO
BE PERFORMED ENTIRELY WITHIN TEXAS.

     This Agreement constitutes the full and entire understanding and agreement between the parties
with regard to the subject matter hereof and may only be modified or amended in writing signed by
both parties.

     All references to the number of Shares shall be appropriately adjusted to reflect any stock
split, stock dividend or other change in the Shares that may be made by the Company after the date
of this Agreement, in accordance with the terms of the Plan.

     All notices and other communications required or permitted hereunder shall be in writing and
may be delivered in person or by facsimile, electronic mail, courier or U.S. mail, in which event
it may be mailed by first-class, certified or registered, postage prepaid, addressed (i) if to
Grantee, at Grantee’s address set forth on the signature page of the Agreement, or at such other
address as Grantee shall have furnished to the Company in writing, or (ii) if to the Company, to
its address set forth on the signature page of this Agreement and addressed to the attention of the
Secretary, or at such other address as the Company shall have furnished to Grantee. All such
notices and other communications shall be deemed given upon personal delivery, upon confirmation of
facsimile transfer, upon confirmation of electronic mail transmission, upon delivery by courier or
three business days after deposit in the United States mail.

 

 

     If any provision of this Agreement becomes or is declared by a court of competent jurisdiction
to be illegal, unenforceable or void, this Agreement shall continue in full force and effect
without such provision, provided, however, that no such severability shall be effective if it
materially changes the economic benefit of this Agreement to any party.

     This Agreement may be executed 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.

     IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the Effective Date.

Powell Industries, Inc.

	 	 	 	 	 	 	 

	By:
	 	 	 	 	 	 
	 

	 	 	 	[Name of Grantee]	 	 
	Its:
	 	 	 	 	 	 
	 

	 	 

	 	 
	 	 
	Address:	 	Address:	 	 
	 	 	 	 	 	 	 
	8550 Mosley Drive	 	 	 	 
	Houston, Texas 77075	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	 

{Please provide address for notice
purposes}
	 	 

 

 

CONSENT OF SPOUSE

     I,             
            
               
                        , spouse of [Name of Grantee], have read and approve the foregoing Agreement.
In consideration of granting to [Name of Grantee] 2,000 shares of common stock of Powell Industries, Inc.
as set forth in the Agreement, I hereby appoint [Name of Grantee] as my
attorney-in-fact in respect to the exercise of any rights under the Agreement and agree to be bound
by the provisions of the Agreement insofar as I may have any rights in said Agreement or any shares
issued pursuant thereto under the community property laws of the State of Texas or similar laws
relating to marital property in effect in the state of our residence as of the date of the
signing of the foregoing Agreement.

     Dated:                                         ,                     .

	 	 	 	 	 

	 

	 	“Spouse of Grantee”	 	 
	 
	 
	 	 	 	 
	 

	 	 

(Signature)
	 	 
	 
	 
	 	 	 	 
	 

	 	 

(Print Name)Exhibit 10.1

EXHIBIT 10.1

AMENDMENT NO. 3 TO

EXECUTIVE
TRANSITION AGREEMENT

THIS AMENDMENT NO. 3
is effective as of the 20th day of December, 2010, between The Bon-Ton Stores,
Inc., a Pennsylvania corporation (the “Company”), and
Mr. M. Thomas Grumbacher (the “Executive”).

WHEREAS, the Company
and the Executive are parties to an Executive Transition Agreement effective as
of February 1, 2005;

WHEREAS, as of
December 6, 2007, the Company and the Executive entered Amendment
No. 1 to the Executive Transition Agreement extending its term until
January 31, 2010, and making certain other changes;

WHEREAS, as of
February 1, 2010, the Company and the Executive entered into Amendment
No. 2 to the Executive Transition Agreement (“Amendment
No. 2”) extending its term until December 31, 2010, and making
certain other changes; and

WHEREAS, the parties
wish to amend the Transition Agreement, as amended (with all amendments, the
“Transition Agreement”), to extend its term until
February 5, 2012, and make certain other changes.

NOW, THEREFORE, for
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereby agree as follows:

1. Capitalized
Terms. Unless otherwise defined herein, capitalized terms used herein shall
have the respective meanings ascribed to such terms in the Transition Agreement.

2. Amendments
to Transition Agreement. The Transition Agreement is hereby amended, as
follows:

a.
Section I of the Transition Agreement is hereby amended by deleting the
existing section and substituting the following:

“Term.
The term of the Executive’s service hereunder shall commence as of
February 1, 2005 (the “Effective Date”) and shall
remain in effect through February 5, 2012, or until such earlier time at
which the Executive ceases to serve as Executive Chairman of the Board (the
“Term”). The Term shall automatically renew for successive
periods of one year unless either party shall give written notice to the other
party not less than 60 days prior to the end of the then current Term that
it does not wish to renew the Transition Agreement.”

b.
Section II of the Transition Agreement is hereby amended by deleting the
existing section and substituting the following:

 

1

 

“Position and Duties. During the Term, Executive
shall serve as Executive Chairman of the Board and as a member of the Executive
Committee of the Board. It is understood that Executive’s duties,
authority and responsibilities in such role shall be governed by and subject to
the applicable provisions of the Company’s “Governance Policies and
Procedures” adopted by the Board, as the same may be in effect from time
to time.”

c.
Section III.A of the Transition Agreement is hereby amended by deleting
the existing section and substituting the following:

“A. Base
Salary. For each fiscal year of the Company (each, a “Fiscal
Year”) during the Term, i.e., the Fiscal Years commencing on
or about February 1, 2005, February 1, 2006, February 1, 2007,
February 1, 2008, February 1, 2009, February 1, 2010 and
February 1, 2011 (and for each Fiscal Year thereafter during the Term),
the Executive shall receive a base salary at the rate of $650,000 per year
(“Base Salary”), payable in accordance with the
Company’s normal payroll practices.”

d.
After the fifth sentence of Section III.B of the Transition Agreement (the
current fifth sentence of such Section having been added by the Amendment
No. 2), the following sentence is hereby added:

“For the 2011
Fiscal Year (and for each fiscal year thereafter during the Term), the
Executive shall be eligible for a target bonus of 40% of Base Salary and a
maximum bonus equal to 80% of his Base Salary.”

e.
Section IV.A of the Transition Agreement is hereby amended by deleting the
existing section and substituting the following:

“A. Medical Insurance. During the Term, the Executive
and his eligible dependents shall be eligible to participate in the
Company’s group medical plans in accordance with the terms of such plans
and subject to the restrictions and limitations contained in the plans or
applicable insurance or agreements. Following the cessation of the
Executive’s service as Executive Chairman for any reason, the Executive
(for the duration of his lifetime) and his wife Nancy Grumbacher (for the
duration of her lifetime) shall be reimbursed for the costs actually incurred
by them (or either of them following the death of the other) for the purchase
of health coverage generally similar to the coverage available to active
employees of the Company; provided, however, that any such coverage shall be of
a type that is coordinated with and pays secondarily after benefits the
Executive and/or Mrs. Grumbacher are entitled to receive from the U.S.
government (such as Medicare coverage), or, in the alternative, if possible,
the Company shall purchase such a policy for the Executive and/or
Mrs. Grumbacher, as applicable. Reimbursements to the Executive and/or
Mrs. Grumbacher shall be paid to them on provision of appropriate
documentation indicating the amounts actually paid by the Executive and/or Mrs.
Grumbacher, and shall be

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paid at a time and in
a manner that is consistent with the requirements set forth in Treasury
Regulation Section 1.409A-3(i)(1)(iv) (that permits certain
arrangements that call for the payment of reimbursements or the provision of
in-kind benefit plans to be treated as creating a fixed schedule of payments as
permitted with regard to nonqualified deferred compensation plans subject to
Code Section 409A). In addition, in the event the arrangement is treated
as creating a tax liability for the Executive (and/or Mrs. Grumbacher),
such tax liability shall be “grossed up” (i.e., the Company
shall pay to Executive and/or Mrs. Grumbacher, as applicable, an
additional payment (the “Gross Up Payment”) in an amount that is
sufficient so that, after payment of all tax liabilities attributable to the
Gross Up Payment itself, Executive and/or Mrs. Grumbacher, as applicable,
shall have an amount that is sufficient to pay the tax liability attributable
to the benefit arrangement) and payments of any such amounts as are required to
be paid as such a gross up shall be paid consistent with the requirements of
Treasury Regulation Section 1.409A-3(i)(1), including provisions regarding
tax gross-up payments. The Company shall continue to provide the Executive with
the Pinnacle Care Plan (or similar coverage) through the date of
Executive’s cessation of service as Executive Chairman, and the Company
shall continue to provide such coverage (or similar coverage) at no cost to
either the Executive or Mrs. Grumbacher for the lifetime of each of the them,
but only if such coverage is available and does not violate any applicable law,
including, but not limited to, provisions of law enacted as part of federal
healthcare reform legislation.”

f. A
new Section IV.G is added at the end of Section IV of the Transition
Agreement to read as follows:

“G. Additional Provisions Related to Code
Section 409A. Notwithstanding anything to the contrary contained
herein, and in addition to other amendments to the Executive Transition
Agreement that eliminate provisions that may have been considered to constitute
impermissible alternative forms of payments or benefits, the Executive
Transition Agreement shall be interpreted and implemented pursuant to the
following provisions:

1.
Any benefit or payment that is paid by reason of the Executive’s
cessation of service as the Executive Chairman that constitutes a form of
nonqualified deferred compensation that is subject to Code Section 409A
shall only be paid following the Executive’s “separation from
service” with the Company, and reference to cessation or termination of
service as Executive Chairman herein shall be interpreted so that, to the
extent necessary to comply with Code Section 409A and applicable Treasury
Regulations thereunder, the event that constitutes such cessation of service as
Executive Chairman also qualifies as a “separation from service”
(as that phrase is used for purposes of Code Section 409A and as defined
in Treasury Regulation Section 1.409A-1(h).

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2.
Any payment of deferred compensation that is subject to the requirement under
Code Section 409A(a)(2)(B)(i) (regarding the six month delay of payments
to specified employees of a publicly traded company) shall not be paid earlier
than 18 months following the date of the amendment adding this
Section IV.G. to the Executive Transition Agreement, or six months
following the date of the Executive’s separation from service, whichever
is later, to the extent such deferral of payment is necessary to comply with
Code Section 409A and with the requirements of IRS Notice 2010-6.”

3. Full Force
and Effect. Except as amended hereby, the Transition Agreement shall remain
unchanged and in full force and effect.

IN WITNESS WHEREOF,
the Company has caused this Amendment No. 3 to be duly executed and the
Executive has hereunto set his hand, effective as of the date first set forth
above.

THE BON-TON STORES,
INC.

By: /s/
MARSHA M. EVERTON

Marsha M. Everton

Chair, Human
Resources and Compensation Committee

EXECUTIVE

/s/ M.
THOMAS GRUMBACHER

M. Thomas Grumbacher

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