Exhibit 10.2(d) ECHELON CORPORATION PERFORMANCE SHARE AGREEMENT


    Exhibit
      10.2(d)


    ECHELON
      CORPORATION

     

    Performance
      Share Agreement

     

     

    Grant
      #__________

     

     

    Echelon
      Corporation (the “Company”) hereby grants you, [Name]
      (the
“Employee”), an award of Performance Shares under the Company’s 1997 Stock Plan
      (the “Plan”). The date of this Agreement is ______, 200__. Subject to the
      provisions of Appendix A (attached hereto) and of the Plan, the principal
      features of this award are as follows:

     

     

    Number
      of Performance Shares: [________]

     

    Vesting
      of Performance Shares: The
      Performance Shares will vest in accordance with the following schedule:
[insert
      vesting schedule],
      subject
      to your continued employment with the Company or its Subsidiaries through the
      applicable vesting date. 

     

     

    IMPORTANT:

    


    Your
      signature below indicates your agreement and understanding that this award
      is
      subject to all of the terms and conditions contained in Appendix A and the
      Plan. For example, important additional information on vesting and forfeiture
      of
      the Performance Shares is contained in paragraphs 3 through 6 of
      Appendix A. PLEASE
      BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC TERMS AND
      CONDITIONS OF THIS AGREEMENT.

     

    
      	 ECHELON
              CORPORATION	 	 EMPLOYEE
	 	 	 
	 	 	 
	 [NAME]	 	 [NAME]
	 	 	 
	 	 	 
	 [TITLE]	 	 
	 	 	 
	 Date: ___________, 200__	 	 Date: ___________,
              200__

 

     

     

     

     

        

     

    
       

      
        
          

        

      

      
        APPENDIX
          A

         

      

    

    TERMS
      AND CONDITIONS OF PERFORMANCE SHARES

     

    


     

    1. Grant.
      The
      Company hereby grants to the Employee under the 1997 Plan Performance Shares,
      subject to all of the terms and conditions in this Agreement and the Plan.
      When
      the Performance Shares are paid to the Employee, par value will be deemed paid
      by the Employee for each Performance Share by past services rendered by the
      Employee, and will be subject to the appropriate tax withholdings.

     

    2. Company’s
      Obligation to Pay.
      Each
      Performance Share has a value equal to the Fair Market Value of a Share on
      the
      date of grant. Unless and until the Performance Shares have vested in the manner
      set forth in paragraphs 3 or 4, the Employee will have no right to payment
      of such Performance Shares. Prior to actual payment of any vested Performance
      Shares, such Performance Shares will represent an unsecured obligation.


     

    3. Vesting
      Schedule/Period of Restriction.
      Except
      as otherwise provided in paragraph 4 of
      this
      Agreement, the Performance Shares awarded by this Agreement shall vest in
      accordance with the vesting schedule set forth in the Notice of Grant, subject
      to the Employee’s continuing to be a Service Provider on each relevant vesting
      date. Notwithstanding anything in this paragraph 3 to the contrary, and except
      as otherwise provided by the Administrator, vesting of the Performance Shares
      shall be suspended during any unpaid leave of absence other than military leave
      and will resume on the date the Employee returns to work on a regular schedule
      as determined by the Company; provided, however, that no vesting credit will
      be
      awarded for the time vesting has been suspended during such leave of
      absence.

     

    4. Administrator
      Discretion.
      The
      Administrator, in its discretion, may accelerate the vesting of the balance,
      or
      some lesser portion of the balance, of the Performance Shares at any time,
      subject to the terms of the Plan. If so accelerated, such Performance Shares
      will be considered as having vested as of the date specified by the
      Administrator. 

     

    5. Payment
      after Vesting.
      Any
      Performance Shares that vest in accordance with paragraph 3 or 4 will be paid
      to
      the Employee (or in the event of the Employee’s death, to his or her estate) in
      Shares which have an aggregate Fair Market Value equal to the value of the
      earned Performance Shares at vesting as soon as practicable following the date
      of vesting, subject to paragraph 8. 

     

    6. Forfeiture.
      Notwithstanding any contrary provision of this Agreement, the balance of the
      Performance Shares that have not vested pursuant to paragraphs 3 or 4 at the
      time of the Employee’s termination as a Service Provider for any or no reason
      will be forfeited and automatically transferred to and reacquired by the Company
      at no cost to the Company. The Employee shall not be entitled to a refund of
      the
      price paid for the Performance Shares forfeited to the Company pursuant to
      this
      paragraph 6. 

     

    7. Death
      of Employee.
      Any
      distribution or delivery to be made to the Employee under this Agreement will,
      if the Employee is then deceased, be made to the administrator or executor
      of
      the Employee’s estate. Any such administrator or executor must furnish the
      Company with (a) written notice of his or her status as transferee, and (b)
      evidence satisfactory to the Company to establish the validity of the transfer
      and compliance with any laws or regulations pertaining to said
      transfer.

     

    8. Withholding
      of Taxes.
      When
      the Shares are issued as payment for vested Performance Shares, the Employee
      will recognize immediate U.S. taxable income if the Employee is a U.S. taxpayer.
      If the Employee is a non-U.S. taxpayer, the Employee will be subject to
      applicable taxes in his or her jurisdiction. The Company will withhold a portion
      of the vested Performance Shares that have an aggregate market value sufficient
      to pay the minimum federal, state and local income, employment and any other
      applicable taxes required to be withheld by the Company. No fractional Shares
      will be withheld or issued pursuant to the grant of Performance Shares and
      the
      issuance of Shares thereunder; any additional withholding necessary for this
      reason will be done by the Company through the Employee’s paycheck. The Company,
      in its discretion, may, and with respect to its executive officers (as
      determined by the Company) will, withhold an amount equal to two (2) times
      the
      fair market value of a Share from the last paycheck due to the Employee prior
      to
      the vesting of the Performance Shares. In the event that the cash amounts
      withheld by the Company exceed the withholding taxes that are due after the
      automatic withholding of whole Shares, the Company will reimburse the Employee
      for the excess amounts. In the event the withholding requirements are not
      satisfied through the withholding of Shares (or, through the Employee’s
      paycheck, as indicated above), no payment will be made to the Employee (or
      his
      or her estate) for Performance Shares unless and until satisfactory arrangements
      (as determined by the Administrator) have been made by the Employee with respect
      to the payment of any income and other taxes which the Company determines must
      be withheld or collected with respect to such Performance Shares. By accepting
      this Award, the Employee expressly consents to the withholding of Shares and
      to
      any additional cash withholding as provided for in this
      paragraph 8.

     

    9. Rights
      as Stockholder.
      Neither
      the Employee nor any person claiming under or through the Employee will have
      any
      of the rights or privileges of a stockholder of the Company in respect of any
      Shares deliverable hereunder unless and until certificates representing such
      Shares (which may be in book entry form) will have been issued, recorded on
      the
      records of the Company or its transfer agents or registrars, and delivered
      to
      the Employee (including through electronic delivery to a brokerage account).
      After such issuance, recordation and delivery, the Employee will have all the
      rights of a stockholder of the Company with respect to voting such Shares and
      receipt of dividends and distributions on such Shares. 

     

    10. No
      Effect on Employment.
      Subject
      to any employment contract with the Employee, the terms of such employment
      will
      be determined from time to time by the Company, or the Affiliate employing
      the
      Employee, as the case may be, and the Company, or the Affiliate employing the
      Employee, as the case may be, will have the right, which is hereby expressly
      reserved, to terminate or change the terms of the employment of the Employee
      at
      any time for any reason whatsoever, with or without good cause. The transactions
      contemplated hereunder and the vesting schedule set forth in the Notice of
      Grant
      do not constitute an express or implied promise of continued employment for
      any
      period of time. 

     

    11. Address
      for Notices.
      Any
      notice to be given to the Company under the terms of this Agreement will be
      addressed to the Company, in care of Human Resources Department, at Echelon
      Corporation, 550 Meridian Avenue, San Jose, CA 95126, or at such other address
      as the Company may hereafter designate in writing.

     

    12. Grant
      is Not Transferable.
      Except
      to the limited extent provided in paragraph 7 above, this grant of Performance
      Shares and the rights and privileges conferred hereby will not be sold, pledged,
      assigned, hypothecated, transferred or disposed of any way (whether by operation
      of law or otherwise) and will not be subject to sale under execution, attachment
      or similar process, until you have been issued the Shares. Upon any attempt
      to
      sell, pledge, assign, hypothecate, transfer or otherwise dispose of this grant,
      or any right or privilege conferred hereby, or upon any attempted sale under
      any
      execution, attachment or similar process, this grant and the rights and
      privileges conferred hereby immediately will become null and void. 

     

    13. Restrictions
      on Sale of Securities.
      The
      Shares issued as payment for vested Performance Shares awarded under this
      Agreement will be registered under the federal securities laws and will be
      freely tradable upon receipt. However, your subsequent sale of the Shares will
      be subject to any market blackout-period that may be imposed by the Company
      and
      must comply with the Company’s insider trading policies, and any other
      applicable securities laws.

     

    14. Binding
      Agreement.
      Subject
      to the limitation on the transferability of this grant contained herein, this
      Agreement will be binding upon and inure to the benefit of the heirs, legatees,
      legal representatives, successors and assigns of the parties
      hereto.

     

    15. Additional
      Conditions to Issuance of Certificates for Shares.
      The
      Company shall not be required to issue any certificate or certificates for
      Shares hereunder prior to fulfillment of all the following conditions:
      (a) the admission of such Shares to listing on all stock exchanges on which
      such class of stock is then listed; (b) the completion of any registration
      or other qualification of such Shares under any state or federal law or under
      the rulings or regulations of the Securities and Exchange Commission or any
      other governmental regulatory body, which the Administrator shall, in its
      absolute discretion, deem necessary or advisable; (c) the obtaining of any
      approval or other clearance from any state or federal governmental agency,
      which
      the Administrator shall, in its absolute discretion, determine to be necessary
      or advisable; and (d) the lapse of such reasonable period of time following
      the date of vesting of the Performance Shares as the Administrator may establish
      from time to time for reasons of administrative convenience.

     

    16. Plan
      Governs.
      This
      Agreement is subject to all terms and provisions of the Plan. In the event
      of a
      conflict between one or more provisions of this Agreement and one or more
      provisions of the Plan, the provisions of the Plan will govern. Capitalized
      terms used and not defined in this Agreement will have the meaning set forth
      in
      the Plan.

     

    17. Administrator
      Authority.
      The
      Administrator will have the power to interpret the Plan and this Agreement
      and
      to adopt such rules for the administration, interpretation and application
      of
      the Plan as are consistent therewith and to interpret or revoke any such rules
      (including, but not limited to, the determination of whether or not any
      Performance Shares have vested). All actions taken and all interpretations
      and
      determinations made by the Administrator in good faith will be final and binding
      upon the Employee, the Company and all other interested persons. No member
      of
      the Administrator will be personally liable for any action, determination or
      interpretation made in good faith with respect to the Plan or this Agreement.
      

     

    18. Captions.
      Captions provided herein are for convenience only and are not to serve as a
      basis for interpretation or construction of this Agreement.

     

    19. Agreement
      Severable.
      In the
      event that any provision in this Agreement will be held invalid or
      unenforceable, such provision will be severable from, and such invalidity or
      unenforceability will not be construed to have any effect on, the remaining
      provisions of this Agreement.

     

    20. Modifications
      to the Agreement.
      This
      Agreement constitutes the entire understanding of the parties on the subjects
      covered. The Employee expressly warrants that he or she is not accepting this
      Agreement in reliance on any promises, representations, or inducements other
      than those contained herein. Modifications to this Agreement or the Plan can
      be
      made only in an express written contract executed by a duly authorized officer
      of the Company.

     

    21. Amendment,
      Suspension or Termination of the Plan.
      By
      accepting this Award, the Employee expressly warrants that he or she has
      received a right to purchase stock under the Plan, and has received, read and
      understood a description of the Plan. The Employee understands that the Plan
      is
      discretionary in nature and may be modified, suspended or terminated by the
      Company at any time.

     

    22. Notice
      of Governing Law.
      This
      grant of Performance Shares shall be governed by, and construed in accordance
      with, the laws of the State of California without regard to principles of
      conflict of laws.