ECHELON CORPORATION Performance Share Agreement for Non-U.S. Employees TERMS AND CONDITIONS OF PERFORMANCE SHARES
Exhibit
10.2(e)
ECHELON
CORPORATION
for
Non-U.S. Employees
TERMS
AND CONDITIONS OF PERFORMANCE SHARES
By
executing the Grant Acceptance process and using the services on this ▇▇▇▇▇
▇▇▇▇▇▇ Benefit Access® website, you, the Employee and Echelon Corporation (the
“Company”) agree that this Award is granted under and governed by the terms and
conditions of the Company’s 1997 Plan (the “Plan”) and the Terms and Conditions
of Performance Shares (the “Agreement”), which may be amended or modified from
time to time. Employee has reviewed the Plan and this Agreement in its entirety,
has had an opportunity to obtain the advice of counsel prior to accepting this
Award and fully understands provisions of the Plan and this Agreement. Employee
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Administrator upon any questions relating to the Plan
and
this Agreement. Employee further agrees to promptly notify the Company upon
any
change in the Employee’s residence address. [PLEASE BE SURE TO READ ALL OF THE
TERMS AND CONDITIONS (IF ANY) AND APPENDICES, (IF ANY) FOR YOUR COUNTRY, THAT
CONTAIN THE SPECIFIC TERMS AND CONDITIONS OF THIS AWARD.]
____________________
The
Company hereby grants you, the Employee, an award (the “Award”) of Performance
Shares under the Plan. The Award is subject to the provisions of the Plan and
the Agreement, including Appendices, if any, for the Employee’s country.
1. Grant.
The
Company hereby grants Performance Shares to the Employee under the Plan subject
to all of the terms and conditions in the Plan and this Agreement, including
Appendices, if any, for the Employee’s country. If the Performance Shares are
paid out in Shares to the Employee upon vesting, par value for the Common Stock
underlying the Performance Shares will be deemed to have been paid by the
Employee’s services over the vesting period rendered by the Employee to the
Company or its Subsidiary.
2. Company’s
Obligation to Pay.
Each
Performance Share represents an unfunded promise by the Company to issue one
share of the Company’s Common Stock, subject to certain restrictions and on the
terms and conditions contained in this Agreement. 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 the payment of 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 Summary 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 or as required by local law, 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, if permissible under local law.
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, and if permissible under local law. 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 paragraphs 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.
Regardless of any action the Company or its Subsidiary takes with respect to
any
or all income tax, social insurance, payroll tax, or other tax-related
withholding (“Tax-Related Items”), the Employee acknowledges and agrees that the
ultimate liability for all Tax-Related Items legally due by the Employee is
and
remains the Employee’s responsibility and that the Company and/or the Subsidiary
(a) make no representations or undertakings regarding the treatment of any
Tax-Related Items in connection with any aspect of the Performance Shares,
including the grant or vesting of the Performance Shares, the subsequent sale
of
Shares acquired under the Plan and the receipt of dividend equivalents, if
any;
and (b) do not commit to structure the terms of the Award or any aspect of
the
Award to reduce or eliminate the Employee’s liability for Tax-Related
Items.
No
Shares
will be issued 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 Tax-Related
Items obligations of the Company and/or the Subsidiary with respect to the
issuance of such Shares.
In
this
regard, the Employee authorizes the Company and/or its Subsidiary to withhold
Shares from the Performance Shares, provided that the Company withholds only
that number of Shares with a Fair Market Value equal to the minimum required
withholding amount for Tax-Related Items, determined on the date that the amount
for Tax-Related Items to be withheld is to be determined. If the Company or
the
Employer satisfies the obligation for Tax-Related Items by withholding a number
of whole Shares as described herein, the Employee is deemed to have been issued
the full number of Shares subject to the Award of Performance Shares,
notwithstanding that a number of the Shares is held back solely for the purpose
of paying the Tax-Related Items due as a result of the vesting of the
Performance Shares. 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
or
the Subsidiary through the Employee’s paycheck or other cash compensation paid
to the Employee by the Company and/or the Subsidiary. The Company or the
Subsidiary, 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 or other cash
compensation due to the Employee prior to the vesting of the Performance Shares.
In the event that the cash amounts withheld by the Company or the Subsidiary
exceed the Tax-Related Items that are due after the automatic withholding of
whole Shares, the Company or the Subsidiary will reimburse the Employee for
the
excess amounts.
In
addition, the Employee authorizes the Company and/or the Subsidiary, in their
sole discretion, in lieu of or in addition to the foregoing and in each case
to
the extent permissible under local law, to (i) sell or to arrange for the sale
of Shares received as a result of vesting of the Performance Shares (on the
Employee’s behalf and at the Employee’s discretion pursuant to the Employee’s
authorization in this Agreement), with the proceeds going toward satisfaction
of
the Tax-Related Items, (ii) require the Employee to pay the Tax Related Items
in
cash or with a cashier’s check or certified check, and/or (iii) withhold all
applicable Tax-Related Items legally payable by the Employee from the Employee’s
wages or other cash compensation payable to the Employee by the Company or
its
Subsidiary.
The
Employee shall pay to the Company and or the Subsidiary any amount of
Tax-Related Items that the Company may be required to withhold as a result
of
the Employee’s participation in the Plan that cannot be satisfied by one or more
of the means previously described in this paragraph 8.
The
Company shall not be required to deliver any of the Shares if the Employee
fails
to comply with his or her obligations in connection with the Tax-Related Items
as described 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 with respect to
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 Subsidiary employing
the
Employee, as the case may be, and the Company, or the Subsidiary, as the case
may be, will have, and the Employee’s participation in the Plan shall not
interfere with, 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,
the Employee’s participation in the Plan and the vesting schedule set forth in
the Summary of Grant do not constitute an express or implied promise of
continued employment for any period of time. In the event that the Employee
is
not an employee of the Company, the grant will not be interpreted to form an
employment contract with the Employee’s employer or any Subsidiary or affiliate
of the Company.
11. Nature
of Grant.
In
accepting the Performance Shares, the Employee acknowledges that:
(a) the
grant
of the Performance Shares is voluntary and occasional and does not create any
contractual or other right to receive future grants of Performance Shares,
or
benefits in lieu of Performance Shares even if Performance Shares have been
granted repeatedly in the past;
(b) all
decisions with respect to future Awards of Performance Shares, if any, will
be
at the sole discretion of the Company;
(c) the
Employee’s participation in the Plan is voluntary;
(d) Performance
Shares are extraordinary items that do not constitute regular compensation
for
services rendered to the Company or its Subsidiary, and that is outside the
scope of the Employee’s employment contract, if any;
(e) the
Award
is not part of normal or expected compensation or salary for any purposes,
including, but not limited to, calculating any severance, resignation,
redundancy or end of service payments, bonuses, long-service awards, pension
or
retirement or welfare benefits or similar payments and in no event should be
considered as compensation for, or relating in any way to, past services for
the
Company or its Subsidiary;
(f) the
future value of the underlying Shares is unknown and cannot be predicted with
certainty;
(g) in
consideration of the Award, no claim or entitlement to compensation or damages
shall arise from termination of the Award or any diminution in value of the
Performance Shares or Shares received when the Performance Shares vest resulting
from termination of employment by the Company or its Subsidiary (for any reason
whatsoever and whether or not in breach of local labor laws), and the Employee
irrevocably releases the Company and/or its Subsidiary from any such claim
that
may arise; if, notwithstanding the foregoing, any such claim is found by a
court
of competent jurisdiction to have arisen, then, by signing this Agreement,
the
Employee shall be deemed irrevocably to have waived his or her entitlement
to
pursue such claim;
(h) in
the
event of involuntary termination of the Employee’s employment (whether or not in
breach of local labor laws), the Employee’s right to receive Performance Shares
and vest under the Plan, if any, will terminate effective as of the date that
the Employee is no longer actively employed and will not be extended by any
notice period mandated under local law (e.g.,
active
employment would not include a period of “garden leave” or similar period
pursuant to local law); the Committee shall have the exclusive discretion to
determine when the Employee is no longer actively employed for purposes of
the
Award;
(i) the
Company is not providing any tax, legal or financial advice, nor is the Company
making any recommendations regarding the Employee’s participation in the Plan,
or the Employee’s acquisition or sale of the underlying Shares; and
(j) the
Employee is hereby advised to consult with his or her own personal tax, legal
and financial advisors regarding the Employee’s participation in the Plan before
taking any action related to the Plan.
12. Data
Privacy.
The Employee hereby explicitly and unambiguously consents to the collection,
use
and transfer, in electronic or other form, of the Employee’s personal data as
described in this Agreement by and among, as applicable, the Employee’s
employer, the Company and its Subsidiaries and affiliates for the exclusive
purpose of implementing, administering and managing the Employee’s participation
in the Plan.
The
Employee understands that the Company and the Subsidiary may hold certain
personal information about the Employee, including, but not limited to, the
Employee’s name, home address and telephone number, date of birth, social
insurance number or other identification number, salary, nationality, job title,
any shares of stock or directorships held in the Company or its Subsidiaries
and
affiliates, details of all Performance Shares or any other entitlement to shares
of stock awarded, canceled, exercised, vested, unvested or outstanding in the
Employee’s favor, for the exclusive purpose of implementing, administering and
managing the Plan (“Personal Data”). The Employee understands that Personal Data
may be transferred to any third parties assisting in the implementation,
administration and management of the Plan, that these recipients may be located
in the Employee’s country, or elsewhere, and that the recipient’s country may
have different data privacy laws and protections than the Employee’s country.
The Employee understands that he or she may request a list with the names and
addresses of any potential recipients of the Personal Data by contacting the
Employee’s local human resources representative. The Employee authorizes the
recipients to receive, possess, use, retain and transfer the Personal Data,
in
electronic or other form, for the purposes of implementing, administering and
managing the Employee’s participation in the Plan, including any requisite
transfer of such Personal Data as may be required to a broker or other third
party with whom the Employee may elect to deposit any Shares received upon
vesting of the Award. The Employee understands that Personal Data will be held
only as long as is necessary to implement, administer and manage the Employee’s
participation in the Plan. The Employee understands that he or she may, at
any
time, view Personal Data, request additional information about the storage
and
processing of Personal Data, require any necessary amendments to Personal Data
or refuse or withdraw the consents herein, without cost, by contacting in
writing the Employee’s local human resources representative. The Employee
understands that refusal or withdrawal of consent may affect the Employee’s
ability to realize benefits from the Award. For more information on the
consequences of the Employee’s refusal to consent or withdrawal of consent, the
Employee understands that he or she may contact his or her local human resources
representative.
13. 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, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, or at such other address
as the Company may hereafter designate in writing.
14. 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 may not be sold, pledged,
assigned, hypothecated, transferred or disposed of any way (whether by operation
of law or otherwise) and may 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.
15. Restrictions
on Sale of Securities.
Subject
to the provisions of paragraph 17 below, the Shares issued as payment for vested
Performance Shares awarded under this Agreement will be registered under the
U.S. 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 ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ policies, and any other applicable securities laws.
16. 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, to the
extent permissible under local law.
17. 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, federal, or local law
or
under the rulings or regulations of the U.S. 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 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.
18. 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.
19. 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.
20. Captions.
Captions provided herein are for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
21. 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.
22. 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 can be made only
in
an express written contract executed by a duly authorized officer of the
Company.
23. Amendment,
Suspension or Termination of the Plan.
The
Employee understands that the Plan is discretionary in nature and may be
amended, altered, suspended or terminated by the Company at any
time.
24. Notice
of Governing Law.
This
grant of Performance Shares and the provisions of this Agreement, including
Appendices, if any, for the Employee’s country, shall be governed by, and
construed in accordance with, the laws of the State of California without regard
to principles of conflict of laws.
25. Electronic
Delivery.
The
Company may, in its sole discretion, decide to deliver any documents related
to
the Performance Shares granted under and participation in the Plan or future
Awards that may be granted under the Plan by electronic means or to request
the
Employee’s consent to participate in the Plan by electronic means. The Employee
hereby consents to receive such documents by electronic delivery and, if
requested, to agree to participate in the Plan through an on-line or electronic
system established and maintained by the Company or another third party
designated by the Company.
26. Language.
If the
Employee has received this Agreement, including Appendix A and Appendix B (if
any), or any other document related to the Plan translated into a language
other
than English, and if the translated version is different than the English
version, the English version will control.
27. No
Compensation Deferrals.
Payments
made pursuant to the Plan and this Award are intended to qualify for the
“short-term deferral” exemption from Section 409A of the Code. The Company
reserves the right, to the extent the Company deems necessary or advisable
in
its sole discretion, to unilaterally amend or modify the Plan and/or this
Agreement, including Appendix A and Appendix B (if any) to ensure that all
Performance Share Awards are made in a manner that qualifies for exemption
from
or complies with Section 409A of the Code, provided, however, that the Company
makes no representation that this Award is not subject to Section 409A of the
Code nor makes any undertaking to preclude Section 409A of the Code from
applying to this Award.