ECHELON CORPORATION Performance Share Agreement
Exhibit
10.2(d)
ECHELON
CORPORATION
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, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, 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 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ 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.