Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On June 27, 2008, the Board of Directors of Echelon Corporation (the "Company") approved amendments to the forms of equity award agreements under the Company's 1997 Stock Plan (the "1997 Plan") to provide for acceleration of certain equity awards in the event of certain terminations of service following a change in control of the Company.

Specifically, the Board of Directors approved that, upon the "Involuntary Termination" (as defined below) of an Eligible Award Holder (as defined below) within the twelve (12) months following a "Change of Control Merger" (as defined in the 1997 Plan), "Eligible Awards" (as defined below) will, to the extent then-outstanding, immediately be fully vested and exercisable, all restrictions on restricted stock, performance shares and performance units will lapse and, with respect to Eligible Awards with performance-based vesting, all performance goals or other vesting criteria will be deemed achieved at one hundred percent (100%) of target levels and all other terms and conditions met. (These types of acceleration, lapse of restrictions and deemed achievement are often referred to as "Double Trigger Acceleration" provisions.)

The Board of Directors defined an "Involuntary Termination" as any of the following events: (i) without the participant's express written consent, a significant reduction of the participant's duties, authority or responsibilities, relative to the participant's duties, authority or responsibilities as in effect immediately prior to the Change of Control Merger;
(ii) a material reduction in the total cash compensation of the participant as in effect immediately prior to the Change of Control Merger; (iii) the relocation of the participant to a facility or a location more than thirty
(30) miles from the participant's then present location, without the participant's express written consent; or (iv) any purported termination of the participant which is not effected for Disability or for Cause (as defined in the 1997 Plan), or any purported termination for which the grounds relied upon are not valid.

The Board of Directors defined "Eligible Awards" to include (i) all shares of restricted stock, stock purchase rights and stock appreciation rights granted under the 1997 Plan outstanding as of June 27, 2008 or granted on or after June 27, 2008 and (ii) all performance shares and performance units granted under the 1997 Plan on or after June 27, 2008, in each case to an employee of the Company or its subsidiaries at the level of Vice President and above (each, an "Eligible Award Holder").

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