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

On April 17, 2009, Echelon Corporation (the "Company") reported that a structured salary reduction plan had been approved by the Board of Directors, pursuant to which the salaries of certain employees of the Company, including the executive officers of the Company (and including the named executive officers), would be reduced. As part of the salary reduction plan, the Board also approved the issuance on June 10, 2009 of certain performance shares under the Company's 1997 Stock Plan to those employees affected by the salary reduction plan, in a number equal to one half of the amount of that employee's annual salary reduction, valued at the closing price of the Company's common stock on June 10, 2009. Such closing price was $8.00.

The total number of performance shares so issued as of June 10, 2009 was 147,462, including the following issuances to the named executive officers:
(i) M. Kenneth Oshman, the Company's Chief Executive Officer, 1,032 shares;
(ii) Oliver R. Stanfield, the Company's Executive Vice President and Chief Financial Officer, 3,375 shares; (iii) Kathleen B. Bloch, the Company's Senior Vice President and General Counsel, 3,347 shares; (iv) Frederik H. Bruggink, the Company's Senior Vice President and General Manager - Service Provider Group, 4,041 shares; and (v) Russell Harris, the Company's Senior Vice President-Operations, 3,235 shares. The performance shares issued to each named executive officer will vest on April 30, 2010, provided that such officer continues to be employed by the Company as of that date.

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