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Exhibit
10.4
ENVIRONMENTAL POWER
CORPORATION
L ONG -
TERM I NCENTIVE P
LAN
The following represents a summary of
the Long-term Incentive Plan (LTIP) for Environmental Power
Corporation (“EPC” or the “Company”) ,
which was adopted by the Compensation Committee of EPC’s
Board of Directors pursuant to its discretionary authority under
EPC’s 2005 Equity Incentive Plan and 2006 Equity Incentive
Plan to provide guidelines for annual equity awards to eligible
positions.
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LAN O BJECTIVES |
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• Provide a long-term
incentive plan based on the financial growth of the
Company
• Foster teamwork and
entrepreneurial spirit among the participants tied to the
achievement of the Company’s growth and financial
objectives
• Provide a long-term
compensation tool to motivate and reward
• Acts as a retention
mechanism.
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ARTICIPATION |
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• LTIP participation is
limited to full-time employees. • Participation is divided
into tiers by level of function.
• All participants are
assigned to an Award Tier as follows:
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TIER
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L
EVEL
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A |
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CEO |
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B |
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Executive Management |
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C |
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CEO Designee |
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ARGET A WARDS |
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• Calculated as a percentage
of Base Salary earned, with Target Awards designated by
Tier:
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TIER
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I NCENTIVE
T ARGET
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A |
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Annually Established by Board |
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B |
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30% of Base Salary |
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C |
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Discretionary |
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• Value will be determined
using Fair Market Value (FMV) at time of grant utilizing the
modified Black-Scholes methodology where appropriate.
• Grant Awards will be
considered annually
• Vesting will be three-year
vesting with 33 1/3% of each grant vesting annually.
• Awards for participants
who are hired, transferred or promoted into eligible positions are
first eligible for the next plan cycle (January 1).
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WARD G RANT M
IX |
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• Award grants may be a
combination of different long-term vehicles including Restricted
Shares, Incentive Stock Options and Stock Appreciation Rights
(SAR’s).
• Grant mix guidelines will
be considered by the Board on a yearly basis. For 2008, a grant of
Stock Appreciation Rights will be considered.
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