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

On July 24, 2008, the Board of Directors of Active Power, Inc. (the "Company") approved the execution by the Company of change of control severance agreement (the "Severance Agreements") with each executive officer of the Company, other than James A. Clishem and John K. Penver. Each of the Severance Agreements provides that if within twelve months following a change in control (as defined in the Company's 2000 Stock Incentive Plan) the executive officer's employment is terminated for reasons other than cause, as defined therein, or by the executive for good reason, as defined therein, then any unvested options or shares of restricted stock held by such executive officer on the date of such change in control would accelerate and vest in full as of the date of such termination.

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