Executive Incentive Plan

On May 12, 2009, the Compensation Committee of the Board of Directors (the "Committee") of American Superconductor Corporation (the "Company"), as well as the Board of Directors of the Company, approved an executive incentive plan for the Company's fiscal year ending March 31, 2010 ("fiscal 2009"). Participants in the plan include the Company's Chief Executive Officer and all other executive officers. The Committee is responsible for determining the payout under the plan to each executive officer except the Chief Executive Officer. The Board of Directors of the Company determines the payout under the plan for the Chief Executive Officer, taking into account the recommendation received from the Committee.

Pursuant to the plan, the Committee designated for each executive officer a target cash incentive amount, expressed as a percentage of the officer's base salary. In establishing these targets, the Committee took into account for each officer the level of total compensation including base salary, cash incentive and equity paid by similar companies for comparable positions based on market data compiled by the Company's outside compensation consultant Pearl Meyer & Company and the Company's Vice President of Human Resources.

The amount of the incentive award actually paid to each executive officer may be less than or greater than the executive's target cash incentive, with the amount capped at 156% of the target incentive. Individual incentive awards will be determined following the end of fiscal 2009 based on the following factors and their corresponding weightings:

• the Company's net income (loss) before amortization of acquisition-related intangibles, restructuring and impairments, stock-based compensation expense, other unusual charges and any tax effects related to these items for fiscal 2009 as compared to the target established by the Committee - 40%

• the executive's achievement of individual, measurable objectives during fiscal 2009 as determined by the Committee for all executives with the exception of the Chief Executive Officer, who is evaluated by the Board of Directors - 40%

• the executive's overall contribution during fiscal 2009 towards the achievement of the Company's financial and non-financial objectives (subjective performance measure) - 20%

The following table sets forth each current executive officer's target cash incentive for fiscal 2009.

                                                     Target Incentive as % of
Executive Officer                  Title                   Base Salary               Target Incentive
Gregory J. Yurek            Chief Executive
                            Officer and
                            President                                      60 %      $         360,000

Charles W. Stankiewicz      Executive Vice
                            President and
                            General Manager,
                            AMSC Power Systems                             50 %      $         156,000

David A. Henry              Senior Vice
                            President, Chief
                            Financial Officer,
                            Treasurer and
                            Secretary                                      50 %      $         140,000

Daniel P. McGahn            Senior Vice
                            President and
                            General Manager,
                            AMSC
                            Superconductors                                50 %      $         130,000

Angelo R. Santamaria        Senior Vice
                            President, Global
                            Manufacturing
                            Operations                                     50 %      $         114,000

Timothy D. Poor             Senior Vice
                            President, Global
                            Sales and Business
                            Development                                    50 %      $         110,000