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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended: December 31, ~~2023~~2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ~~________~~_______

Commission file number: 001-35212

PIONEER POWER SOLUTIONS, INC.

(Exact name of registrant as specified in its charter)

Delaware		27-1347616
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

400 Kelby Street, 12th Floor

Fort Lee, New Jersey 07024

(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: (212) 867-0700

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		PPSI		Nasdaq Capital Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐		Accelerated filer ☐
Non-accelerated filer ☒		Smaller reporting company ☒
		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ~~Yes~~ ☐ ~~No ☒~~

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

As of June 3028, ~~2023~~2024, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate ~~market~~ market value of the voting and non-voting common equity held by non-affiliates of the registrant based on the price at which the common equity was last sold on the Nasdaq Capital Market on such date, was approximately $6333,~~848.~~995 (in thousands). For purposes of this computation only, all officers, directors and 10% or greater stockholders of the registrant are deemed to be affiliates.

As of ~~July~~April 2511, ~~2024~~2025, 1011,~~917~~120,~~038~~266 shares of the registrant’s common stock were outstanding.

PIONEER POWER SOLUTIONS, INC.

Form 10-K

For the Fiscal Year Ended December 31, ~~2023~~2024

TABLE OF CONTENTS

Page Special Note Regarding Forward-Looking Statements 1

		Page
Special Note Regarding Forward-Looking Statements		1

PART I
Item 1.	Business	2
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	16
Item 1C.	Cybersecurity	16
Item 2.	Properties	17
Item 3.	Legal Proceedings	17
Item 4.	Mine Safety Disclosures	17

PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	18
Item 6.	[Reserved]	18
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 8.	Consolidated Financial Statements and Supplementary Data	26
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	54
Item 9A.	Controls and Procedures	54
Item 9B.	Other Information	55
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	55

PART III
Item 10.	Directors, Executive Officers and Corporate Governance	56
Item 11.	Executive Compensation	60
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	66
Item 13.	Certain Relationships and Related Transactions, and Director Independence	67
Item 14.	Principal Accountant Fees and Services	68

PART IV
Item 15.	Exhibits and Financial Statement Schedules	69
Item 16.	Form 10-K Summary	69

PART I
Item 1.	Business	2
Item 1A.	Risk Factors	7
Item 1B.	Unresolved Staff Comments	17
Item 1C.	Cybersecurity	17
Item 2.	Properties	18
Item 3.	Legal Proceedings	19
Item 4.	Mine Safety Disclosures	19
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20
Item 6.	[Reserved]	20
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 8.	Financial Statements and Supplementary Data	29
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	59
Item 9A.	Controls and Procedures	59
Item 9B.	Other Information	60
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	60
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	61
Item 11.	Executive Compensation	65
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	71
Item 13.	Certain Relationships and Related Transactions, and Director Independence	72
Item 14.	Principal Accountant Fees and Services	73
PART IV
Item 15.	Exhibits and Financial Statement Schedules	74
Item 16.	Form 10-K Summary	74

EXPLANATORY NOTE

We are filing this comprehensive Annual Report on Form 10-K for the fiscal years ended December 31, 2023 and 2022 (“Comprehensive Form 10-K”). This Comprehensive Form 10-K contains our audited financial statements for the fiscal year ended December 31, 2023, as well as restatements of the following previously filed periods: (i) audited consolidated financial statements as of and for the fiscal year ended December 31, 2022, originally included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (the “2022 10-K”), and (ii) unaudited condensed consolidated financial statements for the quarterly periods ended March 31, 2022 through September 30, 2023, originally included in our Quarterly Reports on Form 10-Q for the periods ended March 31, 2023, June 30, 2023 and September 30, 2023 (collectively, the “Form 10-Qs” and together with the 2022 10-K, the “Prior Financial Statements”).

Restatement Background

As previously disclosed in our Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on June 6, 2024, in connection with the preparation of our consolidated financial statements for the fiscal year ended December 31, 2023, we, in consultation with the Audit Committee (the “Committee”) of our Board of Directors, concluded that the Prior Financial Statements should no longer be relied upon due to errors in such consolidated financial statements and should be restated to correct the misstatements therein.

During 2022 and 2023, we recognized revenues associated with customer contracts with performance obligations satisfied over time (“Over Time Contracts”) using labor hours as the measure of progress. Our underlying estimates of total labor hours required to complete Over Time Contracts were materially different from the actual labor hours required, which was determined to represent an error, and, as a result, the percentage of completion used to recognize revenue in the Prior Financial Statements is materially different from the percentage of completion using actual labor hours incurred. As a result, we have restated revenues during the Prior Financial Statements to adjust the percentage of completion based upon the actual labor hours incurred to complete each Over Time Contract (the “Revenues Adjustment”).

Additionally, we have determined that costs from Over Time Contracts should be recognized as incurred and, as a result, we have recorded an adjustment to our consolidated financial statements during the Prior Financial Statements (together with the Revenues Adjustment, the “Restatement Adjustments”). As a result of this error, the Restatement Adjustments result in the recognition of cost of revenues in the Prior Financial Statements for which the recognition of a portion of the corresponding revenues have been deferred to future periods. For those Over Time Contracts that have been completed by us during the Prior Financial Statements, the Restatement Adjustments have the effect of derecognizing amounts in one period and recognizing corresponding amounts in another period within the Prior Financial Statements. Cumulatively, these adjustments will net to zero over time.

Restatement Overview

Other sections impacted by the restatement of the Prior Financial Statements are:

● Part I, Item 1A. Risk Factors ● Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ● Part II, Item 8. Financial Statements and Supplementary Data ● Part II, Item 9A. Controls and Procedures

We have not filed, and do not intend to file, amendments to the previously filed Form 10-Qs, nor the previously filed 2022 10-K. Accordingly, investors should rely only on the financial information and other disclosures regarding the restated periods in this Comprehensive Form 10-K or in future filings with the SEC (as applicable), and not on any previously issued or filed reports, earnings releases or similar communications relating to these periods.

Refer to Note 2 – Restatement of Previously Issued Consolidated Financial Statements and Note 4 – Restatement of Previously Issued Unaudited Interim Condensed Consolidated Financial Statements in the accompanying consolidated financial statements included in Part II, Item 8 for additional information.

Internal Control Considerations

In connection with the Restatement Adjustments, management has evaluated its disclosure controls and procedures and internal control over financial reporting as of December 31, 2023. As a result of that assessment, management has concluded that an additional material weakness existed as of December 31, 2023 as follows:

The Company did not maintain effective controls over the revenue recognition of over-time contracts and associated costs. The Company’s underlying estimates of total labor hours required to complete over time contracts were materially different from the actual labor hours required, which was determined to represent an error, and, as a result, the percentage of completion used to recognize revenue was materially different from the percentage of completion using actual labor hours incurred. Additionally, the Company did not properly account for recognition of costs incurred by contract. This material weakness resulted in the restatement of the Company’s consolidated financial statements for the year ended December 31, 2022, as well as its interim consolidated financial statements for the three months ended March 31, 2022 and 2023, the three and six months ended June 30, 2022 and 2023 and the three and nine months ended September 30, 2022 and 2023.

For a discussion of management’s consideration of disclosure controls and procedures, internal controls over financial reporting, and the material weaknesses identified, see Part II, Item 9A.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains “forward-looking statements,” which include information relating to future events, future financial performance, financial projections, strategies, expectations, competitive environment and regulation. Words such as “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward-looking statements are based on information we have when those statements are made or management’s good faith belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:

● General economic conditions and their effect on demand for electrical equipment, particularly in the commercial ~~construction~~ market, but also in the power generation, industrial production and infrastructure industries. ● The effects of fluctuations in sales on our business, revenues, expenses, net income (loss), income (loss) per share, margins and profitability. ● Many of our competitors are better established and have significantly greater resources and may subsidize their competitive offerings with other products and services, which may make it difficult for us to attract and retain customers. ● The potential loss or departure of key personnel, including Nathan J. Mazurek, our chairman, president and chief executive officer. ● Our ability to generate internal growth, maintain market acceptance of our existing products and gain acceptance for our new products. ● Unanticipated increases in raw material prices or disruptions in supply could increase production costs and adversely affect our profitability. ● Our ability to realize revenue reported in our backlog. ● Our ability to remediate the ongoing material ~~weaknesses~~weakness identified in our internal control over financial reporting ~~as of December 31~~, ~~2023,~~ or inability to otherwise maintain an effective system of internal control. ● The effect that the ~~restatement~~identified ofmaterial ~~the~~weakness ~~Prior~~and ~~Financial~~failure ~~Statements~~to establish and maintain effective internal control over financial reporting could have on investor confidence in us and raise reputational risk. ● Operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material, labor or overhead cost increases, interest rate risk and commodity risk. ● Strikes or labor disputes with our employees may adversely affect our ability to conduct our business. ● The impact of geopolitical activity on the economy, changes in government regulations such as income taxes, climate control initiatives, the timing or strength of an economic recovery in our markets and our ability to access capital markets. ● ~~Material weaknesses in internal controls. ●~~ Future sales of large blocks of our common stock may adversely impact our stock price. ● The liquidity and trading volume of our common stock. ● Our business could be adversely affected by an outbreak of disease, epidemic or pandemic, such as the global coronavirus pandemic, or similar public threat, or fear of such an event. ● Our ability to maintain compliance with the continued listing standards of the Nasdaq Capital Market. ● Risks associated with litigation and claims, which could impact our financial results and condition.

The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with that may cause our actual results to differ from those anticipated in our forward-looking statements. Moreover, new risks regularly emerge, and it is not possible for us to predict or articulate all risks we face, nor can we assess the impact of all risks on our business or the extent to which any risk, or combination of risks, may cause actual results to differ from those contained in any forward-looking statements. Except to the extent required by applicable laws or rules, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. You should review carefully the risks and uncertainties described under the heading “Item 1A. Risk Factors” in this Annual Report on Form 10-K for a discussion of the foregoing and other risks that relate to our business and investing in shares of our common stock.

PART I

ITEM 1. BUSINESS.

Overview

Pioneer Power Solutions, Inc. and its wholly owned ~~subsidiaries~~subsidiary (referred to herein as the “Company,” “Pioneer,” “Pioneer Power,” “we,” “our” and “us”) design, manufacture, integrate, ~~refurbish,~~ service, ~~distribute~~ and sell ~~electric power systems,~~ distributed energy resources, on site and mobile power generation equipment and a platform of mobile electric vehicle (“EV”) charging solutions. Our products and services are sold to a broad range of customers in the utility, industrial and commercial markets. Our customers include, but are not limited to, ~~electric,~~Federal ~~gas~~ and ~~water~~State ~~utilities~~government entities, ~~data~~package ~~center~~delivery businesses, ~~developers~~school ~~and~~bus ~~owners~~fleet operators, EV charging infrastructure developers and owners, and distributed energy developers. We are headquartered in Fort Lee, New Jersey and operate from ~~three~~two (32) additional locations in the United States for manufacturing, service and maintenance, engineering, and sales and administration.

~~Description~~U.S. ofdollars ~~Business~~are ~~Segments~~reported in thousands, except for share and per share amounts (unless otherwise noted).

WeDescription ~~have~~of ~~two~~Business ~~reportable segments: Electrical Infrastructure Equipment (“Electrical Infrastructure”) and Critical Power Solutions (“Critical Power”).~~Segment

●In ~~Our~~October ~~Electrical Infrastructure business provides equipment solutions that allow customers to effectively and efficiently protect~~2024, ~~control,~~we ~~transfer,~~sold ~~monitor and manage their electric energy usage and requirements. These solutions are marketed principally through~~ our Pioneer Custom Electrical Products Corp. (“PCEP”) ~~brand~~business ~~name.~~unit ●to ~~Our~~a ~~Critical~~buyer ~~Power~~(the ~~business~~“PCEP ~~provides~~Sale”) ~~customers~~as ~~with~~a ~~our~~result ~~suite~~ of ~~mobile~~a ~~e-Boost©~~strategic change EVto ~~charging~~the ~~solutions,~~operations ~~power~~of ~~generation~~our ~~equipment~~business. ~~and~~See ~~all~~Item ~~forms~~7. ofManagement’s ~~preventative~~Discussion ~~maintenance, repairs, remote monitoring~~ and ~~other~~Analysis ~~equipment~~of ~~service~~Financial onCondition ~~our~~and Results ~~customers’~~of ~~equipment.~~Operations ~~These~~– ~~products~~Recent ~~and~~Developments ~~services~~for ~~are~~more ~~marketed~~information byregarding ~~our~~the ~~operations~~PCEP ~~headquartered~~Sale. inFollowing the ~~Minnesota~~PCEP Sale, we currently ~~doing~~have ~~business~~one ~~under~~reportable ~~our~~segment ~~Pioneer eMobility (“e~~-~~Boost”),~~ ~~Titan~~Critical ~~Energy~~Power ~~Systems~~Solutions ~~Inc.~~ (“~~Titan”) and Pioneer~~ Critical Power ~~brand names~~”).

~~Electrical Infrastructure~~● ~~Segment~~Our Critical Power business provides customers with our suite of mobile EV charging solutions, power generation equipment and all forms services, including but not limited to, preventative maintenance, repairs, fuel polishing, and remote monitoring. These products and services are marketed by our operations headquartered in Minnesota, currently doing business under our Pioneer eMobility (“e-Boost”) and Pioneer Critical Power (“Titan”) brand names.

We design, manufacture, integrate and sell a wide range of electrical distribution and control equipment. Our focus since approximately 2020 has been to address the Distributed Generation (“DG”) and Electric Vehicle Charging Infrastructure markets. We primarily compete in these markets with our E-Bloc product. E-Bloc combines an automatic transfer switch, circuit protection and special programmable controls into an integrated, compact outdoor system. We believe that demand for our Electrical Infrastructure solutions is driven primarily by customers’ demands to improve the cost of electricity, electrical resilience and reliability, and the world-wide transition to lower carbon emissions.

In addition, we distinguish ourselves by producing a wide range of highly engineered power solutions, typically integrating circuit protection, metering and transmission schemes, as well as unitized medium and low voltage substations. Electrical Infrastructure equipment is sold either directly to end users, engineering, procurement and construction (“EPC”) firms, or through electrical distributors. We serve customers in a variety of industries including, but not limited to, utilities, EV charging infrastructure integrators, data center developers and owners, distributed energy resource developers, contractors, and renewable energy developers and producers.

Summary of Electrical Infrastructure Segment Offerings

Product Category Solutions Power Systems ▪ Integrated Power Centers (“IPC”): indoor and outdoor power systems integrating any combination of the following, but not limited to: switchgear, controls, engine generator sets, energy storage, fuel cells, solar power, and EV charging solutions marketed and internally designated as “E-Bloc” power solutions. Circuit Protective Equipment ▪ Low and medium voltage switchgear, switchboards and automatic transfer switches.

We engineer, manufacture and integrate these offerings at our facility in Southern California.

Critical Power Segment

Our Critical Power business designs, manufactures and sells mobile EV charging solutions under our e-Boost suite of products, in addition to distributing new power generation equipment, refurbishing and reselling used power generation equipment, and performing service and maintenance on our customers’ existing equipment. Many of these systems are used to maintain reliable, primary, peak shaving or emergency standby power at facilities where it is required or where the potential consequences of a power outage make it necessary, such as at major national retailers, hospitals, data centers, communications facilities, factories, military sites, office complexes and other critical operations.

Summary of Critical Power Segment Product Offerings

Product Category	Solutions
Suite of e-Boost Products	▪ e-Boost G.O.A.T. (Generator on a Truck) is a truck-mounted option that brings on-demand, high-capacity charging to EV truck and car owners at any convenient location. ▪ e-Boost Mobile is a trailer-mounted solution that provides multiple options for towing and can be available at specific businesses, large sports and cultural events and can be relocated with minimal effort on short notice. ▪ e-Boost Pod is a stationary EV charging solution with customizable higher capacity that can also service other power needs especially in emergency situations, such as a power outage, serving as a back-up power source with convenient power connectors and outlets available on board.	~~e-Boost G.O.A.T. (Generator on a Truck) is a truck-mounted option that brings on-demand, high-capacity charging to EV truck and car owners at any convenient location.~~
	▪	e-Boost Mobile is a trailer-mounted solution that provides multiple options for towing and can be available at specific businesses, large sports and cultural events and can be relocated with minimal effort on short notice.
Power Generation Equipment	▪ Engine-generator sets: power generation equipment with up to 2 MW of power output per genset, sourced from several manufacturers and available for install by our expert, licensed technicians. ▪ Available individually or in multi-unit paralleled configurations. Fuel options include liquid propane, natural gas, diesel and bi-fuel. ▪ Uninterruptible Power Supply (“UPS”) systems.
	▪	e-Boost Pod is a stationary EV charging solution with customizable higher capacity that can also service other power needs especially in emergency situations, such as a power outage, serving as a back-up power source with convenient power connectors and outlets available on board.
Service	▪ Scheduled preventative maintenance and 24/7 repair and support services provided for all makes and models of power generation equipment under one- to five-year contracts. ▪ Regional service and maintenance: provided by our technicians in the Midwest and Florida. ▪ National service and maintenance: provided by our technicians and a network of field service providers throughout the United States for multi-site, multi-state power generation equipment owners. ▪ UPS systems from major manufacturers.
Power Generation Equipment	▪	Engine-generator sets: power generation equipment with up to 2 MW of power output per genset, sourced from several manufacturers and available for install by our expert, licensed technicians.
	▪	Available individually or in multi-unit paralleled configurations. Fuel options include liquid propane, natural gas, diesel and bi-fuel.
	▪	Uninterruptible Power Supply (“UPS”) systems.
Service	▪	Scheduled preventative maintenance and 24/7 repair and support services provided for all makes and models of power generation equipment under one to five year contracts.
	▪	Regional service and maintenance: provided by our technicians in the Midwest and Florida.
	▪	National service and maintenance: provided by our technicians and a network of field service providers throughout the United States for multi-site, multi-state power generation equipment owners.
	▪	UPS systems from major manufacturers.

Power generation systems represent considerable investments that require proper maintenance and service in order to operate reliably during a time of emergency. Our power maintenance programs provide preventative maintenance, repair and support service for our customers’ power generation systems. To support our customers in managing their critical infrastructure, we maintain inventories of repair parts, a fleet of service vehicles and a staff of certified field service technicians in the Midwest and Florida. To complete our geographic coverage, we maintain a network of field service partners located in other regions, enabling us to provide a quick-response, 24/7 service capabilities that can effectively repair and maintain any make and model of back-up power equipment. Our field service organization services more than 2,400 generators owned by more than 900 customers located throughout the United States and its territories, including for multi-site, multi-state customers.

We recognize discrete revenue streams from service contracts, sales, installation, maintenance and repair services, and we offer service contracts to all owners of power generation and related equipment, whether or not the equipment was originally sold by us. Our service agreements have terms ranging from one to five years in duration, providing the Company with a recurring revenue stream.

Business Strategy

We believe we have established a stable platform from which to develop and grow our business lines, revenue, profitability and shareholder value. We are focused on internal growth through operating efficiencies, new product development, customer focus and ~~our~~broadening ~~continued migration towards more highly-engineered products~~ and ~~specialized services. We intend to significantly increase the percentage of~~ deepening our ~~sales derived from engineered-to-order products and differentiated services and believe this can be accomplished by targeting~~ market segments such as EV charging infrastructure, microgrid developers, national and regional retailers, water treatment facilities, data centers and independent power producers which have growth characteristics exceeding the norm in our industrypenetration.

We intend to build our revenue and net income through internal growth initiatives. Accomplishing these financial goals will be dependent on a number of factors, including our ability to execute the following strategies and actions:

	●	Establishing a scalable organizational infrastructure to support our expected growth;

	●	Investing in our capabilities to provide progressively more advanced equipment and service solutions;

	●	Continuously applying our manufacturing and service resources to their highest and best uses;

	●	Combining and streamlining our business unit supply chains and administrative functions; and

	●	Improving business processes to deliver consistency, quality and value to our customers.

Electrical Infrastructure Segment

We intend to accomplish our growth objectives within our Electrical Infrastructure segment by concentrating on our ability to deliver scalable solutions for the EV infrastructure, DG, and microgrid markets. Our Electrical Infrastructure equipment can be used in many applications and large vertical markets, including but not limited to, electrical, gas and water utilities, EV charging infrastructure integrators, and solar, microgrid and data center developers.

Critical Power Segment

Within our Critical Power business, we are actively marketing our preventive maintenance services to new national accounts including: major national retailers, telecommunications companies, data centers, banks, hospitals and health care facilities, educational institutions and property management companies. Since November 2021, we have been aggressively marketing our e-Boost mobile EV charging products to electric bus and truck manufacturers, fleet management companies, municipalities and EV infrastructure providers.

Our Industry

The market for Electrical Infrastructure equipment and Critical Power solutions is very fragmented due to the range of equipment types, electrical and mechanical properties, technological standards and service parameters required by different categories of end users for their specific applications. Many orders are custom-engineered and tend to be time-sensitive since other critical work is frequently being coordinated around the customer’s electrical equipment installation. The vast majority of North American demand for the types of solutions we provide is satisfied by thousands of producers and service companies in the United States.

We believe that several of the key industry trends supporting future growth in our industry are as follows:

● Aging and Overburdened North American Power Grid — The aging and overburdened North American power grid is expected to require significant capital expenditures to upgrade the existing infrastructure over the next several years to maintain adequate levels of reliability and efficiency. Significant capital investment will be required to relieve congestion, meet growing demand, achieve targets for efficiency, emissions and use of renewable sources, and to replace components of the U.S. power grid operating at, near or past their planned service lives. ● Increasing Long-Term Demand for Electricity and Reliable Power — The Department of Energy’s Energy Information Administration, or EIA, forecasts that total electricity use in the United States will increase by approximately 28% from 2011 to 2040. This increase is driven by anticipated population growth, economic expansion, increasing dependence on computing power throughout the economy and the increased use of electrical devices in the home. In order to meet growing demand for electricity in North America, substantial investment in increased electrical grid capacity and efficiency will be required, as well as the addition of specialized equipment to help ensure the reliability and quality of electricity for critical applications. In response to these challenges, there is an increasing trend among commercial and industrial companies to invest in on-site power sources, both for standby purposes in the event of a catastrophic power outage, or to reduce the amount of electricity they draw from the utility grid during peak periods. ● Rapidly Expanding EV and Charging Infrastructure Market — A report from Allied Market Research in 2020 projected that the global electric vehicle market will reach $803 billion by the year 2027, registering a compound annual growth rate (“CAGR”) of 22.6%. North America is estimated to reach $194 billion by 2027, at a significant CAGR of 27.5%. In 2010, only about 17,000 electric vehicles were on the world’s roads. By 2019, that number had swelled to 7.2 million and is increasing rapidly according to the International Energy Agency. Furthermore, in order for EV’s to grow at such a rapid pace, it is necessary that infrastructure be built to allow for such growth. In 2019, there were about 7.3 million chargers worldwide compared to an insignificant amount ten years ago, and the EV infrastructure has become a global priority as major governments and corporations have committed to spending billions of dollars towards building EV charging infrastructure. In order to meet the rapidly growing demand for EV’s and the infrastructure supporting it, substantial investment in grid connectivity and enhancement will be required.

	●	*Increasing Long-Term Demand for Electricity and Reliable Power* — The Department of Energy’s Energy Information Administration, or EIA, forecasts that total electricity use in the United States will increase by approximately 28% from 2011 to 2040. This increase is driven by anticipated population growth, economic expansion, increasing dependence on computing power throughout the economy and the increased use of electrical devices in the home. In order to meet growing demand for electricity in North America, substantial investment in increased electrical grid capacity and efficiency will be required, as well as the addition of specialized equipment to help ensure the reliability and quality of electricity for critical applications. In response to these challenges, there is an increasing trend among commercial and industrial companies to invest in on-site power sources, both for standby purposes in the event of a catastrophic power outage, or to reduce the amount of electricity they draw from the utility grid during peak periods.

	●	*Rapidly Expanding EV and Charging Infrastructure Market —* A report from Allied Market Research in 2020 projected that the global electric vehicle market will reach $803 billion by the year 2027, registering a compound annual growth rate (“CAGR”) of 22.6%. North America is estimated to reach $194 billion by 2027, at a significant CAGR of 27.5%. In 2010, only about 17,000 electric vehicles were on the world’s roads. By 2019, that number had swelled to 7.2 million and is increasing rapidly according to the International Energy Agency. Furthermore, in order for EV’s to grow at such a rapid pace, it is necessary that infrastructure be built to allow for such growth. In 2019, there were about 7.3 million chargers worldwide compared to an insignificant amount ten years ago, and the EV infrastructure has become a global priority as major governments and corporations have committed to spending billions of dollars towards building EV charging infrastructure.

Customers

~~For~~A ~~the~~substantial ~~years~~portion ~~ended~~of ~~December~~the ~~31,~~products ~~2023~~ and ~~2022,~~services ~~100%~~we ofoffer ~~our~~are ~~sales~~sold ~~were~~directly to ~~U.S.~~ customers, ~~represented~~by inour ~~large~~marketing ~~part~~and bysales ~~companies~~personnel ~~involved~~operating from our office locations in ~~DG,~~the ~~regulated~~United ~~and~~States. ~~non-regulated~~Our ~~utilities,~~direct ~~and~~sales ~~industrial~~force and ~~wholesale~~authorized ~~business.~~representatives ~~During~~market ~~the~~our ~~years~~products ~~ended~~and ~~December~~services to ~~31,~~end ~~2023~~users and ~~2022~~third parties, we ~~sold~~such ~~our~~as ~~electrical~~original equipment manufacturers and ~~services~~their todealers, ~~over~~state ~~900~~and ~~individual~~local ~~customers~~governments, ~~and~~fleet ~~our~~management companies, ~~twenty~~school ~~largest~~bus ~~customers~~operators ~~represented approximately 82%~~ and ~~77%~~various ofintermediary ~~our~~selling ~~consolidated revenue, respectively~~groups.

~~Approximately~~For 42the year ended December 31, 2024, 87% of our sales were to U.S. customers and 2013% were to Canadian customers, compared to 100% of our sales ~~during~~being to U.S. customers for the year ended December 31, 2023. ~~were~~This ~~made~~was tolargely ~~Enchanted~~driven ~~Rock~~by ~~Electric,~~companies ~~LLC~~involved ~~and~~in ~~Sequel~~distributed ~~Electrical Supply~~generation, regulated ~~LLC,~~and ~~respectively.~~non-regulated ~~Approximately~~utilities, ~~43%~~ and ~~10%~~the ofindustrial ~~our~~and ~~sales~~wholesale ~~during~~sectors. During the ~~year~~years ended December 31, ~~2022~~2024, ~~were~~and ~~made~~2023, we tosold ~~Enchanted Rock~~our ~~Electric,~~electrical ~~LLC~~equipment and ~~Southern~~services ~~California~~to ~~Gas~~over ~~Company,~~875 ~~respectively.~~individual ~~The~~customers, ~~majority~~and of our ~~sales~~20 tolargest customers ~~were~~represented ~~made pursuant to~~approximately ~~specific~~74% ~~contract~~and ~~terms~~47% ~~and~~of ~~conditions~~our ~~for~~consolidated ~~each~~revenue, ~~project~~respectively.

~~Marketing~~Approximately 22% and 13% of our sales during the year ended December 31, 2024, were made to INF Associates, LLC and British Columbia Hydro and Power ~~Sales~~Authority, respectively. Approximately 14% of our sales during the year ended December 31, 2023, were made to Target Corporation. The majority of our sales to customers were made pursuant to specific contract terms and ~~Distribution~~conditions for each project.

A substantial portion of the products and services we offer are sold directly to customers by our marketing and sales personnel operating from our office locations in the United States. Our direct sales force and authorized representatives market our products and services to end users and third parties, such as original equipment manufacturers, EPC firms, electrical wholesalers, energy developers and value-added integrators.

Revenue Backlog

Revenue backlog, which consists of purchase orders and contracts from customers that we believe to be firm, reflects the amount of revenue that we expect to realize in the future upon the satisfaction of customer orders for our products or services that are not yet complete or for which work has not yet begun. Our revenue backlog as of December 31, ~~2023~~2024, was approximately $4519,~~165~~762, as compared to $3816,~~278~~668 as of December 31, ~~2022~~2023. During the year ended December 31, ~~2023~~2024, we experienced a surge in orders and contracts for our mobile EV charging solutions, e-Boost, which was the primary driver for the increase in our revenue backlog.

Competition

We experience intense competition from agenerator ~~large number of electrical equipment~~ manufacturers and from distributors and servicers of such equipment. The number and size of our competitors varies considerably by product line and service category, with many of our competitors tending to be small, highly specialized or focused on a certain geographic market area or customer. However, several of our competitors have substantially greater financial and technical resources than us, including some of the world’s largest electrical products and industrial equipment manufacturing companies. A representative list of our direct competitors inincludes ~~our~~EV ~~Electrical Infrastructure segment~~Power ~~includes~~Pods ~~Crown Electric Engineering and Manufacturing,~~ LLC, ~~Industrial~~DD ~~Electric~~Dannar ~~Machinery,~~ LLC, ~~RESA~~Yoshi ~~Power~~Inc., ~~LLC,~~Caterpillar ~~Switchgear Power Systems~~Inc., ~~LLC,~~ ~~Myers~~Cummins ~~Power Products,~~ Inc. and ~~Powell~~Interstate ~~Industries~~Power Systems, Inc.

We believe that we compete primarily on the basis of technical support and application expertise, engineering, manufacturing and service capabilities, equipment rating, quality, scheduling and price. In all our businesses, our objective is to focus our efforts on more specialized, challenging and complex applications. Accordingly, a critical element to the success of our business is responsiveness and flexibility in providing custom-engineered solutions to satisfy customer needs. As a result of our long-time presence in the industry, we possess a number of special designs and libraries of programming code for our equipment that were engineered and developed specifically for our customers. We believe these factors give us a competitive advantage and that they are a major contributor to our frequency of repeat customer orders and the longevity of our customer relationships.

Raw Materials and Suppliers

The principal ~~raw~~ materials purchased by us are ~~steel,~~certain ~~copper,~~electrical ~~sensors, circuit breakers, meters, cassettes~~ and ~~relays.~~engine ~~We also purchase certain electrical~~ components such as ~~switches~~generators, ~~fuses~~transfer switches, ~~protectors~~electric vehicle chargers and ~~circuit~~related ~~breakers~~parts from a variety of suppliers. These ~~raw materials and~~ components are available from and supplied by numerous sources at competitive prices. Unanticipated increases in ~~raw~~component ~~material~~ prices or disruptions in supply could increase production costs and adversely affect our profitability. Our largest suppliers during the year ended December 31, ~~2023~~2024, included ~~Industrial~~Taylor ~~Connections~~Power ~~& Solutions~~Systems, ~~LLC~~Inc., ~~Royal~~Gillette ~~Industrial Solutions, Schweitzer Engineering Laboratories,~~Generators Inc., ~~Eaton~~Winco, ~~Corporation~~Inc. and ~~Thyssenkrupp~~Kelly ~~Materials~~Generator NA& Equipment, Inc.

Research and Development

Because the industries in which we compete are characterized by rapid technological advances, our ability to compete successfully depends heavily upon our ability to ensure a continual and timely flow of competitive products, services and technologies to the marketplace. We continue to develop new technologies to enhance existing products and services, and to expand the range of our offerings through research and development (“R&D”), licensing of intellectual property and acquisition of third-party businesses and technology. During the ~~year~~years ended December 31, 2024 and 2023, we incurred $1,050 and $885, respectively, of R&D costs related to our mobile EV charging solutions, e-Boost. ~~We did not incur any R&D costs during the year ended December 31, 2022.~~

Employees

As of December 31, ~~2023~~2024, we had ~~143~~60 employees consisting of 4159 ~~salaried~~full-time ~~staff~~employees and ~~102~~1 hourly workers. Certain of our employees located at our manufacturing facility in Santa Fe Springs, California are covered by a collective bargaining agreement with Local Union 1710 of the International Brotherhood of Electrical Workers, AFLpart-~~CIO~~time ~~that expires in June 2027~~employee.

Environmental

We are subject to numerous environmental laws and regulations concerning, among other areas, air emissions, discharges into waterways and the generation, handling, storing, transportation, treatment and disposal of waste materials. These laws and regulations are constantly changing and it is impossible to predict with accuracy the effect they may have on us in the future. Like many other industrial enterprises, our manufacturing operations entail the risk of noncompliance, which may result in fines, penalties and remediation costs, and there can be no assurance that such costs will be insignificant. To our knowledge, we are in substantial compliance with all federal, state, provincial and local environmental protection provisions, and believe that the future compliance cost should not have a material adverse effect on our capital expenditures, net income or competitive position. However, legal and regulatory requirements in these areas have been increasing and there can be no assurance that significant costs and liabilities will not be incurred in the future due to regulatory noncompliance.

Corporate History

We were originally formed in the State of Nevada in 2008. On November 30, 2009, we merged with and into Pioneer Power Solutions, Inc., a Delaware corporation, for the sole purpose of changing our state of incorporation from Nevada to Delaware and changing our name to “Pioneer Power Solutions, Inc.”. On September 24, 2013, we completed an underwritten public offering, and our common stock began trading on on the Nasdaq Capital Market under the symbol “PPSI”.

Available Information

Our corporate website is located at www.pioneerpowersolutions.com. On the investor relations section of our website, we make available, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports as soon as reasonably practicable after we electronically file them with or furnish them to the Securities and Exchange Commission (“SEC”). The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers, such as us, that file electronically with the SEC at www.sec.gov.

Additionally, we provide notifications of news or announcements regarding our financial performance, including SEC filings, investor events and press and earnings releases as part of the investor relations section of our website. The contents of and the information on or accessible through our corporate website, including the investor relations portion of our website, are not a part of, and are not intended to be incorporated into, this report or any other report or document we file with or furnish to the SEC, and any references to our website are intended to be inactive textual references only.

ITEM 1A. RISK FACTORS

Investing in our common stock involves a high degree of risk. Before investing in our common stock, you should carefully consider the following risks, together with the financial and other information contained in this Annual Report on Form 10–K for the year ended December 31, ~~2023~~2024, and our other periodic filings with the ~~Securities and Exchange Commission~~SEC. Additional risks and uncertainties that we are unaware of may become important factors that affect us. If any of the following events occur, our business, financial conditions and operating results may be materially and adversely affected. In that event, the trading price of our common stock may decline, and you could lose all or part of your investment.

Summary of Risk Factors

Below is a summary of the principal factors that make an investment in our common stock speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading “Risk Factors” and should be carefully considered, together with other information in this Form 10-K and our other filings with the SEC, before making an investment decision regarding our common stock.

● We have ~~concluded~~identified that certain of our previously issued financial statements should not be relied upon and have restated certain of our previously issued consolidated financial statements which was time-consuming and expensive and could expose us to additional risks that could have a ~~negative effect on us; ● The restatement of the Prior Financial Statements may lead to future stockholder litigation; ● We have identified~~ material ~~weaknesses~~weakness in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, which may adversely affect investor confidence in our company and, as a result, the value of our common stock; ● WeFailure ~~are~~to ~~vulnerable~~establish toand ~~economic~~maintain ~~downturns~~effective internal control over financial reporting may result in ~~the~~us ~~commercial~~not ~~construction~~being ~~market~~able to accurately report our financial results, which ~~may~~could ~~reduce~~result ~~the~~in ~~demand~~a ~~for~~loss ~~some~~ of ~~our~~investor ~~products~~confidence and adversely affect ~~our~~the ~~sales,~~market ~~net~~price ~~income,~~of ~~cash~~our ~~flow~~common ~~or financial condition~~stock; ● Our operating results may vary significantly from quarter to quarter, which makes our operating results difficult to predict and can cause our operating results in any particular period to be less than comparable quarters and expectations from time to time; ● Our industry is highly competitive; ● WeA ~~currently derive a~~ significant portion of our revenues have historically been concentrated and derived from ~~two~~a few customers. Material or significant loss of business from these customers could have an adverse effect on our business, financial condition and operating results; ● Certain of our business units have historically generated operating losses and negative cash flows, which may result in the usage of our cash; ● Our operations have been curtailed following the PCEP Sale, and we have limited sources of revenue following such sale, which may negatively impact the value and liquidity of our common stock; ● The departure or loss of key personnel could disrupt our business; ● Fluctuations in the price and supply of ~~raw~~ materials used to manufacture our products may reduce our profits; ● We may not be able to fully realize the revenue value reported in our backlog; ● We are subject to pricing pressure from our larger customers; ● Deterioration in the credit quality of several major customers could have a material adverse effect on our operating results and financial condition; ● We rely on third parties for key elements of our business whose operations are outside our control; ● Supply chain and shipping disruptions may result in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales and reputational damage, which may have a material adverse effect on our business, operating results and financial condition; ● Our business may face cybersecurity risk generally associated with our information technology systems which could materially affect our business, and our results of operations could be materially affected if our information technology systems (or third-party systems we rely on) are interrupted, damaged by unforeseen events, or fail for any extended period of time; ● Our business requires skilled labor, and we may be unable to attract and retain qualified employees; ● ~~Our business operations are dependent upon our ability to engage in successful collective bargaining with our unionized workforce; ●~~ Delaware law and our corporate charter and bylaws contain anti-takeover provisions that could delay or discourage takeover attempts that stockholders may consider favorable; ● Our stock price may be volatile, which could result in substantial losses for investors; ● Our risk management activities may leave us exposed to unidentified or unanticipated risks; ● Regulatory, environmental, monetary and other governmental policies could have a material adverse effect on our profitability; ● Global, market and economic conditions may negatively impact our business, financial condition and stock price;

	●	Our risk management activities may leave us exposed to unidentified or unanticipated risks;

	●	Regulatory, environmental, monetary and other governmental policies could have a material adverse effect on our profitability;

	●	Global, market and economic conditions may negatively impact our business, financial condition and stock price;

	●	We face risks associated with litigation and claims, which could impact our financial results and condition;

	●	Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline;

	●	We are subject to financial reporting and other requirements for which our accounting, internal audit and other management systems and resources may not be adequately prepared;

	●	There are inherent limitations in all control systems, and misstatements due to error or fraud may occur and not be detected;

	●	Any acquisitions that we have completed, or may complete in the future, may not perform as planned and could disrupt our business and harm our financial condition and operations;

	●	The success of our business depends on achieving our strategic objectives, including dispositions;

	●	If we do not conduct an adequate due diligence investigation of a target business that we acquire, we may be required subsequently to take write downs or write-offs, restructuring, and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and our stock price, which could cause you to lose some or all of your investment;

	●	We may be unable to generate internal growth; and

	●	In the event that we fail to satisfy any of the listing requirements of the Nasdaq Capital Market, our common stock may be delisted, which could affect our market price and liquidity.

Risks Relating to Our Business and Industry

We have identified a material weakness in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.

Although we are working to remedy the material weakness and ineffectiveness of the Company’s internal control over financial reporting and disclosure controls and procedures, there can be no assurance as to when the remediation plan will be fully developed and implemented or the outcome of such remediation efforts, or that in the future, additional material weaknesses will not exist, reoccur or otherwise be discovered, a risk that is significantly increased in light of the complexity of our business. Until our remediation plan is fully implemented, our management will continue to devote significant time, attention and financial resources to these efforts. If we do not complete our remediation in a timely fashion, or at all, or if our remediation plan is inadequate, there will continue to be an increased risk that our future consolidated financial statements could contain errors that will be undetected. If we continue to have this existing material weakness, other material weaknesses or significant deficiencies in the future, it could create a perception that our financial results do not fairly state our financial condition or results of operations. See “Part II. Item 9A – Controls and Procedures.” This material weakness could adversely affect our business, reputation, revenues, results of operations, financial condition, and liquidity. They could also adversely affect our ability to timely file periodic reports under the Exchange Act, and limit our ability to access the capital markets through equity or debt issuances. Additional impacts could include a decline in our stock price, suspension of trading or delisting of our common stock by the Nasdaq Capital Market. Any of the foregoing could have an adverse effect on the value of our stock. For more information relating to the Company’s internal control over financial reporting, the material weakness that existed as of December 31, 2024, and the remediation activities undertaken by us, see Part II, Item 9A, Controls and Procedures of this Comprehensive Form 10-K. See also “—Failure to establish and maintain effective internal control over financial reporting may result in us not being able to accurately report our financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.”

● We face risks associated with litigation and claims, which could impact our financial results and condition; ● Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline; ● We are subject to financial reporting and other requirements for which our accounting, internal audit and other management systems and resources may not be adequately prepared; ● There are inherent limitations in all control systems, and misstatements due to error or fraud may occur and not be detected; ● Any acquisitions that we have completed, or may complete in the future, may not perform as planned and could disrupt our business and harm our financial condition and operations; ● The success of our business depends on achieving our strategic objectives, including dispositions; ● If we do not conduct an adequate due diligence investigation of a target business that we acquire, we may be required subsequently to take write downs or write-offs, restructuring, and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and our stock price, which could cause you to lose some or all of your investment; ● We may be unable to generate internal growth; and ● In the event that we fail to satisfy any of the listing requirements of the Nasdaq Capital Market, our common stock may be delisted, which could affect our market price and liquidity.

Risks Relating to the Restatement of the Prior Financial Statements

We have concluded that certain of our previously issued financial statements should not be relied upon and have restated certain of our previously issued financial statements which was time-consuming and expensive and could expose us to additional risks that could have a negative effect on us.

As discussed in the Explanatory Note of this Comprehensive Form 10-K and in Note 2, “Restatement of Previously Issued Consolidated Financial Statements” under Item 8 of this Comprehensive Form 10-K, we have concluded that the Prior Financial Statements should not be relied upon. We have restated our previously issued (i) audited consolidated financial statements as of and for the fiscal year ended December 31, 2022, included in the 2022 10-K, and (ii) unaudited condensed consolidated financial statements for the quarterly periods ended March 31, 2022, through September 30, 2023, included in the Form 10-Qs. The restatement process was time consuming and expensive and could expose us to additional risks that could have a negative effect on us. In particular, we incurred substantial unanticipated expenses and costs, including audit, legal and other professional fees, in connection with the restatement of the Prior Financial Statements and the ongoing remediation of material weaknesses in our internal control over financial reporting. We are in the process of implementing certain remediation actions (see Part II, Item 9A, Controls and Procedures of this Comprehensive Form 10-K for a description of these remediation measures). To the extent these steps are not successful, we could be required to incur additional time and expense. Our management’s attention was also diverted from some aspects of the operation of our business in connection with the restatement of the Prior Financial Statements and these ongoing remediation efforts. In addition, the restatement and related matters could impair our reputation and could cause our counterparties to lose confidence in us. Each of these occurrences could have an adverse effect on our business, results of operations, financial condition and stock price.

The restatement of the Prior Financial Statements may lead to future stockholder litigation.

Lawsuits may be commenced against the Company and its officers and directors based in part or whole on allegations related to the restatement of the Prior Financial Statements. As with any substantial litigation, the Company expects to devote significant time, attention and resources to the defense of the litigation, which may have a material adverse effect on the Company even if the litigation is resolved in a manner favorable to the Company, and cannot predict when or how the litigation will be resolved or estimate what the potential loss or range of loss would be, if any.

We have identified material weaknesses in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.

Section 404 of the Sarbanes-Oxley Act of 2002 requires that public companies evaluate and report on their systems of internal control over financial reporting. As disclosed in Part II, Item 9A, Controls and Procedures of this Comprehensive Form 10-K, our management, including our Chief Executive Officer and our Chief Financial Officer, has determined that we had material weaknesses in our internal control over financial reporting as of December 31, 2023, due to the following material weaknesses: (i) the accounting for revenues and costs associated with over-time contracts, which resulted in material misstatements relating to the percentage of completion used to recognize revenue; (ii) the accounting for inventory and related cost of sales and (iii) lack of sufficient accounting personnel which negatively impacted the Company’s ability to maintain appropriate segregation of duties, and close, consolidate and file financial statements on a timely basis to meet SEC regulations. These material weaknesses resulted in identified material misstatements to the financial statements, and the Prior Financial Statements are restated in this filing. As a result of these material weaknesses, the Company’s management, under the supervision of the Audit Committee and with participation of the Company’s Chief Executive Officer and Chief Financial Officer, concluded that the Company’s internal control over financial reporting was not effective as of December 31, 2023.

Although we are working to remedy the material weaknesses and ineffectiveness of the Company’s internal control over financial reporting and disclosure controls and procedures, there can be no assurance as to when the remediation plan will be fully developed and implemented or the outcome of such remediation efforts, or that in the future, additional material weaknesses will not exist, reoccur or otherwise be discovered, a risk that is significantly increased in light of the complexity of our business. Until our remediation plan is fully implemented, our management will continue to devote significant time, attention and financial resources to these efforts. If we do not complete our remediation in a timely fashion, or at all, or if our remediation plan is inadequate, there will continue to be an increased risk that our future consolidated financial statements could contain errors that will be undetected. If we continue to have these existing material weaknesses, other material weaknesses or significant deficiencies in the future, it could create a perception that our financial results do not fairly state our financial condition or results of operations. See “Part II. Item 9A – Controls and Procedures.” These material weaknesses could adversely affect our business, reputation, revenues, results of operations, financial condition, and liquidity. They could also adversely affect our ability to timely file periodic reports under the Exchange Act, and limit our ability to access the capital markets through equity or debt issuances. Additional impacts could include a decline in our stock price, suspension of trading or delisting of our common stock by the Nasdaq Capital Market. Any of the foregoing could have an adverse effect on the value of our stock. For more information relating to the Company’s internal control over financial reporting, the material weaknesses that existed as of December 31, 2023, and the remediation activities undertaken by us, see Part II, Item 9A, Controls and Procedures of this Comprehensive Form 10-K. See also “—Failure to establish and maintain effective internal control over financial reporting may result in us not being able to accurately report our financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.”

Failure to establish and maintain effective internal control over financial reporting may result in us not being able to accurately report our financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.

We are responsible for establishing and maintaining adequate internal control over financial reporting, which is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. GAAP (as defined below). Because we are continuing to implement remedial actions to strengthen our financial control and management systems, our internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. A failure to prevent or detect errors or misstatements may result in a decline in the price of our common stock and harm our ability to raise capital in the future.

If our management is unable to certify the effectiveness of our internal controls or if material weaknesses or significant deficiencies in our internal controls are identified, we could be subject to regulatory scrutiny and a loss of public confidence, which could harm our business and cause a decline in the price of our common stock. As disclosed under “Item 9A. Controls and Procedures” in this Comprehensive Form 10-K, in connection with preparing our financial statements for the year ended December 31, ~~2023~~2024, management concluded that a material ~~weaknesses~~weakness existed in our internal control over financial reporting ~~due~~related to the following material weaknesses: (i) the accounting for revenues and costs associated with over-time contracts, which resulted in material misstatements relating to the percentage of completion used to recognize revenue; (ii) the accounting for inventory and related cost of sales and (iii) lack of sufficient accounting personnel which negatively impacted the Company’s ability to maintain appropriate segregation of duties~~, and close, consolidate and file financial statements on a timely basis to meet SEC regulations~~. In addition, due to the same material ~~weaknesses~~weakness, we determined that our disclosure controls and procedures were not effective as of December 31, ~~2023~~2024. See “—We have identified a material ~~weaknesses~~weakness in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.”

In addition, if we do not maintain adequate financial and management personnel, processes and controls, we may not be able to accurately report our financial performance on a timely basis, which could cause a decline in the price of our common stock and harm our ability to raise capital. Failure to accurately report our financial performance on a timely basis could also jeopardize our listing on the Nasdaq Capital Market. Delisting of our common stock on any exchange would reduce the liquidity of the market for our common stock, which would reduce the price of, and increase the volatility of, our common stock. See also “—Risks Relating to Our Organization— We have identified material weaknesses in our internal control over financial reporting, and if we are unable to achieve and maintain effective internal control over financial reporting or effective disclosure controls, this could have a material adverse effect on our business.”

We do not expect that our disclosure controls and procedures and internal control over financial reporting will prevent all error or fraud. A control system, no matter how well designed and implemented, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Due to the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues within an organization will be detected. The inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Controls can also be circumvented by individual acts of certain persons, by collusion of two or more people or by management override of the controls. Due to the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and may not be detected in a timely manner or at all. See also “—General Risk Factors— There are inherent limitations in all control systems, and misstatements due to error or fraud may occur and not be detected.” If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results could be materially adversely affected, which could also cause investors to lose confidence in our reported financial information, which in turn could result in a reduction in the price of our common stock.

In addition, acquisitions can pose challenges in implementing the required processes, procedures and controls in the new operations. Companies that are acquired by us may not have disclosure controls and procedures or internal control over financial reporting that are as thorough or effective as those required by the securities laws that currently apply to us.

~~Risks Relating to Our Business and Industry~~8

We are vulnerable to economic downturns in the commercial construction market, which may reduce the demand for some of our products and adversely affect our sales, net income, cash flow or financial condition.

A large portion of our business involves sales of our products in connection with commercial and industrial construction. Our sales to this sector are affected by the level of discretionary business spending. During economic downturns in this sector, the level of business discretionary spending may decrease. This decrease in spending will likely reduce the demand for some of our products and may adversely affect our sales, net income, cash flow or financial condition.

Our operating results may vary significantly from quarter to quarter, which makes our operating results difficult to predict and can cause our operating results in any particular period to be less than comparable quarters and expectations from time to time.

Our quarterly results may fluctuate significantly from quarter to quarter due to a variety of factors, many of which are outside our control and have the potential to materially and adversely affect our results. Factors that affect our operating results include the following:

● the size, timing and terms of sales and orders, especially large customer orders; ● variations caused by customers delaying, deferring or canceling purchase orders or making smaller purchases than expected; ● the timing and volume of work under new agreements; ● the spending patterns of customers; ● customer orders received; ● a change in the mix of our products having different margins; ● a change in the mix of our customers, contracts and business; ● increases in design and manufacturing costs; ● the length of our sales cycles; ● the rates at which customers renew their contracts with us; ● changes in pricing by us or our competitors, or the need to provide discounts to win business; ● a change in the demand or production of our products caused by severe weather conditions; ● our ability to control costs, including operating expenses; ● losses experienced in our operations not otherwise covered by insurance; ● the ability and willingness of customers to pay amounts owed to us; ● the timing of significant investments in the growth of our business, as the revenue and profit we hope to generate from those expenses may lag behind the timing of expenditures; ● costs related to the acquisition and integration of companies or assets; ● general economic trends, including changes in equipment spending or national or geopolitical events such as economic crises, wars or incidents of terrorism; and ● future accounting pronouncements and changes in accounting policies.

● variations caused by customers delaying, deferring or canceling purchase orders or making smaller purchases than expected; ● the timing and volume of work under new agreements; ● the spending patterns of customers; ● customer orders received; ● a change in the mix of our products having different margins; ● a change in the mix of our customers, contracts and business; ● increases in design and manufacturing costs; ● the length of our sales cycles; ● the rates at which customers renew their contracts with us; ● changes in pricing by us or our competitors, or the need to provide discounts to win business; ● a change in the demand or production of our products caused by severe weather conditions; ● our ability to control costs, including operating expenses; ● losses experienced in our operations not otherwise covered by insurance; ● the ability and willingness of customers to pay amounts owed to us;

● the timing of significant investments in the growth of our business, as the revenue and profit we hope to generate from those expenses may lag behind the timing of expenditures; ● costs related to the acquisition and integration of companies or assets; ● general economic trends, including changes in equipment spending or national or geopolitical events such as economic crises, wars or incidents of terrorism; and ● future accounting pronouncements and changes in accounting policies.

Accordingly, our operating results in any particular quarter may not be indicative of the results that you can expect for any other quarter or for an entire year.

Our industry is highly competitive.

The electrical equipment manufacturing industry is highly competitive. ~~Principal competitors in our markets include Crown Electric Engineering~~ and ~~Manufacturing,~~barriers LLC, Industrial Electric Machinery, LLC, RESA Power, LLC, Switchgear Power Systems, LLC, Myers Power Products, Inc. and Powell Industries, Inc. Some of these competitors, as well as other companies in the broader electrical equipment manufacturing and service industry where we expect to ~~compete,~~entry ~~are significantly larger and have substantially greater resources than we do and are able~~ to ~~achieve~~manufacture ~~greater~~similar ~~economies~~systems ~~of scale and lower cost structures than us and may, therefore, be able~~ to ~~provide~~the ~~their~~ones ~~products and services~~the toCompany ~~customers~~sells atis ~~lower~~easily ~~prices than we are able to~~imitated. ~~Moreover,~~On ~~our~~the ~~competitors~~service ~~could~~side ~~develop~~of the ~~expertise~~Company’s business, ~~experience and resources to offer products that are superior in both price and quality to our products. While~~ we ~~seek~~already to compete bywith ~~providing~~many ~~more customized, highly-engineered products, there are few technical or~~ other ~~barriers to prevent much larger~~ companies ~~in our industry from putting more emphasis on this~~offering ~~same~~similar ~~strategy~~services. ~~Similarly,~~Many ~~we cannot be certain that we will be able to market our business effectively in the face~~ of ~~competition~~these ~~or to~~companies ~~maintain~~have ora ~~enhance~~larger ~~our~~geographic ~~competitive~~footprint ~~position~~than ~~within~~Pioneer ~~our~~and ~~industry,~~substantially ~~maintain~~greater ~~our~~financial ~~customer base at current levels or increase our customer base~~resources. ~~Our inability to manage our business in light of the competitive forces we face could have a material adverse effect on our results of operations.~~

WeA ~~currently derive a~~ significant portion of our revenues have historically been concentrated and derived from ~~two~~a few customers. Material or significant loss of business from ~~these~~ customers could have an adverse effect on our business, financial condition and operating results.

We historically have depended, and expect to continue to depend on ~~two~~a small number of customers for a large portion of our business each quarter, ~~and~~due ~~any~~to the scope of certain projects. Any change in the level of orders from ~~these~~ customers could have a significant impact on our results of operations, and a loss of business from customers could have an adverse effect on our business, financial condition and operating results. Approximately 4222% and 2013% of our sales during the year ended December 31, ~~2023~~2024, were made to ~~Enchanted~~INF ~~Rock Electric~~Associates, LLC and ~~Sequel~~British Columbia ~~Electrical~~Hydro ~~Supply,~~and ~~LLC~~Power Authority, respectively. ~~Loss~~The majority of ~~business~~our ~~from~~sales to these customers ~~could~~and ~~have an~~other ~~adverse~~customers ~~effect~~in onthe ~~our~~past ~~business,~~were ~~financial~~made pursuant ~~condition~~to ~~and~~contract ~~operating~~terms ~~results.~~and ~~The~~conditions ~~majority~~for ofeach ~~our~~project ~~sales~~and toit ~~Enchanted~~is ~~Rock~~expected ~~Electric,~~that ~~LLC and~~future ~~Sequel~~sales ~~Electrical~~will ~~Supply,~~similarly ~~LLC~~be ~~were~~ made pursuant to the relevant contract terms and conditions for ~~each~~future ~~project~~projects. See “Item 1. Business - Customers”.

Certain of our business units have historically generated operating losses and negative cash flows, which may result in the usage of our cash.

WeAfter ~~have~~the ~~two~~sale ~~business~~of ~~units~~our (PCEP ~~and~~business ~~Titan),~~unit ~~and~~in ~~these~~October ~~two~~2024, we ~~units~~now have one business unit (Critical Power), which has been unable to earn positive income and generate positive cash flow in ~~their~~ its recent history. With $341,~~582~~622 of cash on hand as of December 31, ~~2023~~2024, any such losses will negatively impact our cash balance.

Our operations have been curtailed following the PCEP Sale, and we have limited sources of revenue following such sale, which may negatively impact the value and liquidity of our common stock.

The PCEP Sale has reduced the size of our business operations, and our sources of revenue are limited to our Critical Power segment following the closing of the PCEP Sale. Although our board of directors may use a portion of the proceeds from the PCEP Sale to support the business operations remaining following the PCEP Sale, there can be no assurance that we will be successful at carrying out the operations of our remaining businesses, or that we will be successful at generating revenue. A failure by us to secure additional sources of revenue following the closing of the PCEP Sale could negatively impact the value and liquidity of our common stock.

The departure or loss of key personnel could disrupt our business.

We depend heavily on the continued efforts of Nathan J. Mazurek, our principal executive officer, and on other senior officers who are responsible for the day-to-day management of our operating ~~subsidiaries~~subsidiary. In addition, we rely on our current electrical and mechanical design engineers, many of whom are important to our operations and would be difficult to replace. We cannot be certain that any of these individuals will continue in their respective capacities for any particular period of time. The departure or loss of key personnel, or the inability to hire and retain qualified employees, could negatively impact our ability to manage our business.

10Fluctuations in the price and supply of materials used to manufacture our products may reduce our profits.

~~Fluctuations~~The inprincipal ~~the~~materials ~~price~~purchased by us certain electrical and ~~supply~~engine components such as generators, transfer switches, electric vehicle chargers and related parts from a variety of ~~raw~~suppliers. ~~materials~~These ~~used~~components toare ~~manufacture~~available from, and supplied by, numerous sources at competitive prices. Unanticipated increases in component prices or disruptions in supply could increase production costs and adversely affect our profitability. ~~products~~We ~~may~~cannot ~~reduce~~provide any assurances that we will not experience difficulties sourcing our ~~profits~~materials in the future.

Our raw material costs represented approximately 38% and 50% of our revenues for the years ended December 31, 2023 and 2022, respectively. The principal raw materials purchased by us are metal, copper, sensors, breakers, meters, relays, switches, fuses, protectors and circuit breakers. These raw materials and components are available from, and supplied by, numerous sources at competitive prices. Unanticipated increases in raw material prices or disruptions in supply could increase production costs and adversely affect our profitability. We cannot provide any assurances that we will not experience difficulties sourcing our raw materials in the future.

We may not be able to fully realize the revenue value reported in our backlog.

We routinely have a backlog of work to be completed on contracts representing a significant portion of our annual sales. As of December 31, ~~2023~~2024, our order backlog was $4519,~~165~~762. Orders included in our backlog are represented by customer purchase orders and service contracts that we believe to be firm. Backlog consists of customer orders that either (1) have not yet been started or (2) are in progress and are not yet completed. In the latter case, the revenue value reported in backlog is the remaining value associated with work that has not yet been billed and recognized as revenue. From time to time, customer orders are canceled that appeared to have a high certainty of going forward at the time they were recorded as new business taken. In the event of a customer order cancellation, we may be reimbursed for certain costs but typically have no contractual right to the total revenue reflected in our backlog. In addition to us being unable to recover certain direct costs, canceled customer orders may also result in additional unrecoverable costs due to the resulting underutilization of our assets.

We are subject to pricing pressure from our larger customers.

We face significant pricing pressures in ~~all of~~ our business ~~segments~~segment from our larger customers. Because of their purchasing size, our larger ~~customers~~ customers can influence market participants to compete on price terms. Such customers also use their buying power to negotiate lower prices. If we are not able to offset pricing reductions resulting from these pressures by improved operating efficiencies and reduced expenditures, those price reductions may have an adverse impact on our financial results.

Deterioration in the credit quality of several major customers could have a material adverse effect on our operating results and financial condition.

A significant asset included in our working capital is accounts receivable from customers. If customers responsible for a significant amount of accounts receivable become insolvent or are otherwise unable to pay for products and services, or become unwilling or unable to make payments in a timely manner, our operating results and financial condition could be adversely affected. A significant deterioration in the economy could have an adverse effect on these accounts receivable, which could result in longer payment cycles, increased collection costs and defaults in excess of management’s expectations. Deterioration in the credit quality of our major customers could have a material adverse effect on our operating results and financial condition.

We rely on third parties for key elements of our business whose operations are outside our control.

We rely on arrangements with third-party shippers and carriers such as independent shipping companies for timely delivery of our products to our customers. As a result, we may be subject to carrier disruptions and increased costs due to factors that are beyond our control, including labor strikes, inclement weather, natural disasters and rapidly increasing fuel costs. If the services of any of these third parties become unsatisfactory, we may experience delays in meeting our customers’ product demands and we may not be able to find a suitable replacement on a timely basis or on commercially reasonable terms. Any failure to deliver products to our customers in a timely and accurate manner may damage our reputation and could cause us to lose customers.

We also utilize third-party distributors to sell, install and service certain of our products. While we are selective in whom we choose to represent us, it is difficult for us to ensure that our distributors consistently act in accordance with the standards we set for them. To the extent any of our end-customers have negative experiences with any of our distributors or manufacturer’s representatives; it could reflect poorly on us and damage our reputation, thereby negatively impacting our financial results.

Supply chain and shipping disruptions may result in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales and reputational damage, which may have a material adverse effect on our business, operating results and financial condition.

Our third-party manufacturers and suppliers have experienced, and expect to continue to experience, supply chain disruption and shipping disruptions, including disruptions or delays in loading container cargo in ports of origin or off-loading cargo at ports of destination, congestion in port terminal facilities, labor supply and shipping container shortages, inadequate equipment and persons to load, dock and offload container vessels and for other reasons. These disruptions may impact our ability to receive materials and products from our manufacturers and suppliers, to distribute our products to our customers in a cost-effective and timely manner and to meet customer demand, all of which could have an adverse effect on our financial condition and results of operations. There can be no assurance that further unforeseen events impacting the supply chain will not have a material adverse effect on us in the future. Additionally, the impacts that supply chain disruptions have on our third-party manufacturers and suppliers are not within our control. It is not currently possible to predict how long it will take for these supply chain disruptions to cease or ease. Prolonged supply chain disruptions that may impact us or our manufacturers and suppliers could interrupt product manufacturing, increase raw material and product lead times, increase raw material and product costs, impact our ability to meet customer demand and result in lost sales and reputational damage, all of which could have a material adverse effect on our business, financial condition and results of operations.

Our business may face cybersecurity risk generally associated with our information technology systems which could materially affect our business, and our results of operations could be materially affected if our information technology systems (or third-party systems we rely on) are interrupted, damaged by unforeseen events, or fail for any extended period of time.

We rely on information systems (“IS”) in our business to obtain, rapidly process, analyze, manage and store data to among other things:

	●	receive, process and ship orders on a timely basis; and

	●	manage the accurate billing and collections from our customers.

IS risks have generally increased in recent years, and a cyberattack that bypasses our IS security systems causing an IS security breach may lead to a material disruption of our business operations and/or the loss of business information resulting in a material effect on our business.

In addition, we develop products and provide services to our customers that are technology-based, and a cyberattack that bypasses the IS security systems of our products or services causing a security breach and/or perceived security vulnerabilities in our products or services could also cause significant reputational harm, and actual or perceived vulnerabilities may lead to claims against us by our customers. Perceived or actual security vulnerabilities in our products or services, or the perceived or actual failure by us or our customers who use our products to comply with applicable legal requirements, may not only cause us significant reputational harm, but may also lead to claims against us by our customers and involve fines and penalties, costs for remediation, and settlement expenses.

Our IS utilize certain third-party service organizations that manage a portion of our information systems, and our business may be materially affected if these third-party service organizations are subject to an IS security breach. Risks associated with these and other IS security breaches may include, among other things:

	●	future results could be materially affected due to theft, destruction, loss, misappropriation or release of confidential data or intellectual property;

	●	operational or business delays resulting from the disruption of information systems and subsequent clean-up and mitigation activities;

	●	we may incur claims, fines and penalties, and costs for remediation, or substantial defense and settlement expenses; and

	●	negative publicity resulting in reputation or brand damage with our customers, partners or industry peers.

We have various insurance policies, covering risks in amounts that we consider adequate. There can be no assurance that the insurance coverage we maintain is sufficient or will be available in adequate amounts or at a reasonable cost. Successful claims for misappropriation or release of confidential or personal data brought against us in excess of available insurance or fines or other penalties assessed or any claim that results in significant adverse publicity against us could have a material adverse effect on our business and our reputation.

Our business requires skilled labor, and we may be unable to attract and retain qualified employees.

Our ability to maintain our productivity and profitability will be limited by our ability to employ, train and retain skilled personnel necessary to meet our requirements. We may experience shortages of qualified personnel. We cannot be certain that we will be able to maintain an adequate skilled labor force necessary to operate efficiently and to support our growth strategy or that our labor expenses will not increase as a result of a shortage in the supply of skilled personnel. Labor shortages, increased labor costs or loss of our most skilled workers could impair our ability to deliver on time to our customers (thereby creating a risk that we lose our customers to competition) and would inhibit our ability to maintain our business or grow our revenues, and may adversely impact our profitability.

An overall tightening and increasingly competitive labor market has been observed in the United States. A sustained labor shortage or increased turnover rates within our employee base could lead to increased costs, such as increased wage rates to attract and retain employees, and could negatively affect our ability to efficiently operate our manufacturing facilities and overall business. If we are unable to hire and retain employees capable of performing at a high-level, or if mitigation measures we may take to respond to a decrease in labor availability, such as overtime and third-party outsourcing, have unintended negative effects, our business could be adversely affected. An overall labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our operations, results of operations, liquidity or cash flows.

Our business operations are dependent upon our ability to engage in successful collective bargaining with our unionized workforce.

If we are unable to renew our collective bargaining agreements, or if additional segments of our workforce become unionized, we may be subject to work interruptions or stoppages. Strikes or labor disputes with our employees may adversely affect our ability to conduct our business.

Risks Relating to Our Organization

Delaware law and our corporate charter and bylaws contain anti-takeover provisions that could delay or discourage takeover attempts that stockholders may consider favorable.

Our board of directors is authorized to issue shares of preferred stock in one or more series and to fix the voting powers, preferences and other rights and limitations of the preferred stock. Accordingly, we may issue shares of preferred stock with a preference over our common stock with respect to dividends or distributions on liquidation or dissolution, or that may otherwise adversely affect the voting or other rights of the holders of common stock. Issuances of preferred stock, depending upon the rights, preferences and designations of the preferred stock, may have the effect of delaying, deterring or preventing a change of control, even if that change of control might benefit our stockholders. In addition, we are subject to Section 203 of the Delaware General Corporation Law. Section 203 generally prohibits a public Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years after the date of the transaction in which the person became an interested stockholder, unless (i) prior to the date of the transaction, the board of directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder; (ii) the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding (a) shares owned by persons who are directors and also officers and (b) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or (iii) on or subsequent to the date of the transaction, the business combination is approved by the board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock which is not owned by the interested stockholder.

Section 203 of the Delaware General Corporation Law could delay or prohibit mergers or other takeover or change in control attempts with respect to us and, accordingly, may discourage attempts to acquire us even though such a transaction may offer our stockholders the opportunity to sell their stock at a price above the prevailing market price.

General Risk Factors

Our stock price may be volatile, which could result in substantial losses for investors.

The market price of our common stock is highly volatile and could fluctuate widely in response to various factors, many of which are beyond our control, including the following:

● technological innovations or new products and services by us or our competitors; ● additions or departures of key personnel, including Nathan J. Mazurek, our chairman, president and chief executive officer; ● sales of our common stock, including management shares;

● additions or departures of key personnel, including Nathan J. Mazurek, our chairman, president and chief executive officer; ● sales of our common stock, including management shares; ● limited availability of freely-tradable “unrestricted” shares of our common stock to satisfy purchase orders and demand; ● our ability to execute our business plan; ● operating results that fall below expectations; ● loss of any strategic relationship; ● industry developments; ● economic and other external factors; ● our ability to manage the costs of maintaining adequate internal financial controls and procedures in connection with the acquisition of additional businesses; ● period-to-period fluctuations in our financial results; and ● announcements of acquisitions.12

	●	limited availability of freely-tradable “unrestricted” shares of our common stock to satisfy purchase orders and demand;

	●	our ability to execute our business plan;

	●	operating results that fall below expectations;

	●	loss of any strategic relationship;

	●	industry developments;

	●	economic and other external factors;

	●	our ability to manage the costs of maintaining adequate internal financial controls and procedures in connection with the acquisition of additional businesses;

	●	period-to-period fluctuations in our financial results; and

	●	announcements of acquisitions.

In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also significantly affect the market price of our common stock.

Our risk management activities may leave us exposed to unidentified or unanticipated risks.

Although we maintain insurance policies for our business, these policies contain deductibles and limits of coverage. We estimate our liabilities for known claims and unpaid claims and expenses based on information available as well as projections for claims incurred but not reported. However, insurance liabilities are difficult to estimate due to various factors and we may be unable to effectively anticipate or measure potential risks to our company. If we suffer unexpected or uncovered losses, any of our insurance policies or programs are terminated for any reason or are not effective in mitigating our risks, we may incur losses that are not covered by our insurance policies or that exceed our accruals or that exceed our coverage limits and could adversely impact our consolidated results of operations, cash flows and financial position.

Regulatory, environmental, monetary and other governmental policies could have a material adverse effect on our profitability.

We are subject to international, federal, provincial, state and local laws and regulations governing environmental matters, including emissions to air, discharge to waters and the generation and handling of waste. We are also subject to laws relating to occupational health and safety. The operation of manufacturing plants involves a high level of susceptibility in these areas, and there is no assurance that we will not incur material environmental or occupational health and safety liabilities in the future. Moreover, expectations of remediation expenses could be affected by, and potentially significant expenditures could be required to comply with, environmental regulations and health and safety laws that may be adopted or imposed in the future. Future remediation technology advances could adversely impact expectations of remediation expenses. We can give no assurance that any lawsuits or claims brought in the future will not have an adverse effect on our financial condition, liquidity or operating results. Types of potential litigation cases include product liability, contract, employment-related, labor relations, personal injury or property damage, intellectual property, stockholder claims and claims arising from any injury or damage to persons, property or the environment from hazardous substances used, generated or disposed of in the conduct of our business. Adverse outcomes in some or all of these claims may result in significant monetary damages that could adversely affect our ability to conduct our business.

Global, market and economic conditions may negatively impact our business, financial condition and stock price.

Concerns over inflation, geopolitical issues, the U.S. financial markets, capital and exchange controls, unstable global credit markets and financial conditions, have led to periods of significant economic instability, declines in consumer confidence and discretionary spending, diminished expectations for the global economy and expectations of slower global economic growth going forward, and increased unemployment rates. Our general business strategy may be adversely affected by any such economic downturns, volatile business environments and continued unstable or unpredictable economic and market conditions. If these conditions continue to deteriorate or do not improve, it may make any necessary debt or equity financing more difficult to complete, more costly, and more dilutive. In addition, there is a risk that one or more of our current or future service providers, manufacturers, suppliers, our third-party payors, and other partners could be negatively affected by difficult economic times, which could adversely affect our ability to attain our operating goals on schedule and on budget or meet our business and financial objectives.

In addition, we face several risks associated with international business and are subject to global events beyond our control, including war, public health crises, such as pandemics and epidemics, trade disputes, economic sanctions, trade wars and their collateral impacts and other international events. Any of these changes could have a material adverse effect on our reputation, business, financial condition or results of operations. There may be changes to our business if there is instability, disruption or destruction in a significant geographic region, regardless of cause, including war, terrorism, riot, civil insurrection or social unrest; and natural or man-made disasters, including famine, flood, fire, earthquake, storm or disease. In addition, the consequences of the ongoing conflict between Israel and Hamas, and the ongoing conflict between Russia and Ukraine, including related sanctions and countermeasures, and the effects of rising global inflation, are difficult to predict, and could adversely impact geopolitical and macroeconomic conditions, the global economy, and contribute to increased market volatility, which may in turn adversely affect our business and operations.

Additionally, since the start of the Trump Administration in 2025, U.S. policy changes have been implemented at a rapid pace and additional changes are likely. Changes to U.S. policy implemented by the U.S. Congress, the Trump administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. Although we cannot predict the impact, if any, of these changes to our business, they could adversely affect our business. Until we know what policy changes are made, whether those policy changes are challenged and subsequently upheld by the court system and how those changes impact our business and the business of our competitors over the long term, we will not know if, overall, we will benefit from them or be negatively affected by them.

We face risks associated with litigation and claims, which could impact our financial results and condition.

Our business, results of operations and financial condition could be affected by significant litigation or claims adverse to us. Types of potential litigation cases include product liability, contract, employment-related, labor relations, personal injury or property damage, intellectual property, trade secret or unfair competition claims, stockholder claims and claims arising from any injury or damage to persons, property or the environment from hazardous substances used, generated or disposed of in the conduct of our business. We have been involved in the past and may in the future be involved in legal proceedings.

Offers or availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline.

Sales of a significant number of shares of our common stock in the public market could harm the market price of our common stock and make it more difficult for us to raise funds through future offerings of common stock. Our stockholders and the holders of our options and warrants may sell substantial amounts of our common stock in the public market. The availability of these shares of our common stock for resale in the public market has the potential to cause the supply of our common stock to exceed investor demand, thereby decreasing the price of our common stock.

In addition, the fact that our stockholders, option holders and warrant holders can sell substantial amounts of our common stock in the public market, whether or not sales have occurred or are occurring, could make it more difficult for us to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.

We are subject to financial reporting and other requirements for which our accounting, internal audit and other management systems and resources may not be adequately prepared.

We are subject to reporting and other obligations under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), including the requirements of Section 404 of the Sarbanes-Oxley Act. Section 404 requires us to conduct an annual management assessment of the effectiveness of our internal controls over financial reporting. These reporting and other obligations place significant demands on our management, administrative, operational, internal audit and accounting resources. Any failure to maintain effective internal controls could have a material adverse effect on our business, operating results and stock price.

In addition, our internal controls will also include those of any company or business that we may acquire in the future. Acquired companies or businesses are likely to have different standards, controls, contracts, procedures and policies, making it more difficult to implement and harmonize company-wide financial, accounting, information and other systems. As a result, our internal controls may become more complex and we may require significantly more resources to ensure they remain effective. Failure to implement required new or improved controls, or difficulties encountered in their implementation, either in our existing business or in businesses that we may acquire, could harm our operating results or cause us to fail to meet our reporting obligations. See also “—Risks Relating to the Restatement of the Prior Financial Statements-- Failure to establish and maintain effective internal control over financial reporting may result in us not being able to accurately report our financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.”

There are inherent limitations in all control systems, and misstatements due to error or fraud may occur and not be detected.

The ongoing internal control provisions of Section 404 of the Sarbanes-Oxley Act of 2002 require us to identify material weaknesses in ~~internal~~ internal control over financial reporting, which is a process to provide reasonable assurance regarding the reliability of financial ~~reporting~~ reporting for external purposes in accordance with accounting principles generally accepted in the United States. Our management, including our chief executive officer and chief financial officer, does not expect that our internal controls and disclosure controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. In addition, the design of a control system must reflect the fact that there are resource constraints and the benefit of controls must be relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, in our company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Further, controls can be circumvented by individual acts of some persons, by collusion of two or more persons, or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may be inadequate because of changes in conditions, such as growth of the company or increased transaction volume, or the degree of compliance with the policies or procedures may deteriorate. Because of inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. See also “—Risks Relating to the Restatement of the Prior Financial Statements-- Failure to establish and maintain effective internal control over financial reporting may result in us not being able to accurately report our financial results, which could result in a loss of investor confidence and adversely affect the market price of our common stock.”

1514

In addition, discovery and disclosure of a material weakness, including the material ~~weaknesses~~weakness identified in our internal control over financial reporting as of December 31, ~~2023~~2024, by definition, could have a material adverse impact on our consolidated financial statements. See “—Risks Relating to the Restatement of the Prior Financial Statements— We have identified material weaknesses in our internal control over financial reporting which could, if not remediated, adversely affect our ability to report our financial condition and results of operations in a timely and accurate manner, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.” Such an occurrence could discourage certain customers or suppliers from doing business with us and adversely affect how our stock trades. This could in turn negatively affect our ability to access equity markets for capital.

Any acquisitions that we have completed, or may complete in the future, may not perform as planned and could disrupt our business and harm our financial condition and operations.

In an effort to effectively compete in the specialty electrical equipment manufacturing and service businesses, where increasing competition and industry consolidation prevail, we have sought to acquire complementary businesses in the past and will continue to do so in the future. In the event of any future acquisitions, we could:

	●	issue additional securities that would dilute our current stockholders’ percentage ownership or provide the purchasers of the additional securities with certain preferences over those of common stockholders, such as dividend or liquidation preferences;

	●	incur debt and assume liabilities; and

	●	incur large and immediate write-offs of intangible assets, accounts receivable or other assets.

These events could result in significant expenses and decreased revenue, which could adversely affect the market price of our common stock. In addition, integrating acquired businesses and completing any future acquisitions involve numerous operational and financial risks. These risks include difficulty in assimilating acquired operations, diversion of management’s attention, and the potential loss of key employees or customers of acquired operations. Furthermore, companies acquired by us may not generate financial results consistent with our management’s plans at the time of acquisition.

The success of our business depends on achieving our strategic objectives, including dispositions.

We continue to evaluate the potential disposition of assets and businesses that may no longer help us meet our objectives. When we decide to sell assets or a business, we may encounter difficulty in finding buyers or executing alternative exit strategies on acceptable terms in a timely manner, which could delay the accomplishment of our strategic objectives. Alternatively, we may dispose of a business at a price or on terms that are less than we had anticipated, or with the exclusion of assets that must be divested separately. After reaching an agreement with a buyer for the disposition of a business, the transaction remains subject to the satisfaction of pre-closing conditions, which may prevent us from completing the transaction. Dispositions may also involve continued financial involvement in the divested business, such as through continuing equity ownership, transition service agreements, guarantees, indemnities or other current or contingent financial obligations. Under these arrangements, performance by the divested businesses or other conditions outside our control could affect our future financial results.

If we do not conduct an adequate due diligence investigation of a target business that we acquire, we may be required subsequently to take write downs or write-offs, restructuring, and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and our stock price, which could cause you to lose some or all of your investment.

As part of our acquisition strategy, we will need to conduct a due diligence investigation of one or more target businesses. Intensive due diligence is time consuming and expensive due to the operations, accounting, finance and legal professionals who must be involved in the due diligence process. We may have limited time to conduct such due diligence. Even if we conduct extensive due diligence on a target business that we acquire, we cannot assure you that this diligence will uncover all material issues relating to a particular target business, or that factors outside of the target business and outside of our control will not later arise. If our diligence fails to identify issues specific to a target business or the environment in which the target business operates, we may be forced to write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in us reporting losses. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our common stock. In addition, charges of this nature may cause us to violate net worth or other covenants that we may be subject to as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination debt financing.

1615

We may be unable to generate internal growth.

Our ability to generate internal growth will be affected by, among other factors, our ability to attract new customers, increases or decreases in the number or size of orders received from existing customers, hiring and retaining skilled employees and increasing volume utilizing our existing facilities. Many of the factors affecting our ability to generate internal growth may be beyond our control, and we cannot be certain that our strategies will be implemented with positive results or that we will be able to generate cash flow sufficient to fund our operations and to support internal growth. If we do not achieve internal growth, our results of operations will suffer and we will likely not be able to expand our operations or grow our business.

WeIn ~~may~~the ~~not~~event ~~meet~~that ~~the~~we ~~continued~~fail to satisfy any of the listing requirements of the Nasdaq Capital Market, ~~which~~our ~~could~~common ~~result~~stock inmay abe ~~delisting~~delisted, ofwhich could affect our ~~common~~market ~~stock~~price and liquidity.

AsOur common ~~previously~~stock ~~disclosed,~~is listed on ~~April~~the ~~18,~~Nasdaq ~~2024,~~Capital weMarket. ~~received~~For acontinued ~~notice~~listing ~~(the~~on ~~“10-K Notice”) from~~ the ~~Listing Qualifications staff of~~ Nasdaq ~~notifying~~Capital usMarket, ~~that as~~ we ~~had~~will ~~not~~be ~~yet~~required ~~filed~~to ~~our~~comply with ~~Annual~~the ~~Report~~continued onlisting ~~Form~~requirements, ~~10-K for~~including the ~~year~~minimum ~~ended~~market ~~December~~capitalization 31standard, ~~2023 (~~the ~~“Form~~minimum ~~10-K”)~~stockholders’ equity requirement, wethe nocorporate ~~longer~~governance ~~complied~~requirements ~~with~~and ~~Listing~~the ~~Rule~~minimum ~~5250(c)(1)~~closing ~~for~~bid ~~continued~~price ~~listing on Nasdaq. On May 24~~requirement, ~~2024,~~among weother ~~received~~requirements. anIn ~~additional~~the ~~notice from Nasdaq notifying us~~ event that as we ~~had~~fail ~~not~~to ~~yet~~satisfy ~~filed~~any ~~our~~of ~~Form 10-Q for~~ the ~~quarter~~ ~~ended~~listing ~~March~~requirements ~~31,~~of ~~2024, and because we remained delinquent in filing~~ the ~~Form~~Nasdaq ~~10-K~~Capital Market, weour ~~did~~common ~~not~~stock ~~comply~~may ~~with~~be ~~Listing Rule 5250(c)(1) for continued listing on Nasdaq~~delisted. WeIf ~~had~~our 60securities are ~~calendar~~delisted ~~days~~ from ~~the~~trading ~~10-K~~on ~~Notice,~~the ~~or until June 17, 2024, to submit to~~ Nasdaq aCapital ~~plan to regain compliance~~Market, and ifwe ~~such~~are ~~plan~~not isable ~~accepted,~~to ~~Nasdaq~~list ~~may~~our ~~grant~~securities uson ananother ~~exception~~exchange ofor up to ~~180~~have ~~calendar~~them quoted ~~days~~on ~~from~~ the ~~prescribed~~Nasdaq ~~due~~Capital ~~date for filing the Form 10-K~~Market, orour ~~until~~securities ~~October~~could ~~14,~~be ~~2024,~~quoted toon ~~regain~~the ~~compliance~~OTC Markets. WeAs ~~submitted~~a ~~our~~result, ~~plan~~we tocould ~~Nasdaq~~face onsignificant ~~June~~adverse consequences ~~17, 2024.~~including:

~~Although~~● wea ~~expect~~limited toavailability ~~take~~of ~~actions~~market ~~intended~~quotations tofor ~~restore~~our securities; ● a determination that our ~~compliance~~common ~~with the~~stock ~~listing~~is ~~requirements~~a “penny stock,” wewhich ~~can~~would ~~provide~~require nobrokers ~~assurance~~trading ~~that~~in ~~any~~our ~~action~~common ~~taken~~stock byto usadhere ~~would~~to bemore ~~successful.~~stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;

If our common stock is delisted from the Nasdaq Capital Market, we expect that our common stock would begin trading on the over-the-counter markets. The delisting of our common stock could result in a reduction in our trading price and would substantially limit the liquidity of our common stock. In addition, delisting could materially adversely impact our ability to raise capital or pursue strategic restructuring, refinancing or other transactions. Delisting from the Nasdaq Capital Market could also have other negative results, including the potential loss of confidence by institutional investors.

	●	a limited amount of news and analyst coverage; and

	●	a decreased ability to issue additional securities (including pursuant to short-form registration statements on Form S-3 or obtain additional financing in the future).

ITEM 1B. UNRESOLVED STAFF COMMENTS.

Not applicable.

ITEM 1C. CYBERSECURITY

We operate in the industrial sector, which is subject to various cybersecurity risks that could adversely affect our business, financial condition, and results of operations, including intellectual property theft; fraud; extortion; harm to employees or customers; violation of privacy laws and other litigation and legal risk; and reputational risk. We recognize the critical importance of developing, implementing, and maintaining robust cybersecurity measures to safeguard our information systems and protect the confidentiality, integrity, and availability of our data. We currently have security measures in place to protect our employees, customers, and corporate data and prevent data loss and other security breaches, including a cybersecurity risk assessment program. Both management and our board of directors are actively involved in the continuous assessment of risks from cybersecurity threats, including prevention, mitigation, detection, and remediation of cybersecurity incidents.

Our current cybersecurity risk assessment program consists of not only real-time monitoring of things from patching policies to mandatory multi-factor authentication, but also policies in place for encryption of data both in transmission and at rest. The program outlines governance, policies and procedures, and technology we use to oversee and identify risks from cybersecurity threats and is informed by previous cybersecurity incidents we have observed in our company, in our industry, and as reported by our cybersecurity partner CCS Business Solutions, Inc.

Management, along with CCS Business Solutions, Inc., are responsible for day-to-day assessment and management of risks from cybersecurity threats, including the prevention, mitigation, detection, and remediation of cybersecurity incidents. The individuals currently serving in these roles are the Chief Financial Officer as the representative of our management, and the CEO of CCS Business Solutions, Inc. The CEO of CCS Business Solutions, Inc. has over 20 years of experience in the technology industry, with most of that experience being specifically in cybersecurity. He also has formal education with a degree in Computer Science with a concentration in Artificial Intelligence, mainly involving self-learning algorithms.

The board of directors is responsible for oversight of risks from cybersecurity threats in conjunction with our senior management team and CCS Business Solutions, Inc. This includes receiving reports and updates from our outside partner CCS Business Solutions, Inc. with respect to the management of risks from cybersecurity threats. Such reports cover our information technology security program, including its current status, capabilities, objectives and plans, as well as the evolving cybersecurity threat landscape. Additionally, the board of directors considers risks from cybersecurity threats as part of its oversight of our business strategy and risk management.

We routinely undertake activities to prevent, detect, and minimize the effects of cybersecurity incidents, including assessments of our data access in the form of user audits, real-time monitoring of risk on a per system level as it pertains to AV completeness, system vulnerabilities, and third-party patching. In addition to this, we actively monitor and practice disaster recovery and business continuity plans in the event that any risk is able to circumvent the controls we have in place.

We leverage the advice of third-party consultants and auditors to help us assess and identify risks from cybersecurity threats, including the threat of a cybersecurity incident, and manage our risk assessment program. Among other things, these providers perform a an audit of the datacenter from the top down annually, to ensure that controls are effective, still implemented to the fullest, and are meeting industry standards.

We also have policies and procedures to oversee and identify the risks from cybersecurity threats associated with our use of third-party service providers. Our core third-party service provider in the technology space is audited yearly through our Sarbanes Oxley process, providing line-of sight to their internal operations along with their SSAE-16 certification.

To date, no cybersecurity incident (or aggregation of incidents) or cybersecurity threat has materially affected our results of operations or financial condition. However, an actual or perceived breach of our security could damage our reputation, or subject us to third-party lawsuits, regulatory fines or other actions or liabilities, any of which could adversely affect our business, operating results or financial condition. It is for this reason we are constantly reevaluating our cybersecurity stance, posturing against industry standards to try and effectively mitigate our risk.

We currently maintain a cyber liability insurance policy. However, our cyber liability insurance may be inadequate or may not be available in the future on acceptable terms, or at all. In addition, our cyber liability insurance policy may not cover all claims made against us, and defending a suit, regardless of its merit, could be costly and divert management’s attention from our business and operations.

ITEM 2. PROPERTIES.

		Approximate		~~Owned or~~	Owned or
		square		~~lease~~	lease
Location	Description	footage		~~expiration date~~	expiration date
Santa Fe Springs, California	Manufacturing, sales, engineering and administration	40,000		August 2024
Champlin, Minnesota	Manufacturing, sales, service and warehouse		16,000		March 2026
Champlin, Minnesota	Manufacturing, sales, service and warehouse	16,000		March 2026
Miami, Florida	Sales, service and warehouse		3,600		December 2029
Miami, Florida	Sales, service and warehouse	3,600		December 2024
Fort Lee, New Jersey	Corporate management and sales office		2,700		December 2025
Fort Lee, New Jersey	Corporate management and sales office	2,700		December 2025

We believe our facilities are well maintained, in proper condition to operate at higher than current levels and are adequately insured. We do not anticipate significant difficulty in renewing or extending existing leases as they expire, or in replacing them with equivalent facilities or office locations.

ITEM 3. LEGAL PROCEEDINGS

From time to time, we may become involved in lawsuits, investigations and claims that arise in the ordinary course of business. As of the date hereof, we are not aware of or a party to any legal proceedings to which we or our subsidiary is a party or to which any of our property is subject, nor are we aware of any such threatened or pending litigation or any such proceedings known to be contemplated by governmental authorities that we believe could have a material adverse effect on our business, financial condition or operating results.

~~On June 15, 2023, Terrence and Kay Mimick (the “Plaintiffs”)~~We ~~filed~~can agive ~~complaint~~no inassurance ~~the~~that ~~U.S.~~any ~~District~~lawsuits ~~Court,~~or ~~District~~claims ofbrought ~~Nebraska naming the Company, its wholly-owned subsidiary, Pioneer Critical Power, Inc., and an individual acting~~ in ~~his capacity as an employee of~~ the ~~Company,~~future ~~collectively~~will asnot ~~defendants.~~have ~~Plaintiffs filed~~ an ~~amended complaint~~adverse oneffect ~~July 7, 2023, alleging negligent driving, negligent entrustment, and negligent hiring, training and supervision, as a result of a car accident that occurred~~ on ~~September~~our 9,financial ~~2019~~condition, ~~and seeking special damages related to the injuries allegedly sustained by Plaintiffs.~~liquidity ~~The~~or ~~amended~~operating ~~complaint also named Titan Energy Systems, Inc~~results. as a defendant instead of Pioneer Critical Power, Inc. On July 27, 2023, the defendants filed an Answer to Plaintiff’s Amended Complaint. On October 6, 2023, a mediation was held, but the parties did not reach a settlement. In June 2024 another mediation was held and the parties reached a settlement for all of the Plaintiffs’ claims.

On May 26, 2023, the Company filed a complaint against PowerSecure, Inc. (“PowerSecure”) in Minnesota state court, which was subsequently removed to U.S. District Court, District of Minnesota on June 20, 2023, alleging breach of contract, unjust enrichment and tortious interference (the “PowerSecure Action”). Thereafter, in the fourth quarter of 2023, the Company entered into a Settlement Agreement and Release with PowerSecure. On January 4, 2024, the Company and PowerSecure stipulated to a voluntary dismissal of the PowerSecure Action with prejudice, and as a result, the PowerSecure Action was dismissed with prejudice on January 5, 2024.

As of the date hereof, we are not aware of or a party to any other legal proceedings to which we or any of our subsidiaries is a party or to which any of our property is subject, nor are we aware of any such threatened or pending litigation or any such proceedings known to be contemplated by governmental authorities that we believe could have a material adverse effect on our business, financial condition or operating results.

We can give no assurance that any other lawsuits or claims brought in the future will not have an adverse effect on our financial condition, liquidity or operating results.

We are not aware of any material proceedings in which any of our directors, officers or affiliates or any registered or beneficial shareholder of more than 5% of our common stock is an adverse party or has a material interest adverse to our interest.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

1917

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

Our common stock has been listed on the Nasdaq Capital Market under the symbol “PPSI” since September 19, 2013. Prior to that time, it was quoted on the OTCQB. The last reported sales price of our common stock on the Nasdaq Capital Market on ~~July~~April 2511, ~~2024,~~ 2025, was $42.4253 per share. As of ~~July~~April 2511, ~~2024~~2025, there were 3738 holders of record of our common stock.

~~The timing~~U.S. ~~and~~dollars ~~amount~~are ofreported ~~future~~in ~~dividends~~thousands, ~~could~~except ~~require us to seek capital funding to support our ongoing operations as our historical credit~~for ~~arrangements~~share ~~were~~and ~~terminated~~per inshare ~~connection~~amounts ~~with the sale of the transformer business units in August 2019~~ (~~the~~unless ~~“Equity~~otherwise ~~Transaction”~~noted).

We ~~did~~have ~~not~~previously ~~repurchase~~paid ~~any~~dividends ofto our ~~equity~~stockholders, ~~securities~~and ~~during~~on ~~the~~January ~~fourth~~7, ~~quarter~~2025, ofwe ~~the~~paid ~~fiscal~~a ~~year~~one-time ~~ended~~special ~~December~~cash 31dividend of an aggregate of $16,665. ~~2023~~We currently do not expect that comparable cash dividends will continue to be paid in the future.

We did not repurchase any of our equity securities during the fourth quarter of the fiscal year ended December 31, 2024.

ITEM 6. [RESERVED].

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

You should read the following discussion and analysis of our financial condition and results of operations together with our consolidated financial statements and related notes appearing elsewhere in this annual report on Form 10-K. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this prospectus, particularly in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements.”

The discussion in this section has been impacted by the restatement described in the Explanatory Note at the beginning of this Comprehensive Form 10-K and in Note 2 and Note 4 of the consolidated financial statements of this Comprehensive Form 10-K. Certain of the financial and other information provided in this Management’s Discussion and Analysis of our financial condition and results of operations has been updated to reflect the restatement adjustments.

Overview

We design, manufacture, integrate, ~~refurbish,~~ service, ~~distribute~~ and sell ~~electric power systems,~~ distributed energy resources, on site power generation equipment and mobile EV charging solutions. Our products and services are sold to a broad range of customers in the utility, industrial and commercial markets. Our customers include, but are not limited to, ~~electric,~~Federal ~~gas~~ and ~~water~~State ~~utilities~~government entities, ~~data~~package ~~center~~delivery ~~developers and~~business’, ~~owners~~school bus fleet operators, EV charging infrastructure developers and owners, and distributed energy developers. We are headquartered in Fort Lee, New Jersey and operate from ~~three~~two (32) additional locations in the United States for manufacturing, service and maintenance, engineering, and sales and administration.

We intend to grow our business through continued internal investments in product development and expansion of our manufacturing, engineering, sales and marketing personnel.

~~Our~~Following ~~operations~~the ~~are~~sale ~~divided~~of ~~into~~our ~~two~~PCEP ~~reportable segments: Electrical Infrastructure segment and Critical Power segment. Our Electrical Infrastructure~~ business ~~provides~~unit ~~equipment~~in ~~solutions~~October ~~that~~2024, ~~allow~~described ~~customers~~below tounder ~~effectively~~“Recent ~~and efficiently protect~~Developments”, ~~control,~~we ~~transfer,~~currently ~~monitor~~have ~~and manage~~one ~~their~~reportable ~~electric~~segment: ~~energy~~Critical ~~usage and requirements~~Power. ~~These solutions are marketed principally through our PCEP brand name.~~ Our Critical Power business provides customers with our suite of mobile e-Boost© EV charging solutions, power generation equipment and all forms of preventative maintenance, repairs, remote monitoring and other service on our customers’ equipment. These products and services are marketed by our operations headquartered in Minnesota, currently doing business under the Titan, Pioneer eMobility and Pioneer Critical Power brand names.

20U.S. dollars are reported in thousands, except for share and per share amounts (unless otherwise noted).

Recent Developments

On October 29, 2024, we entered into an Equity Contribution and Purchase Agreement (the “Equity Purchase Agreement”), by and among us, PCEP, Voltaris Power LLC (the “Buyer”) and Pioneer Investment LLC (“Investment”). Pursuant to the terms of the Equity Purchase Agreement, we agreed to:

(i)

contribute 4% of all of the issued and outstanding equity interests of PCEP to Investment (the “Rollover Interests”) in exchange for Investment issuing $2,000 of common units (representing approximately 6% of Investment’s issued and outstanding common units on the Closing Date (as defined below)) (the “Rollover Units”) to us; and

(ii)

sell all of the issued and outstanding equity interests of PCEP other than the Rollover Interests to the Buyer ((i) and (ii) being, the “Equity Transaction”).

The Equity Transaction included total consideration of (i) $48,000 in cash, subject to adjustment pursuant to the terms of the Equity Purchase Agreement, and (ii) $2,000 in equity pursuant to Investment’s issuance of the Rollover Units to us. The Equity Transaction contains customary terms and conditions and are subject to working capital adjustments. Following the execution of the Equity Purchase Agreement, the Equity Transaction was consummated on October 29, 2024 (the “Closing Date”). PCEP represented the entirety of our Electrical Infrastructure segment. The PCEP Sale was a result of a strategic change to the operations of our business.

Critical Accounting Estimates

The preparation of consolidated financial statements and related disclosures are in ~~conformity~~ conformity with U.S. GAAP. These accounting principles require us to make estimates and judgments that can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenue and expense during the ~~periods~~ periods presented. We believe that the estimates and judgments upon which we rely are reasonable based upon information available to us at the time that we make these estimates and judgments. To the extent that there are material differences between these estimates and ~~actual~~ actual results, our financial results will be affected. The accounting policies that reflect our more significant estimates and judgments and which we believe are the most critical to aid in fully understanding and evaluating our reported financial results are described below.

We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. As of December 31, 2024, no critical accounting estimates have been identified.

~~Management has identified certain critical accounting estimates which are outlined below.~~ In addition, there are other items within our consolidated financial statements that require estimation but are not deemed critical, as defined above. Changes in estimates used in these and other items could have a material impact on our consolidated financial statements.

Our significant accounting policies are more fully described in Note 3 – Summary of Significant Accounting Policies, in our consolidated financial statements included elsewhere in this Annual Report.

~~Revenue Recognition~~19

A significant portion of our business is derived from design and production contracts. Revenue for these contracts is recognized proportionally over the term of the contract using an input method based on the proportion of labor hours incurred as compared to the total estimated labor hours for the fixed-fee contract performance obligations, which we consider the best available indicator of the pattern and timing in which contract performance obligations are fulfilled and control transfers to the customer. This percentage is multiplied by the contracted dollar amount of the project to determine the amount of revenue to recognize in an accounting period.

There are situations where the number of hours to complete projects may exceed our original estimate as a result of an increase in project scope or unforeseen events. The related impact on income is recognized using the cumulative catch-up method, which the Company recognizes in the current period.

Recognition of revenue on a contract requires estimates of the total labor hours at completion and the measurement of progress towards completion. Due to the long-term nature of many of our contracts, developing the estimated total labor hours at completion often requires judgment. Factors that must be considered in estimating the total labor hours to be completed include the nature and complexity of the work to be performed and the risk and impact of delayed performance.

At the outset of each contract, we gauge its complexity and perceived risks and establish an estimated total number of labor hours at completion in line with these expectations. We follow a standard contract review process in which we review the progress and performance on our ongoing contracts at least quarterly.

RESULTS OF OPERATIONS

Overview of December 31, 2024, and 2023 Operating Results

Selected financial and operating data for our reportable business ~~segments~~segment for the most recent two years is summarized below. This information, as well as the selected financial data provided in Note 1413 and our Consolidated Financial Statements and related notes included in this Annual Report on Form 10-K, should be referred to when reading our discussion and analysis of results of operations below. Our summary of operating results during the years ended ~~2023~~December 31, 2024, and ~~2022~~2023 are as follows (in thousands):

	Year Ended December 31,
	For the Years Ended
	2023			2022 (Restated)
	December 31,
	2024			2023
Revenues
Electrical Infrastructure	$	30,377		$	16,270
Critical Power Solutions	$	22,879		$	11,116
Critical Power Solutions		11,116			9,608
Consolidated		41,493			25,878
Cost of goods sold
Electrical Infrastructure		24,252			15,052
Critical Power Solutions		17,365			8,891
Critical Power Solutions		8,891			8,000
Gross profit		5,514			2,225
Consolidated		33,143			23,052
Selling, general and administrative		9,672			8,190
Gross profit		8,350			2,826
Depreciation and amortization		40			185
Selling, general and administrative		9,896			8,445
Research and development		1,050			885
Depreciation and amortization		223			191
Total operating expenses		10,762			9,260
Research and development		885			-
Operating loss from continuing operations		(5,248	)		(7,035	)
Total operating expenses		11,004			8,636
Interest income		431			232
Operating loss from continuing operations		(2,654	)		(5,810	)
Other income, net		50			524
Interest income		(232	)		(465	)
Loss before income taxes		(4,767	)		(6,279	)
Other (income) expense		(524	)		67
Income tax benefit		(1,418	)		-
Loss before income taxes		(1,898	)		(5,412	)
Net loss from continuing operations		(3,349	)		(6,279	)
Income tax expense		-			7
Income from discontinued operations, net of income taxes		35,204			4,381
Net loss	$	(1,898	)	$	(5,419	)
Net income (loss)	$	31,855		$	(1,898	)

Backlog. Revenue backlog, which consists of purchase orders and contracts from customers that we believe to be firm, reflects the amount of revenue that we expect to realize in the future upon the satisfaction of customer orders for our products or services that are not yet complete or for which work has not yet begun. Backlog may vary significantly from reporting period to reporting period due to the timing of customer commitments. ~~As of December 31, 2023, backlog from our E-Bloc power systems and related equipment was approximately $12,706, or 28.1% of the total backlog.~~

Our revenue backlog atas of December 31, ~~2023~~2024, from our Critical Power business was $4519,~~165~~762, an increase of $63,~~887~~094, or 18.06%, when compared to $3816,~~278~~668 atas ~~December~~of ~~31, 2022. During the year ended~~ December 31, 2023~~, we experienced a surge in orders and contracts for our mobile EV charging solutions, e-Boost, which was the primary driver for the increase in our revenue backlog~~. The following table represents the progression of our backlog, byas ~~reporting~~of ~~segment~~December 31, ~~for~~2024 ~~the~~and ~~periods~~2023 ~~ended~~(in ~~as indicated~~thousands):

	December 31,
	2023		2022 (Restated)
	2024		2023
Electrical Infrastructure	$	28,497	$	31,994
Critical Power Solutions	$	19,762	$	16,668
Critical Power Solutions		16,668		6,284
Order backlog		19,762		16,668
Total order backlog	$	45,165	$	38,278
Discountinued operation		-		28,497
Total order backlog	$	19,762	$	45,165

2220

Revenue

The following table represents our revenues by ~~reporting segment and~~ major product category for the periods indicated (in thousands, except percentages):

	Year Ended
	For the Years Ended
	December 31,
	2023		2022 (Restated)		Variance		%
	2024		2023		Variance		%
Electrical Infrastructure
Equipment	$	30,302	$	16,260	$	14,042		86.4
Service		75		10		65		650.0
		30,377		16,270		14,107		86.7
Critical Power Solutions
Equipment		312,~~413~~262		23,~~229~~413		18,~~184~~849		53259.13
Service		710,~~703~~617		7,~~379~~703		~~324~~2,914		437.48
		11,116		9,608		1,508		15.7
Total revenue	$	22,879	$	11,116	$	11,763		105.8
Total revenue	$	41,493	$	25,878	$	15,615		60.3

For the year ended December 31, ~~2023~~2024, our ~~consolidated~~ revenue from our Critical Power segment increased by $1511,~~615~~763, or 60105.38% to $4122,~~493~~879, up from $2511,~~878~~ 116 during the year ended December 31, ~~2022~~2023, primarily due to an increase in ~~sales~~shipments ~~of our power systems from our Electrical Infrastructure segment~~ and ~~an increase~~rentals ~~in sales~~ of our ~~equipment~~suite ~~from~~of ~~our~~mobile ~~Critical~~EV ~~Power~~charging ~~segment~~equipment, e-Boost©.

Electrical Infrastructure. During the year ended December 31, 2023, revenue from our equipment sales increased by $14,042 or 86.4%, as compared to the year ended December 31, 2022, primarily due to increased sales of our E-Bloc power systems and related equipment, as well as medium and low voltage circuit protective equipment.

Critical Power. For the year ended December 31, 2023, revenue for our Critical Power segment increased by $1,508, or 15.7%, as compared to the year ended December 31, 2022, primarily due to an increase in sales of our new and refurbished generation equipment.

Gross Profit and Margin

The following table represents our gross profit ~~by reporting segment~~ for the periods indicated (in thousands, except percentages):

	Year Ended
	For the Years Ended
	December 31,
	2023		2022 (Restated)		Variance		%
	2024		2023		Variance		%
Electrical Infrastructure
Gross profit	$	6,125	$	1,218	$	4,907		402.9
Gross margin %		20.2		7.5		12.7
Critical Power Solutions
Gross profit		25,~~225~~514		12,~~608~~225		~~617~~3,289		38147.48
Gross margin %		2024.01		1620.70		34.31
Consolidated gross profit	$	8,350	$	2,826	$	5,524		195.5
Consolidated gross margin %		20.1		10.9		9.2

For the year ended December 31, ~~2023~~2024, our gross margin ~~percentage~~from ~~was~~our 20Critical Power segment increased to 24.1% of revenues, as compared to 1020.90% during the year ended December 31, ~~2022~~2023. The increase was predominately due to the increase in sales of our e-Boost equipment from our Pioneer eMobility business.

Electrical Infrastructure. For the year ended December 31, 2023, our gross margin increased by 12.7%, to 20.2%, from 7.5% for the year ended December 31, 2022. The increase was primarily due to the significant increase in sales of our E-Bloc power systems and related equipment and medium and low voltage circuit protective equipment and improved productivity from our manufacturing facility.21

Critical Power. For the year ended December 31, 2023, our gross margin increased by 3.3%, to 20.0%, from 16.7% for the year ended December 31, 2022. The increase was also primarily due to a favorable sales mix and the acceptance of price increases from our customers.

Operating Expenses

The following table represents our operating expenses ~~by reportable segment~~ for the periods indicated (in thousands, except percentages):

	Year Ended December 31,
	For the Years Ended
	2023		2022		Variance			%
	December 31,
Electrical Infrastructure
	2024		2023		Variance			%
Selling, general and administrative	$	19,~~707~~712	$	18,~~197~~375	$	~~510~~1,337			4216.60
Depreciation and amortization		38		18		20			111.1
Research and development		1,050		885		165			18.6
Segment operating expense	$	1,745	$	1,215	$	530			43.6
Total operating expense	$	10,762	$	9,260	$	1,502			16.2
Critical Power Solutions
Selling, general and administrative	$	3,679	$	3,464	$	215			6.2
Depreciation and amortization		176		147		29			19.7
Research and development		885		-		885			-
Segment operating expense	$	4,740	$	3,611	$	1,129			26
Unallocated Corporate Overhead Expenses
Selling, general and administrative	$	4,510	$	3,784	$	726			19.2
Depreciation and amortization		9		26		(17	)		(65.4	)
Segment operating expense	$	4,519	$	3,810	$	709			18.6
Consolidated
Selling, general and administrative	$	9,896	$	8,445	$	1,451			17.2
Depreciation and amortization		223		191		32			16.8
Research and development		885		-		885			-
Consolidated operating expense	$	11,004	$	8,636	$	2,368			27.4

Selling, General and Administrative Expense. For the year ended December 31, ~~2023~~2024, consolidated selling, general and administrative expense~~, before~~ ~~depreciation and amortization,~~ increased by approximately $1,~~451~~337, or 1716.20%, to $9,~~896~~712, as compared to $8,~~445~~375 during the year ended December 31, ~~2022~~2023, primarily due to an increase in payroll related expense. As a percentage of our consolidated revenue, selling, general and administrative expense decreased to 2442.4% in the year ended December 31, ~~2023~~ 2024, as compared to 3375.43% in the year ended December 31, ~~2022~~2023 primarily due to the increase in total revenue during the year ended December 31, 2024.

~~The~~R&D ~~selling,~~Expenses. ~~general~~Research and ~~administrative~~development ~~expense~~expenses in our ~~Electrical~~Critical ~~Infrastructure~~Power segment ~~increased~~consists byof ~~$510,~~costs orincurred ~~42.6%,~~in ~~during~~performing ~~the~~research ~~year~~and ~~ended~~development ~~December~~activities, 31including salaries, ~~2023~~benefits, asoverhead ~~compared~~costs, todepreciation, contract services and other related costs. During the year ended December 31, ~~2022~~2024, ~~primarily~~we ~~due~~incurred $1,050 of R&D expenses related to andeveloping ~~increase~~our inmobile ~~payroll~~e-Boost ~~related~~EV ~~costs~~charging ~~and~~solutions ~~third~~as ~~party~~compared ~~commissions~~to ~~expense~~$885 for the year ended December 31, 2023.

~~The~~Income ~~selling,~~from ~~general~~Discontinued and administrative expense in our Critical Power segment increased by $215, or 6.2%, during the year ended December 31, 2023, as compared to the year ended December 31, 2022, primarily due to an increase in payroll related costs and business travel related costs.Operations

~~The~~Income ~~selling,~~from ~~general~~discontinued ~~and~~operations, ~~administrative~~net ~~expense~~of intax ~~our~~was ~~unallocated corporate overhead expenses increased by~~ $~~726~~35,204 ~~or 19.2%,~~ during the year ended December 31, ~~2023~~2024, as compared to $4,381 during the year ended December 31, ~~2022,~~2023. ~~primarily~~The ~~due to an~~ increase inis ~~payroll~~primarily ~~related~~due ~~costs,~~to ~~including stock-based~~the ~~compensation,~~gain ~~professional~~on ~~fees~~the ~~and~~sale ~~business~~of ~~travel~~our ~~related~~Electrical ~~costs~~Infrastructure segment.

Depreciation and Amortization Expenses. Depreciation and amortization expense included in selling, general and administrative expense in our consolidated statement of operations have been disclosed as a separate component of operating expense in the tables above.22

~~Depreciation~~Operating ~~and~~Income ~~amortization~~(Loss) ~~expense~~from ~~consists~~Continuing primarily of depreciation of fixed assets and amortization of right-of-use assets related to our finance leases and excludes amounts included in cost of sales. For the year ended December 31, 2023, consolidated depreciation and amortization expense included in selling, general and administrative expense increased by $32, or 16.8%, as compared to the year ended December 31, 2022.Operations

~~R&D~~The ~~Expenses.~~following ~~Research~~table ~~and~~represents ~~development expenses in~~ our ~~Critical~~operating ~~Power~~loss ~~segment~~for ~~consists~~the ofperiods ~~costs~~indicated ~~incurred~~ (in performing research and development activities, including salaries, benefits, overhead costs, depreciation, contract services and other related costs. During the year ended December 31, 2023, we incurred $885 of R&D expenses related to developing our mobile e-Boost EV charging solutions. There were no R&D expenses incurred during 2022.thousands):

	For the Years Ended
	December 31,
	2024			2023			Variance		%
Operating loss from continuing operations	$	(5,248	)	$	(7,035	)	$	1,787		25.4

~~Operating~~During ~~Income~~the ~~(Loss)~~year ended December 31, 2024, our operating loss from continuing operations decreased by approximately $1,787, or 25.4%, to $5,248, as compared to $7,035 during the year ended December 31, 2023, primarily due to an increase in sales and rentals of our e-Boost equipment from our Pioneer eMobility business in addition to an increase in service sales.

~~The~~Non-Operating ~~following~~Income ~~table~~from ~~represents~~Continuing ~~our operating income (loss) by reportable segment for the periods indicated:~~Operations

	Year Ended
	December 31,
	2023			2022 (Restated)			Variance			%
Electrical Infrastructure	$	4,380		$	3		$	4,377			145,900.0
Critical Power Solutions		(2,515	)		(2,003	)		(512	)		(25.6	)
Unallocated corporate overhead expenses		(4,519	)		(3,810	)		(709	)		(18.6	)
Loss from operations	$	(2,654	)	$	(5,810	)	$	3,156			54.3

Interest Income. For the year ended December 31, 2024, we had interest income of approximately $431, as compared to interest income of approximately $232 during the year ended December 31, 2023. We generated the majority of our interest income from our cash on hand during the year ended December 31, 2024.

~~Electrical~~Other ~~Infrastructure~~Income. ~~Operating~~Other income ~~from~~in ~~our Electrical Infrastructure segment was $4,380 during~~ the ~~year~~consolidated ~~ended~~statements ~~December~~of ~~31,~~operations ~~2023, as~~reports ~~compared~~certain togains ~~essentially~~and nolosses ~~operating~~associated ~~income~~with ~~during~~activities ~~the year ended December 31, 2022. The increase is primarily due to the large increase in~~not ~~sales~~directly ~~of our power systems equipment and~~ related ~~equipment,~~to ~~reduced input costs and improved productivity from~~ our ~~manufacturing facility~~core ~~during the year ended December 31, 2023~~operations.

~~Critical~~For ~~Power.~~the ~~Operating~~year ~~loss~~ended ~~from~~December ~~our~~31, ~~Critical~~2024, ~~Power~~other ~~segment~~non-operating ~~increased~~income bywas $~~512~~50, oras ~~25.6%~~compared to other non-operating expense of $524 during the year ended December 31, 2023. Included in other non-operating income during the year ended December 31, 2023, ~~primarily due~~was toa ansettlement ~~increase~~gain inof ~~payroll~~ $525 related ~~costs~~to ~~and~~a ~~consulting,~~legal ~~marketing~~matter and ~~promotion~~no ~~fees~~such ~~related~~gain towas ~~our~~recognized ~~e-Boost~~during ~~initiative~~the year ended December 31, 2024.

~~General~~Provision ~~Corporate~~for ~~Expense~~Income Taxes. Our ~~general~~provision ~~corporate~~for ~~expenses~~income ~~consist~~taxes ~~primarily~~reflects ofan ~~executive~~effective ~~management,~~tax ~~corporate~~rate ~~accounting~~on ~~and~~loss ~~human~~before ~~resources personnel,~~taxes ~~corporate~~of ~~office~~29.7% ~~expenses,~~for ~~financing~~the ~~and~~year ~~corporate~~ended December ~~development activities~~31, ~~payroll and benefits administration~~2024, ~~treasury, tax~~as ~~compliance,~~compared ~~legal,~~to ~~stock-based~~0.0% ~~compensation,~~for ~~public~~the ~~reporting~~year ~~costs~~ended ~~and~~December ~~costs~~31, ~~not~~2023, ~~specifically~~as ~~allocated~~set toforth ~~reportable~~below ~~business~~(in ~~segments.~~thousands):

During the year ended December 31, 2023, our unallocated corporate overhead expense increased by $709, or 18.6%, as compared to the year ended December 31, 2022, primarily due to an increase in payroll related costs, including stock-based compensation, professional fees and business travel related costs.

	For the Years Ended
	December 31,
	2024			2023			Variance
Loss before income taxes	$	(4,767	)	$	(6,279	)	$	1,512
Income tax income		(1,418	)		-			(1,418	)
Effective income tax rate %		(29.7	)		-			(29.7	)

~~Non-Operating~~Net ~~(Income)~~Loss ~~Expense~~per Share from Continuing Operations

~~Interest~~We ~~Income.~~generated ~~For~~a ~~the~~net ~~year~~loss ~~ended~~from ~~December~~continuing ~~31,~~operations ~~2023, we had interest income~~ of ~~approximately~~ $~~232~~4,767 asfor ~~compared to interest income of approximately $465 during~~ the year ended December 31, ~~2022. We generated the majority of our interest income from our cash on hand during the year ended December 31~~2024, ~~2023,~~ as compared to ~~generating the majority of our interest income from the two subordinated promissory notes (the “Seller Notes”) we received from the Equity Transaction~~$6,279 ~~and our cash on hand,~~ during the year ended December 31, ~~2022~~2023.

~~Other~~Our ~~(Income)~~net ~~Expense.~~loss ~~Other~~from ~~(income)~~continuing ~~expense~~operations inper basic and diluted share for the ~~consolidated~~year ~~statements~~ended ofDecember ~~operations~~31, ~~reports~~2024, ~~certain~~was ~~gains~~$0.31, ~~and~~compared ~~losses~~to ~~associated~~a net loss ~~with~~from ~~activities~~continuing ~~not~~operations ~~directly~~per ~~related~~basic toand ~~our~~diluted ~~core~~share ~~operations~~of $0.63 for the year ended December 31, 2023.

For the year ended December 31, 2023, other non-operating income was $524, as compared to other non-operating expense of $67 during the year ended December 31, 2022. Included in other non-operating income during the year ended December 31, 2023, is a settlement gain of $525 related to a legal matter.23

Provision for Income Taxes. Our provision reflects an effective tax rate on loss before taxes of 0.0% for the year ended December 31, 2023, as compared to (0.1)% for the year ended December 31, 2022, as set forth below:

	Year Ended
	December 31,
	2023			2022 (Restated)			Variance
Loss before income taxes	$	(1,898	)	$	(5,412	)	$	3,514
Income tax expense		-			7			(7	)
Effective income tax rate %		-			(0.1	)		0.1

Net Loss per Share

We generated a net loss of $1,898 for the year ended December 31, 2023, as compared to a net loss of $5,419 during the year ended December 31, 2022.

Our net loss per basic and diluted share for the year ended December 31, 2023 was $0.19, compared to a net loss per basic and diluted share of $0.56 for the year ended December 31, 2022.

Quarterly Discussion and Analysis

The Company has restated the unaudited condensed consolidated financial statements for the quarterly periods ended March 31, 2022 through September 30, 2023, originally included in its Quarterly Reports on Form 10-Q for the periods ended March 31, 2023, June 30, 2023 and September 30, 2023 (“Affected Periods”).

During 2022 and 2023, we recognized revenues associated with customer contracts with performance obligations satisfied over time (“Over Time Contracts”) using labor hours as the measure of progress. Our underlying estimates of total labor hours required to complete Over Time Contracts were materially different from the actual labor hours required, which was determined to represent an error, and, as a result, the percentage of completion used to recognize revenue in the Affected Periods is materially different from the percentage of completion using actual labor hours incurred. As a result, we restated revenues during the Affected Periods to adjust the percentage of completion based upon the actual labor hours incurred to complete each Over Time Contract. Additionally, we determined that costs from Over Time Contracts should be recognized as incurred and, as a result, we recorded an adjustment during the Affected Periods as the Company was previously incorrectly deferring costs incurred to a future period.

The restatements of such unaudited condensed consolidated quarterly financial statements are provided in Note 4, “Restatement of Previously Issued Unaudited Interim Condensed Consolidated Financial Statements.” The above discussion should be read in conjunction with our accompanying restated unaudited condensed interim consolidated financial statements disclosed in Part II, Item 8. Financial Statements and Supplementary Data, Note 4, “Restatement of Previously Issued Unaudited Interim Condensed Consolidated Financial Statements” of this Comprehensive Form 10-K.

LIQUIDITY AND CAPITAL RESOURCES

General. On October 20, 2020, we entered into an At the Market Sale Agreement with H.C. Wainwright & Co., LLC (“Wainwright”), pursuant to which we may offer and sell our shares of common stock from time to time through Wainwright, acting as sales agent or principal (the “ATM Program”). AtSince ~~December~~October 3120, ~~2023~~2020, weand ~~had~~through $3December 31,~~582~~ of2024, ~~cash~~we onsold ~~hand~~an ~~generated~~aggregate ~~primarily~~of ~~from~~1,835,616 ~~the~~shares ~~sale~~ of common ~~stock~~ ~~under~~stock ~~the~~for ~~ATM~~aggregate ~~Program,~~gross ~~payment~~proceeds of ~~all~~approximately ~~unpaid~~$14,051, ~~principal~~before ~~and~~any ~~interest~~sales ~~from~~agent ~~the~~fees ~~Seller~~and ~~Notes~~expenses ~~during~~payable ~~the~~by ~~year~~us ~~ended~~under ~~December~~the ~~31,~~ATM ~~2022, and~~Program. ~~cash~~During ~~flows~~the ~~from~~year ~~operating~~ended ~~activities. Since October 20, 2020, and through~~ December 31, ~~2023~~2024, we sold an aggregate of ~~916~~919,~~059~~557 shares of common stock for an aggregate ~~gross~~consideration ~~proceeds~~ of approximately $85,~~904~~147, before any sales agent fees and expenses payable by us under the ATM Program. ~~During~~As ~~the~~of ~~year ended~~ December 31, ~~2023~~2024, ~~we sold an aggregate of 27~~$69,~~559~~853 ~~shares~~ of common stock remained available for anissuance ~~aggregate~~under ~~consideration~~ the ATM Program. As of ~~approximately~~December 31, 2024, we had $~~184~~41,622 ~~before~~of ~~any~~cash ~~sales~~on ~~agent~~hand ~~fees~~generated from the PCEP Sale and ~~expenses~~the ~~payable~~sale byof uscommon stock under the ATM Program. On October 29, 2024, we closed on the PCEP Sale for gross cash proceeds of $48,000.

OnThe ~~December~~continuing 13impacts of the rising interest rates, ~~2021~~inflation, wechanges ~~filed~~in aforeign ~~prospectus~~currency ~~supplement~~exchange torates and geopolitical developments, such as the ~~prospectus~~ongoing ~~which~~conflict ~~forms~~between aRussia ~~part~~and ofUkraine, ~~our~~and ~~registration~~the ~~statement~~ongoing onconflict ~~Form~~between ~~S-3~~Israel ~~(File~~and Hamas, have resulted, and may continue ~~No.~~to ~~333-249569)~~result, ~~(the~~in ~~“Prior~~a ~~Shelf~~global ~~Registration~~slowdown ~~Statement”)~~of economic activity, ~~that~~which ~~was~~may ~~declared~~decrease ~~effective~~demand byfor ~~the~~a ~~SEC~~broad onvariety ~~October~~of ~~27,~~goods ~~2020~~and ~~(the~~services, including ~~“Prior~~those ~~ATM~~provided ~~Prospectus”)~~by our clients, inwhile ~~connection~~also ~~with~~disrupting ~~the~~supply ~~offer~~channels, sales channels and ~~sale~~advertising and marketing activities for an unknown period of uptime. Additionally, recent changes to anU.S. ~~aggregate~~policy ~~offering~~implemented ~~amount~~by ofthe $8U.S. Congress,~~600~~ ofthe ~~common stock~~Trump ~~that~~administration ~~may~~or beany new ~~issued~~administration have impacted and ~~sold~~may ~~under~~in the ~~ATM~~future ~~Program~~impact, among other things, the U.S. Onand ~~August~~global 30economy, ~~2023~~international trade relations, unemployment, weimmigration, ~~filed~~healthcare, ataxation, ~~new~~the ~~registration~~U.S. ~~statement~~regulatory onenvironment, ~~Form~~inflation ~~S-3~~and ~~(File No~~other areas. ~~333-274266)~~As toa ~~replace~~result of the ~~Prior~~current uncertainty ~~Shelf~~in ~~Registration~~economic ~~Statement~~activity, ~~including~~we aare ~~base~~unable ~~prospectus~~to ~~which~~predict ~~covers~~the potential size and duration of the ~~offering,~~impact ~~issuance~~on our revenue and our results ~~sale~~of operations, if any. The extent of upthe topotential ~~$150,000~~impact of ~~common~~these ~~stock,~~macroeconomic ~~preferred~~factors ~~stock,~~on ~~warrants~~our operational and~~/or~~ ~~units;~~financial ~~and~~performance will depend on a ~~sales~~variety ~~agreement~~of ~~prospectus~~factors, ~~covering~~including the ~~offering, issuance~~extent ~~and~~of ~~sale~~geopolitical ofdisruption upand toits aimpact ~~maximum~~on ~~aggregate~~our ~~offering~~clients, ~~price~~partners, ofindustry, and ~~$75~~employees,~~000~~ all of ~~common~~which ~~stock~~are ~~that~~uncertain ~~may~~at bethis ~~issued~~time and ~~sold~~cannot ~~under~~be ~~the~~accurately ~~ATM~~predicted. ~~Program (~~We continue to monitor the ~~“New~~effects ~~ATM~~of ~~Prospectus”).~~these macroeconomic ~~The~~factors ~~new~~and ~~registration~~intend ~~statement~~to ~~was~~take ~~declared~~steps ~~effective~~deemed byappropriate to limit the ~~SEC~~impact on ~~September~~our ~~8, 2023~~business. AsDuring ~~of December~~the year ended December 31, ~~2023~~2024, ~~$75,000~~we ofwere ~~common~~able ~~stock~~to ~~remained~~operate ~~available~~substantially ~~for~~at ~~issuance under the New ATM Prospectus~~capacity.

As of the filing date of this Form 10-K, we became subject to the limitations of General Instruction I.B.6 of Form S-3, which limits the amount of funds we can raise through primary public offerings of securities in any twelve-calendar month period using a registration statement on Form S-3 to one-third of the aggregate market value of our common stock held by non-affiliates. Therefore, we will be limited in the amount of proceeds we are able to raise by selling our common stock using Form S-3, including under the New ATM Prospectus, until such time as our public float held by non-affiliates exceeds $75,000.

The continuing impacts of the rising interest rates, inflation, changes in foreign currency exchange rates and geopolitical developments, such as the ongoing conflict between Russia and Ukraine, and the ongoing conflict between Israel and Hamas, have resulted, and may continue to result, in a global slowdown of economic activity, which may decrease demand for a broad variety of goods and services, including those provided by our clients, while also disrupting supply channels, sales channels and advertising and marketing activities for an unknown period of time. As a result of the current uncertainty in economic activity, we are unable to predict the potential size and duration of the impact on our revenue and our results of operations, if any. The extent of the potential impact of these macroeconomic factors on our operational and financial performance will depend on a variety of factors, including the extent of geopolitical disruption and its impact on our clients, partners, industry, and employees, all of which are uncertain at this time and cannot be accurately predicted. We continue to monitor the effects of these macroeconomic factors and intends to take steps deemed appropriate to limit the impact on our business. During the year ended December 31, 2023, we were able to operate substantially at capacity.

There can be no assurance that precautionary measures, whether adopted by us or imposed by others, will be effective, and such measures could negatively affect our sales, marketing, and client service efforts, delay and lengthen our sales cycles, decrease our employees’, clients’, or partners’ productivity, or create operational or other challenges, any of which could harm our business and results of operations.

26The cash flows related to the discontinued operations have not been segregated and are included in the consolidated statements of cash flows.

Cash Used in Operating Activities. Cash used in our operating activities was $36,~~894~~212 during the year ended December 31, ~~2023~~2024, as compared to cash used in our operating activities of $53,~~772~~895 during the year ended December 31, ~~2022~~2023. The ~~decrease~~ increase in cash used in operating activities is primarily due to working capital fluctuations ~~and the significant reduction to net loss of $3,521 during the year ended December 31, 2023~~.

Cash ~~Used in/~~Provided by/ Used in Investing Activities. Cash ~~used~~provided inby investing activities during the year ended December 31, ~~2023~~2024, was $238,~~497~~876, as as compared to cash ~~provided~~used byin our investing activities of $42,~~722~~496 during the year ended December 31, ~~2022~~2023. The ~~decrease~~increase in cash provided by investing activities is primarily due to ~~collecting all unpaid principal and interest from~~ the ~~Seller~~PCEP ~~Notes~~Sale during the year ended December 31, ~~2022~~2024. During the ~~year~~years ended December 31, 2024 ~~2023~~ and ~~2022~~2023, additions to our property and equipment were $23,~~497~~759 and $12,~~512~~496, respectively.

Cash Provided by/ Used in Financing Activities. Cash ~~used~~provided inby our financing activities was $~~323~~5,376 during the year ended December 31, ~~2023~~ 2024, as compared to cash used in our financing activities $~~353~~323 during the year ended December 31, ~~2022~~2023. The ~~primary~~increase ~~use~~in of cash inprovided by financing activities ~~for~~is ~~the~~primarily ~~year~~due ~~ended~~to ~~December~~the ~~31,~~sale ~~2023 and~~of ~~2022~~common ~~was~~stock ~~repayments~~under ofthe ~~financing~~ATM ~~leases~~Program.

Working Capital. As of December 31, ~~2023~~2024, we had working capital of $926,~~421~~679, including $341,~~582~~622 of cash, compared to working capital of $129,~~293~~421, including $103,~~296~~582 of cash on hand atas of December 31, ~~2022~~2023.

Assessment of Liquidity. AtAs of December 31, ~~2023~~2024, we had $341,~~582~~622 of cash on hand generated primarily from the PCEP Sale and the sale of common stock under the ATM ~~Program,~~ ~~payment of all unpaid principal and interest from the Seller Notes during the year ended December 31, 2022 and cash flows from operating activities~~Program. We have historically met our cash needs through a combination of cash flows from operating activities and bank borrowings, the completion of the ~~Equity Transaction, proceeds from the~~ sale of the ~~CleanSpark~~transformer ~~common~~business ~~stock~~units ~~and~~in ~~warrants~~August to2019 ~~purchase CleanSpark~~and ~~common~~the ~~stock,~~ sale of common stock under the ATM Program ~~and collecting all unpaid principal and interest from the Seller Notes~~. Historically, our cash requirements were generally for operating activities, debt repayment, capital improvements and acquisitions.

We expect to meet our cash needs with our working capital and cash flows from operating activities. We expect our cash requirements to be generally for operating activities, capital improvements and product development. We expect that product development and promotional activities related to our new initiatives will continue in the near future and we expect to continue to incur costs related to such activities. We expect that our cash balance is sufficient to fund operations for the next twelve months from the date our consolidated financial statements are issued.

As of December 31, 2023, we had no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships with unconsolidated entities or other persons that had, or that may have, a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.24

As of December 31, 2024, we had no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships with unconsolidated entities or other persons that had, or that may have, a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Capital Expenditures

Our additions to property and equipment were $23,~~497~~759 during the year ended December 31, ~~2023~~2024, as compared to $12,~~512~~496 additions during the year ended December 31, ~~2022~~2023.

Known Trends, Events, Uncertainties and Factors That May Affect Future Operations

We believe that our future operating results will continue to be subject to quarterly variations based upon a wide variety of factors, including the cyclical nature of the electrical equipment industry and the markets for our products and services. Our operating results could also be impacted by changing customer requirements and exposure to fluctuations in prices of important raw supplies, such as copper, steel and aluminum. We have various insurance policies, including cybersecurity, covering risks in amounts that we consider adequate. In addition to these measures, we attempt to recover other cost increases through improvements to our manufacturing efficiency and through increases in prices where competitively feasible. Lastly, other economic conditions we cannot foresee may affect customer demand. In addition, the consequences of the ongoing geopolitical conflicts, such as the ongoing conflict between Russia and Ukraine and the ongoing conflict between Israel and Hamas, including related sanctions and countermeasures, and the effects of rising global inflation, are difficult to predict, and could adversely impact geopolitical and macroeconomic conditions, the global economy, and contribute to increased market volatility, which may in turn adversely affect our business and operations. Additionally, recent changes to U.S. policy implemented by the U.S. Congress, the Trump administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. Although we cannot predict the impact, if any, of these changes to our business, they could adversely affect our business. We predominately sell to customers in the industrial production ~~and~~ ~~commercial construction~~ markets. Accordingly, changes in the condition of any of our customers may have a greater impact than if our sales were more evenly distributed between different end markets. For a further discussion of factors that may affect future operating results see the sections entitled “Risk Factors” and “Special Note Regarding Forward-Looking Statements.”

Off Balance Sheet Transactions and Related Matters

We have no off-balance sheet transactions, arrangements, obligations (including contingent obligations), or other relationships with unconsolidated entities or other persons that have, or may have, a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

New Accounting Pronouncements

The information required by this Item is provided in “Note 2 - Summary of Significant Accounting Policies” to our consolidated financial statements for the year ended December 31, ~~2023~~2024, included in this Annual Report on Form 10-K.

Recent Accounting Pronouncements

There have been no recent accounting pronouncements not yet adopted by us which would have a material impact on our consolidated financial statements.

Accounting Standards Update (“ASU”) 2023-03, “Presentation of Financial Statements (Topic 205), Income Statement - Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation - Stock Compensation (Topic 718): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 120, SEC Staff Announcement at the March 24, 2022 Emerging Issues Task Force (“EITF”) Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X: Income or Loss Applicable to Common Stock.” ASU 2023-03 amends the ASC for SEC updates pursuant to SEC Staff Accounting Bulletin No. 120; SEC Staff Announcement at the March 24, 2022 EITF Meeting; and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X: Income or Loss Applicable to Common Stock. These updates were immediately effective and did not have a significant impact on our consolidated financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

2825

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

	Page	~~Page~~
Consolidated Financial Statements for the Years Ended December 31, 2023 and 2022
Consolidated Financial Statements for the Years Ended December 31, 2024, and 2023
Report of Independent Registered Public Accounting Firm (PCAOB ID#688)		30
Report of Independent Registered Public Accounting Firm (BDO USA, P.C.; New York, NY; PCAOB ID#243	27
Consolidated Statements of Operations		31
Report of Independent Registered Public Accounting Firm (Marcum LLP; Saddle Brooke, NJ; PCAOB ID#688)	28
Consolidated Balance Sheets		32
Consolidated Statements of Operations	29
Consolidated Statements of Cash Flows		33
Consolidated Balance Sheets	30
Consolidated Statements of Changes in Stockholders’ Equity		34
Consolidated Statements of Cash Flows	31
Notes to the Consolidated Financial Statements		35
Consolidated Statements of Changes in Stockholders’ Equity	32
Notes to the Consolidated Financial Statements	33

2926

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

~~To the~~ Shareholders and Board of Directors of

Pioneer Power Solutions, Inc.

Fort Lee, New Jersey

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance ~~sheets~~sheet of Pioneer Power Solutions, Inc. ~~and subsidiaries~~ (the “Company”) as of December 31, ~~2023 and 2022~~2024, the related consolidated statements of operations, changes in stockholders’ equity, and cash flows for ~~each of~~ the ~~two~~year ~~years in the period~~ then ended ~~December 31~~, ~~2023,~~ and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company asat of December 31, ~~2023 and 2022~~2024, and the results of its operations and its cash flows for ~~each of~~ the ~~two~~year ~~years in~~then ~~the period~~ ended ~~December 31~~, ~~2023,~~ in conformity with accounting principles generally accepted in the United States of America.

Restatement of Previously Issued Consolidated Financial Statements

As discussed in Note 2 to the consolidated financial statements, the Company has restated its consolidated financial statements for the year ended December 31, 2022 to correct misstatements.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on on the Company’s consolidated financial statements based on our ~~audits~~audit. We are a public accounting firm registered with the Public ~~Company~~ Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our ~~audits~~audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the ~~audits~~audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our ~~audits~~audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our ~~audits~~audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether ~~due~~ due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our ~~audits~~audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our ~~audits~~audit ~~provide~~provides a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Recognition

As described in Note 2 and Note 3 to the consolidated financial statements, the Company’s principal products and services include electric power systems and equipment, distributed energy resources, power generation equipment and mobile electric vehicle charging solutions. The Company satisfies its performance obligations and, therefore, recognizes revenue, either over time or at a point in time, which is when the customer has obtained control of the good or service.

We identified the timing of revenue recognition related to the Company’s products and services as a critical audit matter. Auditing the timing of those revenue transactions was especially challenging due to the significant audit effort involved in performing the procedures, given the significance of revenue, and the volume and magnitude of sales transactions.

The primary procedures we performed to address this critical audit matter included:

●

Obtaining a sample of contracts and evaluating the key terms included in those contracts.

●

Evaluating the timing when the Company satisfied its performance obligations for a sample of sales transactions by agreeing invoices to shipping documents, service reports or confirming with customers, where applicable.

/s/ BDO USA, P.C.

We have served as the Company’s auditor since 2024.

New York, New York

April 14, 2025

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Directors of

Pioneer Power Solutions, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Pioneer Power Solutions, Inc. (the “Company”) as of December 31, 2023, the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the year ended December 31, 2023 and the related notes ( collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows the year then ended in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of consolidated the financial statements. We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matters

Critical audit matters are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. We determined that there are no critical audit matters.

/s/ Marcum ~~llp~~LLP

Marcum LLP

We ~~have~~ served as the Company’s auditor ~~since~~from 2022. to November 2024

Saddle Brook, NJ ~~July 26, 2024~~

30July 26, 2024, except for Discontinued Operations in Note 11 and Business Segment, Geographic and Customer Information in Note 13, as to which date is April 14, 2025

PIONEER POWER SOLUTIONS, INC.

Consolidated Statements of Operations

(In thousands, except for share and per share ~~data~~amounts)

	2023			2022 (Restated)
	2024			2023
	Year Ended
	For the Years Ended
	December 31,
	2023			2022 (Restated)
	2024			2023
Revenues	$	4122,~~493~~879		$	2511,~~878~~116
Cost of goods sold		3317,~~143~~365			238,~~052~~891
Gross profit		85,~~350~~514			2,~~826~~225
Operating expenses
Selling, general and administrative		109,~~119~~712			8,~~636~~375
Research and development		~~885~~1,050			-885
Total operating expenses		1110,~~004~~762			89,~~636~~260
Loss from operations		(2,654	)		(5,810	)
Operating loss from continuing operations		(5,248	)		(7,035	)
Interest income		(232	)		(465	)
Interest income, net		431			232
Other (income) expense, net		(524	)		67
Other income, net		50			524
Loss before income taxes		(14,~~898~~767	)		(56,~~412~~279	)
Income tax expense		-			7
Income tax benefit		(1,418	)		-
Net loss	$	(1,898	)	$	(5,419	)
Net loss from continuing operations		(3,349	)		(6,279	)
Loss per share:
Income from discontinued operations, net of income taxes		35,204			4,381
Basic	$	(0.19	)	$	(0.56	)
Net income (loss)	$	31,855		$	(1,898	)
Diluted	$	(0.19	)	$	(0.56	)
Basic (loss) earnings per share:
Loss from continuing operations	$	(0.31	)	$	(0.63	)
Earnings from discontinued operations		3.28			0.44
Basic earnings (loss) per share	$	2.97		$	(0.19	)
Diluted (loss) earnings per share:
Loss from continuing operations	$	(0.31	)	$	(0.63	)
Earnings from discontinued operations		3.21			0.43
Diluted earnings (loss) per share	$	2.90		$	(0.20	)
Weighted average common shares outstanding:
Basic		910,~~905~~745,~~234~~217			9,~~727~~905,~~542~~234
Diluted		910,~~905~~953,~~234~~861			910,~~727~~127,~~542~~188

The accompanying notes are an integral part of these consolidated financial statements.

3129

PIONEER POWER SOLUTIONS, INC.

Consolidated Balance Sheets

(In thousands, except for share amounts)

	2023			2022 (Restated)
	2024			2023
	December 31,
	2023			2022 (Restated)
	2024			2023
ASSETS
Current assets
Cash	$	341,~~582~~622		$	103,~~296~~582
Accounts receivable, net of allowance for credit losses of $97 and $788 as of December 31, 2023 and 2022, respectively		9,010			10,010
Accounts receivable, net of allowance for credit losses of $13 and $0 as of December 31, 2024 and 2023, respectively		7,826			1,219
Inventories		76,~~579~~068			83,~~090~~078
Prepaid expenses and other current assets		71,~~512~~141			26,~~853~~159
Total current assets		27,683			31,249
Current assets held for sale		-			13,645
Property and equipment, net		3,899			1,800
Total current assets		56,657			27,683
Operating lease right-of-use assets		760			1,450
Property and equipment, net		6,503			3,601
Financing lease right-of-use assets		403			727
Operating lease right-of-use assets		530			425
Deferred financing costs		195			-
Financing lease right-of-use assets		221			403
Other assets		82			162
Deferred financing costs		-			195
Total assets	$	33,022		$	35,388
Investments		2,000			-
Other assets		40			40
Noncurrent assets held for sale		-			675
Total assets	$	65,951		$	33,022
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable and accrued liabilities	$	124,~~609~~543		$	78,~~239~~111
Current portion of operating lease liabilities		~~582~~244			~~703~~237
Current portion of financing lease liabilities		~~139~~109			~~355~~139
Deferred revenue		~~4,932~~991			~~10,659~~307
Total current liabilities		18,262			18,956
Consideration due to buyer		3,347			-
Operating lease liabilities, non-current portion		215			797
Income taxes payable		4,079			-
Financing lease liabilities, non-current portion		278			418
Dividend payable		16,665			-
Other long-term liabilities		49			65
Current liabilities held for sale		-			9,468
Total liabilities		18,804			20,236
Total current liabilities		29,978			18,262
Operating lease liabilities, non-current portion		301			215
Financing lease liabilities, non-current portion		121			278
Other long-term liabilities		122			49
Total liabilities		30,522			18,804
Commitments and contingencies (Note 7)		-
Stockholders’ equity
Preferred stock, $0.001 par value, 5,000,000 shares authorized; none issued		-			-
Common stock, $0.001 par value, 30,000,000 shares authorized; 9,930,022 and 9,644,545 shares issued and outstanding on December 31, 2023 and 2022, respectively		10			10
Common stock, $0.001 par value, 30,000,000 shares authorized; 11,120,266 and 9,930,022 shares issued and outstanding on December 31, 2024 and 2023, respectively		11			10
Additional paid-in capital		3335,~~837~~418			3233,~~859~~837
Accumulated other comprehensive income		-			14
Accumulated deficit		-			(19,629	)
Accumulated deficit		(19,629	)		(17,731	)
Total stockholders’ equity		35,429			14,218
Total stockholders’ equity		14,218			15,152
Total liabilities and stockholders’ equity	$	65,951		$	33,022
Total liabilities and stockholders’ equity	$	33,022		$	35,388

The accompanying notes are an integral part of these consolidated financial statements.

3230

PIONEER POWER SOLUTIONS, INC.

Consolidated Statements of Cash Flows

(In thousands)

	2023			2022 (Restated)
	2024			2023
	Year Ended
	For the Years Ended
	December 31,
	2023			2022 (Restated)
	2024			2023
Operating activities
Net loss	$	(1,898	)	$	(5,419	)
Net income (loss)	$	31,855		$	(1,898	)
Adjustments to reconcile net loss to net cash used in operating activities:
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation		~~397~~716			~~228~~397
Amortization of right-of-use financing leases		~~324~~129			~~238~~324
Amortization of right-of-use operating leases		~~690~~224			~~663~~690
Amortization of imputed interest		-			(455	)
Change in allowance for credit losses		35			97
Change in receivable reserves		97			(140	)
Stock-based compensation		1,055			1,471
Stock-based compensation		1,471			1,002
Gain on sale of PCEP business		(35,044	)		-
Other		(14	)		-
Loss on disposal of fixed assets		177			-
Other		-			(14	)
Changes in current operating assets and liabilities:
Accounts receivable		~~585~~(10,360	)		~~(7,441~~585	)
Inventories		~~511~~(14,536	)		~~(3,931~~511	)
Prepaid expenses and other assets		(4,~~982~~558	)		(14,~~799~~982	)
Income taxes		(7	)		28
Assets held for sale		14,320			-
Accounts payable and accrued liabilities		5,361			3,670
Liabilities held for sale		(9,468	)		-
Deferred revenue		(5,727	)		8,237
Accounts payable, accrued liabilities and other liabilities		11,609			5,361
Operating lease liabilities		(703	)		(653	)
Income taxes		(1,418	)		(7	)
Net cash used in operating activities		(3,895	)		(5,772	)
Deferred revenue		684			(5,727	)
Operating lease liabilities		(748	)		(703	)
Net cash used in operating activities		(6,212	)		(3,895	)
Investing activities
Purchases of property and equipment		(2,496	)		(1,512	)
Purchase of property and equipment		(3,759	)		(2,496	)
Collection of notes receivable		-			6,234
Proceeds from sale of PCEP business, net of transaction costs		42,635			-
Net cash (used in)/ provided by investing activities		(2,496	)		4,722
Net cash provided by/(used in) investing activities		38,876			(2,496	)
Financing activities
Net proceeds from the exercise of options for common stock		50519			1750
Net proceeds from issuance of common stock		~~177~~4,986			-177
Payment to affiliates		-			(129	)
Payment of deferred financing costs		-			(195	)
Payment of deferred financing costs		(195	)		-
Principal repayments of financing leases		(129	)		(355	)
Principal repayments of financing leases		(355	)		(241	)
Net cash provided by/ (used in) financing activities		5,376			(323	)
Net cash used in financing activities		(323	)		(353	)
Increase (decrease) in cash		38,040			(6,714	)
Decrease in cash		(6,714	)		(1,403	)
Cash
Cash, beginning of period		10,296			11,699
Cash, beginning of year		3,582			10,296
Cash, end of period	$	3,582		$	10,296
Cash, end of year	$	41,622		$	3,582
Supplemental cash flow information:
Interest paid	$	735		$	47
Income taxes paid, net of refunds		27			~~(20~~2	)
Non-cash investing and financing activities:
Acquisition of right-of-use assets and lease liabilities		-			841
Surrender and retirement of common stock		344			720
Surrender and retirement of common stock		720			-
Acquisition of right-of-use assets and lease liabilities		330			-
Property and equipment obtained in exchange for accounts payable		272			-
Cash dividend declared		16,665			-

The accompanying notes are an integral part of these consolidated financial statements.

3331

PIONEER POWER SOLUTIONS, INC.

Consolidated Statements of Changes in Stockholders’ Equity

(~~Amounts~~In in thousands, except for share amounts)

	Shares			Amount		capital			income			deficit			equity
	Common Stock					Additional paid-in			Accumulated other compre-hensive			Accumulated			Total stockholders’
									Accumulated
						Additional			other						Total
	Common Stock					paid-in			comprehensive			Accumulated			stockholders’
	Shares			Amount		capital			income			deficit			equity
Balance - January 1, 2022		9,640,545		$	10	$	31,840		$	14		$	(12,312	)	$	19,552
Balance - January 1, 2023 (As Restated)		9,644,545		$	10	$	32,859		$	14		$	(17,731	)	$	15,152
Net loss		-			-		-			-			(5,419	)		(5,419	)
Stock-based compensation		-			-		1,002			-			-			1,002
Exercise of stock options		4,000			-		17			-			-			17
Balance - December 31, 2022 (Restated)		9,644,545		$	10	$	32,859		$	14		$	(17,731	)	$	15,152
Balance - January 1, 2023 (Restated)		9,644,545		$	10	$	32,859		$	14		$	(17,731	)	$	15,152
Balance		9,644,545		$	10	$	32,859		$	14		$	(17,731	)	$	15,152
Net loss		-			-		-			-			(1,898	)		(1,898	)
Stock-based compensation		360,000			-		1,471			-			-			1,471
Surrender and retirement of common stock		(117,082	)		-		(720	)		-			-			(720	)
Exercise of stock options		15,000			-		50			-			-			50
Issuance of common stock, net of transaction costs		27,559			-		177			-			-			177
Surrender and retirement of common stock		(117,082	)		-		(720	)		-			-			(720	)
Other		-			-		-			(14	)		-			(14	)
Balance - December 31, 2023		9,930,022		$	10	$	33,837		$	-		$	(19,629	)	$	14,218
Balance - January 1, 2024		9,930,022		$	10	$	33,837		$	-		$	(19,629	)	$	14,218
Balance		9,930,022		$	10	$	33,837		$	-		$	(19,629	)	$	14,218
Net income		-			-		-			-			31,855			31,855
Net (loss) income		-			-		-			-			31,855			31,855
Stock-based compensation		185,000			-		1,055			-			-			1,055
Exercise of stock options		162,837			-		519			-			-			519
Issuance of common stock, net of transaction costs		919,557			1		4,790			-			-			4,791
Surrender and retirement of common stock		(77,150	)		-		(344	)		-			-			(344	)
Cash dividend declared		-			-		(4,439	)		-			(12,226	)		(16,665	)
Balance - December 31, 2024		11,120,266		$	11	$	35,418		$	-		$	-		$	35,429
Balance		11,120,266		$	11	$	35,418		$	-		$	-		$	35,429

The accompanying notes are an integral part of these consolidated financial statements.

3432

PIONEER POWER SOLUTIONS, INC.

Notes to the Consolidated Financial Statements

(in thousands, except for share and per share amounts)

1. BUSINESS ORGANIZATION, NATURE OF OPERATIONS, RISKS AND UNCERTAINTIES

Pioneer Power Solutions, Inc. and its wholly owned ~~subsidiaries~~subsidiary (referred to herein as the “Company” or “Pioneer”) design, manufacture, ~~integrate, refurbish,~~ service, ~~distribute~~ and ~~sell~~integrate ~~electric power systems,~~ distributed energy resources, power generation equipment and mobile electric vehicle (“EV”) charging solutions. ~~The~~Our ~~Company’s~~ products and services are sold to a broad range of customers in the utility, industrial and commercial markets. ~~The~~Our ~~Company’s~~ customers include, but are not limited to, ~~electric,~~federal ~~gas~~ and ~~water~~state ~~utilities~~government entities, ~~data~~package ~~center~~delivery business’, ~~developers~~school ~~and~~bus ~~owners~~fleet operations, EV charging infrastructure developers and owners, and distributed energy developers. We ~~The~~are ~~Company is~~ headquartered in Fort Lee, New Jersey and ~~operates~~operate from ~~three~~two (32) additional locations in the United States for manufacturing, service and maintenance, engineering, and sales and administration.

Nasdaq Listing

On September 24, 2013, the Company completed an underwritten public offering of 1,265,000 shares of its common stock at a gross sales price of $7.00 per share, resulting in net proceeds to the Company of approximately $7,900, after deducting underwriting discounts and commissions and other offering expenses. In connection with the public offering, the Company’s common stock began trading on the Nasdaq Capital Market under the symbol PPSI.

Segments

In determining operating and reportable segments in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 280, Segment Reporting (“ASC 280”), the Company concluded that it has ~~two~~one reportable ~~segments, which are also its operating segments~~segment: ~~Electrical Infrastructure Equipment (“Electrical Infrastructure”) and~~ Critical Power Solutions (“Critical Power”). Financial information about the Company’s ~~segments~~segment is presented in Note 13 - Business Segment, Geographic and Customer Information.

Basis of Presentation

The Company’s consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The Company believes that the disclosures made are adequate to make the information presented not misleading to the reader. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary to fairly state the financial position, results of operations and cash flows with respect to the consolidated financial statements have been included.

These consolidated financial statements include the accounts of Pioneer and its wholly- owned ~~subsidiaries~~subsidiary. All significant intercompany accounts and transactions have been eliminated in consolidation.

Liquidity

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying consolidated financial statements, as of ~~the year ended~~ December 31, ~~2023~~2024, the Company had $341,~~582~~622 of cash on hand and working capital of $926,~~421~~679. The cash on hand was generated primarily from the sale of ~~common stock under~~ the ~~ATM~~Company’s ~~Program~~former ~~(as~~wholly ~~defined~~owned ~~below)~~subsidiary, ~~payment~~Pioneer ofCustom Electrical ~~all~~Products ~~unpaid~~Corp. ~~principal~~(“PCEP”) and ~~interest from~~ the ~~two subordinated promissory notes the Company received in connection with the~~ sale of ~~the~~common ~~transformer~~stock ~~business~~under ~~units~~the inATM ~~August~~Program ~~2019~~ (~~the~~as ~~“Equity Transaction”~~defined below). ~~for~~On anOctober ~~aggregate principal amount of $7~~29,~~500~~ 2024, (the ~~“Seller~~Company ~~Notes”)~~closed ~~during~~on the ~~year~~sale ~~ended~~of ~~December~~PCEP ~~31,~~for ~~2022, and~~gross cash ~~flows~~proceeds ~~from~~of ~~operating activities~~$48,000. On October 20, 2020, ~~the~~we ~~Company~~ entered into an At the Market Sale Agreement with H.C. Wainwright & Co., LLC (“Wainwright”), pursuant to which ~~the~~we ~~Company~~ may offer and sell our shares of common stock from time to time through Wainwright, acting as sales agent or principal (the “ATM Program”). ~~Since~~During ~~October~~the ~~20,~~year ~~2020,~~ended ~~and through~~ December 31, ~~2023~~2024, the Company sold an aggregate of ~~916~~919,~~059~~557 shares of common stock for an aggregate ~~gross~~consideration ~~proceeds~~ of approximately $85,~~904~~147, ~~before~~ before any sales agent fees and expenses payable by the Company under the ATM Program. ~~During~~As ~~the~~of ~~year ended~~ December 31, ~~2023~~2024, ~~the Company sold an aggregate of 27~~$69,~~559~~853 ~~shares~~ of common stock ~~for~~remained anavailable ~~aggregate~~for ~~consideration~~issuance ~~of approximately $184, before any sales agent fees and expenses payable by the Company~~ under the ATM Program.

The Company has historically met its cash needs through a combination of cash flows from operating activities and bank borrowings, the completion of the ~~Equity Transaction, proceeds from the~~ sale of the ~~CleanSpark~~transformer ~~common~~business ~~stock~~units ~~and~~in ~~warrants~~August to2019, ~~purchase~~the ~~CleanSpark~~completion ~~common~~of ~~stock,~~the sale of ~~common~~the ~~stock~~PCEP ~~under~~business ~~the~~unit ~~ATM~~in ~~Program~~October 2024, and the ~~collecting~~sale ~~all~~of ~~unpaid~~common ~~principal~~stock ~~and~~under ~~interest from~~ the ~~Seller~~ATM ~~Notes~~program. Historically, the Company’s cash requirements were generally for operating activities, debt repayment, capital improvements and acquisitions. The Company expects to meet its cash needs with the working capital and cash flows from the Company’s operating activities. The Company expects its cash requirements to be generally for operating activities, product development and capital improvements. The Company expects that its current cash balance is sufficient to fund operations for the next twelve months from the date our consolidated financial statements are issued.

3533

On December 13, 2021, the Company filed a prospectus supplement to a prospectus which forms a part of its registration statement on Form S-3 (File No. 333-249569) (the “Prior Shelf Registration Statement”), that was declared effective by the SEC on October 27, 2020 (the “Prior ATM Prospectus”), in connection with the offer and sale of up to an aggregate offering amount of $8,600 of common stock that may be issued and sold under the ATM Program. Prior to the expiration of the Prior Shelf Registration Statement at the end of its three-year term, the Company sold an aggregate of 27,559 shares of common stock for an aggregate consideration of approximately $184, before any sales agent fees and expenses payable by us, under the Prior ATM Prospectus. On August 30, 2023, the Company filed a new registration statement on Form S-3 (File No. 333-274266) to replace the Prior Shelf Registration Statement, including a base prospectus which covers the offering, issuance and sale of up to $150,000 of common stock, preferred stock, warrants and/or units; and a sales agreement prospectus covering the offering, issuance and sale of up to a maximum aggregate offering price of $75,000 of common stock that may be issued and sold under the ATM Program (the “New ATM Prospectus”). The new registration statement was declared effective by the SEC on September 8, 2023. As of December 31, 2023, $75,000 of common stock remained available for issuance under the New ATM Prospectus.

Risks and Uncertainties

The continuing impacts of the rising interest rates, inflation, changes in foreign currency exchange rates and geopolitical developments, such as the ongoing conflict between Russia and Ukraine, and the ongoing conflict between Israel and Hamas, have resulted, and may continue to result, in a global slowdown of economic activity, which may decrease demand for a broad variety of goods and services, including those provided by the Company’s clients, while also disrupting supply channels, sales channels and advertising and marketing activities for an unknown period of time. Additionally, recent changes to U.S. policy implemented by the U.S. Congress, the Trump administration or any new administration have impacted and may in the future impact, among other things, the U.S. and global economy, international trade relations, unemployment, immigration, healthcare, taxation, the U.S. regulatory environment, inflation and other areas. As a result of the current uncertainty in economic activity, the Company is unable to predict the potential size and duration of the impact on its revenue and its results of operations, if any. The extent of the potential impact of these macroeconomic factors on the Company’s operational and financial performance will depend on a variety of factors, including the extent of geopolitical disruption and its impact on the Company’s clients, partners, industry, and employees, all of which are uncertain at this time and cannot be accurately predicted. The Company continues to monitor the effects of these macroeconomic factors and intends to take steps deemed appropriate to limit the impact on its business. ~~During the year ended December 31, 2023, the Company was able to operate substantially at capacity.~~

There can be no assurance that precautionary measures, whether adopted by the Company or imposed by others, will be effective, and such measures could negatively affect its sales, marketing, and client service efforts, delay and lengthen its sales cycles, decrease its employees’, clients’, or partners’ productivity, or create operational or other challenges, any of which could harm its business and results of operations.

Rounding

All dollar amounts (except share and per share data) presented are stated in thousands of dollars, unless otherwise noted. Amounts may not foot due to rounding.

362. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2. RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS

In connection with the preparation of our consolidated financial statements for the years ended December 31, 2023 and 2022, the Company identified errors related to revenue and cost recognition in its previously issued (i) consolidated financial statements as of and for the year ended December 31, 2022 included in its Annual Report on Form 10-K for the year ended December 31, 2022 (the “Annual Period”) and (ii) unaudited condensed consolidated financial statements for the quarters ended March 31, 2022 through September 30, 2023 included in its Quarterly Reports on Form 10-Q for the periods ended March 31, 2022, June 30, 2022, September 30, 2022, March 31, 2023, June 30, 2023 and September 30, 2023 (the “Interim Periods”, which, together with the Annual Period, the “Affected Periods”).

During 2022 and 2023, the Company recognized revenues associated with customer contracts with performance obligations satisfied over time (“Over Time Contracts”) using labor hours as the measure of progress. The Company’s underlying estimates of total labor hours required to complete Over Time Contracts were materially different from the actual labor hours required, which was determined to represent an error since the information underlying the estimate was known or knowable as of the balance sheet date and, as a result, the percentage of completion used to recognize revenue in the Affected Periods is materially different from the percentage of completion using actual labor hours incurred. As a result, the Company has restated revenues during the Affected Periods to adjust the percentage of completion based upon the actual labor hours incurred to complete each Over Time Contract (the “Revenues Adjustment”).

Additionally, the Company has determined that costs from Over Time Contracts should be recognized as incurred and, as a result, the Company has recorded an adjustment to its consolidated financial statements during the Affected Periods (together with the Revenues Adjustment, the “Restatement Adjustments”), as the Company was previously incorrectly deferring costs incurred to a future period.

The Company evaluated the materiality of these misstatements both qualitatively and quantitatively in accordance with Staff Accounting Bulletin (“SAB”) No. 99, Materiality, and SAB No. 108, Considering the Effects of Prior Year Misstatements in Current Year Financial Statements, and determined the effect of correcting these misstatements was material to the Affected Periods. As a result of the material misstatements, the Company has restated its consolidated financial statements for the Affected Periods in accordance with ASC 250, Accounting Changes and Error Corrections (the “Restated Consolidated Financial Statements”).

A reconciliation from the amounts previously reported for the Affected Periods to the restated amounts in the Restated Consolidated Financial Statements is provided for the impacted financial statement line items below for: (i) the consolidated balance sheet as of December 31, 2022; (ii) the consolidated statement of operations for the year ended December 31, 2022; (iii) the consolidated statement of changes in stockholders’ equity for the year ended December 31, 2022; and (iv) the consolidated statement of cash flows for the year ended December 31, 2022. The amounts labeled “Restatement Adjustments” represent the effects of the Restatement Adjustments.

SCHEDULE OF RESTATEMENT ADJUSTMENTS

The following table presents the effects of the Restatement Adjustments on the Company’s consolidated balance sheet as of December 31, 2022:

	Stated			Adjustments			Restated
	December 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
ASSETS
Current assets
Accounts receivable, net	$	11,139		$	(1,129	)	$	10,010
Inventories, net	$	8,748		$	(658	)	$	8,090
Total current assets	$	33,036		$	(1,787	)	$	31,249
Total assets	$	37,175		$	(1,787	)	$	35,388
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	10,665		$	(6	)	$	10,659
Total current liabilities	$	18,962		$	(6	)	$	18,956
Total liabilities	$	20,242		$	(6	)	$	20,236
Stockholders’ equity
Accumulated deficit	$	(15,950	)	$	(1,781	)	$	(17,731	)
Total stockholders’ equity	$	16,933		$	(1,781	)	$	15,152
Total liabilities and stockholders’ equity	$	37,175		$	(1,787	)	$	35,388

The following table presents the effects of the Restatement Adjustments on the Company’s consolidated statement of operations for the year ended December 31, 2022:

	Stated			Adjustments			Restated
	For the Year Ended
	December 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
Revenues	$	27,000		$	(1,122	)	$	25,878
Cost of goods sold	$	22,393		$	659		$	23,052
Gross profit	$	4,607		$	(1,781	)	$	2,826
Loss from operations	$	(4,029	)	$	(1,781	)	$	(5,810	)
Loss before taxes	$	(3,631	)	$	(1,781	)	$	(5,412	)
Net loss	$	(3,638	)	$	(1,781	)	$	(5,419	)
Loss per share - basic and diluted	$	(0.37	)	$	(0.19	)	$	(0.56	)

The following table presents the effects of the Restatement Adjustments on the Company’s consolidated statement of changes in stockholders’ equity for the year ended December 31, 2022:

	As Previously			Restatement			As
	Stated			Adjustments			Restated
		(unaudited)			(unaudited)			(unaudited)
Balance - January 1, 2022	$	19,552		$	-		$	19,552
Net loss	$	(3,638	)	$	(1,781	)	$	(5,419	)
Balance - December 31, 2022	$	16,933		$	(1,781	)	$	15,152

The following table presents the effects of the Restatement Adjustments on the Company’s consolidated statement of cash flows for the year ended December 31, 2022:

	Stated			Adjustments			Restated
	December 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
Cash flows from operating activities:
Net loss	$	(3,638	)	$	(1,781	)	$	(5,419	)
Changes in operating assets and liabilities:
Accounts receivable	$	(8,570	)	$	1,129		$	(7,441	)
Inventories	$	(4,589	)	$	658		$	(3,931	)
Deferred revenue	$	8,243		$	(6	)	$	8,237
Net cash used in operating activities	$	(5,772	)	$	-		$	(5,772	)

The remainder of the notes to the Company’s consolidated financial statements have been updated and restated, as applicable, to reflect the impact of the Restatement Adjustments described above.

See Note 4 - Restatement of Previously Issued Unaudited Interim Condensed Consolidated Financial Statements for details of the effect of the Restatement Adjustments on the Interim Periods.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The consolidated financial statements include estimates based on currently available information and management’s judgment as to the outcome of future conditions and circumstances. Significant estimates in these consolidated financial statements include, but are not limited to, measurement of revenue for contracts accounted for over time, ~~accounts~~allowance ~~receivable reserves~~for expected credit losses, inventory valuation, useful lives and impairment of long-lived assets, equity-method investment, consideration to buyer, stock-based compensation and the valuation allowance related to the Company’s deferred tax assets. Changes in the status of certain facts or circumstances could result in material changes to the estimates used in the preparation of the consolidated financial statements and actual results could differ from the estimates and assumptions.

Revenue Recognition

Revenue is recognized when (1) a contract with a customer exists, (2) performance obligations promised in a contract are identified based on the products or services that will be transferred to the customer, (3) the transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring products or services to the customer, (4) the transaction price is allocated to the performance obligations in the contract and (5) the Company satisfies its performance obligation. The Company satisfies its performance obligations and, therefore, recognizes revenue, either over time or at a point in time, which is when the customer has obtained control of the good or service. Revenue from the sale of the Company’s electric power systems under its Electrical Infrastructure segment is recognized either over time or at a point in time and substantially all of the Company’s revenue from the sale of power generation equipment under its Critical Power segment is recognized at a point in time. Certain sales of highly customized electrical equipment under the Company’s Electrical Infrastructure segment are recognized over time when such equipment has no alternative use and the Company has an enforceable right to payment for performance completed to date. The Company’s measure of progress for such contracts is evaluated under the input method based on direct labor hours incurred relative to the estimated total direct labor hours required in order to complete the project. Any anticipated losses on contracts are fully recognized in the period in which the losses become evident. Service revenues include maintenance contracts that are recognized over time based on the contract term and repair services that are recognized as services are delivered.

~~Contract~~The Company’s ~~Estimates~~principal source of revenue is derived from sales of products and fees for services. The Company measures revenue based upon the consideration specified in the customer arrangement, and revenue is recognized when the performance obligations in the customer arrangement are satisfied. Changes in deferred revenue are generally as a result of the Company’s normal operating cycle and the effect of cumulative catch-up adjustments arising from a change in the measure of progress or a contract modification identified at each reporting period.

~~Revenue~~A performance ~~from~~obligation ~~over time contracts~~ is ~~recognized~~a ~~proportionally over~~promise ~~the~~in ~~term~~a ofcontract ~~the~~to ~~contract~~transfer ~~using~~a andistinct ~~input~~product ~~method~~or ~~based~~service onto the ~~proportion~~customer. ofThe ~~labor~~transaction ~~hours~~price ~~incurred~~of a ascontract ~~compared~~is allocated to ~~the~~each ~~total~~distinct ~~estimated labor~~performance ~~hours~~obligation ~~for~~and ~~the~~recognized ~~fixed-fee~~as ~~contract~~revenue ~~performance~~when ~~obligations,~~or ~~which~~as the ~~Company~~customer ~~considers~~receives the ~~best~~benefit of ~~available~~the ~~indicator~~performance ofobligation. Customers typically receive the ~~pattern and~~benefit ~~timing~~of inthe ~~which~~Company’s ~~contract~~products ~~performance~~when ~~obligations~~the ~~are~~risk ~~fulfilled~~of ~~and~~loss or control for the product transfers to the customer and for services as they are performed. ~~This~~Under ~~percentage~~ASC 606, revenue is ~~multiplied by~~recognized ~~the~~when ~~contracted~~a ~~dollar~~customer obtains ~~amount~~control of ~~the~~promised ~~project~~products toor ~~determine~~services ~~the~~in an amount ofthat ~~revenue~~reflects the consideration the Company expects to ~~recognize~~receive in anexchange for ~~accounting~~those ~~period~~products or services. To achieve this core principle, the Company applies the following five steps:

~~There~~1) ~~are situations where the number of hours to~~Identify ~~complete projects may exceed~~ the ~~original~~contract ~~estimate~~with as a ~~result of an increase in project scope or unforeseen events. The related impact on income is recognized using the cumulative catch-up method, which the Company recognizes in the current period.~~customer

A contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the products or services to be transferred and identifies the payment terms related to these products or services, (ii) the contract has commercial substance and, (iii) the Company determines that collection of substantially all consideration for products or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience or, in the case of a new customer, published credit and financial information pertaining to the customer.

2) Identify the performance obligations in the contract

Performance obligations promised in a contract are identified based on the products or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the product or service either on its own or together with other resources that are readily available from third parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the products or services is separately identifiable from other promises in the contract. To the extent a contract includes multiple promised products or services, the Company must apply judgment to determine whether promised products or services are capable of being distinct and distinct in the context of the contract. If these criteria are not met the promised products or services are accounted for as a combined performance obligation.

3) Determine the transaction price

The transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring products or services to the customer. The customer payments are generally due in 30 days.

4) Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis. The Company determines standalone selling price based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations.

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring a promised product or service to a customer.

The Company satisfies its performance obligations and, therefore, recognizes revenue, either over time or at a point in time, which is when the customer has obtained control of the good or service.

Shipping and handling costs incurred after control of a product has transferred to the customer are treated as fulfillment costs and, therefore, are not accounted for as separate performance obligations.

Certain sales of highly customized electrical equipment under the Company’s Electrical Infrastructure segment (included in discontinued operations; see Note 11 – Discontinued Operations for details) were recognized over time when such equipment had no alternative use and the Company had an enforceable right to payment for performance completed to date. The Company’s measure of progress for such contracts was evaluated under the input method based on direct labor hours incurred relative to the estimated total direct labor hours required in order to complete the project. Any anticipated losses on contracts were fully recognized in the period in which the losses become evident. Service revenues include maintenance contracts that are recognized over time based on the contract term and repair services that are recognized as services are delivered.

Contract Estimates (discontinued operations)

Revenue from over time contracts for the Company’s Electrical Infrastructure segment (included in discontinued operations; see Note 11 – Discontinued Operations for details) was recognized proportionally over the term of the contract using an input method based on the proportion of labor hours incurred as compared to the total estimated labor hours for the fixed-fee contract performance obligations, which the Company considered the best available indicator of the pattern and timing in which contract performance obligations were fulfilled and control transferred to the customer. This percentage was multiplied by the contracted dollar amount of the project to determine the amount of revenue to recognize in an accounting period.

There were situations where the number of hours to complete projects may have exceeded the original estimate as a result of an increase in project scope or unforeseen events. The related impact on income was recognized using the cumulative catch-up method in an accounting period.

Recognition of revenue on a contract requires estimates of the total labor hours at completion and the measurement of progress towards completion. Due to the long-term nature of many of the Company’s contracts, developing the estimated total labor hours at completion often requires judgment. Factors that must be considered in estimating the total labor hours to be completed include the nature and complexity of the work to be performed and the risk and impact of delayed performance.

At the outset of each contract, the Company gauges its complexity and perceived risks and establish an estimated total number of labor hours at completion in line with these expectations. The Company follows a standard contract review process in which the Company reviews the progress and performance on its ongoing contracts at least quarterly.

Cost of Goods Sold

Cost of goods sold primarily includes charges for materials, direct labor and related benefits, freight (inbound and outbound), direct ~~supplies~~ supplies and tools, depreciation and amortization, purchasing and receiving costs, inspection costs, internal transfer costs, warehousing costs and utilities related to production facilities and, where appropriate, an allocation of overhead. Cost of goods sold also includes indirect labor and infrastructure cost related to the provision of field services.

Fair Value of Financial Instruments

Fair value is defined as the amount that would be received for selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and is measured using inputs in one of the following three categories:

Level 1 measurements are based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Valuation of these items does not entail a significant amount of judgment.

Level 2 measurements are based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active or market data other than quoted prices that are observable for the assets or liabilities.

Level 3 measurements are based on unobservable data that are supported by little or no market activity and are significant to the fair value of the assets or liabilities.

The Company’s financial instruments consist primarily of cash, accounts receivable, accounts payable and accrued liabilities. The carrying values of these financial instruments approximate their respective fair values due to the relatively short period of time between their origination and their expected realization or payment.

Concentrations

The Company manages its accounts receivable credit risk by performing credit evaluations and monitoring amounts due from the Company’s customers. The Company had certain customers whose revenue individually represented 10% or more of the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable, as follows:

AtAs of December 31, ~~2023~~2024, one customer represented approximately 23 72% of the Company’s accounts receivable. AtAs of December 31, ~~2022~~2023, two ~~three~~ customers represented approximately 5222%~~, 15%~~ and 12% of the Company’s accounts receivable.

For the year ended December 31, ~~2023~~2024, two customers represented approximately 4222% and 2013% of the Company’s revenue. For the year ended December 31, ~~2022~~2023, ~~two~~one ~~customers~~customer represented approximately 4314% ~~and~~ ~~10%~~ of the Company’s revenue.

As of December 31, ~~2023~~2024, one of the Company’s suppliers represented 18approximately 25% of the Company’s accounts payable. As of December 31, ~~2022~~2023, ~~three~~one of the Company’s suppliers represented 38 approximately 14% of the Company’s accounts payable.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents in the consolidated financial statements. AtAs of December 31, ~~2023~~2024, and ~~2022~~2023, the Company did not have any cash equivalents. The Company has cash on deposits in several financial institutions which may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. As of December 31, ~~2023~~2024, and ~~2022~~2023, the Company had balances of $341,~~332~~372 and $103,~~046~~332 in excess of the FDIC insured limits, respectively. The Company reduces exposure to credit risk by maintaining cash deposits with major financial institutions. The Company has not experienced losses in such accounts and periodically evaluates the creditworthiness of its financial institutions. While the Company does not anticipate any losses, liquidity issues, or capital resource constraints arising from the bank failures during 2023, it cannot predict at this time to what extent it or its collaborators, employees, suppliers, and/or vendors could be negatively impacted by such bank failures and other macroeconomic and geopolitical events. The Company reduces its credit risk by placing its cash and cash equivalents with major financial institutions.

Accounts Receivable

On January 1, 2023, the Company adopted ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments,” using a modified retrospective approach. The standard amends several aspects of the measurement of credit losses related to certain financial instruments, including the replacement of the existing incurred credit loss model and other models with the current expected credit losses model. The cumulative effect of adoption did not result in an adjustment to the allowance for credit loss, and accordingly, the Company’s accumulated deficit as of January 1, 2023.

The Company accounts for trade receivables at original invoice amount less an estimate made for expected credit losses. The Company’s allowance for expected credit losses on accounts receivable reflects management’s estimate of credit losses over the remaining expected life of such assets, measured primarily using historical experience, as well as current conditions and forecasts that affect the collectability of the reported amount. There was $9713 ~~and $788~~ of reserves for expected credit losses as of December 31, ~~2023~~2024, and ~~2022~~the Company did not have any reserves for expected credit losses as of December 31, ~~respectively~~2023.

Long-Lived Assets

Depreciation and amortization for property and equipment is computed and included in cost of goods sold and in selling and administrative expense, as appropriate. Long-lived assets, consisting primarily of property and equipment, are stated at cost less accumulated depreciation. Property and equipment are depreciated using the straight-line method, based on the estimated useful lives of the assets (buildings - 25 years, machinery and equipment - 5 to 15 years, computer hardware and software - 3 to 5 years, furniture & fixtures - 5 to 7 years, leasehold improvements – term of lease). Depreciation commences in the year the assets are ready for their intended use.

The Company reviews all long-lived assets such as property and equipment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. Recoverability of the assets that are held and used is measured by a comparison of the carrying amount of an asset to the estimated future cash flows expected to be generated by the asset or asset group. Impairment is measured by the amount by which the carrying value of the asset(s) exceed the fair value. There were no triggering events that would indicate impairment of long-lived assets atas of December 31, ~~2023~~ 2024 and ~~2022~~2023.

39Held for Sale and Discontinued Operations

The Company classifies assets and liabilities to be sold (disposal group) as held for sale in the period when all of the applicable criteria are met, including: (i) management commits to a plan to sell, (ii) the disposal group is available to sell in its present condition, (iii) there is an active program to locate a buyer, (iv) the disposal group is being actively marketed at a reasonable price in relation to its fair value, (v) significant changes to the plan to sell are unlikely, and (vi) the sale of the disposal group is generally probable of being completed within one year. Management performs an assessment at least quarterly or when events or changes in business circumstances indicate that a change in classification may be necessary.

Assets and liabilities held for sale are presented separately within the consolidated balance sheets with any adjustments necessary to measure the disposal group at the lower of its carrying value or fair value less costs to sell. Depreciation of property and equipment and amortization of right-of-use assets are not recorded while these assets are classified as held for sale. For each period the disposal group remains classified as held for sale, its recoverability is reassessed and any necessary adjustments are made to its carrying value.

The Company reports the results of operations of a business as discontinued operations if a disposal represents a strategic shift that will have a major effect on its operations and financial results. The results of discontinued operations are reported as income or loss from discontinued operations, net of tax in the consolidated statements of comprehensive income for the current and prior periods commencing in the period in which the held for sale criteria are met. Income or loss from discontinued operations, net of tax includes direct costs attributable to the divested business and excludes any cost allocations associated with any shared or corporate functions unless otherwise dedicated to the divested business. Income or loss from discontinued operations, net of tax will include any gain or loss recognized upon disposition or from adjustment of the carrying amount to fair value less costs to sell while classified as held for sale.

Transactions between the businesses held for sale and businesses held for use that are expected to continue after the disposal are not eliminated in order to appropriately reflect the continuing operations as well as the activity to be disposed of.

Equity-Method Investments

The Company accounts for investments in LLCs in which the Company has more than virtually no influence, but does not control, under the equity method of accounting. Under the equity method of accounting, the Company’s initial investment is recorded at fair value in accordance with ASC 810-10-40-5 as its equity method investment arose from a deconsolidation event. See Note 11- Discontinued Operations and Note 12 – Equity Method Investment.

The carrying amount is adjusted for the Company’s share of the earnings or losses, and dividends received from the investee. When the Company’s share of losses in an investee equals or exceeds the carrying value of the investment plus any advances, no further losses are recognized unless the Company has guaranteed obligations of the investee or is otherwise committed to provide further financial support for the investee.

The Company periodically assesses if impairment indicators exist at equity method investments. When an impairment indicator is observed, any excess of the carrying amount over its estimated fair value is recognized as impairment expense when the loss in value is deemed other-than-temporary and included in income or loss from equity method investments in the consolidated statements of operations.

In relation to the Company’s investment in the Investment, the Company elected to recognize its proportional share of the income or loss from the equity method investment on a financial reporting lag of one fiscal quarter due to the timing and availability of financial information. There were no earnings recognized from the Investment during the year ended December 31, 2024.

Leases

Lessee Accounting

The Company leases offices, facilities and equipment under operating and financing leases. The Company determines whether an arrangement is, or contains, a lease at contract inception. An arrangement contains a lease if the Company has the right to direct the use of and obtain substantially all of the economic benefits of an identified asset. Right-of-use assets and lease liabilities are recognized at lease commencement based on the present value of lease payments over the lease term. Leases with an initial term of 12 months or less are not recognized on the balance sheet and are recorded as short-term lease expense. The discount rate used to calculate present value is the Company’s incremental borrowing rate based on the lease term and the economic environment of the applicable country or region.

Certain leases contain renewal options or options to terminate prior to lease expiration, which are included in the measurement of right-of-use assets and lease liabilities when it is reasonably certain they will be exercised. The Company has elected to account for lease and non-lease components as a single lease component for its offices and manufacturing facilities. Some lease arrangements include payments that are adjusted periodically based on actual charges incurred for common area maintenance, utilities, taxes and insurance, or changes in an index or rate referenced in the lease. The fixed portion of these payments is included in the measurement of right-of-use assets and lease liabilities at lease commencement, while the variable portion is recorded as variable lease expense. The Company’s leases typically do not contain material residual value guarantees or restrictive covenants.

Lessor Accounting

The Company leases electric generators and mobile electric vehicle charging equipment to certain of its customers. The Company accounts for such rentals as operating leases. The lease terms are included in the Company’s contracts and the determination of whether the Company’s contracts contain leases generally does not require significant assumptions or judgments. Leasing revenues do not include material amounts of variable payments. The Company does not generally provide an option for the lessee to purchase the rented equipment at the end of the lease. Leasing revenues are recognized on a straight-line basis over the duration of the contractual agreement. Lessees do not provide residual value guarantees on rented equipment.

Deferred Financing Costs

Certain legal, accounting and other third-party fees that are directly associated with equity financings are capitalized as deferred financing costs and included as a non-current asset on the balance sheet until such financings are consummated. After consummation of the equity financing, these costs will be recorded in the stockholders’ equity section of the consolidated balance sheets as a reduction of additional paid-in capital generated as a result of the offering, to the extent there are sufficient proceeds. Should the equity financing no longer be considered probable of being consummated, all deferred financing costs would be charged to operating expenses in the consolidated statements of operations.

Income Taxes

The Company accounts for income taxes under the asset and liability method, based on the income tax laws and rates in the countries in which operations are conducted and income is earned. For the year ended December 31, ~~2023~~2024 and ~~2022~~2023, the Company operated ~~solely~~primarily in the United States. This approach requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. Developing the provision for income taxes requires significant judgment and expertise in federal, international and state income tax laws, regulations and strategies, including the determination of deferred tax assets and liabilities and, if necessary, any valuation allowances that may be required for deferred tax assets. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. The Company believes that the deferred asset, net recorded as of December 31, ~~2023~~2024, and ~~2022~~2023 is realizable through future reversals of existing taxable temporary differences and future taxable income. If the Company was to subsequently determine that it would be able to realize deferred tax assets in the future in excess of its net recorded amount, an adjustment to deferred tax assets would increase net income for the period in which such determination was made. The Company will continue to assess the adequacy of the valuation allowance on a quarterly basis. The Company’s tax filings are subject to audit by various taxing authorities.

The objective of accounting for income taxes is to recognize the amount of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequences or events that have been recognized in the Company’s consolidated financial statements or tax returns. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position (see “Unrecognized Tax Benefits” below).

Income tax related interest and penalties are grouped with interest expense on the consolidated statement of operations.

Unrecognized Tax Benefits

The Company accounts for unrecognized tax benefits in accordance with FASB ASC “Income Taxes” (“ASC 740”). ASC 740 prescribes a recognition threshold that a tax position is required to meet before being recognized in the consolidated financial statements and provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition issues. ASC 740 contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained upon ultimate settlement with a taxing authority, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement.

Additionally, ASC 740 requires the Company to accrue interest and related penalties, if applicable, on all tax positions for which reserves have been established consistent with jurisdictional tax laws. The Company’s policy is to recognize interest and penalties related to income tax matters as interest expense.

40Advertising and Promotional Costs

We expense advertising and promotional costs as incurred. Total advertising and promotional expenses were $311 and $414 for the years ended December 31, 2024 and 2023, respectively.

Share-Based Payments

The Company measures the cost of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award is measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period, using the straight-line attribution approach. Upon the exercise of an award, the Company issues new shares of common stock out of its authorized shares.

The Company computes the fair value of stock options granted using the Black-Scholes option pricing model. Award forfeitures are accounted for at the time of occurrence. The expected term used for options is the estimated period of time that options granted are expected to be outstanding. The Company utilizes the “simplified” method under ASC 718 to develop an estimate of the expected term of “plain vanilla” option grants. The Company does not currently have a sufficient trading history to fully support its historical volatility calculations. Accordingly, the Company is utilizing an expected volatility figure based on a review of the historical volatility on a blended basis of its own stock as well as of comparable entities over a period of time equivalent to the expected life of the instrument being valued. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.

Inventory

Inventory is stated at the lower of cost or net realizable value using a weighted average cost method and includes the cost of materials, labor and manufacturing overhead. The Company uses estimates in determining the level of reserves required to state inventory at the lower of cost or net realizable value. The Company estimates are based on market activity levels, production requirements, the physical condition of products and technological innovation. Changes in any of these factors may result in adjustments to the carrying value of inventory.

Income (Loss) Per Share

Basic income (loss) per share is computed by dividing the income or loss for the period by the weighted average number of vested common shares outstanding during the period. Diluted income (loss) per share is computed by dividing the income or loss for the period by the weighted average number of vested common shares outstanding, plus the number of additional common shares that would have been outstanding if the common share equivalents had been issued (computed using the treasury stock or if converted method), if dilutive.

Research and Development

Research and development include expenses incurred by the Company’s Critical Power segment related to developing the Company’s mobile e-Boost EVelectric vehicle charging solutions. Research and development expenses are charged to operations as incurred. During the years ended December 31, 2024 and 2023, the Company incurred $1,050 and $885, respectively, of research and development expenses.

Recently Issued Accounting Pronouncements

~~There~~In November ~~have~~2023, ~~been~~the noFASB ~~recent~~issued an accounting ~~pronouncements~~standards update ASU 2023-07 “Segment Reporting: Improvements to Reportable Segment ~~not~~Disclosures” related ~~yet~~to ~~adopted~~improvements byto ~~the~~reportable ~~Company~~segment ~~which~~disclosures. ~~would~~The ~~have~~amendments ain ~~material~~this ~~impact~~update require additional disclosure of significant expenses related to our reportable segments, additional segment disclosures on an interim basis, and qualitative disclosures regarding the ~~Company’s~~decision ~~consolidated~~making ~~financial~~process ~~statements~~for segment resources. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. These updates resulted in expanded disclosures. See Note 13 – Business Segment, Geographic and Customer Information for additional information.

~~Accounting~~In December ~~Standards Update (“ASU”)~~ 2023~~-03~~, ~~“Presentation~~ ofthe ~~Financial~~FASB ~~Statements (Topic 205), Income Statement~~ issued ASU 2023-09 ~~Reporting Comprehensive~~ “Income ~~(Topic~~Taxes ~~220), Distinguishing Liabilities from Equity~~ (Topic ~~480~~740)~~, Equity (Topic 505), and Compensation - Stock Compensation (Topic 718)~~: ~~Amendments~~Improvements to ~~SEC~~Income ~~Paragraphs Pursuant~~Tax Disclosures” related to ~~SEC~~improvements ~~Staff~~to ~~Accounting~~income ~~Bulletin~~tax Nodisclosures. ~~120,~~The ~~SEC~~amendments ~~Staff~~in ~~Announcement~~this atupdate ~~the~~require ~~March~~enhanced ~~24,~~jurisdictional ~~2022 Emerging Issues Task Force (“EITF”) Meeting,~~ and ~~Staff~~other ~~Accounting~~disaggregated ~~Bulletin Topic 6.B, Accounting Series Release 280 - General Revision of Regulation S-X: Income or Loss Applicable~~disclosures ~~to Common Stock.” ASU 2023-03 amends the ASC~~ for ~~SEC updates pursuant to SEC Staff Accounting Bulletin No. 120; SEC Staff Announcement at~~ the ~~March~~effective ~~24,~~tax ~~2022~~rate ~~EITF~~reconciliation ~~Meeting;~~ and ~~Staff~~income ~~Accounting~~taxes ~~Bulletin~~paid. ~~Topic~~The ~~6.B,~~amendments ~~Accounting~~in ~~Series~~this ~~Release~~update ~~280~~are -effective ~~General~~for ~~Revision~~fiscal ofyears ~~Regulation~~beginning ~~S-X:~~after ~~Income~~December or15, ~~Loss Applicable to Common Stock~~2024. These updates ~~were~~will ~~immediately effective and did~~ not have a significant impact on the Company’s consolidated financial statements.

41In November 2024, the FASB issued ASU 2024-03 “Disaggregation of Income Statement Expenses”, which requires public business entities to disclose additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently assessing the impact that adoption of this new accounting guidance will have on its consolidated financial statements and footnote disclosures.

43. ~~RESTATEMENT OF PREVIOUSLY ISSUED UNAUDITED INTERIM~~ ~~CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~REVENUES

The following tables present the effects of the Restatement Adjustments described in Note 2 - Restatement of Previously Issued Consolidated Financial Statements on the Company’s unaudited interim condensed consolidated financial statements for the periods indicated.

SCHEDULE OF INTERIM RESTATEMENT ADJUSTMENTS

The following tables present the effects of the Restatement Adjustments on the Company’s unaudited interim condensed consolidated balance sheets as of the dates indicated:

	Stated			Adjustments			Restated
	March 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Inventories, net	$	6,687		$	(1,788	)	$	4,899
Total current assets	$	31,884		$	(1,788	)	$	30,096
Total assets	$	34,705		$	(1,788	)	$	32,917
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	6,992		$	23		$	7,015
Total current liabilities	$	14,393		$	23		$	14,416
Total liabilities	$	15,819		$	23		$	15,842
Stockholders’ equity
Accumulated deficit	$	(13,052	)	$	(1,811	)	$	(14,863	)
Total stockholders’ equity	$	18,886		$	(1,811	)	$	17,075
Total liabilities and stockholders’ equity	$	34,705		$	(1,788	)	$	32,917

	Stated			Adjustments			Restated
	June 30, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Inventories, net	$	8,147		$	(3,044	)	$	5,103
Total current assets	$	30,210		$	(3,044	)	$	27,166
Total assets	$	33,246		$	(3,044	)	$	30,202
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	8,389		$	59		$	8,448
Total current liabilities	$	14,796		$	59		$	14,855
Total liabilities	$	16,236		$	59		$	16,295
Stockholders’ equity
Accumulated deficit	$	(15,587	)	$	(3,103	)	$	(18,690	)
Total stockholders’ equity	$	17,010		$	(3,103	)	$	13,907
Total liabilities and stockholders’ equity	$	33,246		$	(3,044	)	$	30,202

	Stated			Adjustments			Restated
	September 30, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Inventories, net	$	8,479		$	(1,849	)	$	6,630
Total current assets	$	26,451		$	(1,849	)	$	24,602
Total assets	$	29,445		$	(1,849	)	$	27,596
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	6,621		$	(59	)	$	6,562
Total current liabilities	$	12,299		$	(59	)	$	12,240
Total liabilities	$	13,603		$	(59	)	$	13,544
Stockholders’ equity
Accumulated deficit	$	(16,898	)	$	(1,791	)	$	(18,689	)
Total stockholders’ equity	$	15,842		$	(1,791	)	$	14,051
Total liabilities and stockholders’ equity	$	29,445		$	(1,849	)	$	27,596

	Stated			Adjustments			Restated
	March 31, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Accounts receivable, net	$	7,863		$	(162	)	$	7,701
Inventories, net	$	9,589		$	(1,087	)	$	8,502
Total current assets	$	31,908		$	(1,249	)	$	30,659
Total assets	$	35,857		$	(1,249	)	$	34,608
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	10,095		$	(88	)	$	10,007
Total current liabilities	$	17,614		$	(88	)	$	17,526
Total liabilities	$	18,673		$	(88	)	$	18,585
Stockholders’ equity
Accumulated deficit	$	(15,828	)	$	(1,161	)	$	(16,989	)
Total stockholders’ equity	$	17,184		$	(1,161	)	$	16,023
Total liabilities and stockholders’ equity	$	35,857		$	(1,249	)	$	34,608

	Stated			Adjustments			Restated
	June 30, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Accounts receivable, net	$	5,835		$	380		$	6,215
Inventories, net	$	8,457		$	(72	)	$	8,385
Total current assets	$	26,541		$	308		$	26,849
Total assets	$	30,695		$	308		$	31,003
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	4,462		$	302		$	4,764
Total current liabilities	$	12,178		$	302		$	12,480
Total liabilities	$	13,011		$	302		$	13,313
Stockholders’ equity
Accumulated deficit	$	(16,147	)	$	6		$	(16,141	)
Total stockholders’ equity	$	17,684		$	6		$	17,690
Total liabilities and stockholders’ equity	$	30,695		$	308		$	31,003

	Stated			Adjustments			Restated
	September 30, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
ASSETS
Current assets
Accounts receivable, net	$	8,936		$	(966	)	$	7,970
Inventories, net	$	8,280		$	905		$	9,185
Total current assets	$	30,315		$	(61	)	$	30,254
Total assets	$	35,761		$	(61	)	$	35,700
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Deferred revenue	$	5,980		$	(54	)	$	5,926
Total current liabilities	$	16,613		$	(54	)	$	16,559
Total liabilities	$	17,262		$	(54	)	$	17,208
Stockholders’ equity
Accumulated deficit	$	(15,123	)	$	(7	)	$	(15,130	)
Total stockholders’ equity	$	18,499		$	(7	)	$	18,492
Total liabilities and stockholders’ equity	$	35,761		$	(61	)	$	35,700

The following tables present the effects of the Restatement Adjustments on the Company’s unaudited interim condensed consolidated statements of operations for the periods indicated:

	Stated			Adjustments			Restated
	For the Three Months Ended
	March 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Revenues	$	6,362		$	(23	)	$	6,339
Cost of goods sold	$	5,439		$	1,788		$	7,227
Gross profit (loss)	$	923		$	(1,811	)	$	(888	)
Loss from operations	$	(823	)	$	(1,811	)	$	(2,634	)
Loss before taxes	$	(733	)	$	(1,811	)	$	(2,544	)
Net loss	$	(740	)	$	(1,811	)	$	(2,551	)
Loss per share - basic and diluted	$	(0.08	)	$	(0.19	)	$	(0.26	)

	Stated			Adjustments			Restated			Stated			Adjustments			Restated
	For the Three Months Ended									For the Six Months Ended
	June 30, 2022									June 30, 2022
	As Previously			Restatement			As			As Previously			Restatement			As
	Stated			Adjustments			Restated			Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Revenues	$	4,863		$	(37	)	$	4,826		$	11,225		$	(59	)	$	11,166
Cost of goods sold	$	4,800		$	1,256		$	6,056		$	10,239		$	3,044		$	13,283
Gross profit (loss)	$	63		$	(1,292	)	$	(1,229	)	$	986		$	(3,103	)	$	(2,117	)
Loss from operations	$	(2,522	)	$	(1,292	)	$	(3,814	)	$	(3,345	)	$	(3,103	)	$	(6,448	)
Loss before taxes	$	(2,535	)	$	(1,292	)	$	(3,827	)	$	(3,268	)	$	(3,103	)	$	(6,371	)
Net (loss) income	$	(2,535	)	$	(1,292	)	$	(3,827	)	$	(3,275	)	$	(3,103	)	$	(6,378	)
Earnings (loss) per share - basic and diluted	$	(0.26	)	$	(0.13	)	$	(0.39	)	$	(0.34	)	$	(0.32	)	$	(0.65	)

	Stated			Adjustments			Restated			Stated			Adjustments			Restated
	For the Three Months Ended									For the Nine Months Ended
	September 30, 2022									September 30, 2022
	As Previously			Restatement			As			As Previously			Restatement			As
	Stated			Adjustments			Restated			Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)
Revenues	$	6,251		$	118		$	6,369		$	17,476		$	59		$	17,535
Cost of goods sold	$	5,390		$	(1,195	)	$	4,195		$	15,629		$	1,849		$	17,478
Gross profit	$	861		$	1,313		$	2,174		$	1,847		$	(1,791	)	$	56
Total operating expenses	$	2,305		$	-		$	2,305		$	6,636		$	-		$	6,636
(Loss) income from operations	$	(1,444	)	$	1,313		$	(131	)	$	(4,789	)	$	(1,791	)	$	(6,580	)
(Loss) income before taxes	$	(1,311	)	$	1,313		$	2		$	(4,579	)	$	(1,791	)	$	(6,370	)
Net (loss) income	$	(1,311	)	$	1,313		$	2		$	(4,586	)	$	(1,791	)	$	(6,377	)
Earnings (loss) per share - basic:	$	(0.13	)	$	0.13		$	0.00		$	(0.47	)	$	(0.18	)	$	(0.66	)
Weighted average common shares outstanding - diluted		9,770			671			10,441			9,713			671			10,384
Earnings (loss) per share - diluted	$	(0.13	)	$	0.13		$	0.00		$	(0.47	)	$	(0.14	)	$	(0.61	)

	Stated		Adjustments		Restated
	For the Three Months Ended
	March 31, 2023
	As Previously		Restatement		As
	Stated		Adjustments		Restated
	(unaudited)		(unaudited)		(unaudited)
Revenues	$	8,507	$	1,048	$	9,555
Cost of goods sold	$	6,294	$	429	$	6,723
Gross profit	$	2,213	$	620	$	2,833
Income from operations	$	55	$	620	$	675
Income before taxes	$	122	$	620	$	742
Net income	$	122	$	620	$	742
Earnings per share - basic and diluted	$	0.01	$	0.06	$	0.07

	Stated			Adjustments			Restated		Stated			Adjustments			Restated
	For the Three Months Ended								For the Six Months Ended
	June 30, 2023								June 30, 2023
	As Previously			Restatement			As		As Previously			Restatement			As
	Stated			Adjustments			Restated		Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)		(unaudited)			(unaudited)			(unaudited)
Revenues	$	12,130		$	152		$	12,282	$	20,638		$	1,200		$	21,838
Cost of goods sold	$	9,419		$	(1,015	)	$	8,404	$	15,714		$	(587	)	$	15,127
Gross profit	$	2,711		$	1,167		$	3,878	$	4,924		$	1,787		$	6,711
(Loss) income from operations	$	(378	)	$	1,167		$	789	$	(322	)	$	1,787		$	1,465
(Loss) income before taxes	$	(319	)	$	1,167		$	848	$	(197	)	$	1,787		$	1,590
Net (loss) income	$	(319	)	$	1,167		$	848	$	(197	)	$	1,787		$	1,590
Earnings (loss) per share - basic:	$	(0.03	)	$	0.12		$	0.09	$	(0.02	)	$	0.18		$	0.16
Weighted average common shares outstanding - diluted		9,908			838			10,747		9,839			838			10,677
Earnings (loss) per share - diluted	$	(0.03	)	$	0.11		$	0.08	$	(0.02	)	$	0.17		$	0.15

	Stated		Adjustments			Restated		Stated		Adjustments			Restated
	For the Three Months Ended							For the Nine Months Ended
	September 30, 2023							September 30, 2023
	As Previously		Restatement			As		As Previously		Restatement			As
	Stated		Adjustments			Restated		Stated		Adjustments			Restated
	(unaudited)		(unaudited)			(unaudited)		(unaudited)		(unaudited)			(unaudited)
Revenues	$	12,443	$	(990	)	$	11,453	$	33,080	$	211		$	33,291
Cost of goods sold	$	8,732	$	(976	)	$	7,756	$	24,445	$	(1,563	)	$	22,882
Gross profit (loss)	$	3,711	$	(13	)	$	3,698	$	8,635	$	1,774		$	10,409
Income (loss) from operations	$	953	$	(13	)	$	940	$	631	$	1,774		$	2,405
Income (loss) before taxes	$	1,024	$	(13	)	$	1,011	$	827	$	1,774		$	2,601
Net income (loss)	$	1,024	$	(13	)	$	1,011	$	827	$	1,774		$	2,601
Earnings (loss) per share - basic and diluted	$	0.10	$	-		$	0.10	$	0.08	$	0.18		$	0.26

The following tables present the effects of the Restatement Adjustments on the Company’s unaudited interim condensed consolidated statements of changes in stockholders’ equity for the periods indicated:

	As Previously			Restatement			As
	Stated			Adjustments			Restated
		(unaudited)			(unaudited)			(unaudited)
Balance - January 1, 2022	$	19,552		$	-		$	19,552
Net loss	$	(740	)	$	(1,811	)	$	(2,551	)
Balance - March 31, 2022	$	18,886		$	(1,811	)	$	17,075
Balance - January 1, 2022	$	19,552		$	-		$	19,552
Net loss	$	(3,275	)	$	(3,103	)	$	(6,378	)
Balance - June 30, 2022	$	17,010		$	(3,103	)	$	13,907
Balance - January 1, 2022	$	19,552		$	-		$	19,552
Net loss	$	(4,586	)	$	(1,791	)	$	(6,377	)
Balance - September 30, 2022	$	15,842		$	(1,791	)	$	14,051

	As Previously			Restatement			As
	Stated			Adjustments			Restated
		(unaudited)			(unaudited)			(unaudited)
Balance - January 1, 2023	$	16,933		$	(1,781	)	$	15,152
Net income	$	122		$	620		$	742
Balance - March 31, 2023	$	17,184		$	(1,161	)	$	16,023
Balance - January 1, 2023	$	16,933		$	(1,781	)	$	15,152
Net (loss) income	$	(197	)	$	1,787		$	1,590
Balance - June 30, 2023	$	17,684		$	6		$	17,690
Balance - January 1, 2023	$	16,933		$	(1,781	)	$	15,152
Net income	$	827		$	1,774		$	2,601
Balance - September 30, 2023	$	18,499		$	(7	)	$	18,492

The following tables present the effects of the Restatement Adjustments on the Company’s unaudited interim condensed consolidated statements of cash flows for the periods indicated:

	Stated			Adjustments			Restated
	March 31, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net loss	$	(740	)	$	(1,811	)	$	(2,551	)
Changes in operating assets and liabilities:
Inventories	$	(2,527	)	$	1,788		$	(739	)
Deferred revenue	$	4,569		$	23		$	4,592
Net cash provided by operating activities	$	2,087		$	-		$	2,087

	Stated			Adjustments			Restated
	June 30, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net loss	$	(3,275	)	$	(3,103	)	$	(6,378	)
Changes in operating assets and liabilities:
Inventories	$	(3,987	)	$	3,044		$	(943	)
Deferred revenue	$	5,966		$	59		$	6,025
Net cash used in operating activities	$	(1,621	)	$	-		$	(1,621	)

	Stated			Adjustments			Restated
	September 30, 2022
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net loss	$	(4,586	)	$	(1,791	)	$	(6,377	)
Changes in operating assets and liabilities:
Inventories	$	(4,319	)	$	1,849		$	(2,470	)
Deferred revenue	$	4,198		$	(59	)	$	4,139
Net cash used in operating activities	$	(3,936	)	$	-		$	(3,936	)

	Stated			Adjustments			Restated
	March 31, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net income	$	122		$	620		$	742
Changes in operating assets and liabilities:
Accounts receivable	$	3,275		$	(967	)	$	2,308
Inventories	$	(841	)	$	429		$	(412	)
Deferred revenue	$	(570	)	$	(82	)	$	(652	)
Net cash provided by operating activities	$	1,525		$	-		$	1,525

	Stated			Adjustments			Restated
	June 30, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net (loss) income	$	(197	)	$	1,787		$	1,590
Changes in operating assets and liabilities:
Accounts receivable	$	5,283		$	(1,509	)	$	3,774
Inventories	$	291		$	(586	)	$	(295	)
Deferred revenue	$	(6,204	)	$	308		$	(5,896	)
Net cash provided by operating activities	$	366		$	-		$	366

	Stated			Adjustments			Restated
	September 30, 2023
	As Previously			Restatement			As
	Stated			Adjustments			Restated
	(unaudited)			(unaudited)			(unaudited)
Cash flows from operating activities:
Net income	$	827		$	1,774		$	2,601
Changes in operating assets and liabilities:
Accounts receivable	$	1,805		$	(163	)	$	1,642
Inventories	$	468		$	(1,563	)	$	(1,095	)
Deferred revenue	$	(4,685	)	$	(48	)	$	(4,733	)
Net cash used in operating activities	$	(228	)	$	-		$	(228	)

5. REVENUES

Nature of the Company’s products and services

The Company’s principal products and services include electric power systems and equipment, distributed energy resources, power generation equipment and mobile EVelectric vehicle charging solutions. The Company’s principal products and services are primarily sold in the United States. See Note 13 – Business Segment, Geographic and Customer Information, for additional information.

Products

The Company’s Electrical Infrastructure business (included in discontinued operations; see Note 11 – Discontinued Operations ~~provides~~for details) provided electric power systems and equipment and distributed energy resources that ~~help~~helped customers effectively and efficiently protect, control, transfer, monitor and manage their electric energy needs.

The Company’s Critical Power business provides customers with power generation equipment and the Company’s suite of mobile e-Boost electric vehicle charging solutions.

Services

Power generation systems represent considerable investments that require proper maintenance and service in order to operate reliably during a time of emergency. The Company’s power maintenance programs provide preventative maintenance, repair and support service for the Company’s customers’ power generation systems.

The timing of revenue recognition, customer billings and cash collections results in accounts receivable, contract assets and deferred revenue at the end of each reporting period. Contract assets include unbilled amounts typically resulting from revenue recognized exceeding amounts billed to customers for contracts utilizing an input method based on the proportion of labor hours incurred as compared to the total estimated labor hours for the fixed-fee contract performance obligations. The Company bills customers as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, upon achievement of contractual milestones or upon deliveries.

The Company’s principal source of revenue is derived from sales of products and fees for services. The Company measures revenue based upon the consideration specified in the customer arrangement, and revenue is recognized when the performance obligations in the customer arrangement are satisfied. Changes in deferred revenue are generally as a result of the Company’s normal operating cycle and the effect of cumulative catch-up adjustments arising from a change in the measure of progress or a contract modification identified at each reporting period.40

Revenue A performance obligation is a promise in a contract to transfer a distinct product or service to the customer. The transaction price of a contract is allocated to each distinct performance obligation and recognized as revenue when or as the customer receives the benefit of the performance obligation. Customers typically receive the benefit of the Company’s products when the risk of loss or control for the product transfers to the customer and for services as they are performed. Under ASC 606, revenue is recognized when a customer obtains control of promised products or services in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. To achieve this core principle, the Company applies the following five steps:Recognition

1)During the ~~Identify~~years ended December 31, 2024, and 2023, the ~~contract~~Company ~~with~~recognized $558 and $343 of equipment revenue over time, respectively, from its Critical Power segment. Additionally, the Company recognized $11,704 and $3,070 of revenue at a ~~customer~~point in time from the sale of its products, which is typically recognized upon delivery, from its Critical Power segment during the years ended December 31, 2024, and 2023, respectively.

AService revenues ~~contract~~include ~~with~~maintenance acontracts ~~customer~~that ~~exists~~are ~~when~~recognized ~~(i)~~over ~~the~~time ~~Company enters~~based ~~into~~on anthe ~~enforceable~~ contract ~~with~~term aand ~~customer~~repair ~~that~~services ~~defines~~which ~~each~~are recognized ~~party’s~~as ~~rights~~services ~~regarding~~are ~~the~~delivered. ~~products~~The orCompany ~~services~~recognized ~~to be transferred~~$8,690 and ~~identifies~~$7,703 of ~~the~~service ~~payment~~revenue ~~terms~~during ~~related~~the toyears ~~these~~ended ~~products~~December or31, ~~services~~2024, ~~(ii)~~and ~~the~~2023, ~~contract~~respectively. ~~has~~Under ~~commercial~~its ~~substance~~continuing ~~and~~operations, ~~(iii)~~ the Company ~~determines~~ ~~that~~recognizes ~~collection~~revenue ofas ~~substantially all consideration for products or~~ services ~~that~~ are ~~transferred~~provided. isAmounts ~~probable~~billed ~~based on the customer’s intent~~ and ~~ability~~due tofrom ~~pay~~customers, ~~the~~as ~~promised~~well ~~consideration.~~as ~~The Company applies judgment in determining~~ the ~~customer’s~~value ~~ability~~of ~~and~~unbilled ~~intention~~account ~~to pay~~receivables, ~~which~~are isgenerally ~~based~~classified onwithin acurrent ~~variety~~assets ~~of factors including the customer’s historical payment experience or,~~ in the ~~case~~consolidated ofbalance asheets. ~~new~~The customer~~, published~~ ~~credit~~payments ~~and~~are ~~financial~~generally due ~~information~~in ~~pertaining~~30 ~~to the customer~~days.

2) Identify the performance obligations in the contract

3) Determine the transaction price

4) Allocate the transaction price to performance obligations in the contract

5) Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies its performance obligations and, therefore, recognizes revenue, either over time or at a point in time, which is when the customer has obtained control of the good or service. Revenue from the sale of the Company’s electric power systems under its Electrical Infrastructure segment is recognized either over time ($23,758 and $8,049 (as restated) of revenue in 2023 and 2022, respectively) or at a point in time ($6,619 and $8,221 of revenue in 2023 and 2022, respectively) and substantially all of the Company’s revenue from the sale of power generation equipment under its Critical Power segment is recognized at a point in time. Certain sales of highly customized electrical equipment under the Company’s Electrical Infrastructure segment are recognized over time when such equipment has no alternative use and the Company has an enforceable right to payment for performance completed to date. The Company’s measure of progress for such contracts is evaluated under the input method based on direct labor hours incurred relative to the estimated total direct labor hours required in order to complete the project. When adjustments in estimated total labor hours at completion are determined, the related impact on income is recognized using the cumulative catch-up method, which the Company recognizes in the current period.

During the year ended December 31, 2023, the Company recognized $24,101 of equipment revenue over time. During the year ended December 31, 2022, the Company recognized approximately $8,049 of equipment revenue over time. Additionally, the Company recognized $9,614 and $10,440 of revenue at a point in time from the sale of its products during the year ended December 31, 2023 and 2022, respectively.

Service revenues include maintenance contracts that are recognized over time based on the contract term and repair services which are recognized as services are delivered. The Company recognized $7,778 and $7,389 of service revenue during the year ended December 31, 2023 and 2022, respectively. The Company bills customers as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals, upon achievement of contractual milestones or upon deliveries. Progress payments are paid by the customer over the duration of the contract. Amounts billed and due from customers, as well as the value of unbilled account receivables, are generally classified within current assets in the consolidated balance sheets. The customer payments are generally due in 30 days.

Under certain contracts, the Company may be entitled to invoice the customer and receive payments in advance of performing the related contract work. In those instances, the Company recognizes a liability for advance billings in excess of revenue recognized, which is referred to as deferred revenue. Payments received from customers in advance of revenue recognition are not considered a significant financing component because they are utilized to pay for contract costs within a one-year period or are requested by the Company to ensure the customers meet their payment obligations.

The change in deferred revenue as of December 31, ~~2023~~2024, was driven primarily by ordinary course contract activity ~~and as a result of cumulative catch-up adjustments related to changes in measure of progress for over-time contracts~~. As of January 1, ~~2022~~2023, the Company had a deferred revenue balance of $~~2,423~~808. For the years ended December 31, ~~2023~~2024, and ~~2022~~2023, the Company recognized revenue of $~~9,046~~ 162 and $~~2,158 (as~~670 ~~restated)~~ respectively, related to amounts that were included in deferred revenue as of December 31, ~~2022~~2023, and ~~2021~~2022, respectively, resulting primarily from the progress made on the various active contracts during the respective reporting periods. As of December 31, 2024, the Company had $991 related to contract liabilities where performance obligations have not yet been satisfied, which has been included within deferred revenue on the consolidated balance sheet.

Unbilled receivables include amounts for work performed for which the Company has an unconditional right to receive payment and that are not subject to the completion of any other specific task, other than the billing itself.

~~The Company manages its accounts receivable credit~~Concentration ~~risk by performing credit evaluations and monitoring amounts due from the Company’s customers. The Company had certain customers whose revenue individually represented 10% or more~~ of ~~the Company’s total revenue, or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable.~~Risk

~~Return of a product requires that~~ For the ~~buyer~~year ~~obtain permission~~ended inDecember ~~writing~~31, ~~from~~2024, the Company. ~~When~~derived ~~the~~22% ~~buyer~~and ~~requests~~13% ~~authorization to return material for reasons~~ of ~~their~~its ~~own,~~revenue ~~the~~from ~~buyer~~two ~~will be~~customers. ~~charged~~For ~~for placing~~ the ~~returned~~year ~~goods~~ended inDecember ~~saleable condition~~31, 2023, ~~restocking~~the ~~charges~~Company ~~and~~derived ~~for~~14% ~~any~~of ~~outgoing~~its ~~and~~revenue ~~incoming~~from ~~transportation~~one ~~paid by the Company~~customer. ~~The~~As ~~Company~~of ~~warrants~~December ~~title~~31, ~~to the products~~2024, ~~and~~one ~~also~~customer’s ~~warrants~~outstanding ~~the~~receivable balance ~~products~~equaled on72% ~~date~~ of ~~shipment~~the tototal ~~the~~outstanding ~~buyer,~~receivable tobalance. beAs of ~~the~~ ~~kind~~December ~~and quality described in the contract~~31, ~~merchantable~~2023, ~~and~~two ~~free~~customers’ ofoutstanding ~~defects~~receivable balance inequaled ~~workmanship~~22% and ~~material.~~12% ~~Returns~~of ~~and warranties during~~ the ~~years~~total ~~ended~~outstanding ~~December~~receivable ~~31, 2023 and 2022 were insignificant~~balance.

Return of a product requires that the buyer obtain permission in writing from the Company. When the buyer requests authorization to return material for reasons of their own, the buyer will be charged for placing the returned goods in saleable condition, restocking charges and for any outgoing and incoming transportation paid by the Company. The Company warrants title to the products, and also warrants the products on date of shipment to the buyer, to be of the kind and quality described in the contract, merchantable, and free of defects in workmanship and material. Returns and warranties during the year ended December 31, 2024 were $295. Returns and warranties during the year ended December 31, 2023, were insignificant.

Disaggregated Revenue

The following table presents the Company’s revenues disaggregated by revenue discipline:

SCHEDULE OF REVENUE DISAGGREGATED

	2023		2022
	2024		2023
	Year Ended
	For the Years Ended
	December 31,
	2023		2022 (Restated)
	2024		2023
Products	$	33,715	$	18,489
Revenues - ASC 606
Services		7,778		7,389
Products	$	12,262	$	3,413
Total revenue	$	41,493	$	25,878
Services		8,690		7,703
Total revenues - ASC 606		20,952		11,116
Revenues - ASC 842
Fixed lease revenue		1,927		-
Total revenues - ASC 842		1,927		-
Total revenue	$	22,879	$	11,116

48Lease Revenues

6.There were ~~INVENTORIES~~no leasing revenues arising from variable lease payments during the years ended December 31, 2024, and 2023.

The following table presents future operating lease payments to be received as of December 31, 2024:

For the Years Ended December 31,	Total
2025	$	2,059
2026		743
2027		200
2028		200
2029		142
Total	$	3,344

4. INVENTORIES

The components of inventories are summarized below:

SCHEDULE OF INVENTORIES

	2023		2022
	2024		2023
	December 31,
	2023		2022 (Restated)
	2024		2023
Raw materials	$	54,~~316~~899	$	2,~~962~~753
Work in process		21,~~263~~169		~~5,128~~325
Total inventories	$	76,~~579~~068	$	83,~~090~~078

75. PROPERTY AND EQUIPMENT, NET

Property and equipment are summarized below:

SCHEDULE OF PROPERTY AND EQUIPMENT

	2023			2022
	2024			2023
	December 31,
	2023			2022
	2024			2023
Machinery, vehicles and equipment	$	35,~~220~~942		$	2,~~308~~558
Furniture and fixtures		~~208~~160			~~208~~160
Computer hardware and software		~~650~~311			~~591~~311
Leasehold improvements		~~368~~103			~~368~~103
Construction in progress		2,~~024~~180			~~499~~1,946
Property and equipment, gross		68,~~470~~696			35,~~974~~078
Less: accumulated depreciation		(2,~~571~~193	)		(21,~~174~~477	)
Total property and equipment, net	$	36,~~899~~503		$	13,~~800~~601

Depreciation expense was $~~397~~716 and $~~228~~397 for the ~~period~~ years ended December 31, ~~2023~~2024, and ~~2022~~2023, respectively.

86. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

The components of accounts payable and accrued liabilities are summarized below:

	2023		2022
	2024		2023
	December 31,
	2023		2022
	2024		2023
Accounts payable	$	53,~~396~~054	$	51,~~615~~680
Accrued liabilities		71,~~213~~489		16,~~624~~431
Total accounts payable and accrued liabilities	$	124,~~609~~543	$	78,~~239~~111

Accrued liabilities primarily consist of accrued ~~legal settlement costs~~insurance, accrued ~~sales commissions, accrued~~ compensation and benefits, ~~accrued sales~~ and ~~use taxes and~~ accrued ~~insurance. As of December 31, 2023, accrued~~ legal settlement costs. ~~were~~As ~~$5,000,~~of ~~compared to no accrued legal settlement costs at~~ December 31, ~~2022. See Note 8 for details. At December 31~~2024, ~~2023~~ and ~~2022~~2023, accrued ~~sales~~insurance ~~commissions~~was ~~were~~ $~~442~~462 and $~~278~~795, respectively. Accrued compensation and benefits atas of December 31, ~~2023~~2024, and ~~2022~~ 2023 were $~~294~~453 and $~~213~~95, respectively. ~~Accrued~~There ~~sales~~were ~~and~~no ~~use~~accrued ~~taxes~~legal atsettlement ~~December~~costs ~~31,~~as ~~2023~~of ~~and~~December ~~2022 were $67 and $258~~31, ~~respectively~~2024, ~~and~~as ~~there~~compared ~~was~~to $~~795~~5,000 as of ~~accrued insurance at~~ December 31, 2023 ~~compared~~(See toNote ~~$559~~7 at- ~~December~~Commitments ~~31,~~and ~~2022~~Contingencies for additional information). The remainder of accrued liabilities are comprised of several insignificant accruals in connection with normal business operations.

~~9. COMMITMENTS AND CONTINGENCIES~~42

7. COMMITMENTS AND CONTINGENCIES

Leases

The Company leases certain offices, facilities and equipment under operating and financing leases. The Company’s leases have remaining terms ranging from less than 1 year to 5 years , some of which contain options to extend up to 5 years. As of December 31, ~~2023~~2024, and ~~2022~~2023, assets recorded under finance leases were $~~638~~ 455 and $1638,~~261,~~ respectively, and accumulated amortization associated with finance leases were $~~235~~234 and $~~534~~235, respectively.

As of December 31, ~~2023~~2024, and ~~2022~~2023, assets recorded under operating leases were $~~2,248~~995 and $2830,~~248,~~ respectively, and accumulated amortization associated with operating leases were $~~1,488~~ 465 and $~~798~~405, respectively. During the fourth quarter of ~~2022~~2024, the Company executed an extension of its operating lease ~~for the corporate management and sales office~~ in ~~Fort Lee~~Miami, ~~New Jersey~~Florida. After adjusting for a weighted average discount rate, the Company recognized a right-of-use asset and lease liability of approximately $~~275~~330 within the consolidated balance sheets.

The components of the lease expense were as follows:

SCHEDULE OF LEASE EXPENSES

	2023		2022
	2024		2023
	Year Ended
	For the Years Ended
	December 31,
	2023		2022
	2024		2023
Operating lease cost	$	~~762~~247	$	~~752~~247
Financing lease cost
Amortization of right-of-use asset	$	~~324~~129	$	~~238~~324
Interest on lease liabilities		4225		4442
Total financing lease cost	$	~~366~~154	$	~~282~~366

Other information related to leases was as follows:

Supplemental cash flows information:

SCHEDULE OF CASH FLOWS INFORMATION

	2023		2022
	2024		2023
	Year Ended
	For the Years Ended
	December 31,
	2023		2022
	2024		2023
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flow payments for operating leases	$	~~774~~260	$	~~742~~255
Operating cash flow payments for financing leases		4225		4442
Financing cash flow payments for financing leases		~~355~~129		~~241~~355
Right-of-use assets obtained in exchange for lease obligations
Operating lease liabilities arising from obtaining right of use assets		-330		~~440~~-
Financing lease obligations		-		401

Weighted average remaining lease term:

	December 31,
	2023	2022
Operating leases	1 years	2 years
Financing leases	2 years	2 years

	December 31,
	2024	2023
Operating leases	3 years	2 years
Financing leases	2 years	3 years

Weighted average discount rate:

	December 31,
	2023			2022
	2024			2023
Operating leases		5.50	%		5.50	%
Financing leases		6.8094	%		6.7380	%

Future minimum lease payments under non-cancellable leases as of December 31, ~~2023~~2024, were as follows:

	Operating Leases			Financing Leases
	Operating			Financing
	Leases			Leases
2024		613			166
2025	$	270		$	123
2025		200			174
2026		97			88
2026		24			88
2027		76			42
Thereafter		-			41
2028		79			-
Total future minimum lease payments		837			469
Thereafter		82			-
Less imputed interest		(40	)		(52	)
Total future minimum lease payments		604			253
Total future minimum lease payments	$	797		$	417
Less imputed interest		(59	)		(23	)
Total future minimum lease payments	$	545		$	230

50Reported as of December 31, 2024:

Reported as of December 31, 2023:

SCHEDULE OF LEASE REPORTED

	Operating		Financing
	Leases		Leases
Right-of-use assets	$	~~760~~530	$	~~403~~221
	Operating		Financing
	Leases		Leases
Current portion of lease liabilities	$	244	$	109
Lease liabilities, non-current portion		301		121
Total	$	545	$	230

	Operating		Financing
	Leases		Leases
Current portion of lease liabilities	$	582	$	139
Lease liabilities, non-current portion		215		278
Total	$	797	$	417

Litigation and Claims

From time to time, the Company is a defendant or plaintiff in various legal actions that arise in the normal course of business. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

On June 15, 2023, Terrence and Kay Mimick (the “Plaintiffs”) filed a complaint in the U.S. District Court, District of Nebraska naming the Company, its wholly-owned subsidiary, Pioneer Critical Power, Inc., and an individual acting in his capacity as an employee of the Company, collectively as defendants. Plaintiffs filed an amended complaint on July 7, 2023, alleging negligent driving, negligent entrustment, and negligent hiring, training and supervision, as a result of a car accident that occurred on September 9, 2019, and seeking special damages related to the injuries allegedly sustained by Plaintiffs. The amended complaint also named Titan Energy Systems, Inc. as a defendant instead of Pioneer Critical Power, Inc. On July 27, 2023, the defendants filed an Answer to Plaintiff’s Amended Complaint. On October 6, 2023, a mediation was held, but the parties did not reach a ~~settlement. In June 2024 another mediation was held and the parties reached~~ a settlement ~~for all of the Plaintiffs’ claims~~. As of December 31, 2023, the Company recognized a liability of $5,000 related to this matter, ~~which was included within accounts payable and accrued liabilities,~~ with a corresponding insurance receivable of $5,000 related to the loss recovery, which was ~~deemed to be probable and~~ included within prepaid expenses and other current assets on the consolidated balance sheet. In June 2024, another mediation was held and the parties reached a settlement for all of the Plaintiffs’ claims. The case was dismissed with prejudice on July 23, 2024. As of December 31, 2024, the Company did not recognize a liability, or a corresponding insurance receivable, related to the loss recovery.

The Company is not aware of any material proceedings in which any of its directors, officers or affiliates or any registered or beneficial shareholder of more than 5% of the Company’s common stock is an adverse party or has a material interest adverse to the Company’s interest.44

108. STOCKHOLDERS’ ~~NOTES RECEIVABLE, NET~~EQUITY

In connection with the Equity Transaction, amongst other consideration, the Company received the Seller Notes for a total aggregate principal amount of $7,500, subject to certain adjustments. The Seller Notes accrue interest at a rate of 4.0% per annum, with a final payment of all unpaid principal and interest becoming fully due and payable at December 31, 2022. The Company determined the fair value of the Seller Notes based on market conditions and prevailing interest rates. During the fourth quarter of 2019, the Company and Pioneer Transformers L.P. (the “US Buyer”) and Pioneer Acquireco ULC (the “Canadian Buyer,” and together with the US Buyer, the “Buyer”), pursuant to that certain Stock Purchase Agreement dated June 28, 2019, completed the net working capital adjustment, which resulted in the Company paying the Buyer $1,800 in cash and reducing the principal amount of the $5,000 Seller Note to $3,200. During the second quarter of 2020, the Company recognized an additional reduction to the principal amount of the Seller Note of $194 for a valid claim paid by the Buyer on behalf of the Company. On December 15, 2022, the Company received in excess of $6,200 as a final payment of all unpaid principal and interest paying the Seller Notes in full.

11. STOCKHOLDERS’ EQUITY

Common Stock

The Company had 911,~~930~~120,~~022~~266 and 9,~~644~~930,~~545~~022 shares of common stock, $0.001 par value per share, outstanding as of December 31, ~~2023~~2024, and ~~December 31~~2023, ~~2022,~~ respectively.

On November 12, 2024, the board of directors declared a one-time special cash dividend of $1.50 per share, or $16,665 in the aggregate, to shareholders of record as of December 17, 2024, which is included in “Dividends payable” on the consolidated balance sheet as of December 31, 2024. The dividend was paid on January 7, 2025.

Preferred Stock

The board of directors is authorized, subject to any limitations prescribed by law, without further vote or action by the shareholders, to issue from time to time up to 5,000,000 shares of preferred stock, $0.001 par value, in one or more series. Each such series of preferred stock shall have such number of shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall be determined by the board of directors, which may include, among others, dividend rights, voting rights, liquidation preferences, conversion rights and preemptive rights.

519. STOCK-BASED COMPENSATION

12. STOCK-BASED COMPENSATION

Stock-Based Compensation

On October ~~May 11~~13, ~~2011~~2021, the Company’s board of directors ~~of the Company~~ adopted the ~~Pioneer~~2021 ~~Power Solutions, Inc. 2011~~ Long-Term Incentive Plan (the “~~2011~~2021 Plan”), subject ~~which~~to ~~was~~stockholder ~~subsequently~~approval, ~~approved by~~which ~~stockholders~~was ofobtained ~~the Company~~ on ~~May~~November 3111, ~~2011~~2021. The 2021 Plan supplemented the 2011 Plan, which expired on May 11, 2021, and which replaced and superseded the 2009 Plan, as noted above. The Company’s outside directors and its employees, including the ~~Company’s~~ principal executive officer, principal financial officer and other named executive officers, and certain contractors ~~were~~are all eligible to participate in the ~~2011~~2021 Plan. The ~~2011~~2021 Plan ~~allowed~~allows for the granting of incentive stock options, ~~nonqualified~~non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend ~~equivalent~~ equivalent rights, and other awards, which ~~were~~may be granted singly, in combination, or in tandem, and upon such terms as are determined by the Board or a committee of the ~~Board~~board that ~~was~~is designated to administer the 2021 Plan. Subject to certain adjustments, the maximum number of shares of the Company’s common stock that ~~were~~may ~~available to~~ be delivered pursuant to awards under the ~~2011~~2021 Plan ~~was~~is 900,000 shares plus any increase by any Prior Plan Awards (as defined in the 2021 Plan) eligible for reuse (700,000 shares) as of December 31, 2024, of which one hundred percent (100%) may be delivered pursuant to incentive stock options. As of December 31, ~~2023~~2024, there were no 279,354 shares available for future grants under the Company’s ~~2011~~2021 ~~Long-Term Incentive~~ Plan. The 2021 Plan was initially administered by the Company’s ~~2011~~ ~~Long-Term~~board ~~Incentive~~of ~~Plan~~directors, ~~expired~~but ~~during~~it has been administered by the ~~second~~compensation committee following the creation of such committee in the first quarter of ~~2021~~2022.

On October 13, 2021, the Company’s board of directors adopted the 2021 Long-Term Incentive Plan (the “2021 Plan”), subject to stockholder approval, which was obtained on November 11, 2021. The 2021 Plan supplemented the 2011 Plan, which expired on May 11, 2021, and which replaced and superseded the 2009 Plan, as noted above. The Company’s outside directors and its employees, including the principal executive officer, principal financial officer and other named executive officers, and certain contractors are all eligible to participate in the 2021 Plan. The 2021 Plan allows for the granting of incentive stock options, non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards, dividend equivalent rights, and other awards, which may be granted singly, in combination, or in tandem, and upon such terms as are determined by the Board or a committee of the board that is designated to administer the 2021 Plan. Subject to certain adjustments, the maximum number of shares of the Company’s common stock that may be delivered pursuant to awards under the 2021 Plan is 900,000 shares plus any increase by any Prior Plan Awards (as defined in the 2021 Plan) eligible for reuse, of which one hundred percent (100%) may be delivered pursuant to incentive stock options. As of December 31, 2023, there were 347,500 shares available for future grants under the Company’s 2021 Plan. The 2021 Plan was initially administered by the Company’s board of directors, but it has been administered by the compensation committee following the creation of such committee in the first quarter of 2022.

The fair value of the stock options granted was measured using the Black-Scholes valuation model with the following assumptions:

	Year Ended December 31,
	For the Years Ended December 31,
	2023			2022
	2024				2023
Expected term (years)	~~5.0 - 6.0~~	5.0 - 6.0		~~5.5~~		5.0 - 6.0
Risk-free interest rate	~~3.5% - 4.4%~~	4.1% - 4.5	%	~~2.9%~~		3.5% - 4.4	%
Expected volatility	~~110.0% - 112.1%~~	112.3% - 125.7	%	~~31.1%~~		110.0% - 112.1	%
Expected dividends	~~0.0%~~	0.0	%	~~0.0%~~		0.0	%

A summary of stock option activity for the year ended December 31, ~~2023~~2024, is presented below:

SUMMARY OF STOCK OPTION ACTIVITY

	Stock options			Weighted average exercise price		Weighted average remaining contractual term		Aggregate intrinsic value
	Stock Options			Weighted average exercise price (1)		Weighted average remaining contractual term		Aggregate intrinsic value
Outstanding as of January 1, 2023		670,667		$	5.45
Outstanding as of January 1, 2024		706,167		$	3.99
Granted		9775,~~500~~146			54.8028
Exercised		(15162,~~000~~837	)		31.3169
Forfeited/Expired		(47,000	)		6.16
Forfeited/expired		(57,000	)		8.71
Outstanding as of December 31, 2023		706,167		$	5.49		5.50	$	1,262
Outstanding as of December 31, 2024		561,476			4.22		5.27	$	426
Exercisable as of December 31, 2023		611,167		$	5.45		4.90	$	1,147
Exercisable as of December 31, 2024		543,498			4.18		5.16		423

52(1) Exercise prices have been reduced by $1.50 per share as a result of the modification in connection with the special cash dividend declared for all common shareholders of record as of December 17, 2024.

A summary of the weighted-average grant-date fair value of options, total intrinsic value of options exercised, and cash receipts from options exercised is shown below:

	2023		2022
	2024		2023
	Year Ended December 31,
	For the Years Ended December 31,
	2023		2022
	2024		2023
Weighted-average fair value of options granted (per share)	$	01.9748	$	10.0997
Intrinsic value gain (loss) of options exercised		52		(6	)
Intrinsic value gain of options exercised		453		52
Cash receipts from exercise of options		50519		1750

The following table presents information related to stock options as of December 31, ~~2023~~2024:

Options outstanding	~~Options outstanding~~			Options exercisable	~~Options exercisable~~
		Outstanding	~~Outstanding~~	Weighted average	~~Weighted average~~	Exercisable		~~Exercisable~~
			number of		remaining life			number of
Exercise price		number of		remaining life		number of
	Exercise price		options		in years			options
(1)		options		in years		options
$	10.6818		5010,000	5.3	~~6.2~~		10,000	~~50,000~~
$	31.1767		2711,000	7.4	~~8.4~~		11,000	~~27,000~~
$	31.3181		~~221~~144,667	6.4	~~7.4~~		144,667	~~221,667~~
$	32.6818		51,000	1.2	~~2.2~~		1,000	~~5,000~~
$	52.2532		701,~~000~~309	0.0	~~0.0~~		-	-
$	53.6075		650,000	8.4	~~4.3~~		50,000	~~6,000~~
$	64.10		104,000	3.3	~~0.0~~		4,000	-
$	74.2542		570,000	9.9	~~0.0~~		70,000	-
$	74.3060		~~236~~10,000	8.7	~~3.2~~		3,333	~~236,000~~
$	75.4975		25,~~500~~000	8.6	~~9.5~~		1,666	~~2,500~~
$	75.6180		2236,~~500~~000	2.3	~~0.0~~		236,000	-
$	85.2799		52,~~000~~500	8.5	~~0.0~~		2,500	-
$	86.5011		2,500	8.6	~~0.0~~		833	-
$	86.9877		65,000	8.5	~~1.2~~		1,666	~~6,000~~
$	107.2100		572,~~000~~500	8.5	~~0.2~~		833	~~57,000~~
			706,167					611,167
$	7.48		6,000	0.3			6,000
			561,476				543,498

A(1) ~~summary~~Exercise prices have been reduced by $1.50 per share as a result of ~~restricted~~the ~~stock~~modification ~~unit~~in ~~(“RSU”) activity~~connection ~~during~~with the ~~year~~special ~~ended~~cash ~~December~~dividend ~~31,~~declared ~~2023~~for isall common shareholders of record as ~~follows:~~of December 17, 2024.

A summary of restricted stock unit (“RSU”) activity during the year ended December 31, 2024, and 2023 is as follows:

SCHEDULE OF RESTRICTED STOCK UNITS

				Weighted-average		Weighted-average
				grant-date		grant-date
	Number of units			fair value per share		fair value
Unvested restricted stock units as of January 1, 2023		250,000		$	4.35	$	1,087
Units granted		100,000			5.75		575
Units vested		(225,000	)		4.97		(1,119	)
Units forfeited		-			-		-
Unvested restricted stock units as of December 31, 2023		125,000		$	4.35	$	543
Unvested restricted stock units as of January 1, 2024		125,000			4.35		543
Units granted		50,000			5.92		296
Units vested		(175,000	)		4.80		(839	)
Units forfeited		-			-		-
Unvested restricted stock units as of December 31, 2024		-			-	$	-

During the years ended December 31, 2024 and 2023, RSUs vested with an aggregate vest date fair value of $780 and $1,251, respectively.

2024

During the year ended December 31, 2024, the Company issued 10,000 shares of its common stock for consulting services with a fair value of $59.

During the year ended December 31, 2024, the Company issued 175,000 shares of common stock to its Chief Financial Officer (“CFO”) in connection with the vesting of 125,000 RSUs on May 1, 2024, and 50,000 RSUs on December 5, 2024.

During the year ended December 31, 2024, the CFO agreed to surrender shares of common stock to the Company, totaling an aggregate of 62,281 shares (57,541 shares on June 7, 2024, with a fair value of $220 and 4,740 shares on October 22, 2024, with a fair value of $29) in connection with income and payroll tax obligations paid by the Company in connection with the exercising of options and vesting of RSUs. The shares were cancelled and retired by the Company.

On November 12, 2024, the board of directors declared a one-time special cash dividend of $1.50 per share to shareholders of record as of December 17, 2024. All stock options that were outstanding as of the record date were modified to reduce the exercise price pursuant to the nondiscretionary anti-dilution provisions in the Company’s 2021 Plan. There was no incremental compensation expense related to the modification.

Stock based compensation expense recorded for the years ended December 31, 2024, and 2023 was approximately $1,055 and $1,471, respectively. As of December 31, 2024, there was $80 of stock-based compensation expense remaining to be recognized in the consolidated statements of operations over a weighted average remaining period of 1.6 years.

2023

During the year ended December 31, 2023, the Company issued 10,000 shares of its common stock for consulting services with a fair value of $65.

During the year ended December 31, 2023, the Company issued 100,000 shares of common stock to its Chief Executive Officer (“CEO”) in connection with the vesting of 100,000 RSUs on May 11, 2023. The fair value of the RSUs on the date of grant was $575, which was recognized immediately.

During the year ended December 31, 2023, the Company issued 250,000 shares of common stock to its ~~Chief Financial Officer (“~~CFO”) in connection with the vesting of 125,000 ~~RSUs~~ RSUs on May 1, 2022, and 125,000 RSUs on May 1, 2023. The fair value of the RSUs on the date of grant was $544, which was recognized immediately.

During the year ended December 31, 2023, the CEO and CFO each individually agreed to surrender shares of common stock to the Company, totaling an aggregate of 117,082 shares with a fair value of $720 in connection with income and payroll tax obligations paid by the Company in connection with the vesting of the above mentioned RSUs. The shares were cancelled and retired by the Company.

Stock based compensation expense recorded for the years ended December 31, 2023 and 2022 was approximately $1,471 and $1,002, respectively. At December 31, 2023, there was $413 of stock-based compensation expense remaining to be recognized in the consolidated statements of operations over a weighted average remaining period of 1.1 years.47

5310. INCOME TAXES

~~13.~~The components ~~INCOME~~of ~~TAXES~~loss before income taxes related to continuing operations are summarized below:

The components of loss before income taxes are summarized below:

SCHEDULE OF LOSS BEFORE INCOME TAXES

	2023			2022
	2024			2023
	Year Ended December 31,
	For the Years Ended
	2023			2022 (Restated)
	December 31,
	2024			2023
Loss before income taxes
U.S. operations	$	(14,~~898~~767	)	$	(56,~~412~~279	)
Loss before income taxes	$	(1,898	)	$	(5,412	)
Loss from continuing operations	$	(4,767	)	$	(6,279	)

The components of the income tax ~~provision~~benefit related to continuing operations were as follows:

SCHEDULE OF INCOME TAX PROVISION

	2023			2022
	2024			2023
	Year Ended December 31,
	For the Years Ended
	2023			2022
	December 31,
	2024			2023
Current
State	$	-		$	7
Federal	$	(1,128	)	$	-
Total income tax provision	$	-		$	7
State		(290	)		-
Total income tax benefit	$	(1,418	)	$	-

A reconciliation from the statutory U.S. income tax rate and the Company’s effective income tax rate for continuing operations, as computed on loss before taxes, is as follows:

	2023			2022
	2024			2023
	Year Ended December 31,
	For the Years Ended
	2023			2022 (Restated)
	December 31,
Federal income tax at statutory rate	$	(399	)	$	(1,136	)
	2024			2023
State and local income tax, net		-			6
Federal income tax at statutory rate	$	(1,001	)	$	(1,319	)
Other permanent items		(7	)		(2	)
State and local income tax, net		(316	)		-
Expired foreign tax credits		28			153
Other permanent items		120			(9	)
Valuation allowance		378			1,010
Expired foreign tax credits		652			28
True-up		-			(24	)
Valuation allowance		(922	)		1,300
Total	$	-		$	7
True-up		49			-
Total	$	(1,418	)	$	-

The Company’s provision for income taxes reflects an effective tax rate on loss before income taxes of 029.07% in ~~2023~~2024, as compared to ( 0.1)0% in ~~2022~~2023. The ~~consistency~~increase in the Company’s effective tax rate during ~~2023~~2024 primarily reflects the ~~increase~~reduction inof ~~state taxes,~~ the ~~increase in the~~ valuation allowance and ~~increase~~the inutilization of its net operating losses.

The net deferred income tax asset (liability) was comprised of the following:

	2023			2022
	2024			2023
	For the Years Ended
	December 31,
	2023			2022 (Restated)
	2024			2023
Noncurrent deferred income taxes
Total assets	$	89749		$	59110
Total liabilities		(89749	)		(59110	)
Net noncurrent deferred income tax asset		-			-
Net deferred income tax asset	$	-		$	-

5448

The tax effect of temporary differences between GAAP accounting and federal income tax accounting creating deferred income tax assets and liabilities were as follows:

	2023			2022
	2024			2023
	For the Years Ended
	December 31,
	2023			2022 (Restated)
	2024			2023
Deferred tax assets
U.S. net operating loss carry forward	$	41,~~930~~051		$	~~4,048~~858
Non-deductible reserves		~~1,874~~830			~~1,530~~923
Tax credits		43,~~272~~581			4,~~300~~233
Fixed assets		-			29
Intangibles		1,294			1,025
Intangibles		1,391			1,516
Total deferred tax assets		6,756			7,039
Valuation allowance		(126,~~378~~007	)		(116,~~365~~929	)
Net deferred tax assets		89749			59110
Deferred tax liabilities
Fixed assets		(89749	)		(53110	)
Other		-			(6	)
Total deferred tax liabilities		(749	)		(110	)
Net deferred tax liabilities		(89	)		(59	)
Deferred asset, net	$	-		$	-

As of December 31, ~~2023~~2024, ~~the~~The Company ~~has~~had $46,~~233 in~~756 ~~foreign~~of deferred tax ~~credits~~assets ~~(“FTCs”)~~on ~~carryforward~~which it is taking a $6,007 valuation allowance. ~~These~~The ~~FTCs~~total ~~begin~~valuation toallowance ~~expire~~of in$6,007 as of December 31, 2024, represents a decrease of $922 from December 31, 2023.

~~The~~A ~~assessment~~valuation ofallowance ~~the amount of value assigned to the Company’s deferred tax assets under the applicable accounting rules~~ is ~~judgmental.~~established ~~The~~when ~~Company~~it is ~~required to consider all available~~determined ~~positive~~that ~~and~~it ~~negative~~is ~~evidence~~more inlikely ~~evaluating~~than ~~the~~not ~~likelihood~~ that the ~~Company will be able to realize the benefit of its~~ deferred tax assets in ~~the~~will ~~future.~~not ~~Such~~be ~~evidence~~realized. ~~includes~~In ~~scheduled~~evaluating ~~reversals~~the ofneed ~~deferred~~for ~~tax~~a ~~liabilities,~~valuation ~~projected future taxable income~~allowance, ~~tax planning strategies~~management ~~and~~assessed ~~the~~all ~~results~~available ofpositive ~~recent~~and ~~operations.~~negative ~~Since~~evidence, ~~this~~including ~~evaluation~~historical ~~requires~~operating ~~consideration~~results, ofcumulative ~~events that may occur some years into the future~~losses, ~~there~~ isprojections ~~an element~~ of ~~judgment involved. Realization of the Company’s deferred tax assets is dependent on generating sufficient~~future taxable income, inand ~~future~~sources ~~periods.~~of ~~The Company does not believe that it is more likely than not that future~~ taxable income ~~will~~such beas ~~sufficient to~~future ~~allow~~reversals ~~the Company to recover any~~ of ~~the~~existing ~~value~~taxable ~~assigned~~temporary todifferences, ~~the Company’s deferred~~ tax-planning ~~assets. Accordingly~~strategies, and the ~~Company~~realization ~~has provided for a valuation allowance~~ of the ~~Company’s~~gain ~~FTCs~~from as the ~~Company~~subsidiary ~~does not anticipate generating sufficient foreign source income~~sale. In ~~addition,~~Significant ~~the~~judgment ~~Company~~is ~~has~~required ~~provided~~in ~~for~~assessing ~~a full valuation allowance on~~ the ~~domestic~~weight ~~deferred tax assets as the combined effect~~ of ~~future domestic~~both ~~source~~positive ~~income~~ and negative ~~the~~evidence, ~~future~~particularly ~~reversals~~in ofdetermining ~~future~~the ~~tax~~likelihood ~~assets~~ and ~~liabilities~~timing ~~will likely be insufficient to realize the full benefits~~ of ~~the~~future ~~assets~~taxable income.

~~The~~During the year ended December 31, 2024, the Company recognized ~~has~~pre-tax ~~federal~~income from the divestiture of PCEP Subsidiary, resulting in a tax gain of approximately $37 million. This gain enabled the Company to fully recognize its existing tax attributes, net operating ~~loss~~losses (“NOLs”) ~~carryforwards~~, of§163(j) ~~approximately~~interest ~~$18~~expense limitations,~~228~~ asand R&D credits available at the time of ~~December~~the 31divestiture. Despite this positive evidence, ~~2023~~the Company determined that it was insufficient to overcome substantial negative evidence. ~~The~~This ~~Federal~~negative ~~NOLs~~evidence ~~were~~includes ~~generated~~cumulative inlosses ~~the~~incurred ~~taxable~~over recent years, ~~ending~~continued ~~after December~~uncertainty ~~31,~~regarding ~~2017.~~sustained Asfuture ataxable ~~result~~income, and the ~~NOLs~~expectation ~~are~~of ~~eligible~~continued toaccumulation beof ~~carried~~new ~~forward~~tax ~~indefinitely~~attributes due to ongoing operating results. Furthermore, ~~but~~the ~~generally~~anticipated ~~may~~annual ~~only~~generation ~~offset~~of upNOLs toupon ~~80%~~reversal of ~~federal~~deferred ~~taxable~~tax liabilities significantly reduces the reliability ~~income~~of ~~earned~~future intaxable income as a ~~taxable~~viable ~~year~~source for realizing deferred tax assets.

~~The~~Considering ~~Company’s~~the ~~net~~significant ~~operating~~judgment ~~losses~~required ~~may~~in ~~be subject~~assessing tothe ~~annual~~likelihood, ~~Section~~timing, ~~382~~and ~~limitations~~magnitude ~~due~~of tofuture ~~ownership~~taxable ~~changes~~income, ~~that~~and ~~could~~given ~~impact~~ the ~~future~~relative ~~realization.~~weight Asand persuasiveness of ~~December~~the ~~31,~~available ~~2023~~evidence, management ~~the~~concluded ~~Company has~~that ~~not~~the ~~experienced~~negative anevidence ~~ownership~~continues ~~change~~to ~~within~~outweigh the ~~meaning~~positive ~~of Sec~~evidence. ~~382(g)~~As ~~and~~a ~~will~~result, ~~continue~~the toCompany ~~monitor~~has ~~its~~determined ~~cumulative ownership changes~~that ~~for~~the ~~purposes~~continuation of ~~Sec.~~a ~~382.~~full ~~The~~valuation ~~Company~~allowance ~~has~~remains ~~$12,467 of~~appropriate ~~deferred~~as ~~tax~~of ~~assets~~December on31, ~~which~~2024. itThis isincludes ~~taking~~ a full valuation allowance. ~~The~~for the ~~total~~Company’s ~~valuation~~foreign ~~allowance~~tax ~~recorded~~credits is(“FTCs”) ~~$12,378, representing~~as anthe ~~increase~~Company ofdoes ~~$1,013 from~~not ~~December~~anticipate ~~31,~~generating ~~2022.~~any ~~The~~foreign ~~Company~~source ~~has~~income ~~approximately $4,233~~to ofrealize ~~FTCs~~this ~~for~~benefit. ~~which~~As itof ~~has~~December ~~provided~~31, a2024, ~~full~~the ~~valuation~~remaining ~~allowance~~balance ~~and $39~~ of ~~research~~the ~~and~~Company’s ~~development~~FTCs ~~credits~~was ~~which expire in 2032~~$3,581.

The Company has ~~interest~~state ~~expense~~net ~~subject~~operating toloss ~~a tax deduction limitation under IRC 163~~(j“NOLs”)~~. The new calculation arising from the 2017 tax reform requires an adjusted taxable income to be~~ ~~calculated~~carryforwards ~~by,~~of ~~among~~approximately ~~other things~~$16,431 ~~adding~~as ~~back~~of ~~to taxable income any depreciation, amortization, or depletion deductions for the taxable years beginning after~~ December 31, ~~2017,~~2024. ~~and~~Certain ~~before~~of ~~January~~these 1,amounts ~~2022,~~are assubject ~~well~~to asannual ~~removing~~limitations ~~any~~under ~~GILTI~~applicable tax ~~inclusions~~law. ~~When~~If ~~calculating the adjusted taxable income for this purpose, The Company did~~ not ~~have sufficient taxable income in previous years to deduct interest expense exceeding the limitation~~utilized, ~~therefore creating~~ a ~~carryover~~portion of ~~business~~these ~~interest~~losses ~~expense~~will toexpire ~~future years. For the year ended December 31, 2023, the company was able to utilize their business interest income to support interest expense deductions, resulting~~ in anvarying ~~interest~~amounts ~~expense~~between ~~deduction of~~2030 ~~$231~~and ~~from prior year carryforwards~~2043. ~~The amount available for carryover to future periods of IRC 163(j) as of December 31, 2023 is $2,897. This carryover is available indefinitely.~~

~~Management~~Internal ~~believes~~Revenue ~~that~~Code anSection ~~adequate~~382 ~~provision~~imposes ~~has~~an annual ~~been~~limitation ~~made~~on ~~for~~the ~~any~~utilization ~~adjustments~~of ~~that~~net ~~may~~operating ~~result~~loss ~~from~~(NOL) carryforwards and certain other tax ~~examinations~~attributes following a change in ownership. An ~~However,~~ownership change generally occurs if the ~~outcome~~percentage of ~~tax~~stock ~~audits~~owned ~~cannot~~by be5-percent ~~predicted~~shareholders ~~with~~increases ~~certainty~~by more than 50 percentage points during a rolling three-year period. As of December 31, 2024, the Company conducted an analysis under Section 382 and determined that no Ifownership ~~any~~change ~~issues~~occurred ~~addressed~~during inthe year. Therefore, there is no annual limitation imposed on the utilization of the Company’s federal ~~tax~~NOL ~~audits~~carryforwards. ~~are~~Furthermore, ~~resolved~~the insale of a ~~manner~~subsidiary ~~not~~completed ~~consistent~~prior ~~with~~to ~~management’s~~year-end ~~expectations,~~ is expected to allow the Company ~~could~~to befully utilize ~~required~~these toNOL ~~adjust~~carryforwards. ~~its~~The ~~provision~~Company ~~for~~has ~~income~~also ~~taxes~~evaluated inthe implications of Section 382 limitations at the ~~period~~state level. Given that state conformity to federal Section 382 provisions varies significantly, additional state-specific considerations may apply. The Company will continue to monitor any future ownership changes, legislative updates, or interpretive guidance related to Section 382, as such ~~resolution~~changes could ~~occurs~~impact the Company’s ability to realize these deferred tax assets.

~~The tax years subject to examination by major tax jurisdiction include the years 2020 and forward by the U.S. Internal Revenue Service and most state jurisdictions.~~49

55The following table summarizes the Company’s state losses by jurisdiction, as well as the expiration date:

~~14.~~ SCHEDULE OF ~~BUSINESS~~STATE ~~SEGMENT,~~LOSSES ~~GEOGRAPHIC~~BY ~~AND CUSTOMER INFORMATION~~JURISDICTION

The Company follows ASC 280 - Segment Reporting in determining its reportable segments. The Company considered the way its management team, most notably its chief operating decision maker, makes operating decisions and assesses performance and considered which components of the Company’s enterprise have discrete financial information available. In determining operating and reportable segments in accordance with Financial Accounting Standards Board Accounting Standards Codification 280, Segment Reporting, the Company concluded that it has two reportable segments, which are also its operating segments: Electrical Infrastructure and Critical Power. The Critical Power reportable segment is the Company’s Titan Energy Systems, Inc. business unit. The Electrical Infrastructure reportable segment is the Company’s Pioneer Custom Electrical Products Corp. business unit.

			Oldest		Carry
			Remaining		Forward		Expiration		Expiration
	December 31, 2024		NOL		Years		Start Date		End Date
California	$	12,844		2015		23		2038		2043
Florida		1,833		2015		20		2035		Indefinitely
Illinois		208		2018		12		2030		2043
Iowa		733		2017		20		2037		Indefinitely
Maryland		40		2017		20		2037		Indefinitely
Minnesota		248		2022		15		2037		2038
Nebraska		234		2017		20		2037		2043
North Carolina		130		2017		20		2037		2038
North Dakota		160		2015		20		2035		Indefinitely
Total	$	16,430

The ~~Electrical~~Company ~~Infrastructure~~incurs ~~segment~~research isand ~~involved~~development expenses inas ~~the~~part ~~design, manufacture and sale~~ of ~~electrical~~its ~~distribution~~ongoing ~~and~~operations. ~~control~~These ~~equipment~~expenditures ~~used~~generate ~~primarily~~a byresearch ~~large industrial~~ and ~~commercial operations~~development tocredit ~~manage~~for ~~their~~tax ~~electrical~~purposes. ~~power~~All ~~distribution~~research ~~needs.~~and ~~The~~development tax ~~Critical~~credits ~~Power~~have ~~segment~~been isfully ~~involved~~utilized inand the ~~sale~~Company ~~and~~has ~~service~~$0 of ~~power generation~~research ~~equipment~~ and ~~provides~~development ~~mobile~~credits ~~high-capacity~~remaining ~~charging~~on ~~solutions,~~December ~~as well as aftermarket field-services~~31, ~~in order to help customers secure mobile fast-charging where fixed charging infrastructure does not exist~~2024.

Under the provisions of the Tax Cuts and Jobs Act (TCJA) and as further modified by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Internal Revenue Code Section 163(j) generally limits our deductible business interest expense to the sum of (i) our business interest income, (ii) 30% of adjusted taxable income (ATI), and (iii) floor plan financing interest expense. Adjusted taxable income is defined as taxable income with adjustments for interest, depreciation, amortization, and depletion through 2021. Beginning in 2022, depreciation, amortization, and depletion deductions are no longer added back when calculating ATI. The ~~following~~limitation ~~tables~~imposed ~~present~~by ~~information~~Section ~~about~~163(j) ~~segment~~may create interest expense carryforwards, which can be utilized indefinitely in future tax periods subject to the same limitation. For the year ended December 31, 2024, due to the gain realized on the sale of PCEP, the Company generated sufficient adjusted taxable income to support interest expense deductions, resulting in an interest expense deduction of $2,897 from prior year carryforwards. The amount available for carryover to future periods of IRC 163(~~loss~~j): as of December 31, 2024 is $0. The Company expects the interest limitation will continue to apply in future years.

~~SCHEDULE~~The Company has determined there are no uncertain tax positions requiring OFrecognition ~~SEGMENT~~or ~~INCOME~~disclosure, ~~LOSS~~including positions related to the sale of PCEP. The Company regularly assesses the adequacy of its provisions for income tax contingencies in accordance with ASC 740-10. As a result, the Company may adjust the reserves for unrecognized tax benefits for the impact of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities, and lapses of statutes of limitations. Management has concluded that the current reserves are appropriate. The Company continues to monitor and evaluate uncertain tax positions that may arise from future developments in tax law interpretations, regulations, or audit outcomes. The Company’s tax returns remain subject to examination by the U.S. Internal Revenue Service and most state jurisdictions include the years 2021 and forward.

	2023		2022
	Year Ended
	December 31,
	2023		2022 (Restated)
Revenues
Electrical Infrastructure
Equipment	$	30,302	$	16,260
Service		75		10
Revenues		30,377		16,270
Critical Power Solutions
Equipment		3,413		2,229
Service		7,703		7,379
Revenues		11,116		9,608
Consolidated	$	41,493	$	25,878
Revenues	$	41,493	$	25,878

11. DISCONTINUED OPERATIONS

	2023		2022
	Year Ended
	December 31,
	2023		2022
Depreciation and amortization
Electrical Infrastructure	$	73	$	56
Critical Power Solutions		639		384
Unallocated corporate overhead expenses		9		26
Consolidated	$	721	$	466
Depreciation and amortization	$	721	$	466

Sale of Electrical Infrastructure Segment

	2023			2022
	Year Ended
	December 31,
	2023			2022 (Restated)
Operating income (loss)
Electrical Infrastructure	$	4,380		$	3
Critical Power Solutions		(2,515	)		(2,003	)
Unallocated corporate overhead expenses		(4,519	)		(3,810	)
Consolidated	$	(2,654	)	$	(5,810	)
Operating income (loss)	$	(2,654	)	$	(5,810	)

On October 29, 2024, the Company entered into an Equity Contribution and Purchase Agreement (the “Equity Purchase Agreement”), by and among the Company, PCEP, Voltaris Power LLC (the “Buyer”) and Pioneer Investment LLC (“Investment”). Pursuant to the terms of the Equity Purchase Agreement, the Company agreed to:

	(i)	contribute 4% of all of the issued and outstanding equity interests of PCEP to Investment (the “Rollover Interests”) in exchange for Investment issuing $2,000 of common units (representing approximately 6% of Investment’s issued and outstanding common units on the Closing Date (as defined below)) (the “Rollover Units”) to the Company; and
	(ii)	sell all of the issued and outstanding equity interests of PCEP other than the Rollover Interests to the Buyer ((i) and (ii) being, the “Equity Transaction”).

The Equity ~~following~~Transaction ~~table~~included ~~presents~~total ~~information~~consideration ~~which~~of ~~reconciles~~(i) $48,000 ~~segment~~in ~~assets~~cash, subject to ~~consolidated~~adjustment ~~total~~pursuant ~~assets:~~to the terms of the Equity Purchase Agreement, and (ii) $2,000 in equity pursuant to Investment’s issuance of the Rollover Units to the Company (See Note 2 – Summary of Significant Accounting Policies and Note 12 – Equity Method Investment). The Equity Transaction contains customary terms and conditions and are subject to working capital adjustments. Negotiations between the parties are ongoing, and the Company’s estimate of the range of adjustments resulting in a lower recognized gain is approximately $1,349 to $5,344, with the midpoint equal to $3,347. The Company determined that the midpoint appears to be a better estimate than any other amount within the range, and, accordingly, has recorded a consideration due to buyer of $3,347 on December 31, 2024, related to anticipated net working capital adjustments. It is at least reasonably possible that the estimate will change in the near term and the effect of the change may be material.

	2023		2022
	December 31,
	2023		2022 (Restated)
Assets
Electrical Infrastructure	$	14,320	$	16,409
Critical Power Solutions		9,409		8,009
Corporate		9,293		10,970
Consolidated	$	33,022	$	35,388
Assets	$	33,022	$	35,388

Following the execution of the Equity Purchase Agreement, the Equity Transaction was consummated on October 29, 2024 (the “Closing Date”). PCEP represents the entirety of the Company’s Electrical Infrastructure segment.

As a result, the assets and liabilities of PCEP have been presented separately under the captions “Current assets held for sale”, “Noncurrent assets held for sale” and “Current liabilities held for sale” in the consolidated balance sheet as of December 31, 2023. The results of operations of PCEP, as well as the gain realized on the sale of $35,044, have been presented under the caption “Income from discontinued operations, net of tax” in the consolidated statements of operations for the years ended December 31, 2024, and 2023.

Summarized Held for Sale and Discontinued Operation Financial Information

A summary of the carrying amounts of major classes of assets and liabilities, which are included in assets and liabilities held for sale in the consolidated balance sheet, is as follows:

	2024		2023
	December 31,
	2024		2023
Assets held for sale:
Current assets:
Accounts receivable, net of allowance for credit losses of $97	$	-	$	7,791
Inventories, net		-		4,501
Prepaid expenses and other current assets		-		1,353
Total current assets		-		13,645
Property and equipment, net		-		298
Operating lease right-of-use assets		-		335
Other assets		-		42
Assets held for sale	$	-	$	14,320

Liabilities held for sale:
Accounts payable and accrued liabilities	$	-	$	4,497
Current portion of operating lease liabilities		-		346
Deferred revenue		-		4,625
Liabilities held for sale	$	-	$	9,468

The income tax (benefit/expense) associated with discontinued operations in 2024 primarily reflects the tax effects of disposal gains along with the utilization of previously unrecognized tax attributes and valuation allowance reversals. The previous valuation allowance established on these deferred tax assets were reversed when the Company entered into a definitive sale agreement during the year. The closing of the transaction provided certainty related to the amounts realized and the resulting gain for tax purposes allowed the company to utilize the deferred tax assets. The determination whether it was more likely than not that the deferred tax assets were not going to be realized was no longer applicable.

The tax effect of temporary differences between GAAP accounting and federal income tax accounting creating deferred income tax assets and liabilities from discontinued operations were as follows:

	2024		2023
	For the Years Ended
	December 31,
	2024		2023
Deferred tax assets
U.S. net operating loss carry forward	$	-	$	4,072
Non-deductible reserves		-		951
Tax credits		-		39
Intangibles		-		366
Total deferred tax assets		-		5,428
Valuation allowance		-		(5,449	)
Net deferred tax assets		-		(21	)
Deferred tax liabilities
Fixed assets		-		21
Net deferred tax liabilities		-		21
Deferred asset, net	$	-	$	-

Income tax expense associated with discontinued operations totaled $5,497 in 2024 and $0 in 2023, reflecting tax disposal gains, offset by utilization of tax attributes and related valuation allowance reversals.

The following table summarizes the results from discontinued operations, net of tax included in the consolidated statements of operations for the years ended December 31, 2024, and 2023:

	2024			2023
	For the Years Ended December 31,
	2024			2023
Revenues	$	12,962		$	30,377
Cost of goods sold		10,521			24,252
Gross profit		2,441			6,125
Operating expenses
Selling, general and administrative		2,278			1,744
Total operating expenses		2,278			1,744
Operating income from discontinued operations		163			4,381
Interest expense		2			-
Gain on sale of business, net of taxes		(35,044	)		-
Other expense		1			-
Net income from discontinued operations	$	35,204		$	4,381

The cash flows related to the discontinued operations have not been segregated and are included in the consolidated statements of cash flows.

Furthermore, the below table illustrates certain cash flows from discontinued operations:

	2024		2023
	For the Years Ended December 31,
	2024		2023
Operating activities
Depreciation	$	77	$	73

Continuing Involvement

As a result of the Company’s investment in Rollover Units of Investment, which is accounted for as an equity method investment (see Note 2 - Summary of Significant Accounting Policies – Equity-Method Investment), the Company determined that it has continuing involvement with the discontinued operation, which is expected to continue for as long as the Company retains its investment in Rollover Units. There are no revenues or expenses presented in continuing operations after the disposal transaction that before the disposal transaction were eliminated in the Company’s consolidated financial statements as intra-entity transactions. The equity method investment did not result in any pretax income or losses reported on the Company’s consolidated statements of operations for the years ended December 31, 2024 or 2023. Prior to the disposal transaction, the Company owned 100% of the discontinued operation, PCEP.

In addition, upon the closing of the Equity Transaction, the Company and the Buyer entered into a transition services agreement, pursuant to which (i) the Company will provide certain transition services to the Buyer for various service periods ranging from 30 days to 12 months following the Closing Date and (ii) the Buyer will provide one specific transition service to the Company until October 31, 2025.

12. EQUITY-METHOD INVESTMENT

As disclosed in Note 11 – Discontinued Operations, on October 29, 2024, the Company deconsolidated its subsidiary, PCEP. As part of the transaction, the Company retained an equity interest in PCEP via the issuance of Rollover Units. The Company estimated the fair value of the retained equity interest on the date of deconsolidation, which was determined to be $2,000 based on the Company’s proportionate share of Investment, which was calculated using the market approach based on the Equity Transaction.

13. BUSINESS SEGMENT, GEOGRAPHIC AND CUSTOMER INFORMATION

The CEO, as the Chief Operating Decision Maker (“CODM”), organizes the Company, manages resource allocations and measures performance of the Company’s single operating segment, Critical Power Solutions. The Critical Power Solutions reportable segment is the Company’s Titan Energy Systems, Inc. business unit. The Critical Power Solutions segment provides mobile high capacity charging equipment, power generation equipment and aftermarket field-services in order to help customers secure fast vehicle charging where fixed charging infrastructure does not exist, and additionally to ensure smooth, uninterrupted power to operations during times of emergency.

The CODM assesses the Company’s performance and decides how to allocate resources based on consolidated net income (loss) in the consolidated statements of operations, which is assessed to be the segment measure of profit or loss. This measure is used to monitor actual results to evaluate the performance of the segment versus the forecasted targets. The segment assets are equal to the assets presented in the consolidated balance sheets.

The significant expenses that are regularly provided to the CODM, which include costs of goods sold, selling, general and administrative expenses and research and development expenses, are disclosed in the consolidated statements of operations as a part of the consolidated net income (loss). The other segment item that is regularly provided to the CODM includes other income (expense) which is disclosed as a separate line item in the consolidated statements of operations. Other income and expenses consist of interest income and interest expense, which are disclosed as separate line items in the consolidated statements of operations.

On October 29, 2024, the Company sold its Electrical Infrastructure segment to Mill Point Capital. Prior to the sale of the Electrical Infrastructure segment, the Company’s CODM assessed performance and allocated resources amongst its two reportable segments. See Note 11- Discontinued Operations for additional information.

Revenues are attributable to countries based on the location of the Company’s customers:

	Year Ended
	For the Years Ended
	December 31,
	2023		2022 (Restated)
	2024		2023
Revenues
United States	$	4119,~~493~~909	$	2511,~~878~~116
Canada		2,970		-
Total	$	22,879	$	11,116

Approximately ~~42%~~ 22% and 2013% of the Company’s ~~sales~~revenues during the year ended December 31, ~~2023~~2024, were made to ~~Enchanted~~INF ~~Rock Electric~~Associates, LLC and ~~Sequel~~British ~~Electrical~~Columbia ~~Supply,~~Hydro ~~LLC~~and Power Authority, respectively. Approximately 4314% ~~and 10%~~ of the Company’s sales during the year ended December 31, ~~2022~~2023, were made to ~~Enchanted~~ ~~Rock~~Target ~~Electric, LLC and Southern California Gas Company, respectively~~Corporation.

The distribution of the Company’s property and equipment by geographic location is approximately as follows:

	December 31,
	2023		2022
	2024		2023
Property and equipment
United States	$	36,~~899~~503	$	13,~~800~~601

5752

1514. BASIC AND DILUTED EARNINGS (LOSS) PER ~~COMMON~~ SHARE

Basic earnings ~~and diluted~~ (loss) per ~~common~~ share data for each period presented is ~~calculated~~ ~~based~~computed onusing the weighted average number of ~~vested~~ shares ~~outstanding~~of common stock outstanding during ~~the~~each such period. ~~The~~Diluted ~~Company’s~~earnings ~~employee~~(loss) ~~and~~per ~~director equity~~share ~~awards,~~data asis ~~well~~computed asusing ~~incremental~~the ~~shares~~weighted ~~issuable~~average ~~upon~~number ~~exercise~~ of ~~warrants,~~common ~~are~~and ~~not~~dilutive common ~~considered~~equivalent inshares ~~the~~outstanding ~~calculations~~during ifeach ~~the~~period. ~~effect would~~Dilutive becommon ~~anti-dilutive.~~equivalent ~~The~~shares ~~following~~consist ~~table~~of ~~sets~~shares ~~forth~~that would be issued upon the ~~computation~~exercise of ~~basic~~stock options and ~~diluted~~vesting ~~loss~~of ~~per~~restricted ~~share~~stock ~~(in thousands~~units, ~~except per~~computed ~~share~~using ~~data):~~the treasury stock method.

A reconciliation of basic and diluted earnings (loss) per share is as follows (in thousands, except per share data):

	2023			2022
	2024			2023
	Year Ended
	For the Years Ended
	December 31,
	2023			2022 (Restated)
	2024			2023
Numerator:
Net loss	$	(1,898	)	$	(5,419	)
Loss from continuing operations	$	(3,349	)	$	(6,279	)
Income from discontinued operations, net of income taxes		35,204			4,381
Net income (loss)	$	31,855		$	(1,898	)
Denominator:
Weighted average basic shares outstanding		9,905,234			9,727,542
Weighted average common shares outstanding - basic		10,745,217			9,905,234
Effect of dilutive securities - equity based compensation plans		-			-
Effect of dilutive securities:
Weighted average diluted shares outstanding		9,905,234			9,727,542
Stock options		186,958			138,565
Net loss per common share:
Restricted stock units		21,686			83,389
Basic	$	(0.19	)	$	(0.56	)
Weighted average common shares outstanding - diluted		10,953,861			10,127,188
Diluted	$	(0.19	)	$	(0.56	)
Basic (loss) earnings per share:
Loss per share from continuing operations	$	(0.31	)	$	(0.63	)
Earnings per share from discontinued operations		3.28			0.44
Basic earnings (loss) per share	$	2.97		$	(0.19	)
Diluted (loss) earnings per share:
Loss per share from continuing operations	$	(0.31	)	$	(0.63	)
Earnings per share from discontinued operations		3.21			0.43
Diluted earnings (loss) per share	$	2.90		$	(0.20	)

AsThe following ofsecurities ~~December~~were ~~31,~~excluded ~~2023~~from ~~and~~the ~~2022,~~calculation ~~basic~~of ~~and~~ diluted ~~loss~~earnings per share ~~excludes~~because ~~potentially~~their ~~dilutive~~inclusion ~~common~~would ~~shares~~have ~~related~~been ~~to 332,500 and 670,667 shares underlying stock options, respectively, and 125,000 and 250,000 shares underlying nonvested RSUs, respectively, as their effect was~~ anti-dilutive.:

~~16.~~ SCHEDULE ~~SUBSEQUENT EVENTS~~OF ANTIDILUTIVE SECURITIES EXCLUDED FROM COMPUTATION OF EARNINGS PER SHARE

Subsequent to December 31, 2023, the Company sold 919,557 shares of common stock under the ATM program (See liquidity section in Note 1 - Business Organization, Nature of Operations, Risks and Uncertainties) for total gross proceeds of approximately $4,986, at an average gross price of $5.5970 per share.

	2024		2023
	For the Years Ended
	December 31,
	2024		2023
Stock options		339,500		402,500
Total		339,500		402,500

~~On May 1, 2024, the third tranche of RSUs under Mr~~15. ~~Michalec’s RSU~~ ~~Award~~SUBSEQUENT vested and, as a result, 125,000 shares of common stock were subsequently issued to Mr. Michalec. On June 7, 2024, Mr. Michalec surrendered 57,541 shares of common stock issued to him upon settlement of his vested RSUs to satisfy tax withholding obligations. The shares were cancelled and retired by the Company.EVENTS

On January 7, 2025, the Company paid a one-time special cash dividend of an aggregate of $16,665.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

Not applicable.

ITEM 9A. CONTROLS AND PROCEDURES.

Management’s Conclusions Regarding Effectiveness of Disclosure Controls and Procedures

We conducted an evaluation of the effectiveness of our “disclosure controls and procedures”, as defined by Rules 13a-15(e) and 15d-15(e) of the Exchange Act, as of December 31, 2024, the end of the period covered by this Annual Report on Form 10-K. The disclosure controls and procedures evaluation was done in conjunction with an independent consultant and consulting firm and under the supervision and with the participation of management, including our chief executive officer and chief financial officer. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures. As of December 31, 2024, based on the evaluation of these disclosure controls and procedures, and in light of the material weakness found in our internal controls over financial reporting, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were not effective. In light of this determination, our management has performed additional analyses, reconciliations, and other post-closing procedures and has concluded that, notwithstanding the material weakness in our internal control over financial reporting, the consolidated financial statements for the periods covered by and included in this Annual Report on Form 10-K fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U.S. GAAP.

Management’s Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external reporting purposes in accordance with generally accepted accounting principles.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness of internal control over financial reporting to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate over time.

Management, including our chief executive officer and our chief financial officer, assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control - Integrated Framework (2013). A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. In our assessment of the effectiveness of internal control over financial reporting as of December 31, 2024, we determined that the Company’s internal control over financial reporting was not effective as of December 31, 2024, due to the lack of sufficient accounting personnel and, as a result, the Company is unable to maintain proper segregation of duties.

Management’s Plan to Remediate the Material Weakness

The Company is implementing enhancements to its internal controls to remediate the identified material weakness in its internal control over financial reporting. Specifically, the Company:

	●	has engaged external third parties for assistance as needed;
	●	has contracted to implement a new ERP system allowing for systemic enforcement of segregation of duties rules; and
	●	will be enhancing, designing and implementing process-level and general information technology controls relevant to the financial reporting process within the new ERP system.

Additionally, the Company plans to hire additional accounting and finance personnel with the requisite skills, knowledge and expertise to address identified control deficiencies.

The Company is committed to maintaining a strong internal control environment and believes these remediation efforts will represent significant improvements in its controls over the control environment. These steps will take time to be fully implemented and confirmed to be effective and sustainable. Additional controls may also be required over time. While the Company believes that these efforts will improve its internal control over financial reporting, the Company will not be able to conclude whether the steps the Company is taking will remediate the material weakness in internal control over financial reporting until a sufficient period of time has passed to allow management to test the design and operational effectiveness of the new and enhanced controls. Until the remediation steps set forth above are fully implemented and tested, the material weakness described above will continue to exist.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting, as permitted by the rules of the SEC.

Changes in Internal Control over Financial Reporting

During the year ended December 31, 2023, the Company identified material weaknesses in our internal control over financial reporting related to the Electrical Infrastructure segment. The material weaknesses were due to deficiencies in the segment’s revenue recognition of over-time contracts and associated costs, recognition of costs incurred by contract, and lack of an inventory automated tracking system.

On October 29, 2024, the Company sold its Electrical Infrastructure segment to Mill Point Capital. As a result of the sale, the deficiencies that contributed to the material weaknesses identified during the year ended December 31, 2023 were eliminated, and the Company’s controls were modified in order to consider the Company’s remaining business. Accordingly, management’s assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024 considered the controls in place as of such date.

Other than described above, there have been no changes in our internal control over financial reporting that occurred during the three months ended December 31, 2024, that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

ITEM 9B. OTHER INFORMATION.

None.

ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Executive Officers and Directors

The following table sets forth the name, age and positions of our executive officers and the members of our board of directors:

Name	Age	Position with the Company
Nathan J. Mazurek	63	President, Chief Executive Officer and Chairman of the Board of Directors
Walter Michalec	36	Chief Financial Officer, Secretary and Treasurer
Yossi Cohn	46	Director
Ian Ross	81	Director
David Tesler	51	Director
Jonathan Tulkoff	63	Director
Thomas Klink	62	Director
Kytchener Whyte	72	Director

The board of directors currently consists of seven members.

Our directors hold office until the earlier of their death, resignation or removal by stockholders or until their successors have been qualified. Our directors serve a term of office to expire at the annual meeting of stockholders in 2024. Pursuant to an amendment to our bylaws, effective September 21, 2023, elected directors shall hold office until the next annual meeting of the stockholders, or until their successors shall be duly elected and qualified.

Our officers hold office until the earlier of their death, resignation or removal by our board of directors or until their successors have been selected. They serve at the pleasure of our board of directors.

Nathan J. Mazurek. Mr. Mazurek has served as our chief executive officer, president and chairman of the board of directors since December 2, 2009. From December 2, 2009, through August 12, 2010, Mr. Mazurek also served as our chief financial officer, secretary and treasurer. Mr. Mazurek has over 25 years of experience in the electrical equipment and components industry. Mr. Mazurek has served as the chief executive officer, president, vice president, sales and marketing and chairman of the board of directors of Pioneer Transformers Ltd. since 1995. Mr. Mazurek has served as the president of American Circuit Breaker Corp., a former manufacturer and distributor of circuit breakers, since 1988. From 1999 through 2017, Mr. Mazurek served as director of Empire Resources, Inc., a distributor of semi-finished aluminum and steel products. From 2002 through 2007, Mr. Mazurek served as president of Aerovox, Inc., a manufacturer of AC film capacitors. Mr. Mazurek received his BA from Yeshiva College in 1983 and his JD from Georgetown University Law Center in 1986. Mr. Mazurek brings to the board of directors extensive experience with our company and in our industry. Since he is responsible for, and familiar with, our day-to-day operations and implementation of our strategy, his insights into our performance and into the electrical equipment and components industry are critical to board discussions and to our success.

Walter Michalec. Mr. Michalec was appointed by our board of directors to act as the interim Chief Financial Officer of the Company, effective as of April 15, 2020, replacing Mr. Klink after his resignation as Chief Financial Officer. On May 13, 2021, our board of directors assigned Mr. Michalec the title of Chief Financial Officer of the Company and removed the title of Interim Chief Financial Officer, effective May 16, 2021. Mr. Michalec also serves as the Company’s principal accounting officer, principal financial officer, treasurer and secretary. Mr. Michalec has served various positions at the Company, most recently as its corporate controller from August 2019 to April 2020. Before becoming the corporate controller, Mr. Michalec served as the Company’s operations controller from March 2016 to August 2019, reporting to the Chief Financial Officer, and as the Company’s senior accountant from May 2012 to February 2016, reporting to the Company’s corporate controller. Prior to working for the Company, Mr. Michalec served as a public accountant for Mendonca & Partners Certified Public Accountants, LLC in Union, NJ. Mr. Michalec received his Bachelor of Science in Accounting and a Minor in Criminal Justice from Kean University in 2011.

Yossi Cohn. Mr. Cohn has served as a director since December 2, 2009. Mr. Cohn founded EastSky Properties, LLC in June 2019 and L3C Capital Partners, LLC in June 2009, both an investor in multi-family residential properties, and serves as a partner in both firms. Mr. Cohn served as a director of investor relations at IDT Corporation, a NYSE-listed telecommunications company, from September 2005 through May 2007. Prior to joining IDT Corporation, Mr. Cohn was a director of research at SAGEN Asset Management, an asset manager of funds of hedge funds, from January 2005 through May 2005. Mr. Cohn began his career as an analyst in the funds-of-funds investment group of Millburn Ridgefield Corporation, where he worked from 2001 through January 2005. Our board believes Mr. Cohn’s background at these and other companies, particularly in areas of capital markets, financial, strategic and investment management experience, makes him an effective member of our board of directors.

Ian Ross. Mr. Ross has served as a director since March 24, 2011. In 2000, Mr. Ross co-founded and has since served as president of Omniverter Inc., a company specializing in electrical power quality solutions for industrial producers and electrical utilities in the United States and Canada. He has also served as the president of KIR Resources Inc. and KIR Technologies Inc. since 1999, companies engaged in management consulting and import/export activities in the electrical equipment industry, respectively. Mr. Ross previously held positions in Canada as vice president technology with Schneider Canada, a specialist in energy management, and vice president of the distribution products business at Federal Pioneer Ltd., now part of Schneider Canada. Previously, Mr. Ross held a number of successive board level positions in UK engineering companies, culminating in five years as managing director, Federal Electric, Ltd., before moving to Canada in 1986 at the request of Federal Pioneer Ltd. He received an MA in mechanical sciences (electrical and mechanical engineering) from Cambridge University and subsequently qualified as an accountant ACMA. Our board of directors believes that Mr. Ross’ relationships and broad experience in the electrical transmission and distribution equipment industry will assist us in continuing to grow our business and realizing our strategic goals.

David Tesler. Mr. Tesler has served as a director since December 2, 2009. Mr. Tesler is President of LeaseProbe, LLC, a provider of lease abstracting services, since he founded the company in 2004. In 2008, LeaseProbe, LLC acquired Real Diligence, LLC, a provider of financial due diligence services. The combined company does business as Real Diligence and operates as an integrated outsourced provider of legal and commercial due diligence services for the commercial real estate industry. Prior to 2004, Mr. Tesler practiced law at Skadden Arps Slate Meager & Flom LLP and at Jenkens & Gilchrist, Parker Chapin LLP. Mr. Tesler received his BA from Yeshiva College, an MA in medieval history from Bernard Revel Graduate School and a JD from Benjamin A. Cardozo School of Law. Mr. Tesler brings extensive legal, strategic and executive leadership experience to our board of directors.

Jonathan Tulkoff. Mr. Tulkoff has served as director since December 2, 2009. Mr. Tulkoff began his career as a currency trader at Marc Rich & Co, he then joined Forest City enterprises, a publicly traded real estate development company, and was a VP in the acquisition and development division. In 2016, Mr. Tulkoff founded Commodity Asset Management, an industrial materials investment fund. For the last twenty years, Mr. Tulkoff has been involved in trading, marketing and financing of physical commodities, with distinct expertise in ferrous metals. Mr. Tulkoff is Series 3 licensed. Our board of directors believes Mr. Tulkoff’s extensive strategic, international and executive leadership experience, particularly in commodity markets for metal products which represent one of the largest components of our company’s cost of manufacture, make him an effective member of our board of directors.

Thomas Klink. Mr. Klink has served as a director since April 30, 2010, and has been employed as a consultant since January 1, 2024. Mr. Klink served as our chief financial officer, secretary and treasurer from January 7, 2016, until April 15, 2020. Since 1996, he has served in various positions at Jefferson Electric, Inc., including as its chief executive officer, chief financial officer, vice president, treasurer, secretary and chairman of the board of directors. Previously, from 1994 to 1996, Mr. Klink served as a division controller at MagneTek, Inc., a company listed on Nasdaq at that time, reporting to the corporate controller. Mr. Klink also previously served as a controller for U.S. Music Corporation, a manufacturer of musical instruments from 1990 through 1994. Mr. Klink received his BBA in Accounting from the University of Wisconsin - Milwaukee in 1984. Mr. Klink brings extensive industry and leadership experience to our board, including over 25 years of experience in the electrical equipment industry. Mr. Klink is currently employed as a consultant for several businesses, supporting their accounting and integration programs.

Kytchener Whyte. Mr. Whyte has served as a director since November 17, 2022. Mr. Whyte has over 45 years of extensive experience in the Electrical Power Distribution & Controls industries with an emphasis on manufacturing, sales and marketing. Since July 31, 2015, Mr. Whyte has been a consultant and served as President of PCEP. Since January 2016, Mr. Whyte has been President of Blue Mountain Industries, Inc., a consulting, electrical engineering and marketing consultancy firm concentrating on the electrical utility, petrochemical and marine markets. From 1999 to 2015, Mr. Whyte was the President and owner of Pacific, based in Southern California. Pacific manufactured electrical power distribution and control products such as its trailblazing IPC units for applications in the petroleum, refining, electric transit and utility industries. Mr. Whyte served as General Manager for CGI, Inc., a manufacturer of Electrical Power Distribution and Controls products from 1993 to 1999. Prior to his time at CGI, Inc., Mr. Whyte was the Vice President for Electrical Power Products between 1985 and 1993. A native of Jamaica, Mr. Whyte is a graduate of Prospect College in St. Mary, Jamaica, and a graduate of Los Angeles Trade Technical College. Mr. Whyte is a United States Air Force Vietnam era veteran, a private pilot and the builder of experimental aircrafts. With his many years of experience in manufacturing, sales, marketing, product design and implementation, Mr. Whyte brings to the board invaluable insights and expertise, and the ability to turn problems into opportunities.

The board of directors believes that the overall experience and knowledge of the members of the board of directors will contribute to the overall success of our business.

Family Relationships

There are no family relationships among any of our directors and executive officers. Mr. Mazurek is a party to a certain agreement related to his service as an executive officer and director described in the “Agreements with Executive Officers” section of Item 11. Mr. Michalec is a party to a certain agreement related to his service as an executive officer described in the “Agreements with Executive Officers” section of Item 11.

Delinquent Section 16(a) Reports

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and officers, and persons who own more than ten percent of our common stock, to file with the SEC initial reports of ownership and reports of changes in ownership of our common stock. Directors, officers and persons who own more than ten percent of our common stock are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file.

To our knowledge, based solely on a review of the copies of such reports furnished to us, during the fiscal year ended December 31, 2024, each of our directors, officers and greater than ten percent stockholders complied with all Section 16(a) filing requirements applicable to our directors, officers and greater than ten percent stockholders.

Board Committees

Our board of directors currently has three standing committees: the audit committee, the nominating and corporate governance committee, and the compensation committee, each of which is described below. All standing committees operate under a charter that has been approved by the board of directors.

Audit Committee. Our board of directors established an audit committee on March 24, 2011, which has the composition and responsibilities described below.

The audit committee consists of Messrs. Cohn, Ross and Tulkoff, each of whom our board of directors has determined to be financially literate and qualify as an independent director under Section 5605(a)(2) of the rules of the Nasdaq Stock Market. In addition, Mr. Ross is the chairman of the audit committee and has been determined by our board of directors to be a financial expert as defined in Item 407(d)(5)(ii) of Regulation S-K. The audit committee’s duties are to recommend to our board of directors the engagement of independent auditors to audit our consolidated financial statements and to review our accounting and auditing principles. The audit committee reviews the scope, timing and fees for the annual audit and the results of audit examinations performed by internal auditors and independent public accountants, including their recommendations to improve the system of accounting and internal controls. The audit committee held a total of five meetings during the fiscal year ended December 31, 2024.

The audit committee operates under a formal charter adopted by the board of directors that governs its duties and conduct. Copies of the charter can be obtained free of charge from the Company’s web site, www.pioneerpowersolutions.com, by contacting the Company by mail at the address appearing on the first page of this Annual Report on Form 10-K to the attention of Investor Relations, or by telephone at (212) 867-0700.

Compensation Committee. On January 18, 2022, the board of directors designated a compensation committee (the “compensation committee”). Our compensation committee is composed of Messrs. Tessler and Cohn, each of whom our board of directors has determined to qualify as an independent director under Section 5605(a)(2) of the rules of the Nasdaq Stock Market. Pursuant to its charter, the compensation committee shall be comprised of at least two (2) “independent” members of the board of directors who shall also satisfy such other criteria imposed on members of the compensation committee pursuant to the federal securities laws and the rules and regulations of the SEC and the Nasdaq Stock Market. The compensation committee’s duties are to discharge the responsibilities of the board of directors relating to compensation of the Company’s directors and executive officers, to assist the board of directors in establishing appropriate incentive compensation and equity-based plans and to administer such plans, to oversee the annual process of evaluation of the performance of the Company’s management, and to perform such other duties and responsibilities as enumerated in and consistent with its charter. The compensation committee may designate one or more subcommittees, each subcommittee to consist of at least two members of the compensation committee. Any such subcommittee, to the extent provided in the resolutions of the compensation committee and to the extent not limited by applicable law, shall have and may exercise all the powers and authority of the compensation committee. The compensation committee has authority to retain or obtain the advice of compensation consultants, legal counsel, experts and other advisors as the compensation committee may deem appropriate in its sole discretion. The compensation committee is directly responsible for the appointment, compensation and oversight of its consultants, legal counsel, experts and advisors and has sole authority to approve their fees and retention terms, and the Company will provide funding for such fees and related expenses. Our compensation committee has not retained the services of any compensation consultants. The compensation committee held a total of two meetings during the fiscal year ended December 31, 2024.

The compensation committee operates under a formal charter adopted by the board of directors that governs its duties and conduct. Copies of the charter can be obtained free of charge by contacting the Company by mail at the address appearing on the first page of this Annual Report on Form 10-K to the attention of Investor Relations, or by telephone at (212) 867-0700.

Nominating Committee. On January 18, 2022, the board of directors designated a nominating and corporate governance committee (the “nominating committee”). Our nominating committee is composed of Messrs. Tessler and Tulkoff, each of whom our board of directors has determined to qualify as an independent director under Section 5605(a)(2) of the rules of the Nasdaq Stock Market. Pursuant to its charter, the nominating committee shall be comprised of at least two (2) “independent” members of the board of directors who shall also satisfy such other criteria imposed on members of the nominating committee pursuant to the federal securities laws and the rules and regulations of the SEC and the Nasdaq Stock Market. The nominating committee’s duties are to assist the board of directors by identifying potential qualified nominees for director and recommend to the board of directors for nomination candidates for the board of directors, developing the Company’s corporate governance guidelines and additional corporate governance policies, exercising such other powers and authority as are set forth in the charter of the nominating committee and exercising such other powers and authority as shall from time to time be assigned to such committee by resolution of the board of directors. The nominating committee held a total of two meetings during the fiscal year ended December 31, 2024.

~~ITEM~~ The 9nominating committee operates under a formal charter adopted by the board of directors that governs its duties and conduct. ~~CHANGES~~Copies of INthe ~~AND~~charter ~~DISAGREEMENTS~~can ~~WITH~~be ~~ACCOUNTANTS~~obtained ONfree ~~ACCOUNTING~~of ~~AND~~charge ~~FINANCIAL~~by ~~DISCLOSURE~~contacting the Company by mail at the address appearing on the first page of this Annual Report on Form 10-K to the attention of Investor Relations, or by telephone at (212) 867-0700.

~~Not~~Code of ~~applicable.~~Business Conduct and Ethics

~~ITEM~~We have 9Aadopted a code of business conduct and ethics that applies to our directors, officers, and employees, including our principal executive officer and principal financial and accounting officer, which is posted on our website at www.pioneerpowersolutions.com. ~~CONTROLS~~We ~~AND~~intend ~~PROCEDURES~~to disclose future amendments to certain provisions of the code of ethics, or waivers of such provisions granted to executive officers and directors, on this website within four business days following the date of such amendment or waiver.

~~Management’s Conclusions Regarding Effectiveness~~Insider ofTrading ~~Disclosure Controls and Procedures~~Policy

We maintain ~~conducted~~ an ~~evaluation~~insider oftrading ~~the~~policy ~~effectiveness~~that ~~of our~~applies ~~“disclosure~~to ~~controls~~our ~~and procedures”~~officers, asdirectors ~~defined by Rules 13a-15(e)~~ and ~~15d-15(e)~~employees ofthat ~~the~~prohibits ~~Exchange~~trading ~~Act,~~our assecurities ~~of December~~during ~~31,~~certain ~~2023,~~established ~~the~~periods ~~end~~and ofwhen ~~the~~in ~~period~~possession ~~covered~~of bymaterial ~~this Annual Report on Form 10~~non-Kpublic information. ~~The~~It ~~disclosure~~also ~~controls~~prohibits, ~~and~~unless ~~procedures~~approved ~~evaluation~~in ~~was done~~advance in ~~conjunction~~limited ~~with~~circumstances anby ~~independent consultant and consulting firm and under~~ the ~~supervision~~policy ~~and~~administrator, ~~with~~ the ~~participation~~hedging of ~~management, including~~ our ~~chief~~securities, ~~executive~~including ~~officer~~short ~~and~~sales ~~chief~~or ~~financial~~purchases ~~officer.~~or ~~There~~sales ~~are inherent limitations to the effectiveness~~ of ~~any system of~~derivative ~~disclosure~~securities ~~controls and procedures. As of December 31, 2023,~~ based on ~~the~~our ~~evaluation of these disclosure controls and procedures~~securities, and in ~~light of~~ the ~~material~~use ~~weaknesses~~of ~~found in~~ our ~~internal~~securities ~~controls~~to ~~over~~secure ~~financial~~a ~~reporting,~~margin ~~our~~or ~~chief~~other ~~executive officer and chief financial officer have concluded that our disclosure controls and procedures were not effective~~loan. InSince ~~light~~the adoption of ~~this determination,~~ our ~~management~~insider ~~has~~trading ~~performed additional analyses~~policy, ~~reconciliations,~~the ~~and~~policy ~~other~~administrator ~~post-closing~~has ~~procedures~~not ~~and~~granted ~~has~~any ~~concluded~~such ~~that,~~exemptions ~~notwithstanding~~to the ~~material weaknesses~~policy’s ingeneral ~~our~~prohibition ~~internal~~on ~~control~~hedging ~~over~~or pledging. ~~financial~~A ~~reporting,~~copy ~~the~~of ~~consolidated~~our ~~financial~~Insider ~~statements~~Trading ~~for~~Policy ~~the~~is ~~periods~~included ~~covered~~as byExhibit ~~and~~19.1 ~~included in~~to this Annual Report on Form 10-K ~~fairly state, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with U~~.~~S. GAAP.~~

~~Management’s Annual Report on Internal Control over Financial Reporting~~59

~~Management is responsible for establishing and maintaining~~ITEM ~~adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act~~11. ~~Our~~EXECUTIVE internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external reporting purposes in accordance with generally accepted accounting principles.COMPENSATION

~~Because of its inherent limitations, internal control~~Compensation ~~over~~Philosophy ~~financial~~and reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness of internal control over financial reporting to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate over time.Process

~~Management, including our chief executive~~Since ~~officer~~January ~~and~~18, ~~our chief financial officer~~2022, ~~assessed~~ the ~~effectiveness~~responsibility offor ~~our internal control over financial reporting as of December 31~~establishing, ~~2023.~~administering Inand ~~making~~interpreting ~~this~~our ~~assessment,~~policies ~~management~~governing ~~used~~ the ~~criteria~~compensation ~~set~~and ~~forth by the Committee of Sponsoring Organizations of the~~benefits ~~Treadway~~for ~~Commission~~our inexecutive ~~Internal~~officers ~~Control~~lies -with ~~Integrated~~our ~~Framework~~compensation ~~(2013)~~committee. AOur ~~material~~compensation ~~weakness~~committee ishas a deficiency, or a combination of deficiencies, within the meaning of Public Company Accounting Oversight Board (“PCAOB”) Auditing Standard AS 2201, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not beretained ~~prevented or detected on a timely basis. In our assessment of~~ the ~~effectiveness~~ ofservices ~~internal control over financial reporting as~~ of ~~December~~any ~~31, 2023, we determined that the Company’s internal~~compensation ~~control over financial reporting was not effective as of December 31, 2023 due to the material weaknesses described below~~consultants.

The ~~Company did not maintain effective controls over~~ ~~the~~goals ~~revenue recognition~~ of ~~over-time~~our ~~contracts~~executive ~~and~~compensation ~~associated~~program ~~costs.~~are ~~The Company’s underlying estimates of total labor hours required~~ to ~~complete over-time contracts were materially different from the actual labor hours required~~attract, ~~which~~motivate ~~was determined to represent an error,~~ and, asretain aindividuals ~~result,~~with the ~~percentage~~skills ofand ~~completion~~qualities ~~used~~necessary to support ~~recognize~~and ~~revenue~~develop ~~was~~our ~~materially~~business ~~different~~within ~~from~~ the ~~percentage~~framework of ~~completion~~our ~~using actual~~size ~~labor~~and ~~hours~~available ~~incurred~~resources. ~~Additionally,~~In the Company did not properly account for recognition of costs incurred by contract. This material weakness resulted in the restatement of the Company’s consolidated financial statements for the year ended December 312018, ~~2022,~~ aswe ~~well~~designed asour ~~its~~executive ~~interim consolidated financial statements for the three months ended March 31, 2022 and 2023, the three and six months~~compensation ~~ended~~program ~~June~~to ~~30,~~achieve ~~2022 and 2023 and~~ the ~~three~~following ~~and nine months ended September 30, 2022 and 2023.~~objectives:

~~The~~● ~~Company~~attract ~~did not design~~ and ~~maintain~~retain ~~effective controls~~executives ~~over~~experienced ~~the~~in ~~accounting~~developing ~~for inventory~~ and ~~related~~delivering ~~cost~~products ofsuch ~~sales,~~as ~~primarily~~our ~~due~~own; to● ~~the~~motivate ~~lack of an automated tracking system~~ and ~~the manual~~reward ~~nature~~executives ofwhose ~~its~~experience ~~current processes~~ and ~~controls~~skills ~~surrounding~~are ~~inventory.~~critical ~~Specifically,~~to weour ~~did~~success; ~~not~~● ~~design~~reward ~~and~~performance; ~~maintain effective controls over (1) complete~~ and ~~accurate~~● ~~inventory~~align ~~costing, including recording inventoriable costs at~~ the ~~lower~~interests of ~~cost~~our ~~and~~executive ~~net~~officers ~~realizable~~and ~~value, (2)~~other ~~cycle~~key ~~count~~employees ~~procedures~~with ~~and~~those ~~inventory~~of ~~system~~our ~~changes,~~stockholders ~~which~~by ~~occur~~motivating ~~without~~our ~~proper~~executive ~~review~~officers and ~~documentation~~other ~~and~~key ~~(3)~~employees ~~proper~~to ~~segregation of~~increase ~~duties~~stockholder value.

~~The~~We appointed ~~Company~~a ~~has~~compensation committee in January 2022 when we no longer qualified as a ~~lack~~“controlled company” under the corporate governance rules of ~~sufficient~~the ~~accounting~~Nasdaq Stock Market. We did not engage any compensation consultants to determine or recommend the amount and ~~personnel~~form ~~with~~of executive and director compensation during and for the ~~necessary~~year ~~skills~~ended December 31, ~~knowledge~~2024. At this time, ~~and~~our ~~expertise.~~compensation ~~This~~committee has, ~~deficiency~~and ~~impacts~~previously our ~~ability~~board toof ~~ensure~~directors ~~appropriate~~had, ~~segregation~~determined that the financial and administrative burden of engaging compensation consultants is not justified in light of ~~duties~~our Company’s size, its resources and toour ~~accurately~~relatively small number of executive officers and ~~timely~~directors. Rather, ~~close~~beginning in the year ended December 31, ~~consolidate~~2022, we anticipate that the recommended level, components and ~~prepare~~rationale ~~financial~~for ~~statements~~our ascompensation program ~~required~~will be developed and presented each year by our compensation committee to ~~maintain~~the ~~compliance~~board ~~with reporting~~of ~~deadlines~~directors ~~under~~for ~~applicable~~its ~~SEC~~consideration ~~regulations~~and approval.

~~These~~We adopted ~~material~~a ~~weaknesses resulted~~Clawback inPolicy ~~identified~~on ~~material~~November ~~misstatements~~9, 2023, as an additional safeguard to ~~the~~mitigate ~~financial~~compensation ~~statements,~~risks. ~~and~~The ~~the~~Clawback ~~Prior~~Policy ~~Financial~~is ~~Statements~~incorporated by ~~are~~reference ~~restated~~as inExhibit 97.1 to this ~~filing~~Annual Report.

~~Remediation~~Summary Compensation ~~Plan~~Table

The following ~~Company~~table issummarizes, ~~implementing~~for ~~enhancements~~each of the last two fiscal years ended December 31, 2024, and 2023, the compensation paid to ~~its~~(i) Nathan ~~internal~~J. ~~controls~~Mazurek, toour ~~remediate~~chief executive officer, president and chairman of the ~~identified~~board ~~material~~of ~~weaknesses~~directors, inand ~~its~~(ii) ~~internal~~Walter ~~control~~Michalec, ~~over~~our chief financial officer, ~~reporting.~~secretary ~~Specifically~~and treasurer, whom we refer to collectively herein as the ~~Company~~ ~~has:~~“named executive officers.”

● engaged external third parties for assistance as needed; ● initiated a review and update of significant accounting policies, procedures, and controls; and ● begun additional training for its accounting and financial reporting personnel.

							Stock		Option		All other
	Years		Salary		Bonus		awards (1)		awards (1)		compensation				Total
Name and principal position			($)		($)		($)		($)		($)				($)
Nathan J. Mazurek (i)		2024		650,500		2,000,000		-		50,660		21,000	(2	)		2,722,160
President, Chief Executive Officer, Chairman of the Board of Directors		2023		562,500		-		575,000		43,514		15,000	(2	)		1,196,014

Walter Michalec (ii)		2024		300,000		164,000		296,000		-		-				760,000
Chief Financial Officer, Secretary, and Treasurer		2023		220,000		31,000		-		-		-				251,000

Additionally the Company plans to hire additional accounting and finance personnel with the requisite skills, knowledge and expertise to address identified control deficiencies.

	(1)	Amounts represent the aggregate grant date fair value, as determined in accordance with FASB ASC Topic 718, with the exception that the amounts shown assume no forfeitures. The assumptions used to calculate the value of share-based awards are set forth in “Item 8. Financial Statements and Supplementary Data – Note 9. Stock-Based Compensation” contained in this Annual Report. These amounts do not represent the actual value that may be realized by our named executive officers, as that is dependent on the long-term appreciation in our common stock.
	(2)	Comprised of board of directors meeting fees.

The Company is committed to maintaining a strong internal control environment and believes these remediation efforts will represent significant improvements in its controls over the control environment. These steps will take time to be fully implemented and confirmed to be effective and sustainable. Additional controls may also be required over time. While the Company believes that these efforts will improve its internal control over financial reporting, the Company will not be able to conclude whether the steps the Company is taking will remediate the material weaknesses in internal control over financial reporting until a sufficient period of time has passed to allow management to test the design and operational effectiveness of the new and enhanced controls. Until the remediation steps set forth above are fully implemented and tested, the material weaknesses described above will continue to exist.60

~~This annual report does not include an attestation~~Agreements ~~report~~with ofExecutive ~~our registered public accounting firm regarding internal control over financial reporting, as permitted by the rules of the SEC.~~Officers

59Nathan J. Mazurek

~~Changes~~We entered into an employment agreement with Mr. Mazurek, dated as of December 2, 2009, pursuant to which Mr. Mazurek was to serve as our chief executive officer for a term of three years. Pursuant to this employment agreement, Mr. Mazurek was entitled to receive an annual base salary of $250,000 from December 2, 2009 through December 2, 2010, which was increased to $275,000 on December 2, 2010 and to $300,000 on December 2, 2011. Mr. Mazurek was entitled to receive an annual cash bonus at the discretion of our board of directors, or a committee thereof, of up to 50% of his annual base salary, which percentage was permitted to be increased in ~~Internal~~the ~~Control~~discretion ~~over~~of ~~Financial~~the ~~Reporting~~board.

~~Except~~This agreement ~~for~~prohibited ~~commencing~~Mr. ~~implementation~~Mazurek offrom ~~the~~competing ~~remediation~~with ~~plan~~us ~~described~~for ina ~~our Annual~~period ~~Report~~of onfour ~~Form~~years ~~10-K~~following ~~for~~ the ~~year~~date ~~ended~~of ~~December 31~~termination, ~~2022,~~unless ~~and~~he ~~the~~was ~~further~~terminated without ~~remediation~~cause ~~efforts~~or ~~described~~due ~~above,~~to ~~there~~disability ~~were~~or nohe ~~changes in~~voluntarily ~~our~~resigned ~~internal~~following ~~control~~a ~~over~~breach ~~financial~~by ~~reporting~~us ~~during~~of ~~the~~this ~~three months ended December 31~~agreement, ~~2023~~in ~~that~~which ~~have~~case ~~materially~~he ~~affected,~~was ~~or are~~prohibited ~~reasonably~~from ~~likely~~competing towith ~~materially~~us ~~affect,~~for ~~our~~a ~~internal~~period ~~control~~of ~~over~~only ~~financial~~two ~~reporting~~years.

~~ITEM~~We entered 9Binto a new employment agreement with Mr. ~~OTHER~~Mazurek, ~~INFORMATION~~dated as of March 30, 2012, pursuant to which Mr. Mazurek will serve as our chief executive officer for a three year term ending on March 31, 2015. Pursuant to this new employment agreement, Mr. Mazurek was entitled to receive an annual base salary of $350,000 during the remainder of the 2012 calendar year, which increased to $365,000 during the 2013 calendar year and then to $380,000 for the remainder of his employment term. The other material terms of the new employment agreement are substantially similar to those under his previous agreement, except that Mr. Mazurek has agreed not to compete with us for a period of one year following the termination of his employment for any reason.

~~None~~On November 11, 2014, we entered into a first amendment to our employment agreement with Mr. Mazurek, pursuant to which the term of the employment agreement was extended by a period of three years ending on March 31, 2018. In addition, pursuant to this employment agreement, as amended, Mr. Mazurek became entitled to receive an annual base salary of $410,000 beginning on the amendment effective date and ending on December 31, 2015, which increased to $425,000 during the 2016 calendar year.

~~ITEM~~On June 9C30, 2016, we entered into a second amendment to our employment agreement with Mr. ~~Disclosure~~Mazurek, ~~Regarding~~pursuant ~~Foreign~~to ~~Jurisdictions~~which ~~that~~the ~~Prevent~~term ~~Inspections~~of the employment agreement was extended by a period of five years ending on March 31, 2021. In addition, pursuant to this employment agreement, as amended, Mr. Mazurek became entitled to receive an annual base salary of $425,000 for the period beginning on January 1, 2016 and ending on December 31, 2016, $440,000, for the period beginning on January 1, 2017 and ending on December 31, 2017, $465,000, for the period beginning on January 1, 2018 and ending on December 31, 2018, $490,000, for the period beginning on January 1, 2019 and ending on December 31, 2019, and $515,000 per annum, for the period beginning on January 1, 2020 and ending on March 31, 2021.

~~Not~~On March ~~applicable~~30, 2020, the Company and Mr. Mazurek entered into a third amendment in order to (i) extend the termination date of the agreement from December 31, 2020, to March 31, 2023, and (ii) set Mr. Mazurek’s annual base salary at $415,000 for the period beginning on April 1, 2020 and ending on March 31, 2021; $435,500, for the period beginning on April 1, 2021 and ending on March 31, 2022; and $457,500, for the period beginning on April 1, 2022 and ending on March 31, 2023.

60On April 25, 2022, the Company and Mr. Mazurek entered into a fourth amendment in order to (i) extend the termination date of the Mazurek Agreement from March 31, 2023, to December 31, 2024, and (ii) adjust Mr. Mazurek’s annual base salary at $535,500, for the period beginning on January 1, 2022 and ending on December 31, 2022, $562,500, for the period beginning on January 1, 2023 and ending on December 31, 2023, and $590,500, for the period beginning on January 1, 2024 and ending on December 31, 2024.

~~PART~~On December ~~III~~26, 2023, the Company and Mr. Mazurek entered into a fifth amendment in order to (i) extend the termination date of the Mazurek Agreement from December 31, 2024 to December 31, 2026, and (ii) adjust Mr. Mazurek’s annual base salary at $650,500, for the period beginning on January 1, 2024 and ending on December 31, 2024, $675,500, for the period beginning on January 1, 2025 and ending on December 31, 2025, and $700,500, for the period beginning on January 1, 2026 and ending on December 31, 2026.

~~ITEM~~If Mr. 10Mazurek is terminated without cause, he is entitled to receive (i) any unpaid base salary accrued through the date of his termination, (ii) any unreimbursed expenses properly incurred prior to the date of his termination, and (iii) severance pay equal to the base salary that would have been payable to Mr. ~~DIRECTORS~~Mazurek for the remainder of the term of his executive employment agreement, ~~EXECUTIVE~~which ~~OFFICERS~~expires ~~AND~~on ~~CORPORATE~~December 31, ~~GOVERNANCE~~2026, less applicable withholdings and taxes. As a precondition to receiving severance pay, Mr. Mazurek is required to execute and deliver within sixty (60) days following his termination a general release of claims against the us and our subsidiaries and affiliates that may have arisen on or before the date of the release.

~~Executive~~For purposes ~~Officers~~of ~~and~~Mr. ~~Directors~~Mazurek’s executive employment agreement, “cause” generally means termination because of: (i) an act or acts of willful or material misrepresentation, fraud or willful dishonesty by Mr. Mazurek; (ii) any willful misconduct by Mr. Mazurek with regard to the Company; (iii) any violation by Mr. Mazurek of any fiduciary duties owed by him to the Company; (iv) Mr. Mazurek’s conviction of, or pleading nolo contendere or guilty to, a felony (other than a traffic infraction) or (v) any other material breach by Mr. Mazurek of the executive employment agreement that is not cured by him within twenty (20) days after his receipt of a written notice from the Company of such breach specifying the details thereof.

~~The following table sets forth the name, age and positions of our executive officers and the members of our board of directors:~~61

Name	Age	Position with the Company
Nathan J. Mazurek	62	President, Chief Executive Officer and Chairman of the Board of Directors
Walter Michalec	36	Chief Financial Officer, Secretary and Treasurer
Yossi Cohn	46	Director
Ian Ross	80	Director
David Tesler	50	Director
Jonathan Tulkoff Thomas Klink	62 61	Director Director
Kytchener Whyte	72	Director

In connection with his employment agreement, we granted Mr. Mazurek an award of restricted stock units (“RSUs”) under the 2021 Pioneer Power Solutions, Inc. Long-Term Incentive Plan (as amended, the “2021 Plan”) covering 100,000 shares of the Company’s common stock, with such RSUs being subject to the terms and conditions of the 2021 Plan and a Restricted Stock Unit Award Agreement, which agreement provided, among other things, that (a) the RSUs shall vest as of the date of grant, and (b) such vested RSUs shall be converted into shares of the Company’s common stock no later than March 15, 2024. The award had a grant date fair value of $575,000. In connection with the vesting of the RSUs, we paid on Mr. Mazurek’s behalf an aggregate amount of $272,829.32 to satisfy his income and payroll tax obligations, to be reimbursed from payroll withholding. On September 20, 2023, we and Mr. Mazurek entered into a letter agreement pursuant to which Mr. Mazurek agreed to surrender and cancel 44,363 shares of common stock issued to him upon settlement of his vested RSUs, in order to reimburse us for the tax payment we made on his behalf. Upon the surrender and cancellation of the shares, we were fully reimbursed. See “Part III. Item 13 - Certain Related Transactions and Relationships”.

~~The board of directors currently consists~~Walter ~~of seven members.~~Michalec

~~Our~~Mr. Michalec ~~directors~~was ~~hold~~appointed ~~office~~by ~~until~~our ~~the~~board ~~earlier~~ of ~~their~~directors ~~death,~~to ~~resignation~~act oras ~~removal~~the byInterim ~~stockholders~~Chief orFinancial ~~until~~Officer ~~their~~of ~~successors~~us, ~~have~~effective ~~been~~as ~~qualified~~of April 15, 2020, replacing Mr. ~~Our~~Klink ~~directors~~after ~~serve~~his aresignation ~~term~~as ofChief ~~office to~~Financial ~~expire~~Officer. atOn ~~the~~May ~~annual~~13, ~~meeting~~2021, our board of ~~stockholders~~directors inassigned ~~2024~~Mr. ~~Pursuant~~Michalec tothe title anof ~~amendment~~Chief toFinancial ~~our~~Officer ~~bylaws,~~and ~~effective~~removed ~~September~~the ~~21,~~title ~~2023,~~of ~~elected directors~~Interim ~~shall~~Chief ~~hold~~Financial ~~office~~Officer, ~~until~~effective ~~the~~May ~~next~~16, ~~annual~~2021. ~~meeting~~Mr. ofMichalec ~~the~~also serves ~~stockholders,~~as orour ~~until~~principal ~~their~~accounting ~~successors~~officer, ~~shall~~principal befinancial ~~duly~~officer, ~~elected~~treasurer and ~~qualified~~secretary.

~~Our~~On April ~~officers~~25, ~~hold~~2022, ~~office~~we ~~until~~and ~~the~~Mr. ~~earlier~~Michalec entered into an employment agreement under which we agreed to employ Mr. Michalec as its Chief Financial Officer, Secretary and Treasurer for a term of ~~their~~three ~~death~~(3) years, ~~resignation~~commencing oron ~~removal~~January by1, ~~our~~2022 ~~board~~and ofending ~~directors~~on orDecember ~~until~~31, ~~their~~2024, ~~successors~~unless such ~~have~~employment ~~been~~is ~~selected~~terminated earlier in accordance with the agreement. ~~They~~Mr. ~~serve~~Michalec is entitled to an annualized base salary at a rate of $200,000 per annum for the ~~pleasure~~period of January 1, 2022 through December 31, 2022, $220,000 per annum for the period of January 1, 2023 through December 31, 2023, and $240,000 per annum for the period of ~~our~~January ~~board~~1, 2023 through the end of ~~directors~~the employment period. Mr. Michalec’s employment may be terminated upon his death or disability, upon the occurrence of certain events that constitute “cause,” and without cause. If terminated without cause, Mr. Michalec will be entitled to receive as severance an amount equal to his base salary for the remainder of the employment period under the agreement.

~~Nathan J. Mazurek. Mr. Mazurek has served~~On ~~as our chief executive officer, president and chairman of the board of directors since~~ December 226, ~~2009. From December 2~~2023, ~~2009~~the ~~through August~~Company ~~12,~~and ~~2010,~~ Mr. ~~Mazurek~~Michalec ~~also~~entered ~~served~~into asa ~~our~~first ~~chief~~amendment ~~financial~~in ~~officer,~~order ~~secretary~~to ~~and~~(i) ~~treasurer.~~extend ~~Mr.~~the ~~Mazurek~~termination ~~has~~date ~~over 25 years~~ of ~~experience in~~ the ~~electrical~~Michalec Agreement ~~equipment~~from ~~and~~December ~~components~~31, ~~industry.~~2023 ~~Mr.~~to ~~Mazurek~~December ~~has served as the chief executive officer~~31, ~~president~~2026, ~~vice president, sales~~ and ~~marketing~~(ii) ~~and~~adjust ~~chairman of the board of directors of Pioneer Transformers Ltd~~Mr. ~~since~~Michalec’s ~~1995.~~annual ~~Mr.~~base ~~Mazurek~~salary ~~has~~at ~~served~~$300,000, asfor the ~~president~~period ofbeginning ~~American~~on ~~Circuit~~January ~~Breaker Corp.~~1, a2024 ~~former manufacturer~~ and ~~distributor~~ending ofon ~~circuit~~December ~~breakers~~31, ~~since 1988. From 1999 through 2017~~2024, ~~Mr. Mazurek served as director of Empire Resources~~$325, ~~Inc.~~000, afor ~~distributor~~the ofperiod ~~semi-finished~~beginning ~~aluminum~~on ~~and~~January ~~steel products. From 2002 through 2007~~1, ~~Mr.~~ ~~Mazurek~~2025 ~~served~~and asending ~~president~~on ~~of Aerovox~~December 31, ~~Inc.~~2025, ~~a manufacturer of AC film capacitors. Mr. Mazurek received his BA from Yeshiva College in 1983~~ and ~~his~~$350,000, JDfor ~~from Georgetown University Law Center in 1986. Mr. Mazurek brings to~~ the ~~board~~period ofbeginning ~~directors~~on ~~extensive~~January ~~experience with our company and in our industry. Since he is responsible for~~1, ~~and~~2026 ~~familiar with, our day-to-day operations~~ and ~~implementation~~ending ofon ~~our~~December ~~strategy~~31, ~~his~~ ~~insights into our performance and into the electrical equipment and components industry are critical to board discussions and to our success~~2026.

~~Walter Michalec. Mr. Michalec~~In ~~was~~connection ~~appointed~~with bythe ~~our~~employment ~~board~~agreement ofentered ~~directors~~into tobetween ~~act as~~ the ~~interim~~Company ~~Chief~~and ~~Financial~~Mr. ~~Officer of the Company~~Michalec, effective ~~as of~~ April 1525, ~~2020~~2022, ~~replacing~~ the Company granted Mr. ~~Klink~~Michalec ~~after~~an ~~his~~award ~~resignation~~of asRSUs ~~Chief~~under ~~Financial~~the ~~Officer.~~2021 OnPlan ~~May~~pursuant ~~13,~~to ~~2021,~~that ~~our~~certain ~~board~~Restricted ofStock ~~directors~~Unit ~~assigned~~Award ~~Mr.~~Agreement ~~Michalec~~ (the ~~title~~ of“RSU ~~Chief~~Award”) covering ~~Financial~~375,000 ~~Officer~~shares of the Company’s ~~and~~common ~~removed~~stock, ~~the~~vesting ~~title~~in ofthree ~~Interim~~equal ~~Chief~~installments ~~Financial~~on ~~Officer,~~each ~~effective~~of May 161st of 2022, ~~2021.~~2023, ~~Mr.~~and ~~Michalec~~2024. ~~also~~In ~~serves~~connection aswith the ~~Company’s~~vesting ~~principal~~of ~~accounting~~the ~~officer~~RSUs, ~~principal~~we ~~financial~~paid ~~officer,~~on ~~treasurer and secretary.~~ Mr. Michalec ~~has~~’s ~~served~~behalf ~~various~~an ~~positions~~aggregate atamount ~~the~~of ~~Company~~$481,220.28 ~~most~~to ~~recently~~satisfy his asincome ~~its~~and ~~corporate~~payroll ~~controller~~tax ~~from~~obligations, ~~August 2019~~ to ~~April~~be ~~2020.~~reimbursed ~~Before~~from ~~becoming the~~payroll ~~corporate controller~~withholding, ~~Mr.~~and ~~Michalec served as~~ the Company’s ~~operations~~had ~~controller~~been reimbursed $34,000.00 from payroll ~~March~~withholding ~~2016~~as toof ~~August~~September ~~2019~~20, ~~reporting~~2023. ~~to the~~On ~~Chief~~September ~~Financial~~20, ~~Officer~~2023, we and asMr. ~~the~~Michalec ~~Company’s~~entered ~~senior~~into ~~accountant~~a ~~from~~letter ~~May~~agreement ~~2012~~pursuant to which ~~February~~Mr. ~~2016,~~Michalec ~~reporting~~agreed to ~~the~~surrender ~~Company’s corporate~~and ~~controller.~~cancel ~~Prior~~72,719 shares of common stock issued to ~~working~~him ~~for~~upon ~~the~~settlement ~~Company,~~of ~~Mr.~~his ~~Michalec~~vested ~~served~~RSUs, asin order ato ~~public~~reimburse ~~accountant~~us for ~~Mendonca~~the &remaining ~~Partners~~amount ~~Certified Public~~of ~~Accountants,~~the ~~LLC~~tax inpayment ~~Union,~~we ~~NJ.~~made Mron his behalf. ~~Michalec~~Upon ~~received~~the ~~his~~surrender ~~Bachelor~~and cancellation of ~~Science~~the inshares, we ~~Accounting~~were ~~and~~fully areimbursed. ~~Minor~~See in“Part ~~Criminal~~III. ~~Justice~~Item ~~from Kean~~13 ~~University~~- inCertain ~~2011~~Related Transactions and Relationships”.

~~Yossi Cohn. Mr. Cohn has served as a~~In ~~director~~addition, ~~since~~on ~~December~~September 220, ~~2009.~~2023, Mr. ~~Cohn~~Michalec’s ~~founded~~RSU ~~EastSky~~Award ~~Properties,~~was ~~LLC~~amended into ~~June~~provide ~~2019~~that ~~and~~his ~~L3C~~future ~~Capital~~tax ~~Partners,~~withholding ~~LLC~~obligations in ~~June 2009, both~~ anconnection ~~investor~~with inthe ~~multi-family~~RSU ~~residential~~Award ~~properties,~~can ~~and~~be ~~serves as a partner in both firms. Mr. Cohn served as a director of investor relations at IDT Corporation~~satisfied, aamong ~~NYSE-listed telecommunications company~~others, ~~from~~

Filing Compare · PIONEER POWER SOLUTIONS, INC.