What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-14 compared with 2024-10-08 · 269 added, 192 removed, 424 unchanged (52% of the section changed)

1 unchanged sentence

POWER SOLUTIONS, INC.

Statements of Operations

Consolidated Statements of Operations

thousands, except for share and per share amounts)

2 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

2023 (As Restated)

6 unchanged sentences

(Loss) income from operations

Interest income

Interest expense (income)

Other expense (income), net

6 unchanged sentences

POWER SOLUTIONS, INC.

Balance Sheets

Consolidated Balance Sheets

thousands, except for share amounts)

September 30,

Current assets

Accounts receivable, net of allowance for credit losses of $ 150 and $ 97 as of June 30, 2024 and December 31, 2023, respectively

Accounts receivable, net of allowance for credit losses of $ 52 and $ 97 as of September 30, 2024 and December 31, 2023, respectively

Prepaid expenses and other current assets

18 unchanged sentences

Common stock, $ 0.001 par value, 30,000,000 shares authorized;

10,917,038 and 9,930,022 shares issued and outstanding on June 30, 2024 and December 31, 2023, respectively

10,917,038 and 9,930,022 shares issued and outstanding on September 30, 2024 and December 31, 2023, respectively

Additional paid-in capital

4 unchanged sentences

POWER SOLUTIONS, INC.

Statements of Cash Flows

2023 (As Restated)

Six Months Ended

Consolidated Statements of Cash Flows

Nine Months Ended

September 30,

2023 (As Restated)

1 unchanged sentence

Net (loss) income

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile net (loss) income to net cash used in operating activities:

Amortization of right-of-use financing leases

8 unchanged sentences

Operating lease liabilities

Net cash (used in)/ provided by operating activities

Net cash used in operating activities

Investing activities

2 unchanged sentences

Financing activities

Net proceeds from the exercise of options for common stock

Net proceeds from issuance of common stock

Payment of deferred financing costs

Principal repayments of financing leases

Net cash provided by/ (used in) financing activities

Increase (decrease) in cash

Decrease in cash

Cash, beginning of period

3 unchanged sentences

Non-cash investing and financing activities:

Acquisition of right-of-use assets and lease liabilities

Deferred financing costs included in accounts payable and accrued liabilities

Surrender and retirement of common stock

1 unchanged sentence

POWER SOLUTIONS, INC.

Statements of Changes in Stockholders’ Equity

Consolidated Statements of Changes in Stockholders’ Equity

thousands, except for share amounts)

comprehensive

stockholders’

Balance - March 31, 2023 (As Restated)

Stock-based compensation

other comprehensive

Total stockholders’

Balance - June 30, 2023 (As Restated)

Balance - March 31, 2024

Stock-based compensation

Issuance of common stock, net of transaction costs

Surrender and retirement of common stock

Exercise of stock options

Issuance of common stock, net of transaction costs

Balance - September 30, 2023 (As Restated)

Balance - June 30, 2024

comprehensive

stockholders’

Stock-based compensation

Balance - September 30, 2024

Additional paid-in

Accumulated other comprehensive

Total stockholders’

Balance - January 1, 2023 (As Restated)

Stock-based compensation

Balance - June 30, 2023 (As Restated)

Surrender and retirement of common stock

Exercise of stock options

Issuance of common stock, net of transaction costs

Balance - September 30, 2023 (As Restated)

Balance - January 1, 2024

Net (loss) income

Net Income (loss)

Stock-based compensation

1 unchanged sentence

Surrender and retirement of common stock

Balance - June 30, 2024

Balance - September 30, 2024

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

POWER SOLUTIONS, INC.

to Unaudited Consolidated Financial Statements for the Quarterly Period Ended June 30, 2024

to Unaudited Condensed Consolidated Financial Statements for the Quarterly Period Ended September 30, 2024

thousands, except for share and per share amounts)

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and Critical Power Solutions (“Critical Power”).

accompanying unaudited interim consolidated financial statements of the Company have been prepared pursuant to the rules of the SEC and

reflect the accounts of the Company as of June 30, 2024.

Certain information and footnote disclosures, normally included in annual financial

statements prepared in accordance with accounting principles generally accepted in the United States (“U.S.

been condensed or omitted pursuant to those rules and regulations.

We believe 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 interim consolidated financial

statements have been included.

The results of operations for the interim period are not necessarily indicative of the results for the

entire fiscal year.

The year-end balance sheet data was derived from audited consolidated financial statements but this filing does not

include all disclosures required by U.S.

GAAP for a year-end balance sheet.

dollar amounts (except share and per share data) presented in the notes to our unaudited interim consolidated financial statements are

stated in thousands of dollars, unless otherwise noted.

ASC 740-270 requires the use of an estimated annual effective tax rate to compute

the tax provision during an interim period unless certain exceptions are met.

We have used a discrete-period computation method to calculate

taxes for the fiscal six-month period ended June 30, 2024.

The Company anticipates that its annual effective tax rate will be 0 %

for the year ending December 31, 2024.

As of June 30, 2024, the Company continues to provide a 100 %

valuation allowance against its net deferred tax assets since the Company believes it is more likely than not that its deferred tax assets

will not be realized.

unaudited interim consolidated financial statements include the accounts of Pioneer and its wholly-owned subsidiaries.

All significant

intercompany accounts and transactions have been eliminated in consolidation.

unaudited interim consolidated financial statements should be read in conjunction with the risk factors under the heading “Part

II - Item 1A.

Risk Factors” and the risk factors and the audited consolidated financial statements and notes thereto of the Company

and its subsidiaries included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

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 June 30, 2024, the Company had $ 6,512

of cash on hand and working capital of $ 11,140 .

The cash on hand was generated primarily from the sale of common stock under the ATM Program (as defined below), payment of all

unpaid principal and interest from the two subordinated promissory notes we received in connection with the sale of the transformer

business units in August 2019 for an aggregate principal amount of $ 7,500

(the “Seller Notes”) during the year ended December 31, 2022, and cash flows from operating activities.

On October 29, 2024, the Company closed on the sale of its Electrical Infrastructure segment.

– Subsequent Events”.

accompanying unaudited condensed interim consolidated financial statements of the Company have been prepared pursuant to the rules

of the SEC and reflect the accounts of the Company as of September 30, 2024.

Certain information and footnote disclosures, normally

included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States

GAAP”), have been condensed or omitted pursuant to those rules and regulations.

We believe 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 interim consolidated financial statements have been included.

The results of operations for the interim

period are not necessarily indicative of the results for the entire fiscal year.

The year-end balance sheet data was derived from

audited consolidated financial statements but this filing does not include all disclosures required by U.S.

GAAP for a year-end

balance sheet.

dollar amounts (except share and per share data) presented in the notes to our unaudited condensed interim consolidated financial

statements are stated in thousands of dollars, unless otherwise noted.

ASC 740-270 requires the use of an estimated annual effective

tax rate to compute the tax provision during an interim period unless certain exceptions are met.

We have used a discrete-period

computation method to calculate taxes for the fiscal nine-month period ended September 30, 2024.

The Company is currently in the

process of estimating its annual effective tax rate for the year ending December 31, 2024 and, as such, the annual effective tax rate is unknown.

As of September 30, 2024, the Company

continues to provide a 100 %

valuation allowance against its net deferred tax assets since the Company believes it is more likely than not that its deferred tax

assets will not be realized.

unaudited condensed interim consolidated financial statements include the accounts of Pioneer and its wholly-owned subsidiaries.

significant intercompany accounts and transactions have been eliminated in consolidation.

unaudited condensed interim consolidated financial statements should be read in conjunction with the risk factors under the heading

“Part II - Item 1A.

Risk Factors” and the risk factors and the audited consolidated financial statements and notes

thereto of the Company and its subsidiaries included in the Company’s Annual Report on Form 10-K for the year ended December

31, 2023, and the Company’s Quarterly Reports on Form 10-Q for the periods ended March 31, 2024, and June 30, 2024.

accompanying condensed interim 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 September 30, 2024, the Company had $ 3,080 of cash on hand and working capital of $ 9,103 .

The cash on hand was generated primarily from the sale of common stock under the ATM Program (as defined below).

On October 20,

3 unchanged sentences

“ATM Program”).

Since October 20, 2020, and through June 30, 2024, the Company sold an aggregate of 1,835,616

shares of common stock for aggregate gross proceeds of approximately $ 14,051 ,

before any sales agent fees and expenses payable by us under the ATM Program.

During the six months ended June 30, 2024, the Company

sold an aggregate of 919,557

shares of common stock for an aggregate consideration of approximately $ 5,147 ,

before any sales agent fees and expenses payable by the Company under the ATM Program.

As of June 30, 2024, $ 69,853

of common stock remained available for issuance under the ATM Program.

Since October 20, 2020, and through September 30, 2024, the Company sold an aggregate of 1,835,616

shares of common stock for aggregate gross proceeds of approximately $ 14,051 , before any sales agent fees and expenses payable by us

under the ATM Program.

During the nine months ended September 30, 2024, the Company sold an aggregate of 919,557 shares of common

stock for an aggregate consideration of approximately $ 5,147 , before any sales agent fees and expenses payable by the Company under

the ATM Program.

As of September 30, 2024, $ 69,853 of common stock remained available for issuance under the ATM Program.

On October 29, 2024, the Company closed on the sale

of its Pioneer Custom Electrical Products, LLC subsidiary for gross cash proceeds of $ 48,000 .

See “Note 11 – Subsequent Events”.

Company has historically met its cash needs through a combination of cash flows from operating activities and bank borrowings, the

completion of the sale of the transformer business units in August 2019, sale of common stock under the ATM Program and collecting

all unpaid principal and interest from the Seller Notes.

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 unaudited interim consolidated financial statements

completion of the sale of the transformer business units in August 2019 and the sale of common stock under the ATM 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 and proceeds from the sale of its subsidiary.

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 unaudited condensed interim consolidated financial statements are issued.

and Uncertainties

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.

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 six months ended June 30, 2024, the Company was able to operate substantially

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.

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

During the three and nine months ended September 30, 2024, the Company was able to operate substantially at

can be no assurance that precautionary measures, whether adopted by the Company or imposed by others, will be effective, and such measures

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ASU 2023-09 on disclosures in our consolidated financial statements.

November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation

Disclosures” to require more detailed information about specified categories of expenses (purchases of inventory, employee compensation,

depreciation, amortization, and depletion) included in certain expense captions presented on the face of the income statement.

is effective for fiscal years beginning after December 15, 2026 and for interim periods within fiscal years beginning after December

Early adoption is permitted.

The amendments may be applied either (1) prospectively to financial statements issued for reporting

periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements.

is currently evaluating the impact of adopting this guidance on its condensed consolidated financial statements and related disclosures.

is recognized when (1) a contract with a customer exists, (2) performance obligations promised in a contract are identified based on

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of the work to be performed and the risk and impact of delayed performance.

the outset of each contract, the Company gauges its complexity and perceived risks and establish an estimated total number of labor hours

the outset of each contract, the Company gauges its complexity and perceived risks and establishes 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.

progress and performance of its ongoing contracts at least quarterly.

of Goods Sold

16 unchanged sentences

the collectability of the reported amount.

There were $ 150 and $ 97 of reserves for expected credit losses as of June 30, 2024, and December

31, 2023, respectively.

There were $ 52 and $ 97 of reserves for expected credit losses as of September 30, 2024, and

December 31, 2023, respectively.

Financing Costs

42 unchanged sentences

To achieve this core principle, the Company applies the following five steps:

the contract with a customer

Identify the contract with a customer

contract with a customer exists when (i) the Company enters into an enforceable contract with a customer that defines each party’s

5 unchanged sentences

to the customer.

the performance obligations in the contract

Identify the performance obligations in the contract

obligations promised in a contract are identified based on the products or services that will be transferred to the customer that are

7 unchanged sentences

for as a combined performance obligation.

the transaction price

Determine the transaction

transaction price is determined based on the consideration to which the Company will be entitled in exchange for transferring products

1 unchanged sentence

The customer payments are generally due in 30 days.

the transaction price to performance obligations in the contract

Allocate the transaction price to performance obligations

in the contract

the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation.

6 unchanged sentences

related to the performance obligations.

revenue when or as the Company satisfies a performance obligation

Recognize revenue when or as the Company satisfies a performance

Company satisfies performance obligations either over time or at a point in time.

1 unchanged sentence

obligation is satisfied by transferring a promised product or service to a customer.

the three months ended June 30, 2024, the Company recognized $ 4,676 of revenue over time, as compared to $ 8,224 during the three months

ended June 30, 2023.

Additionally, the Company recognized $ 1,664 and $ 4,058 of revenue at a point in time from the sale of our products

during the three months ended June 30, 2024, and June 30, 2023, respectively.

the three months ended September 30, 2024, the Company recognized $ 6,607 of revenue over time, as compared to $ 9,900 during the three

months ended September 30, 2023.

Additionally, the Company recognized $ 4,304 and $ 1,553 of revenue at a point in time from the sale of

our products during the three months ended September 30, 2024, and September 30, 2023, respectively.

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 $ 2,235 and $ 1,890 of service revenue during the three months ended June 30, 2024, and

June 30, 2023, respectively.

the six months ended June 30, 2024, the Company recognized $ 8,833 of revenue over time, as compared to $ 14,683 during the six months

ended June 30, 2023.

Additionally, the Company recognized $ 6,097 and $ 7,155 of revenue at a point in time from the sale of our products

during the six months ended June 30, 2024, and June 30, 2023, respectively.

The Company recognized $ 2,455 and $ 2,063 of service revenue during the three months ended September 30, 2024,

and September 30, 2023, respectively.

the nine months ended September 30, 2024, the Company recognized $ 15,447 of revenue over time, as compared to $ 24,635 during the nine

months ended September 30, 2023.

Additionally, the Company recognized $ 10,394 and $ 8,656 of revenue at a point in time from the sale

of our products during the nine months ended September 30, 2024, and September 30, 2023, respectively.

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 $ 4,223 and $ 3,952 of service revenue during the six months ended June 30, 2024, and

June 30, 2023, respectively.

the three months ended June 30, 2024, the Company recognized approximately $ 98

of revenue that was classified as deferred revenue

as of December 31, 2023, as compared to $ 3,334

of revenue recognized during the three months

ended June 30, 2023, that was classified as deferred revenue as of December 31, 2022, resulting primarily from the progress made on the

various active contracts during the respective reporting periods.

the six months ended June 30, 2024, the Company recognized approximately $ 2,477

of revenue that was classified as deferred revenue

as of December 31, 2023, as compared to $ 5,966

of revenue recognized during the six months ended

June 30, 2023, that was classified as deferred revenue as of December 31, 2022, resulting primarily from the progress made on the various

active contracts during the respective reporting periods.

The Company recognized $ 6,678 and $ 6,014 of service revenue during the nine months ended September 30, 2024,

and September 30, 2023, respectively.

the three months ended September 30, 2024, the Company recognized approximately $ 220 of revenue that was classified as deferred revenue

as of December 31, 2023, as compared to $ 2,569 of revenue recognized during the three months ended September 30, 2023 that was classified

as deferred revenue as of December 31, 2022, resulting primarily from the progress made on the various active contracts during the respective

reporting periods.

the nine months ended September 30, 2024, the Company recognized approximately $ 2,688 of revenue that was classified as deferred revenue

as of December 31, 2023, as compared to $ 8,535 of revenue recognized during the nine months ended September 30, 2023 that was classified

as deferred revenue as of December 31, 2022, resulting primarily from the progress made on the various active contracts during the respective

reporting periods.

Company manages its accounts receivable credit risk by performing credit evaluations and monitoring amounts due from the Company’s

1 unchanged sentence

or whose accounts receivable balances individually represented 10% or more of the Company’s total accounts receivable.

of June 30, 2024, one customer represented approximately 11 % of the Company’s accounts receivable.

As of December 31, 2023, one

customer represented approximately 23 % of the Company’s accounts receivable.

the three months ended June 30, 2024, one customer represented approximately 10 % of the Company’s revenue.

For the three months

ended June 30, 2023, one customer represented approximately 65 % of the Company’s revenue.

the six months ended June 30, 2024, one customer represented approximately 16 %

of the Company’s revenue.

For the six months ended June 30, 2023, two customers represented approximately 60 %

of the Company’s revenue.

of September 30, 2024, one customer represented approximately 20 % of the Company’s accounts receivable.

As of December 31, 2023,

one customer represented approximately 23 % of the Company’s accounts receivable.

the three months ended September 30, 2024, two customers represented approximately 26 % and 10 % of the Company’s revenue.

three months ended September 30, 2023, two customers represented approximately 55 % and 12 % of the Company’s revenue.

the nine months ended September 30, 2024, one customer represented approximately 11 % of the Company’s revenue.

For the nine months

ended September 30, 2023, two customers represented approximately 44 % and 20 % of the Company’s revenue.

of a product requires that the buyer obtain permission in writing from the Company.

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and material.

Returns and warranties during the three and six months ended June 30, 2024, and June 30, 2023, were insignificant.

Returns and warranties during the three and nine months ended September 30, 2024, and September 30, 2023, were insignificant.

following table presents our revenues disaggregated by revenue discipline:

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(As Restated)

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“Note 9 - Business Segment and Geographic Information”.

revenues (Topic 842)

842 revenues pertain to revenues and expenses related to the leasing of electric generators.

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.

The Company’s

lease revenues do include variable lease payments based on hours.

Revenues attributable to the variable lease payments are recognized

There were no leasing revenues arising from variable lease payments during the three and nine months ended September 30,

2024, and 2023.

For the three and nine months ended September 30, 2024, leasing revenues were $ 559 and $ 1,305 , respectively, and are included in revenue from products.

For the three

and nine months ended September 30, 2023, leasing revenues were $ 246 and $ 719 , respectively, and are included in revenue from products.

Company does not provide an option for the lessee to purchase the rented equipment at the end of the lease.

Lessees do not provide residual

value guarantees on rented equipment.

Company expects to derive significant future benefits from its equipment following the end of the rental term.

The Company recognizes

revenue over the contractual period of performance of the rental term.

following table presents our lease revenues:

OF LEASE REVENUES

Three Months Ended

Nine Months Ended

September 30,

Revenues - leases

Fixed lease revenue

Total revenues - leases

components of inventories are summarized below:

OF INVENTORIES

September 30,

Raw materials

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OF PROPERTY AND EQUIPMENT

September 30,

Machinery, vehicles and equipment

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Total property and equipment, net

expense was $ 164 and $ 97 for the three months ended June 30, 2024, and 2023, respectively.

expense was $ 286 and $ 227 for the six months ended June 30, 2024, and 2023, respectively.

expense was $ 185 and $ 143 for the three months ended September 30, 2024, and 2023, respectively.

expense was $ 471 and $ 370 for the nine months ended September 30, 2024, and 2023, respectively.

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

1 unchanged sentence

OF ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

September 30,

Accounts payable

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sales and use taxes and accrued insurance.

Accrued legal settlement costs as of June 30, 2024, and December 31, 2023, were $ 5,000 .

Note 10 for details.

As of June 30, 2024, and December 31, 2023, accrued sales commissions were $ 584 and $ 442 , respectively.

compensation and benefits as of June 30, 2024, and December 31, 2023, were $ 252 and $ 294 , respectively.

Accrued sales and use taxes as

of June 30, 2024, and December 31, 2023, were $ 167 and $ 67 , respectively, and there was $ 228 accrued insurance as of June 30, 2024, compared

to $ 795 as of December 31, 2023.

The remainder of accrued liabilities are comprised of several insignificant accruals in connection with

normal business operations.

of June 30, 2024, two of the Company’s suppliers represented approximately 41 % of the Company’s accounts payable.

As of December

31, 2023, one of the Company’s suppliers represented approximately 18 % of the Company’s accounts payable.

As of September 30, 2024, and December 31, 2023, accrued sales commissions were $ 364 and $ 442 ,

respectively.

Accrued compensation and benefits as of September 30, 2024, and December 31, 2023, were $ 319 and $ 294 , respectively.

were no accrued legal settlement costs as of September 30, 2024, compared to $ 5,000 as of December 31, 2023.

Accrued sales and use taxes

as of September 30, 2024, and December 31, 2023, were $ 224 and $ 67 , respectively, and there was no accrued insurance as of September

30, 2024, compared to $ 795 as of December 31, 2023.

The remainder of accrued liabilities are comprised of several insignificant accruals

in connection with normal business operations.

of September 30, 2024, two of the Company’s suppliers represented approximately 44 % of the Company’s accounts payable.

of December 31, 2023, one of the Company’s suppliers represented approximately 18 % of the Company’s accounts payable.

STOCK-BASED COMPENSATION

summary of stock option activity during the six months ended June 30, 2024, is as follows:

summary of stock option activity during the nine months ended September 30, 2024, is as follows:

OF STOCK OPTION ACTIVITY

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Forfeited/expired

Outstanding as of June 30, 2024

Exercisable as of June 30, 2024

summary of RSU activity during the six months ended June 30, 2024, is as follows:

Outstanding as of September 30, 2024

Exercisable as of September 30, 2024

summary of RSU activity during the nine months ended September 30, 2024, is as follows:

SCHEDULE OF RESTRICTED STOCK UNITS

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Units forfeited

Unvested restricted stock units as of June 30, 2024

compensation expense recorded for the three and six months ended June 30, 2024, was approximately $ 96 and $ 321 , respectively.

compensation expense recorded for the three and six months ended June 30, 2023, was approximately $ 819 and $ 962 , respectively.

30, 2024, there was $ 109 of stock-based compensation expense remaining to be recognized in the consolidated statements of operations

over a weighted average remaining period of 2.1 years.

Unvested restricted stock units as of September 30, 2024

compensation expense recorded for the three and nine months ended September 30, 2024, was approximately $ 13 and $ 334 , respectively.

compensation expense recorded for the three and nine months ended September 30, 2023, was approximately $ 285 and $ 1,246 , respectively.

As of September 30, 2024, there was $ 96 of stock-based compensation expense remaining to be recognized in the consolidated statements of

operations over a weighted average remaining period of 1.9 years.

BASIC AND DILUTED (LOSS) INCOME PER COMMON SHARE

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

2023 (As Restated)

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Net (loss) income per common share:

of June 30, 2024, diluted (loss) income per share excludes potentially dilutive common shares related to 654,313 shares underlying stock

options as their effect was anti-dilutive.

of September 30, 2024, diluted (loss) income per share excludes potentially dilutive common shares related to 654,313 shares underlying

stock options as their effect was anti-dilutive.

BUSINESS SEGMENT AND GEOGRAPHIC INFORMATION

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during times of emergency.

October 29, 2024, the Company closed on the sale of its Electrical Infrastructure segment.

See “Note 11 – Subsequent Events”.

following tables present information about segment loss and income:

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(As Restated)

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Depreciation and amortization

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(As Restated)

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Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

2023 (As Restated)

2 unchanged sentences

COMMITMENTS AND CONTINGENCIES

the three months ended September 30, 2024, the Company executed an extension of its operating lease for the manufacturing facility in

Santa Fe Springs, California.

After adjusting for a weighted average discount rate, the Company recognized a right-of-use asset and lease

liability of approximately $ 3,337 within the condensed consolidated balance sheets.

time to time, the Company is a defendant or plaintiff in various legal actions that arise in the normal course of business.

2 unchanged sentences

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.

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 July 27, 2023, the defendants filed an Answer to Plaintiff’s Amended

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.

dismissed with prejudice on July 23, 2024.

As of June 30, 2024, 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 sheets.

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,

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

SUBSEQUENT EVENTS

of Subsidiary

October 29, 2024, the Company entered into an Equity Contribution and Purchase Agreement (the “Equity Purchase Agreement”),

by and among the Company, Pioneer Custom Electrical Products, LLC, a wholly owned subsidiary of the Company (“Pioneer Custom”),

Voltaris Power LLC (the “Buyer”) and Pioneer Investment LLC (“Investment”).

Pursuant to the terms of the Equity

Purchase Agreement, the Company agreed to:

4% of all of the issued and outstanding equity interests of Pioneer Custom 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;

all of the issued and outstanding equity interests of Pioneer Custom other than the Rollover Interests to the Buyer ((i) and (ii)

being, the “Equity Transaction”).

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 the Company.

the execution of the Equity Purchase Agreement, the Equity Transaction was consummated on October 29, 2024 (the “Closing

Pioneer Custom represents the entirety of the Company’s Electrical Infrastructure segment.

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.

Subsequent to September 30, 2024, the Company issued

an aggregate of 95,465 shares of common stock (net of 12,535 shares repurchased) pursuant to option exercises for aggregate net proceeds

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements