<SEC-DOCUMENT>0001144204-16-090344.txt : 20160325
<SEC-HEADER>0001144204-16-090344.hdr.sgml : 20160325
<ACCEPTANCE-DATETIME>20160325141507
ACCESSION NUMBER:		0001144204-16-090344
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20160321
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20160325
DATE AS OF CHANGE:		20160325

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PIONEER POWER SOLUTIONS, INC.
		CENTRAL INDEX KEY:			0001449792
		STANDARD INDUSTRIAL CLASSIFICATION:	POWER, DISTRIBUTION & SPECIALTY TRANSFORMERS [3612]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-35212
		FILM NUMBER:		161529414

	BUSINESS ADDRESS:	
		STREET 1:		400 KELBY STREET, 9TH FLOOR
		STREET 2:		ONE PARKER PLAZA
		CITY:			FORT LEE
		STATE:			NJ
		ZIP:			07024
		BUSINESS PHONE:		212-867-0700

	MAIL ADDRESS:	
		STREET 1:		400 KELBY STREET, 9TH FLOOR
		STREET 2:		ONE PARKER PLAZA
		CITY:			FORT LEE
		STATE:			NJ
		ZIP:			07024

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	SIERRA CONCEPTS, INC.
		DATE OF NAME CHANGE:	20081112

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	SIERRA CONCEPTS
		DATE OF NAME CHANGE:	20081112
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>v435311_8k.htm
<DESCRIPTION>8-K
<TEXT>
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<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>UNITED STATES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Washington, D.C. 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <TD STYLE="border-bottom: Black 1pt solid; text-align: center; width: 20%">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 40%">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FORM 8-K</B></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 40%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="width: 20%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 40%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CURRENT REPORT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Pursuant to Section 13 or 15(d) of the
</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Securities Exchange Act of 1934</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Date of Report (Date of earliest event reported):
March 21, 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
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    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 40%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center; width: 20%">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 40%">&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>PIONEER POWER SOLUTIONS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">(Exact name of registrant as specified
in its charter)</P>

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<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 40%">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: center; width: 20%">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 40%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR>
    <TD STYLE="vertical-align: top; text-align: center; width: 50%"><FONT STYLE="font-size: 10pt"><B>Delaware</B></FONT></TD>
    <TD STYLE="vertical-align: top; text-align: center; width: 50%"><FONT STYLE="font-size: 10pt"><B>27-1347616</B></FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt">(State of incorporation)</FONT></TD>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt">(I.R.S. Employer Identification No.)</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>400 Kelby Street, 12th Floor</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>Fort Lee, New Jersey 07024</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(Address of principal executive offices)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>(212) 867-0700</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">(Registrant&rsquo;s
telephone number, including area code)</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 40%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="width: 20%">&nbsp;</TD>
    <TD STYLE="width: 40%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-top: Black 1pt solid; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 27pt">Check the appropriate box below if the Form
8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&#168;</FONT></TD><TD STYLE="text-align: justify">Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425)</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-indent: -0.75in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&#168;</FONT></TD><TD STYLE="text-align: justify">Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a-12)</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.75in; text-indent: -0.75in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&#168;</FONT></TD><TD STYLE="text-align: justify">Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d-2(b))</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-indent: -13.5pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 0in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Wingdings">&#168;</FONT></TD><TD STYLE="text-align: justify">Pre-commencement communications pursuant to Rule 13e-4
(c) under the Exchange Act (17 CFR 240.13e-4(c))</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 13.5pt; text-indent: -13.5pt">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -1in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 1in"><B>Item 1.01</B></TD>
    <TD><B>Entry into a Material Definitive Agreement..</B></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">On March 21, 2016, Pioneer Power Solutions,
Inc. (the &ldquo;Company&rdquo;) secured a second Limited Duration Waiver and Consent Letter (the &ldquo;Second Waiver and Consent&rdquo;)
from Bank of Montreal (&ldquo;BMO&rdquo;) with respect to the Company&rsquo;s U.S. and Canadian credit facilities with BMO, pursuant
to which BMO agreed, among other things, (i) to extend its waiver of certain existing defaults set forth in the Limited Duration
Waiver and Consent Letter, dated November 18, 2015 (the &ldquo;First Waiver and Consent&rdquo;) until April 30, 2016 and (ii) to
permit Pioneer Electrogroup Canada, Inc., a Quebec corporation and subsidiary of the Company (&ldquo;PECI&rdquo;), to further increase
its borrowing capacity under the Canadian credit facility up to $5,000,000 and advance those proceeds to the Company&rsquo;s U.S.
operations for working capital purposes, subject to the satisfaction of additional financial reporting requirements, margin criteria
and other conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">Pursuant to the Second Waiver and Consent,
the amounts advanced thereunder to PECI under the Canadian credit facility shall bear interest of the U.S. base rate plus 2.50%
per annum. In addition, as provided in the First Waiver and Consent, from and after November 16, 2015 (i) the obligations under
the U.S. credit facilities will bear interest at the default rate until BMO has advised in writing to the contrary, (ii) the Company
will not be permitted to continue Eurodollar loans with interest periods of longer than one month, nor convert any U.S. prime rate
loans into Eurodollar loans with interest periods of longer than one month, (iii) all outstanding advances under the Canadian facility
will bear interest at the default rate, (iv) PECI will not be permitted to make any advances at LIBOR with an interest period in
excess of one month and (v) any LIBOR advance or bankers acceptances under the Canadian credit facility will bear interest at the
applicable rate set forth in PECI&rsquo;s loan agreement plus 2.0% per annum.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The foregoing description of the Second
Waiver and Consent is qualified in its entirety by reference to full text of the Second Waiver and Consent, which is attached as
Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 1in; text-align: left"><B>Item 2.03</B></TD><TD STYLE="text-align: justify"><B>Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a Registrant.</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">The information set forth in Item 1.01 of
this report is incorporated herein by reference.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 1in; text-align: left"><B>Item 9.01</B></TD><TD STYLE="text-align: justify"><B>Financial Statements and Exhibits.</B></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(d)&#9;Exhibits</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 10%"><B>Exhibit Number</B></TD>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify; width: 5%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center; width: 85%"><B>Description</B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">10.1</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: justify">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">Limited Duration Waiver and Consent Letter, dated as of March 21, 2016, by and among Pioneer Power Solutions, Inc., Pioneer Electrogroup Canada Inc. and Bank of Montreal, Chicago Branch.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the requirements
of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

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    <TD STYLE="padding-right: 5.75pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-right: 5.75pt; text-align: justify"><FONT STYLE="text-transform: uppercase"><B>PIONEER POWER SOLUTIONS, inc.</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; padding-right: 5.75pt; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 5%; padding-right: 5.75pt">&nbsp;</TD>
    <TD STYLE="width: 45%; padding-right: 5.75pt; text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.75pt; text-align: justify">Date: March 25, 2016</TD>
    <TD STYLE="padding-right: 5.75pt">By:</TD>
    <TD STYLE="border-bottom: Black 1pt solid; padding-right: 5.75pt; text-align: justify">/s/ Thomas Klink</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.75pt; text-align: justify">&nbsp;</TD>
    <TD STYLE="padding-right: 5.75pt">Name:</TD>
    <TD STYLE="padding-right: 5.75pt; text-align: justify">Thomas Klink</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.75pt; text-align: justify">&nbsp;</TD>
    <TD STYLE="padding-right: 5.75pt">Title:</TD>
    <TD STYLE="padding-right: 5.75pt; text-align: justify">Chief Financial Officer</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<FILENAME>v435311_ex10-1.htm
<DESCRIPTION>EXHIBIT 10.1
<TEXT>
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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0; text-align: right"><B>Exhibit 10.1</B></P>

<P STYLE="margin: 0; text-align: right">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">March 21, 2016</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Pioneer Power Solutions, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Pioneer Electrogroup Canada Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">400 Kelby Street, 9th Floor</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Fort Lee, NJ 07024</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 1in; font-size: 10pt"><FONT STYLE="font-size: 10pt">Attention:</FONT></TD>
    <TD STYLE="font-size: 10pt"><FONT STYLE="font-size: 10pt">Thomas Klink</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 0.5in">&nbsp;</TD>
    <TD STYLE="width: 1in">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0"></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0">Re:</P></TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in 0pt 0"><FONT STYLE="font-variant: small-caps">Limited
Duration Waiver and Consent Letter</FONT></P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Gentlemen:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Reference is hereby
made to that certain Credit Agreement dated as of June&nbsp;28, 2013, as amended (the <I>&ldquo;PPSI Credit Agreement&rdquo;</I>),
between Pioneer Power Solutions, Inc. (the <I>&ldquo;US Borrower&rdquo;</I>), the Guarantors party thereto and Bank of Montreal
(the <I>&ldquo;Bank&rdquo;</I>), acting through its Chicago branch, to that certain Amended and Restated Letter Loan Agreement
dated as of June&nbsp;28, 2013, as amended, among Pioneer Electrogroup Canada Inc., a Quebec corporation (<I>&ldquo;PECI&rdquo;</I>)
as borrower (the &ldquo;<I>Canadian Borrower</I>&rdquo;), and the Bank (<I>&ldquo;PECI Letter Loan Agreement&rdquo;</I>) and the
Limited Duration Waiver and Consent Letter dated November 18, 2015 issued by the Bank and consented to by the US Borrower and the
Canadian Borrower (the <I>1<SUP>st</SUP> Waiver and Consent Letter</I>&rdquo;). Capitalized terms used herein without definition
shall have the same meanings herein as such terms have in the PPSI Credit Agreement and in the 1<SUP>st</SUP> Waiver and Consent
Letter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As indicated in the
1<SUP>st</SUP> Waiver and Consent Letter, the US Borrower disclosed to the Bank on November&nbsp;4, 2015 its failure to pay the
Payroll Tax Liability and that based on the September&nbsp;30, 2015, draft financial statements and covenant forecast furnished
by the US Borrower to the Bank, the Loan Parties and their Subsidiaries were not able to comply with the financial covenant levels
set forth in Section 8.23(e) as of September&nbsp;30, 2015, and the Loan Parties and their non-Canadian Subsidiaries were not in
compliance with respect to the Total Leverage Ratio covenant set forth in Section&nbsp;8.23(a) of the PPSI Credit Agreement and
the Fixed Charge Coverage Ratio covenant set forth in Section&nbsp;8.23(c) of the PPSI Credit Agreement. Each such event, along
with the default by the Canadian Borrower set forth in the next paragraph, constituted and still constitutes an Event of Default
under Section&nbsp;9.1 of the PPSI Credit Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Also as stated in the
1<SUP>st</SUP> Waiver and Consent Letter, based on the draft financial statements for the quarter ending September 30, 2015 submitted
to the Bank, the Canadian Borrower was and is still in default to comply with the financial assistance restrictions set forth in
paragraph 1.5 of Schedule VI (Negative Covenants) of the PECI Letter Loan Agreement. Such default along with the events of default
of the US Borrower under the PPSI Credit Agreement constitute Events of Default under the PECI Letter Loan Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The US Borrower, the
Canadian Borrower and the Guarantors under the PPSI Credit Agreement and the PECI Letter Loan Agreement (collectively the &ldquo;<I>Obligors</I>&rdquo;)
requested that the Bank waive the defaults described in the two prior paragraphs (the <I>&ldquo;Existing Defaults&rdquo;</I>).The
Bank waived the Existing Defaults through January 31, 2016 as appears from the 1<SUP>st</SUP> Waiver and Consent Letter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">At the request of the
US Borrower, PECI was also permitted to borrow up to the equivalent in Canadian dollars of US$3,000,000 under Facility&nbsp;A under
the PECI Letter Loan Agreement (subject to availability under the monthly margin requirement set forth in the PECI Letter Loan
Agreement) and on-lend those proceeds to the US Borrower for working capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Since then, the Bank
has engaged the services of a financial advisor to perform certain tasks and verifications as further described in the 1<SUP>st</SUP>
Waiver and Consent Letter. Although the financial advisor has completed some of the required tasks, further work needs to be performed
to conclude their engagement and accordingly the Bank needs additional time to analyze the information that it has and the information
that will be provided to it.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In the interim, the
US Borrower and the Canadian Borrower have requested the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">a)</TD><TD STYLE="text-align: justify">PECI be further allowed to increase its borrowings under Facility&nbsp;A of the PECI Letter Loan
Agreement up to the equivalent in Canadian dollars of US$5,000,000 (subject to the maximum under the PECI Letter Loan Agreement
and the availability under the monthly margin requirement set forth in the PECI Letter Loan Agreement as amended temporary under
b) below) and on-lend those proceeds to the Borrower for working capital (the <I>&ldquo;Intercompany Loan&rdquo;</I>), and</TD></TR>                                                                                                                                    <TR STYLE="vertical-align: top">
<TD>&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="text-align: justify">&nbsp;</TD></TR>
</TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">b)</TD><TD STYLE="text-align: justify">For the PECI Letter Loan Agreement: a forward margin deficit provision up to a maximum amount of
the equivalent in Canadian dollars of $5,000,000 and for the PPSI Credit Agreement: a forward margin deficit provision up to a
maximum amount of US$5,000,000. For greater clarity, it is understood that such forward margin deficit provisions shall not allow
any aggregate borrowings by the Borrowers above the maximum authorized amounts under the PECI Letter Loan Agreement and the PPSI
Credit Agreement.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0in">(the &ldquo;<I>Temporary
Covenant Accommodations&rdquo;</I>)<I> </I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In light of the above,
the Bank hereby waives the Existing Defaults and agrees to tolerate the Temporary Covenant Accommodations through April&nbsp;30,&nbsp;2016
and only through April 30, 2016, subject to the Obligors&rsquo; strict compliance with the following conditions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 35.45pt; text-align: justify; text-indent: -30.75pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify"><I>Conditions for the Intercompany Loan</I>. The Bank hereby consents to the Intercompany Loan
provided that the advance to PECI to make such Intercompany Loan will be deemed to be a US Base Rate advance bearing interest at
the US Base Rate plus 2.50% per annum under the PECI Letter Loan Agreement and will be fully secured by all Security Documents
referred to in such PECI Letter Loan Agreement. The amount of financial assistance (by way of loan, guarantee or otherwise) set
forth in paragraph 1.5 of Schedule VI (Negative Covenants) of the PECI Letter Loan Agreement to any of the persons enumerated in
the said paragraph 1.5 is hereby amended to provide for a maximum aggregate amount which is comprised of an amount of US$4,115,641
(the aggregate amount of financial assistance as of June 30, 2015) plus the principal amount of the Intercompany Loan up to US$5,000,000.
PECI will not be entitled to make any draw under Facility&nbsp;A for the purpose of making advances under the Intercompany Loan
to the US Borrower (<I>&ldquo;Interco Loan Drawing&rdquo;</I>) unless it has received the specific written authorization of the
Bank for each drawing. In order for the Bank to consider any such drawing, PECI will need to submit to the Bank, at least two (2)
Business Days before any proposed drawing, a notice of borrowing signed by Nathan Mazurek and Thomas Klink of PECI together with
a list of the invoices/items/payables the US Borrower intends to pay with such drawing and the reason for such payments.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(b)&#9;<I>Bank&rsquo;s Financial
Advisor.</I> The Bank has retained the services of a financial advisor, namely Alvarez &amp; Marsal Canada ULC (&ldquo;<B>A&amp;M</B>&rdquo;)
which engagement was accepted by the Obligors on December 2, 2015. The Bank shall continue to have the right to engage on its own
behalf a financial advisor to evaluate the financial condition, operating performance, and business prospects of the Obligors and
to perform such other information gathering or evaluation acts as may be reasonably requested by the Bank, and the costs and expenses
of such financial advisor shall be borne by the Obligors and constitute part of the Obligations. Each Obligor shall take reasonable
steps to make available to such financial advisor and its representatives such information respecting the financial condition,
operating performance, and business prospects of such Obligor as may be reasonably requested and shall make its officers, employees,
and independent public accountants available with reasonable prior notice to discuss such information with such financial advisor
and its representatives.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(c)<B>&#9;</B><I>Cash Flow and
Variance Reports.</I> No later than Tuesday of each week, the US Borrower shall continue to provide to the Bank an updated 13-week
cash flow forecast showing projected cash receipts and cash disbursements (including referencing line item sources and uses of
cash) of the US Borrower and its Subsidiaries over the following 13-week period, together with a reconciliation of actual cash
receipts and cash disbursements of the US Borrower and its Subsidiaries from the prior week against the prior week forecast and
showing any deviations on a cumulative basis and providing a written explanation of the variances), prepared by the US Borrower
and in form and substance, and with such detail, as the Bank may request. In addition, the Canadian Borrower shall continue to
provide to the Bank no later than Tuesday of each week a 13-week cash flow forecast showing projected cash receipts and cash disbursements
(including referencing line item sources and uses of cash) for its activities and those of its subsidiaries, if any, in the form
currently delivered to the Bank or with such modifications as may be requested by the Bank from time to time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(d)&#9;<I>Monthly Reporting.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(i) <I>PPSI Credit Agreement
Reporting</I>. The US Borrower shall continue to provide the financial reporting required by Section 8.5(b) of the PPSI Credit
Agreement for the four quarters of each fiscal year within 45 days after the last day of each quarter and shall also provide the
Bank, for non-quarter-end months, with balance sheets and statements of income, on a consolidated and non-consolidated basis, within
30 days of the last day of each month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.5in">(ii) <I>PECI Letter Loan
Agreement Reporting</I>. The Canadian Borrower shall continue to provide the financial reporting required by clause (b) of the
Reporting Requirements section of the PECI Letter Loan Agreement for the four quarters of each fiscal year within 45 days after
the last day of each quarter and shall also provide the Bank, for non-quarter-end months, with balance sheets and statements of
income, on a consolidated and non-consolidated basis, within 30 days of the last day of each month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(e)&#9;<I>No Permitted Acquisitions.</I>
Notwithstanding the terms of the PPSI Credit Agreement, the US Borrower shall not be permitted to do any Acquisitions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(f)&#9;<I>Payroll Tax Liability.</I>
The US Borrower shall deliver to the Bank copies of any agreements and communications with the IRS promptly upon receiving or sending
the same.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(g)&#9;<I>Default Rate Pricing
In Effect.</I> Notwithstanding the waivers contained herein, and as stipulated in the 1<SUP>st</SUP> Waiver and Consent Letter,
from and after November&nbsp;16, 2015, (i)&nbsp;the Obligations under the PPSI Credit Agreement shall bear interest at the default
rate as provided in Section 2.9 thereof until the Bank has advised in writing to the contrary, (ii)&nbsp;the US Borrower will not
be permitted to continue Eurodollar Loans with Interest Periods of longer than one (1) month, nor convert any U.S. Prime Rate Loans
into Eurodollar Loans with Interest Periods of longer than one (1) month, (iii)&nbsp;all outstanding advances under the PECI Letter
Loan Agreement shall bear interest at the default rate set forth in the PECI Letter Loan Agreement; (iv)&nbsp;PECI will not be
permitted to make any advances at LIBOR with an interest period in excess of one (1) month and (v) the interest rate for any LIBOR
advance or bankers acceptances under the PECI Letter Loan Agreement shall be specifically amended so that all such LIBOR advances
or bankers acceptances bear interest at the applicable rate set forth in such PECI Letter Loan Agreement plus 2% per annum.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify; text-indent: 0.25in">(h)&#9;<I>Acknowledgement. </I>The
US Borrower acknowledges <FONT STYLE="font-family: Times New Roman, Times, Serif">and agrees that the principal balance (excluding
interest and fees) owed to the Bank under the PPSI Credit Agreement as of March 18, 2016 was US$14,290,990.85, as further detailed
in Annex&nbsp;&ldquo;A&rdquo;. Also, PECI acknowledges and agrees that the principal balance (excluding interest and fees) owed
to the Bank under the PECI Letter Loan Agreement as of March 18, 2016 was CAN$765,087.69 and US$ 4,641,916.10, as further detailed
in Annex&nbsp;&ldquo;B&rdquo;. </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This consent and waiver
is limited to the matters and for the periods expressly set forth above. By its execution of this letter, the Obligors agree that
they remain obligated to comply with the terms of the PPSI Credit Agreement and PECI Letter Loan Agreement, and that the Bank shall
not be obligated in the future to waive any provision of the PPSI Credit Agreement or the PECI Letter Loan Agreement. On April
30, 2016 or any earlier date if the financial information received by the Bank from its financial advisor confirms a significant
deterioration of the Obligors&rsquo; financial situation or if the security position of the Bank is, in the sole opinion of the
Bank, insufficient, this waiver shall become null and void and from and after such date, the Bank shall have all of the rights
available to it as a result of the Existing Defaults and the Temporary Covenant Accommodations shall no longer be in force and
effect or tolerated, all as though this waiver had never been granted, unless a further amendment or waiver is granted pursuant
to the PPSI Credit Agreement and the PECI Letter Loan Agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Except as specifically
waived or amended hereby, all of the terms and conditions of the PPSI Credit Agreement and the PECI Letter Loan Agreement stand
and remain in full force and effect. This waiver letter shall be effective upon the execution and delivery hereof by the Bank and
the Obligors. Please provide your consent to the conditions set forth in this waiver letter to the Bank by no later than March
<FONT STYLE="font-family: Times New Roman, Times, Serif">24</FONT>, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This waiver letter
may be executed in any number of counterparts, and by different parties on separate counterpart signature pages, each of which
shall constitute an original and all of which taken together shall constitute one and the same instrument. Delivery of a counterpart
hereof by facsimile transmission or by e-mail transmission of an Adobe portable document format file (also known as a &ldquo;PDF&rdquo;
file) shall be effective as delivery of a manually executed counterpart hereof.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This waiver letter
is entered into between us as of the date and year first above written.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 245.5pt; text-indent: -11.5pt"><FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 245.5pt; text-indent: -11.5pt"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Bank of Montreal</FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">, acting through its Chicago Branch</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Randon Gardley</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Randon Gardley</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Vice President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Bank of Montreal</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Doreen Peters</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Doreen Peters</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Account Manager</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Michael Masson</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Michael Masson</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Account Manager</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">[<FONT STYLE="font-variant: small-caps">Signature Page to
Waiver Letter</FONT>]</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This waiver letter
is acknowledged and agreed to as of the date and year first above written.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 245.5pt; text-indent: -11.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 245.5pt; text-indent: -11.5pt"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Pioneer Power Solutions, Inc.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Pioneer Electrogroup Canada Inc.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Jefferson Electric, Inc.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;<FONT STYLE="font-variant: small-caps">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">[<FONT STYLE="font-variant: small-caps">Signature Page to
Waiver Letter</FONT>]</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Pioneer Critical Power Inc.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 5%">&nbsp;</TD>
    <TD STYLE="width: 40%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Pioneer Custom Electrical products corp.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD COLSPAN="3"><FONT STYLE="font: small-caps 10pt Times New Roman, Times, Serif">Titan Energy Systems, Inc.</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nathan Mazurek</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By</FONT></TD>
    <TD COLSPAN="2" STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Name</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Thomas Klink</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Title:</FONT></TD>
    <TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">[<FONT STYLE="font-variant: small-caps">Signature Page to
Waiver Letter</FONT>]</P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>


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    <!-- Field: /Page -->

<P STYLE="font: small-caps bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: small-caps bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Annex A</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD COLSPAN="3" STYLE="border: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Pioneer Power Solutions Inc: Outstanding Borrowings as of March 18, 2016</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Credit Facility</B></FONT></TD>
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Borrowings in CAD</B></FONT></TD>
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Borrowings in USD</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Revolving Facility; Revolving Credit Line</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">9,538,106.87</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Term Loan Facility</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4,750,000.00</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Corporate MasterCard</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2,883.98</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Total Borrowings</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">14,290,990.85</FONT></TD></TR>
</TABLE>
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<P STYLE="font: small-caps bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: small-caps bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Annex B</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD COLSPAN="3" STYLE="border: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><B>Pioneer Electrogroup Canada Inc: Outstanding Borrowings as of March 18, 2016</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><B>Credit Facility</B></FONT></TD>
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><B>Borrowings in CAD</B></FONT></TD>
    <TD STYLE="width: 25%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt"><B>Borrowings in USD</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Facility A: Revolving Demand Loan</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">288,258.75</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">3,857,916.10</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Facility B: 5 year Term Loan</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">471,288.71</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">0</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Facility C: 5 year Term Loan</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">0</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">784,000</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Facility D: Corporate MasterCard</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">5,540.23</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">0</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">Total Borrowings</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">765,087.69</FONT></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-size: 10pt">4,641,916.10</FONT></TD></TR>
</TABLE>
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