EXHIBIT 10.30

 

AMENDING AGREEMENT NO. 1

 

THIS AMENDING AGREEMENT is entered into as of the 10th day of March, 2014

 

BETWEEN: BANK OF MONTREAL       (the “Lender”)     AND: PIONEER ELECTROGROUP
CANADA INC., a Canadian corporation amalgamated on January 1st, 2014      
(“Amalco”)

 

WHEREAS the Lender and each of Pioneer Electrogroup Canada Inc.
(“Electrogroup”), Pioneer Transformers Ltd. (“Transformers”) and Bemag
Transformer Inc. (“Bemag”) have entered into an amended and restated letter loan
agreement dated June 28, 2013 pursuant to which the Lender agreed to grant the
Facilities to such corporations (the “Letter Loan Agreement”);

 

WHEREAS each of Electrogroup, Transformers, Bemag and Pioneer Wind Energy
Systems Inc. amalgamated on January 1st, 2014 and Pioneer Electrogroup Canada
Inc. (“Amalco”) is the corporation resulting from such amalgamation.

 

WHEREAS the parties wish to amend the Letter Loan Agreement to reflect such
amalgamation and to amend other terms and conditions of the Letter Loan
Agreement;

 

NOW THEREFORE in consideration of the mutual covenants herein set forth, it is
agreed as follows:

 

Article 1
INTERPRETATION

 

1.1All capitalized terms herein, unless otherwise expressly defined herein,
shall have the meanings ascribed to them in the Letter Loan Agreement.

 

1.2The Letter Loan Agreement and all documents or agreements incidental or
related thereto shall henceforth be read and construed in conjunction with this
Agreement; and the Letter Loan Agreement and this Agreement shall henceforth
have effect as far as practicable as though the provisions thereof were
contained in one instrument.

 

 

 

 

1.3All the terms, conditions and provisions of the Letter Loan Agreement not
otherwise amended by this Agreement shall remain unchanged and have full force
and effect.

 

Article 2
AMENDMENTS TO THE LETTER LOAN AGREEMENT

 

2.1The section “BORROWERS” of the Letter Loan Agreement is hereby deleted and
replaced by the following :

 

  “BORROWER: Pioneer Electrogroup Canada Inc., a corporation amalgamated on
January 1st, 2014 (the “Borrower”)”

 

2.2The section “GUARANTORS” of the Letter Loan Agreement is hereby deleted and
replaced by the following:

 

  “GUARANTORS: Pioneer Power Solutions, Inc. (“PPSI”) and any other present and
future Canadian Subsidiaries of the Borrower (collectively, the “Guarantors”)”

  

2.3Any other reference to the “Borrowers”, “each Borrower” or “any Borrower” in
the Letter Loan Agreement is deleted and replaced by a reference to “the
Borrower”.

 

2.4In the definition of “Excluded Inventory” in the section “MARGIN REQUIREMENT”
of the Letter Loan Agreement, the reference to “Bemag” shall be replaced by “the
Borrower”.

 

2.5The section “SECURITY” of the Letter Loan Agreement is hereby deleted and
replaced by the following:

 

  “SECURITY: All amounts owing from time to time under or pursuant to any of the
Facilities shall be secured and shall continue to be secured at all times by the
following Security Documents:

 

  I. EXISTING SECURITY

  

-Deed of hypothec in the amount of $30,000,000 dated June 28, 2011 on the
universality of all present and future immovable property and movable property
of the Borrower (previously known as Pioneer Electrogroup Canada Inc. and
Pioneer Transformers Ltd.), but excluding the immovable property located at 612
Bernard Road, Granby, Quebec (the “Granby Property”) registered at the RPMRR
under number 11-0483207-0001;

 

 

 

 

-Deed of hypothec in the amount of $30,000,000 dated July 5, 2011 on the
universality of all present and future immovable property and movable property
of the Borrower (previously known as Bemag Transformer Inc.) including, without
limitation, the immovable property located at 33 Racine, Farnham, Quebec,
registered at the RPMRR under number 11-0501603-0002 and at the Land Registry
under number 19 235 094;

-Security under section 427 of the Bank Act registered on June 27, 2011 for the
Borrower (previously known as Pioneer Electrogroup Canada Inc. and Pioneer
Transformers Ltd.) and on July 7, 2011 for the Borrower (previously known as
Bemag Transformer Inc.) as follows:

  - Transformers: 01265388   - Electrogroup: 01265390   - Bemag: 01265759

-General Security Agreement by the Borrower (previously known as Pioneer
Transformers Ltd.) dated June 28, 2011 registered in the Province of Ontario
under number 20110628105080283082;

-General Security Agreement by the Borrower (previously known as Bemag
Transformer Inc.) dated July 5, 2011 registered in the Province of British
Columbia under number 232564G;

-Guaranty Agreement dated June 28, 2013 by PPSI;

 

Unless otherwise specifically indicated herein, all such security shall be
first-ranking, subject only to Permitted Encumbrances.”

 

2.6In the section “REPORTING REQUIREMENT” of the Letter Loan Agreement, the
reference to “Electrogroup” in paragraph c), d) and e) shall be replaced by “the
Borrower”.

 

2.7In the section “COVENANTS” of the Letter Loan Agreement, the reference to
“Electrogroup” shall be replaced by “the Borrower”.

 

2.8In the definition of “EBITDA” in Schedule I of the Letter Loan Agreement, the
reference to “Electrogoup” shall be replaced by “the Borrower”.

 

2.9In the definition of “Fixed Charge Coverage Ratio” in Schedule I of the
Letter Loan Agreement, the reference to “Electrogoup” shall be replaced by “the
Borrower”.

 

2.10In the definition of “Funded Debt” in Schedule I of the Letter Loan
Agreement, the reference to “Electrogoup” shall be replaced by “the Borrower”.

 

2.11In the definition of “Shareholders' Equity” in Schedule I of the Letter Loan
Agreement, the reference to “Electrogoup” shall be replaced by “the Borrower”.

 

2.12Paragraph 1.15 of Schedule IV (REPRESENTATIONS AND WARRANTIES) of the Letter
Loan Agreement is deleted and replaced as follow:

 

 

 

 

“1.15the head office/domicile of each Obligor and PPSI is located at the
following addresses:

 

ØBorrower: 612 Bernard Road, Granby, QC, J2J 0H6 and 33 Racine Street, Farnham,
QC, J2N 3A3

 

ØPioneer Power Solutions Inc.: 400 Kelby Street, 9th Floor, Fort Lee, NJ 07024

 

and each Obligor and PPSI have no offices, nor Assets located elsewhere, except
for the following addresses:

 

ØBorrower: 2600 Skymark Avenue, Building 5, #102, Mississauga, Ontario L4W 5E7
and 9210 Wyoming Avenue North, Suite 250, Minneapolis, MN 55445”

 

2.13Schedule VIII of the Letter Loan Agreement is deleted and replaced by the
attached Schedule VIII.

 

Article 3
GENERAL PROVISIONS

 

3.1Novation: It is expressly understood and agreed between the parties hereto
that this Agreement does not constitute a novation of the terms and conditions
of the Facilities, the Letter Loan Agreement or the other Loan Documents, the
Lender hereby reserving all of its rights and recourses under the Facilities,
the Letter Loan Agreement and the other Loan Documents. Nothing set forth in
this Agreement shall, except as specifically set forth herein, be construed as
altering the obligations of the Obligors under the Facilities, the Letter Loan
Agreement and the other Loan Documents. Nothing herein shall in any way release
the Obligors from their obligations to the Lender under the Facilities, the
Letter Loan Agreement and the other Loan Documents.

 

3.2Confirmation: Amalco hereby acknowledges, ratifies, confirms and agrees that
it and all of its present and future Assets are and continue to be bound by all
of the provisions of each of the Loan Documents to which each of Electrogroup,
Transformers and Bemag was (as of immediately prior to the amalgamation) a
party, in the same manner, to the same extent and with the same effect as if
Amalco had executed such Loan Documents in the place and stead of each of
Electrogroup, Transformers and Bemag. Without limiting the generality of the
foregoing, Amalco hereby acknowledges, ratifies, confirms and agrees that (i) it
is (and shall continue to be) liable for and shall observe and perform the
obligations of each of Electrogroup, Transformers and Bemag in connection with
the Loan Documents in accordance with and subject to the terms thereof, (ii) all
present and future Assets of whatever nature and kind of Amalco shall (and shall
continue to) be subject to the Liens granted to or in favour of the Bank
pursuant to the Loan Documents (as applicable) in accordance with and subject to
the terms thereof to secure (and continue to secure) payment and performance of
all obligations described therein, and (iii) the Loan Documents to which each of
Electrogroup, Transformers and Bemag was (as of immediately prior to the
amalgamation) a party are and shall continue in full force and effect in
accordance with their terms with respect to Amalco, in each case in the same
manner, to the same extent and with the same effect as if Amalco had originally
executed such Loan Documents in the place and stead of each of Electrogroup,
Transformers and Bemag and continue to constitute legal, valid, binding
covenants, agreements, obligations and liabilities of Amalco, enforceable
against it in accordance with their respective terms.

 

 

 

 

3.3Execution in Counterparts: This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute but one and the same agreement.

 

3.4Governing Law: This Agreement shall be governed by and construed in
accordance with the Laws of the Province of Québec and the federal laws of
Canada applicable therein.

 

3.5Language: The parties hereby confirm their express wish that this Agreement
and all the documents and agreements directly or indirectly related thereto be
drawn up in English. Les parties reconnaissent leur volonté expresse que la
présente convention ainsi que tous les documents et conventions qui s'y
rattachent directement ou indirectement soient rédigés en langue anglaise.

 

MTL01: 2884773: v3

 

 

 

 

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the
day, month and year first above written.

 

LENDER:       BANK OF MONTREAL       By: /s/ Martin Bazinet     Name: Martin
Bazinet     Title: Directeur / Director  

 

Signature page

 

Amending Agreement No. 1

 

S - 1

 

 

ACCEPTANCE

 

We hereby accept the foregoing terms and conditions.

 

Signed in Montreal, Quebec, this _____ day of March, 2014

 

BORROWER       PIONEER ELECTROGROUP CANADA INC.       By: /s/  Andrew Minkow    
duly authorized     Name:  Andrew Minkow     Title: CFO  

  

GUARANTOR       PIONEER POWER SOLUTIONS, INC.       By: /s/ Andrew Minkow    
duly authorized     Name:  Andrew Minkow     Title:   CFO  

 

Signature page

 

Amending Agreement No. 1

  

S - 2

 

 

 

Schedule VIII

 

CORPORATE CHART

 

Corporate Legal Organization Chart January 2014

 

[tex10-30chart.jpg]

 

* On January 1, 2014, the three wholly-owned subsidiaries of Pioneer
Electrogroup Canada Inc. (consisting of Pioneer Transformers Ltd., Bemag
Transformer Inc., and Pioneer Wind Energy Systems Inc.) were vertically
amalgamated into Pioneer Electrogroup Canada Inc.