8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): September 11, 2017

Global Power Equipment Group Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware	001-16501	73-1541378
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)

400 E. Las Colinas Boulevard, Suite 400

Irving, Texas 75039

(Address of Principal Executive Offices, Zip Code)

Registrant’s telephone number, including area code: 214-574-2700

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:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

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

Item 2.02 Results of Operations and Financial Condition.

On September 12, 2017, Global Power Equipment Group Inc. (the “Company”) issued a press release (the “pressrelease”) reporting its financial results for 2016 and preliminary 2017 financial result estimates. As noted in the press release, management will host a conference call on September 13, 2017, at 10:00 a.m. E.T. (9:00 a.m. C.T.) to discuss such financial results, as well as recent corporate developments and strategic initiatives. Instructions on how to participate in the conference call are contained in the press release, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The press release contains a discussion of Adjusted EBITDA (earnings before interest expense, net, income tax (benefit) expense, depreciation and amortization, and unusual gains or charges), a non-GAAP financial measure within the meaning of Regulation G promulgated under the rules and regulations of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company believes that providing non-GAAP information, such as Adjusted EBITDA, is important as such information is used as analytical indicators by the Company’s management to better understand operating performance. The press release contains reconciliations of comparable GAAP to non-GAAP measures.

The information in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended (the “SecuritiesAct”), or the Exchange Act, regardless of the general incorporation language contained in such filing. Without limiting the generality of the foregoing, the text of the press release set forth under the headings entitled “Forward-looking Statements”  is incorporated by reference into this Item 2.02.

Item 5.02Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

As previously disclosed by the Company in Current Reports on Form 8-K, Craig E. Holmes and Tracy D. Pagliara were appointed as Co-Presidents and Co-Chief Executive Officers (“Co-CEOs”) of the Company on July 26, 2017, and Erin Gonzalez was appointed as the Company’s Chief Financial Officer (“CFO”) on August 2, 2017.

On September 11, 2017, in connection with such appointments,  the Company entered into employment agreements with each of Mr. Holmes, Mr. Pagliara, and Ms. Gonzalez. The employment agreements entered into with Messrs. Pagliara and Holmes (the “Co-CEO Agreements”) contain identical terms. The Co-CEO Agreements provide for an annual base salary for each Co-CEO of $450,000, effective retroactively to July 26, 2017, and a short-term incentive (“STI”) bonus opportunity with a target of 75% of annual base salary. The employment agreement entered into with Ms. Gonzalez (the “CFO Agreement” and, together with the Co-CEO Agreements, the “Agreements”) provides for an annual base salary of $275,000, effective retroactively to August 2, 2017, a STI bonus opportunity with a target of 50% of annual base salary, and a Project Bonus of $40,000 in the event the Company makes certain filings with the Securities and Exchange Commission (the “SEC”)by predetermined dates.  The Agreements also provide that if the executive remains continuously employed by the Company through April 15, 2018, the amount of his or her annual incentive bonus for the 2017 fiscal year shall be not less than the target STI for that fiscal year.

Each of the Agreements entitles the applicable executive to certain severance benefits if the Company terminates the executive’s employment other than for Disability or Cause, or if the executive terminates his or her employment for Good Reason  (a  “Qualified Termination”). In such event, subject to the executive signing and not revoking a release of claims in favor of the Company, the Company would pay the executive, among other things, continued annual base salary for the 18-month period, in the case of Messrs. Pagliara and Holmes, or 12-month period, in the case of Ms. Gonzalez, following the date of termination, subsidized health insurance premiums for 12 months, and, if the Qualified Termination occurred prior to April 15, 2018, the target STI for the 2017 fiscal year. If the Qualified Termination occurred not more than 90 days before or two years after a Change in Control of the Company, then the Company would pay or cause to be paid to the executive the following additional benefits: (i) if the Qualified Termination occurred during 2018, the target STI for the 2018 fiscal year, and (ii) the terminated executive’s then-outstanding equity incentive awards would become vested in full (without pro-ration), with any specified performance objectives deemed to be satisfied at the “target” level. The Company would pay lower amounts of severance benefits if the executive’s employment is terminated due to death or Disability.

The Agreements contain standard ownership of works, confidentiality, non-compete, non-solicitation, and non-disparagement covenants.

Except as otherwise expressly provided in the applicable Agreement,  such Agreement supersedes all prior agreements, Company policies, or arrangements with respect to the subject matter contained in the applicable Agreement.

Mr. Holmes and Ms. Gonzalez each ceased to participate in the Company’s Executive Severance Plan upon entering into their respective employment agreements.

The foregoing description does not constitute a complete summary of the terms of the Agreements and is qualified in its entirety by reference to the full text of the Agreements,  which are filed as Exhibits 10.55, 10.56, and 10.57, respectively, to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016, as filed with the SEC on September 12, 2017, and incorporated by reference herein. All capitalized terms used but not defined herein have the meanings set forth in the applicable Agreement.

Item 7.01 Regulation FD Disclosure.

In connection with the conference call announced in the press release, the Company made available the Company Information Presentation beginning on September 12, 2017, relating to its financial results for 2016 and preliminary 2017 financial result estimates. The Company Information Presentation may be accessed within the investor relations section of Global Power’s website, http://www.globalpower.com. A copy of the Company Information Presentation is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

The information in this Item 7.01, including Exhibit 99.2, shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act or the Exchange Act, regardless of the general incorporation language contained in such filing. Without limiting the generality of the foregoing, the text of the slide in the Company Information Presentation entitled “Cautionary Notes” is incorporated by reference into this Item 7.01.

Item 9.01Financial Statements and Exhibits.

(d)	Exhibits
99.1	Press Release, dated September 12, 2017.
99.2	Company Information Presentation.

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated September 12, 2017 of Global Power Equipment Group Inc.
99.2	Company Information Presentation.

SIGNATURE

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.

Dated: September 13,  2017

Global Power Equipment Group Inc.
By:	/s/ Charles E. Wheelock
	Charles E. Wheelock
	Vice President, Administration, General Counsel, and Secretary

EX-99.1

Exhibit 99.1

NEWS RELEASE

Global Power w400 E Las Colinas Blvd., Suite 400 w Irving, TX 75039

FOR IMMEDIATE RELEASE

Global Power Reports Financial Results for 2016;
Provides Operational Update and Announces Strategic Initiative

IRVING, Texas, September 12, 2017 – Global Power Equipment Group Inc. (OTC: GLPW) (“Global Power” or the “Company”) today reported its financial results for the full year ended December 31, 2016, as well as for the first, second and third quarters of 2016.  Reporting of the Company’s 2016 financial results was delayed because of the time it took to prepare, audit and file the Company’s 2015 Annual Report on Form 10-K, which included restated results from prior-year periods.

The Company also reported on its operational progress in 2017 and its current strategic actions.

Craig Holmes and Tracy Pagliara, Co-Presidents and Co-CEOs of Global Power, commented, “We continue to advance our efforts to address financial, operational and strategic challenges.  We have sold non-core assets, refinanced our debt, realigned management teams in our domestic products businesses and measurably cut costs.” 

They added, “We are currently evaluating strategic alternatives for our Mechanical Solutions segment.  We believe this segment’s customers, employees and suppliers could benefit from a new strategic partner that can provide increased liquidity and capital for the business to compete more effectively and pursue greater growth in its end markets.  In the meantime, we are committed to continuing to leverage our strong brands and remain focused on delivering quality products and services.  We also are working to strengthen each of our business segments by seeking to increase project scope with existing customers while pursuing opportunities to diversify our markets and customer base.”

2016 Financial Results

Revenue

	Year Ended December 31,				Variance
($ in thousands)	2016		2015		$	%
Mechanical Solutions	$	112,022	$	122,593	(10,571)	(8.6)
Electrical Solutions		75,559		93,057	(17,498)	(18.8)
Services		231,007		373,353	(142,346)	(38.1)
Total	$	418,588	$	589,003	(170,415)	(28.9)

As expected, revenue in 2016 declined $170.4 million primarily due to the reduction in Services segment revenue.

· Revenue for Mechanical Solutions declined $6.2 million, related to the July 2016 sale of TOG Holdings, Inc. and its wholly owned subsidiary, TOG Manufacturing Company, Inc. (collectively “TOG”).  TOG’s revenue was $3.6 million in 2016 and

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$9.8 million in 2015.  The decline in revenue was also attributable to a $6.7 million decrease for inlet systems projects, lower after-market parts sales and quality and execution issues in prior years with major OEM customers in its United States-based business.  Currently, the Company believes these issues have been mostly resolved. Additionally, revenue in 2015 was adversely impacted by $3.9 million in liquidated damages.  Approximately 66%, or $74.3 million, of Mechanical Solutions revenue was from sales outside the United States.   

· Revenue for Electrical Solutions decreased $7.9 million due to lower sales of control houses, while 2015 revenue benefited from a $9.9 million multi-unit generator enclosures shipment.

· The vast majority of Electrical Solutions revenue was generated in the United States.

· Revenue for Services declined $65.1 million due to the loss of a maintenance and modification contract in mid-2015 and the related project work associated with that contract.  In addition, approximately $66.4 million of the decline in revenue was due to the completion of a nuclear facility construction project, which was commissioned to restart service in the latter half of 2016.  Furthermore, revenue in 2015 benefited $27.3 million from the 18-month outage schedule associated with another maintenance and modification contract customer. Services revenue in both periods included revenue associated with Hetsco Holdings, Inc. and its wholly owned subsidiary, Hetsco, Inc. (collectively “Hetsco”), which were sold in January 2017 in order to reduce debt.  Hetsco’s revenue was $22.4 million in 2016 and $23.7 million in 2015.

· Services revenue was primarily generated in the United States.

Gross Profit / Margin %

	Year Ended December 31,						Variance
($ in thousands)	2016			2015			$	%
Mechanical Solutions	$	15,507		$	8,740		6,767	77.4
Gross Margin %		13.8	%		7.1	%
Electrical Solutions		2,250			(985)		3,235	NM
Gross Margin %		3.0	%		(1.1)	%
Services		31,232			44,842		(13,610)	(30.4)
Gross Margin %		13.5	%		12.0	%
Total	$	48,989		$	52,597		(3,608)	(6.9)
Gross Margin %		11.7	%		8.9	%

· Gross profit improved on lower revenue for Mechanical Solutions because of improved project execution, a $4.3 million reduction in warranty expense and a $3.9 million reduction in liquidated damages in its domestic business. 

· Electrical Solutions gross profit improvement primarily reflected efficiencies gained from facility rationalization, which included the closure of its Chattanooga, Tennessee plant, and $2.5 million in lower warranty expense. 

· Services gross profit declined on lower revenue.  The lost maintenance and modification contract, completion of construction on a nuclear facility and the timing of a customer outage had a $17.9 million negative impact on gross profit.  Partially offsetting the decline was the addition of $3.0 million in gross profit on multi-year fixed price nuclear and fossil fuel projects.

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Operating Expenses

	Year Ended December 31,				Variance
($ in thousands)	2016		2015		$	%
Selling and marketing expenses	$	9,544	$	12,130	(2,586)	(21.3)
General and administrative expenses		48,599		55,086	(6,487)	(11.8)
Restatement expenses		6,738		14,385	(7,647)	(53.2)
Loss on sale of business and net assets held for sale		8,812		-	8,812	100.0
Loss on sale-leasebacks, net		1,857		-	1,857	100.0
Impairment expense		-		47,755	(47,755)	(100.0)
Bargain purchase gain		-		(3,168)	3,168	(100.0)
Depreciation and amortization expense (1)		7,154		8,602	(1,448)	(16.8)
Total	$	82,704	$	134,790	(52,086)	(38.6)

⁽¹⁾ Excludes depreciation and amortization for the years ended December 31, 2016 and 2015 of $2,200 and $2,470, respectively, included in cost of revenue.

· Reduced selling and marketing expenses were principally the result of a $0.9 million decline in bad debt expense, $0.6 million in lower sales commissions due to lower revenue, $0.3 million reduction in travel and entertainment expense and $0.2 million less for recruiting expense.

· General and administrative expenses declined $7.8 million when excluding $0.7 million in disposition costs associated with the Hetsco and TOG sales, and a $0.6 million charge related to the facility closure in Chattanooga.  The majority of the decline in 2016 was due to reduced headcount and related lower compensation and benefit expense, along with reduced travel costs. 

· Restatement expenses were down from the prior year.  Restatement expenses primarily consisted of fees for legal and accounting services associated with the restatement of the Company’s historical financial results.

Operating Income (Loss)

	Year Ended December 31,				Variance
($ in thousands)	2016		2015		$	%
Mechanical Solutions	$	2,230	$	(32,997)	35,227	NM
Electrical Solutions		(8,739)		(27,542)	18,803	68.3
Services		3		12,217	(12,214)	(100.0)
Corporate		(27,209)		(33,871)	6,662	19.7
Total	$	(33,715)	$	(82,193)	48,478	59.0

Consolidated operating loss for 2016 improved primarily due to $47.8 million in impairment expenses that impacted 2015.

· Mechanical Solutions operating income improved on higher gross profit and the elimination of $24.4 million in impairment expense recorded in 2015.  Additionally, Mechanical Solutions reduced operating costs by $4.0 million, of which $0.7 million were attributable to TOG, which was sold in July 2016.  Mechanical Solutions operating results included $0.8 million and $1.5 million of operating expenses associated with TOG in 2016 and 2015, respectively.

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· Electrical Solutions operating loss improved on higher gross profit and the elimination of  $19.1 million in impairment expense recorded in 2015.  Operating loss in 2015 had the benefit of a $3.2 million bargain purchase gain.

· Services operating income was down to approximately breakeven as a result of lower gross profit of $13.6 million, the $8.3 million loss recorded for the pending sale of Hetsco and a  $1.2 million loss on a sale-leaseback, partially offset by a reduction of $4.2 million of impairment charges recorded in 2015.  Excluding those impacts, operating expenses for Services were down $6.7 million due to various cost reduction initiatives.  Services operating income included Hetsco losses of $7.6 million and $5.3 million in 2016 and 2015, respectively.

· Corporate operating expenses decreased primarily due to reduced restatement expenses.

Non-Operating Items and Net Results

	Year Ended December 31,				Variance
($ in thousands, except per share amounts)	2016		2015		$	%
Interest expense, net	$	8,398	$	4,484	3,914	87.3
Foreign currency gain		(217)		(1,014)	797	78.6
Other expense, net		15		12	3	25.0
Income tax expense (benefit)		1,702		(6,946)	8,648	NM
Net loss		(43,613)		(78,729)	35,116	44.6
Loss per share – diluted		(2.51)		(4.59)	2.08	45.3
Adjusted EBITDA NOTE 1		702		(6,854)	7,556	NM

· Interest expense reflects the impact of a weighted average interest rate of 10.2% in 2016 compared with 5.0% in 2015 on lower average debt balances.

· Income tax expense in 2016 primarily relates to foreign taxes imposed on the net income of our foreign subsidiaries.

· As expected, 2016 Adjusted EBITDAwas slightly positive and improved from 2015 primarily due to lower sales and marketing and general and administrative expenses after adjustments for non-recurring items in both years.  Adjusted EBITDA is defined as consolidated net income before interest expense-net, income tax expense (benefit), franchise taxes, depreciation and amortization, impairment expense, bargain purchase gain, foreign currency gain, other expense, net, stock-based compensation, restatement costs, asset disposition costs, net losses on sale-leasebacks, loss on sale of business and net assets held for sale, bank restructuring costs, facility closure costs and severance costs.

Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP.  Nevertheless, Global Power believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Global Power's financial statements, as they are used as analytical indicators by Global Power's management to better understand operating performance.  Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable with other similarly titled measures used by other companies.

See NOTE 1 – Non-GAAP Financial Measures and the attached tables for additional important disclosures regarding Global Power’s use of Adjusted EBITDA, as well as the attached tables that reconcile net income to Adjusted EBITDA.

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Liquidity Update

As of September 5, 2017, the Company had $29.3 million in cash and equivalents, including $14.0 million in restricted cash, and an outstanding gross debt balance of approximately $60.9 million. 

Given its restrictions under its lending facility, the Company funded operations with working capital during 2016. 

In June 2017, the Company refinanced its borrowings with a new $45.0 million credit facility.  This term loan has a maturity date of December 16, 2021.  In August 2017, the lenders amended the credit agreement to provide an additional $10.0 million term loan to the Company to address working capital needs.  The additional $10.0 million loan matures on September 30, 2018.  Borrowings under the new facility initially bear interest at LIBOR plus 9% per year, payable in cash, plus 10% payable in-kind (“PIK”) interest.  Beginning January 1, 2018, the PIK interest rate will increase to 15% per year if the Company chooses not to make an elective principal payment of $25.0 million.  The Company may voluntarily prepay the term loans at any time in a minimum amount of $1.0 million of the outstanding principal amount, plus any accrued, but unpaid, interest on the aggregate amount of the term loans being prepaid, plus a defined prepayment premium ranging from 0% to 3% based on the timing of the prepayments. 

While the expansion of the term loan has provided the Company with a certain amount of incremental liquidity, the Company’s overall liquidity remains constrained.  To address its liquidity constraints and better focus its resources, the Company has initiated processes to sell its manufacturing facility in Mexico as well as its office facility in the Netherlands.  The Company is also evaluating strategic alternatives relating to its Mechanical Solutions segment.

First Half 2017 Operational Review and Financial Result Estimates

Cautionary Note Regarding Preliminary Estimates

All statements in this press release regarding the Company’s preliminary 2017 financial results, including its revenue, are forward-looking statements based on the Company’s initial review of the results in the first half of 2017.  There is significant risk that actual results could differ significantly from the preliminary estimates contained in this press release.  Investors are cautioned not to place undue reliance on the 2017 guidance.  The preliminary information should not be viewed as a substitute for full financial statements prepared in accordance with GAAP and is not necessarily indicative of the results to be achieved for any periods.

The Company’s independent registered public accounting firm has not audited or reviewed the preliminary 2017 estimates.

In its 2016 Annual Report on Form 10-K (the “2016 10-K”), the Company disclosed that its internal controls over financial reporting were not effective as of December 31, 2016, due to the material weaknesses described in the 2016 10-K, and those material weaknesses have not been remediated as of the date of this press release.  The material weaknesses in the Company’s internal controls significantly increase the risk that the preliminary 2017 information provided herein may need to change.  For additional information about the Company’s internal control over financial reporting, see the 2016 10-K.

· Preliminary revenue for the first six months of 2017 is currently estimated to be down approximately $60 million compared with the first six months of 2016.

§ Preliminary Mechanical Solutions revenue is currently estimated to have declined approximately $31 million in the first half of 2017 because two large orders in its Netherlands-based business were not replicated during the period and domestic sales continued to be weak due to prior-year quality and on-time delivery issues.

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§ Preliminary Electrical Solutions revenue is currently estimated to have declined approximately $15 million, of which $9.3 million relates to the closure of a production facility.  Lower productivity related to ongoing operational issues in the Houston plant has impacted gross margins. 

§ Preliminary Services revenue is currently estimated to have declined approximately $14 million, of which $8.7 million was related to the sale of Hetsco in January 2017. 

Mechanical Solutions: This segment provides custom-designed and engineered auxiliary equipment for utility-scale natural gas turbine power plants.  Backlog at June 30, 2017 was down approximately $5 million from $37.8 million at the end of 2016.  Significant cost reductions were implemented in the domestic operations to better align costs with lower revenue and backlog.  This segment’s operations in Europe performed well in 2016 and continue to meet expectations, although revenue in 2017 has been down somewhat due to timing of projects. 

Electrical Solutions:  This segment provides custom-designed and engineered electrical control houses, generator enclosures and fuel tanks.  Backlog at June 2017 was up approximately  $5 million from backlog of $55.9 million at the end of 2016.  Changes in project selection and pricing helped to improve operating results in 2016, although operational challenges within the segment continued into 2017.  Organizational changes were made in August 2017 to improve operational effectiveness, although material improvement in financial results will likely not be realized until 2018.

Services: This segment provides a comprehensive range of maintenance, modification and construction services, primarily for nuclear power plants, but also for other utilities, power plant operators and industrial customers.  Its strategy for growth is to expand scope with current customers and diversify by leveraging its capabilities for new applications, customers and markets.  Targeted markets for strategic growth include nuclear decommissioning, oil and gas mid-stream and downstream, transmission and distribution, pipeline and electric substations and government.  As a result of the recently announced recommendation to complete construction of the two-reactor expansion of Plant Vogtle, a nuclear power plant near Augusta, Georgia, Services expects to continue its work as a subcontractor on that project, pending final approval from the Georgia Public Service Commission.  Plant Vogtle Units 3 and 4 will be the first new units built in the United States in the last three decades and are currently the only new units being actively constructed in the country.  Backlog at June 30, 2017 was down approximately $20 million from $138.6 million at the end of 2016 due primarily to the completion of a maintenance and modification contract outage in the first half of 2017.  Services backlog is comprised of maintenance and modification contract work expected to be performed over the next 12 months as well as construction contracts and master service agreements.

Strategic Outlook

Mr. Holmes and Mr. Pagliara commented, “We are pleased with the progress being made by our Services segment to expand its project scope and diversify its revenue stream.  It has been safely helping plant owners and operators enhance operations for over 50 years and is capable of becoming a larger and more profitable business.” 

They concluded, “While our Electrical Solutions segment had setbacks during the past year, we are encouraged that recent management and organizational changes have begun to improve our operations and restore our customers’ confidence in us.  As to the Mechanical Solutions segment, it has inherent value in its brand, worldwide product advances and renewed focus on process and quality in its U.S. operations.  Mechanical Solutions could also have better future growth opportunities as a part of a well-capitalized organization with greater resources.  Our objectives are to better capitalize Global Power and generate improved financial performance.” 

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Update on Financial Reporting for 2017

The Company expects to file its quarterly reports for 2017 by the end of the year and its 2017 annual report on Form 10-K by the filing deadline at the end of March 2018.  Once current with its filings, Global Power plans to hold an annual meeting of shareholders and to apply for listing on a national securities exchange.

Webcast and Teleconference

The Company will host a webcast and conference call on Wednesday, September 13, 2017, at 9:00 am Central Time / 10:00 am Eastern Time.  The call can be accessed by dialing 201-493-6780 or the webcast and accompanying slide presentation can be found at www.globalpower.com.

An audio replay of the call will be available from 1:00 pm CT (2:00 pm ET) on the day of the teleconference until the end of day on September 20, 2017.  To listen to the audio replay, call 412‑317-6671 and enter conference ID number 13669379.  Alternatively, you may access the webcast replay at http://ir.globalpower.com/, where a transcript will be posted once available.

NOTE 1 – Non-GAAP Financial Measures

In addition to reporting net income, a U.S. GAAP measure, we present Adjusted EBITDA (earnings before interest expense-net, income tax (benefit) expense, depreciation and amortization, and unusual gains or charges), which is a non-GAAP measure.  The Company’s management believes Adjusted EBITDA is an important measure of operating performance because it allows management, investors and others to evaluate and compare the performance of its core operations from period to period by removing the impact of the capital structure (interest), tangible and intangible asset base (depreciation, amortization and impairment expense), taxes and unusual gains or charges (bargain purchase gain, foreign currency gain, other expense-net, stock-based compensation, restatement expenses, asset disposition costs, net loss on sale-leasebacks, losses on sale of business and net assets held for sale, bank restructuring costs, facility exit costs and severance costs), which are not always commensurate with the reporting period in which such items are included.  Adjusted EBITDA is not calculated through the application of GAAP and is not the required form of disclosure by the U.S. Securities and Exchange Commission (the “SEC”).  As such, it should not be considered as a substitute for the GAAP measure of net income and, therefore, should not be used in isolation from, but in conjunction with, the GAAP measure.  The use of any non-GAAP measure may produce results that vary from the GAAP measure and may not be comparable to a similarly defined non-GAAP measure used by other companies.  See the attached Adjusted EBITDA Reconciliationtable on page 14.

About Global Power

Global Power is a design, engineering and manufacturing firm providing a broad array of equipment and services to the global energy and industrial markets.  The Company reports in three operating segments.  The Mechanical Solutions segment designs, engineers and manufactures a comprehensive portfolio of equipment for utility-scale natural gas turbines.  The Electrical Solutions segment provides custom-configured electrical houses and generator enclosures for a variety of industries.  The Services segment provides lifecycle maintenance, repair, on-site specialty support, outage management, construction and fabrication services for the power generation, industrial, chemical/petrochemical processing and oil and gas industries. 

The Company provides information at its website: www.globalpower.com.  

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

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Forward-looking Statement Disclaimer 

This press release contains “forward-looking statements” within the meaning of the term set forth in the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements or expectations regarding the Company’s ability to comply with the terms of its debt instruments, the timing and the Company’s ability to file its 2017 financial results and regain SEC reporting compliance, the timing or outcome of its strategic alternative initiatives with its products businesses, the expected timing of shipments, preliminary estimates of 2017 financial results, ability to strengthen the Services segment, impact of recent senior leadership changes, ability to register its shares for listing on a national exchange, the expected timing of the Company’s next shareholder meeting and related matters.  These statements reflect our current views of future events and financial performance and are subject to a number of risks and uncertainties, including our ability to comply with the terms of our credit facility.  Our actual results, performance or achievements may differ materially from those expressed or implied in the forward-looking statements. Additional risks and uncertainties that could cause or contribute to such material differences include, but are not limited to, decreased demand for new gas turbine power plants, reduced demand for, or increased regulation of, nuclear power, loss of any of our major customers, whether pursuant to the loss of pending or future bids for either new business or an extension of existing business, termination of customer or vendor relationships, cost increases and project cost overruns, unforeseen schedule delays, poor performance by our subcontractors, cancellation of projects, competition for the sale of our products and services, including competitors being awarded business by our customers that we previously provided, shortages in, or increases in prices for, energy and materials such as steel that we use to manufacture our products, damage to our reputation, warranty or product liability claims, increased exposure to environmental or other liabilities, failure to comply with various laws and regulations, failure to attract and retain highly-qualified personnel, loss of customer relationships with critical personnel, effective integration of acquisitions, volatility of our stock price, deterioration or uncertainty of credit markets, changes in the economic, social and political conditions in the United States and other countries in which we operate, including fluctuations in foreign currency exchange rates, the banking environment or monetary policy, and the factors set forth above under the caption “Cautionary Note Regarding Preliminary Estimates.”

Other important factors that may cause actual results to differ materially from those expressed in the forward-looking statements are discussed in our filings with the SEC, including the section of the 2016 10-K titled “Risk Factors.” Any forward-looking statement speaks only as of the date of this press release. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, and we caution you not to rely upon them unduly. 

Investor Relations Contact:

Deborah K. Pawlowski

Kei Advisors LLC

(716) 843-3908

dpawlowski@keiadvisors.com

Financial Tables Follow.

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page9 of 17

Global Power Equipment Group Inc.

Consolidated Statements of Operations

	Year Ended December 31,
($ in thousands, except share and per share amounts)	2016			2015
Revenue
Mechanical Solutions	$	112,022		$	122,593
Electrical Solutions		75,559			93,057
Services		231,007			373,353
Total revenue		418,588			589,003
Cost of revenue
Mechanical Solutions		96,515			113,853
Electrical Solutions		73,309			94,042
Services		199,775			328,511
Total cost of revenue		369,599			536,406
Gross profit		48,989			52,597
Gross margin		11.7	%		8.9	%
Selling and marketing expenses		9,544			12,130
General and administrative expenses		57,194			69,471
Loss on sale of business and net assets held for sale		8,812			-
Impairment expense		-			47,755
Bargain purchase gain		-			(3,168)
Depreciation and amortization expense(1)		7,154			8,602
Total operating expenses		82,704			134,790
Operating loss		(33,715)			(82,193)
Operating margin		(8.1)	%		(14.0)	%
Interest expense, net		8,398			4,484
Foreign currency gain		(217)			(1,014)
Other expense, net		15			12
Total other expenses, net		8,196			3,482
Loss before income tax		(41,911)			(85,675)
Income tax expense (benefit)		1,702			(6,946)
Net loss	$	(43,613)		$	(78,729)
Loss per share - basic and diluted	$	(2.51)		$	(4.59)
Weighted average common shares outstanding - basic and diluted		17,348,286			17,151,810

(1) Excludes depreciation and amortization for the years ended December 31, 2016 and 2015 of $2,200 and $2,470, respectively, included in cost of revenue.

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page10 of 17

Global Power Equipment Group Inc.

Consolidated Balance Sheets

	December 31,
($ in thousands, except share and per share amounts)	2016		2015
Assets
Current assets:
Cash and cash equivalents	$	2,805	$	22,239
Restricted cash		8,765		321
Accounts receivable, net of allowance of $1,634 and $1,971, respectively		59,280		93,077
Inventories:
Raw material		4,210		6,893
Finished goods		699		1,204
Inventory reserve		(981)		(1,798)
Costs and estimated earnings in excess of billings		52,696		45,491
Assets held for sale		22,832		-
Other current assets		7,936		4,608
Total current assets		158,242		172,035
Property, plant and equipment, net		12,596		33,822
Goodwill		36,456		50,319
Intangible assets, net		24,801		44,003
Other long-term assets		747		851
Total assets	$	232,842	$	301,030
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	19,076	$	16,861
Accrued compensation and benefits		10,640		15,587
Billings in excess of costs and estimated earnings		6,754		10,098
Accrued warranties		5,806		8,050
Liabilities related to assets held for sale		1,151		-
Other current liabilities		33,915		28,605
Total current liabilities		77,342		79,201
Long-term debt		45,341		70,000
Deferred tax liabilities		15,499		14,982
Other long-term liabilities		7,526		6,080
Total liabilities		145,708		170,263
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value, 170,000,000 shares authorized and 18,855,409 and 18,571,411 shares issued, respectively, and 17,485,941 and 17,261,276 shares outstanding, respectively		188		186
Paid-in capital		76,708		74,841
Accumulated other comprehensive loss		(9,513)		(7,618)
Retained earnings		19,764		63,371
Treasury stock, at par (1,369,468 and 1,310,135 common shares, respectively)		(13)		(13)
Total stockholders’ equity		87,134		130,767
Total liabilities and stockholders’ equity	$	232,842	$	301,030

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page11 of 17

Global Power Equipment Group Inc.

Consolidated Statements of Cash Flows

	Year Ended December 31,
($ in thousands)	2016		2015
Operating activities:
Net loss	$	(43,613)	$	(78,729)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Deferred income tax provision (benefit)		516		(8,670)
Depreciation and amortization on plant, property and equipment and intangible assets		9,417		11,072
Amortization of deferred financing costs		231		253
Impairment expense		-		47,755
Loss on disposals of property, plant and equipment		2,446		19
Loss on sale of business and net assets held for sale		8,812		-
Bad debt expense		530		865
Gain on bargain purchase		-		(3,168)
Stock-based compensation		2,434		3,744
Changes in operating assets and liabilities, net of businesses acquired and sold:
Decrease in accounts receivable		27,510		20,132
Decrease in inventories		1,878		467
Decrease (increase) in costs and estimated earnings in excess of billings		(9,110)		8,050
Decrease (increase) in other current assets		(3,636)		2,600
Decrease (increase) in other assets		537		(950)
Increase in accounts payable		2,849		2,029
Increase in accrued and other liabilities		1,014		1,225
Increase (decrease) in accrued warranties		(2,226)		1,573
Decrease in billings in excess of costs and estimated earnings		(3,212)		(1,486)
Net cash (used in) provided by operating activities		(3,623)		6,781
Investing activities:
Acquisitions, net of cash acquired		-		(7,629)
Proceeds from sale of business, net of restricted cash and transaction costs		4,847		-
Net transfers of restricted cash		(8,444)		(321)
Proceeds from sale of property, plant and equipment		13,978		7
Purchase of property, plant and equipment		(872)		(7,316)
Net cash provided by (used in) investing activities		9,509		(15,259)
Financing activities:
Repurchase of stock-based awards for payment of statutory taxes due on stock-based compensation		(267)		(429)
Debt issuance costs		(177)		-
Dividends paid		-		(1,589)
Proceeds from long-term debt		116,418		58,000
Payments of long-term debt		(141,076)		(33,000)
Net cash (used in) provided by financing activities		(25,102)		22,982
Effect of exchange rate changes on cash		(218)		(1,181)
Net change in cash and cash equivalents		(19,434)		13,323
Cash and cash equivalents, beginning of year		22,239		8,916
Cash and cash equivalents, end of year	$	2,805	$	22,239

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page12 of 17

Global Power Equipment Group Inc.

Segment Data

	Year Ended December 31, 2016
($ in thousands)	Mechanical Solutions			Electrical Solutions			Services			Corporate		Consolidated
Revenue	$	112,022		$	75,559		$	231,007		$	-	$	418,588
Gross profit	$	15,507		$	2,250		$	31,232		$	-	$	48,989
Gross margin		13.8	%		3.0	%		13.5	%		-		11.7	%
Operating (loss) income	$	2,230		$	(8,739)		$	3		$	(27,209)	$	(33,715)
Operating margin		2.0	%		(11.6)	%		0.0	%		NM		(8.1)	%

	Year Ended December 31, 2015
($ in thousands)	Mechanical Solutions			Electrical Solutions			Services			Corporate		Consolidated
Revenue	$	122,593		$	93,057		$	373,353		$	-	$	589,003
Gross profit	$	8,740		$	(985)		$	44,842		$	-	$	52,597
Gross margin		7.1	%		(1.1)	%		12.0	%		-		8.9	%
Operating income (loss)	$	(32,997)		$	(27,542)		$	12,217		$	(33,871)	$	(82,193)
Operating margin		(26.9)	%		(29.6)	%		3.3	%		NM		(14.0)	%

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page13 of 17

Global Power Equipment Group Inc.

Quarterly Financial Data

(unaudited)

	For the Quarter Ended
($ in thousands, except share and per share amounts)	December 31, 2016			September 30, 2016			June 30, 2016			March 31, 2016
Total revenue	$	103,635		$	85,444		$	106,787		$	122,722
Gross profit		11,955			12,937			9,286			14,811
Gross margin		11.5	%		15.1	%		8.7	%		12.1	%
Operating expenses		14,066			15,894			17,484			17,853
Restatement expenses		1,151			1,132			1,542			2,913
Loss on sale of business and net assets held for sale		124			495			8,193			-
Loss on sale-leasebacks, net		1,857			-			-			-
Operating loss		(5,243)			(4,584)			(17,933)			(5,955)
Operating margin		(5.1)	%		(5.4)	%		(16.8)	%		(4.9)	%
Interest expense, net		1,977			1,764			1,997			2,660
Foreign currency (gain) loss		(479)			83			(129)			308
Other expense (income), net		65			(109)			64			(5)
Loss before income tax		(6,806)			(6,322)			(19,865)			(8,918)
Income tax expense		180			408			247			867
Net loss	$	(6,986)		$	(6,730)		$	(20,112)		$	(9,785)
Loss per share - basic and diluted	$	(0.40)		$	(0.39)		$	(1.16)		$	(0.57)
Weighted average common shares outstanding - basic and diluted		17,433,754			17,396,079			17,338,255			17,223,901

	For the Quarter Ended
($ in thousands, except share and per share amounts)	December 31, 2015			September 30, 2015			June 30, 2015			March 31, 2015
Total revenue	$	144,424		$	124,162		$	174,276		$	146,141
Gross profit		8,945			14,932			17,948			10,772
Gross margin		6.2	%		12.0	%		10.3	%		7.4	%
Operating expenses		18,162			18,486			18,720			20,450
Restatement expenses		5,974			6,796			1,615			-
Impairment expense		4			47,751			-			-
Bargain purchase gain		-			-			-			(3,168)
Operating loss		(15,195)			(58,101)			(2,387)			(6,510)
Operating margin		(10.5)	%		(46.8)	%		(1.4)	%		(4.5)	%
Interest expense, net		2,076			953			830			625
Foreign currency (gain) loss		151			(55)			144			(1,254)
Other expense (income), net		21			(2)			(39)			32
Loss before income tax		(17,443)			(58,997)			(3,322)			(5,913)
Income tax expense (benefit)		549			(7,192)			576			(879)
Net loss	$	(17,992)		$	(51,805)		$	(3,898)		$	(5,034)
Loss per share - basic and diluted	$	(1.05)		$	(3.02)		$	(0.23)		$	(0.29)
Weighted average common shares outstanding - basic and diluted		17,186,159			17,161,183			17,159,115			17,099,728

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page14 of 17

Global Power Equipment Group Inc.

Adjusted EBITDA Reconciliation

(unaudited)

	Year Ended December 31,
($ in thousands)	2016		2015
Net loss	$	(43,613)	$	(78,729)
Add back:
Depreciation and amortization expense		9,417		11,072
Loss on sale of business and net assets held for sale		8,812		-
Interest expense, net		8,398		4,484
Restatement expenses		6,738		14,385
Stock-based compensation		2,434		3,744
Loss on sale-leasebacks, net		1,857		-
Income tax expense (benefit)		1,702		(6,946)
Facility exit costs		1,679		-
Bank restructuring costs		1,320		-
Severance costs		1,149		1,250
Asset disposition costs		664		-
Franchise taxes		362		301
Other expense, net		-		12
Impairment expense		-		47,755
Bargain purchase gain		-		(3,168)
Foreign currency gain		(217)		(1,014)
Non-GAAP Adjusted EBITDA	$	702	$	(6,854)

Non-GAAP Financial Measure:

Adjusted EBITDA is defined as consolidated net income before interest expense-net, income tax expense (benefit), franchise taxes, depreciation and amortization expense, impairment expense, bargain purchase gain, foreign currency gain, other expense-net, stock-based compensation, restatement expenses, asset disposition costs, net loss on sale-leasebacks, loss on sale of business and net assets held for sale, bank restructuring costs, facility exit costs and severance costs.  Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP.  Nevertheless, Global Power believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Global Power's financial statements, as they are used as analytical indicators by Global Power's management to better understand operating performance.  Global Power’s credit facility also contains ratios based on EBITDA.  Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies.

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Global Power Reports Financial Results for 2016; Provides Operational Update and Announces Strategic Initiatives

September 12, 2017

Page15 of 17

Global Power Equipment Group Inc.

Adjusted EBITDA Reconciliation

(unaudited)

	Year Ended December 31, 2016
	As			EBITDA		As
($ in thousands)	Reported			Adjustments		Adjusted
Mechanical Solutions	$	112,022		$	-	$	112,022
Electrical Solutions		75,559			-		75,559
Services		231,007			-		231,007
Total revenue		418,588			-		418,588
Mechanical Solutions		96,515			(1,341)		95,174
Electrical Solutions		73,309			(2,341)		70,968
Services		199,775			-		199,775
Cost of revenue		369,599			(3,682)		365,917
Mechanical Solutions		15,507			1,341		16,848
Electrical Solutions		2,250			2,341		4,591
Services		31,232			-		31,232
Gross profit		48,989			3,682		52,671
Gross margin		11.7	%		NA		12.6	%
Mechanical Solutions		13,277			(2,321)		10,956
Electrical Solutions		10,989			(4,787)		6,202
Services		31,229			(12,505)		18,724
Corporate		27,209			(11,137)		16,072
Total operating expenses		82,704			(30,750)		51,954
Mechanical Solutions		2,230			3,662		5,892
Electrical Solutions		(8,739)			7,128		(1,611)
Services		3			12,505		12,508
Corporate		(27,209)			11,137		(16,072)
Operating income (loss)		(33,715)			34,432		717
Operating margin		(8.1)	%		NA		0.2	%
Interest expense, net		8,398			(8,398)		-
Foreign currency gain		(217)			217		-
Other expense, net		15			-		15
		8,196			(8,181)		15
Loss before income tax		(41,911)			42,613		702
Income tax expense (benefit)		1,702			(1,702)		-
Net income (loss)	$	(43,613)		$	44,315	$	702

Non-GAAP Financial Measure:

Adjusted EBITDA is defined as consolidated net income before interest expense-net, income tax expense (benefit), franchise taxes, depreciation and amortization expense, impairment expense, bargain purchase gain, foreign currency gain, other expense-net, stock-based compensation, restatement expenses, asset disposition costs, net loss on sale-leasebacks, loss on sale of business and net assets held for sale, bank restructuring costs, facility exit costs and severance costs.  Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP.  Nevertheless, Global Power believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Global Power's financial statements, as they are used as analytical indicators by Global Power's management to better understand operating performance.  Global Power’s credit facility also contains ratios based on EBITDA.  Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies.

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Global Power Equipment Group Inc.

Adjusted EBITDA Reconciliation

(unaudited)

	Year Ended December 31, 2015
	As			EBITDA		As
($ in thousands)	Reported			Adjustments		Adjusted
Mechanical Solutions	$	122,593		$	-	$	122,593
Electrical Solutions		93,057			-		93,057
Services		373,353			-		373,353
Total revenue		589,003			-		589,003
Mechanical Solutions		113,853			(1,991)		111,862
Electrical Solutions		94,042			(1,071)		92,971
Services		328,511			-		328,511
Cost of revenue		536,406			(3,062)		533,344
Mechanical Solutions		8,740			1,991		10,731
Electrical Solutions		(985)			1,071		86
Services		44,842			-		44,842
Gross profit		52,597			3,062		55,659
Gross margin		8.9	%		NA		9.4	%
Mechanical Solutions		41,737			(26,629)		15,108
Electrical Solutions		26,557			(19,248)		7,309
Services		32,625			(8,180)		24,445
Corporate		33,871			(18,220)		15,651
Total operating expenses		134,790			(72,277)		62,513
Mechanical Solutions		(32,997)			28,620		(4,377)
Electrical Solutions		(27,542)			20,319		(7,223)
Services		12,217			8,180		20,397
Corporate		(33,871)			18,220		(15,651)
Operating income (loss)		(82,193)			75,339		(6,854)
Operating margin		(14.0)	%		NA		(1.2)	%
Interest expense, net		4,484			(4,484)		-
Foreign currency gain		(1,014)			1,014		-
Other expense, net		12			(12)		-
		3,482			(3,482)		-
Loss before income tax		(85,675)			78,821		(6,854)
Income tax expense (benefit)		(6,946)			6,946		-
Net income (loss)	$	(78,729)		$	71,875	$	(6,854)

Non-GAAP Financial Measure:

Adjusted EBITDA is defined as consolidated net income before interest expense-net, income tax expense (benefit), franchise taxes, depreciation and amortization expense, impairment expense, bargain purchase gain, foreign currency gain, other expense-net, stock-based compensation, restatement expenses, asset disposition costs, loss on sale-leasebacks-net, loss on sale of business and net assets held for sale, bank restructuring costs, facility exit costs and severance costs.  Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP.  Nevertheless, Global Power believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Global Power's financial statements, as they are used as analytical indicators by Global Power's management to better understand operating performance.  Global Power’s credit facility also contains ratios based on EBITDA.  Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies.

###

EX-99.2

Exhibit 99.2

September 13, 2017 2016 Financial Results and Operational Update Craig E. Holmes Co-President, Co-CEO Tracy Pagliara Co-President, Co-CEO Erin Gonzalez CFO

Forward-Looking Statements 1 Cautionary Note Regarding Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the term set forth in the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements or expectations regarding the Company’s ability to comply with the terms of its debt instruments, the timing and the Company’s ability to file its 2017 financial results and ability to regain SEC reporting compliance, the timing or outcome of its strategic alternative initiatives with its products businesses, the expected timing of shipments, preliminary estimates of 2017 financial results, ability to strengthen the Services segment, impact of recent senior leadership changes, ability to list its shares on a national exchange, the expected timing of the Company’s next shareholder meeting and related matters. These statements reflect our current views of future events and financial performance and are subject to a number of risks and uncertainties, including our ability to comply with the terms of our credit facility. Our actual results, performance or achievements may differ materially from those expressed or implied in the forward-looking statements. Additional risks and uncertainties that could cause or contribute to such material differences include, but are not limited to, decreased demand for new gas turbine power plants, reduced demand for, or increased regulation of, nuclear power, loss of any of our major customers, whether pursuant to the loss of pending or future bids for either new business or an extension of existing business, termination of customer or vendor relationships, cost increases and project cost overruns, unforeseen schedule delays, poor performance by our subcontractors, cancellation of projects, competition for the sale of our products and services, including competitors being awarded business by our customers that had previously been provided by Global Power, shortages in, or increases in prices for, energy and materials such as steel that we use to manufacture our products, damage to our reputation, warranty or product liability claims, increased exposure to environmental or other liabilities, failure to comply with various laws and regulations, failure to attract and retain highly-qualified personnel, loss of customer relationships with critical personnel, effective integration of acquisitions, volatility of our stock price, deterioration or uncertainty of credit markets, changes in the economic, social and political conditions in the United States and other countries in which we operate, including fluctuations in foreign currency exchange rates, and the banking environment or monetary policy. All statements in this presentation regarding the Company’s preliminary 2017 financial estimates, including its revenue and Adjusted EBITDA, are forward-looking statements based on the Company’s initial review of the results in the first half of 2017. There is significant risk that actual results could differ significantly from the preliminary estimates contained in this presentation. Investors are cautioned not to place undue reliance on the 2017 guidance. The preliminary information should not be viewed as a substitute for full financial statements prepared in accordance with generally accepted accounting principles and is not necessarily indicative of the results to be achieved for any periods. The Company’s independent registered public accounting firm has not audited or reviewed the preliminary 2017 estimates. The Company’s 2016 Annual Report on Form 10-K (the “2016 10-K”) disclosed that its internal controls over financial reporting were not effective as of December 31, 2016, due to the material weaknesses described in the 2016 10-K, and those material weaknesses have not been remediated as of the date of this press presentation. The material weaknesses in the Company’s internal controls significantly increase the risk that the preliminary 2017 information provided herein may need to change. For additional information about the Company’s internal control over financial reporting, see the 2016 10-K. Other important factors that may cause actual results to differ materially from those expressed in the forward-looking statements are discussed in our filings with the SEC, including the section of the 2016 10-K titled “Risk Factors.” Any forward-looking statement speaks only as of the date of this press release. Except as may be required by applicable law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, and we caution you not to rely upon them unduly. Non-GAAP Financial Measures This presentation will discuss some non-GAAP financial measures, which Global Power believes are useful in evaluating our performance. You should not consider the presentation of this additional information in isolation or as a substitute for results compared in accordance with GAAP. The Company has provided reconciliations of comparable GAAP to non-GAAP measures in tables found in the Supplemental Information portion of this presentation.

Goal: Stability 2 Aggressive, proactive efforts to address challenges Organizational changes: Right sizing, institutional knowledge, effective leaders Cultural change: Establish core values across Global Power Safety, Integrity, Excellence, Results Growth initiatives: Expanded scope, new customers, new end markets Operational focus: Simplification, innovation, engineering, efficiency Strategic changes: Strategic alternatives for Mechanical Solutions Aggressively reduce debt

Core Values 3 Our Mission To safely provide superior engineered products and services that exceed customer expectations, create enduring value for our shareholders and reward high-performing employees. Our Vision To be recognized as a premier global supplier of engineered products and services. Our Core Values SAFETY “Safety comes first” INTEGRITY “Always do the right thing” Excellence “Strive to be the best” Results “Deliver on promises”

Experienced Leadership Supports Efforts 4 Keeping and advancing high-performing and experienced talent Corporate: Restructured executive management team - all elevated from previous positions within the Company. Co-CEOs: Tracy Pagliara (7 years) and Craig Holmes (2 years) CFO: Erin Gonzalez (5 years) General Counsel: Chip Wheelock (6 years) Mechanical Solutions: Promoted new leadership from within. President, Braden U.S.: Jeff Trost (15 years) President, Braden Europe: Thomas Breuer (13 years), Bert Nix (14 years), Electrical Solutions: Appointed experienced leaders. President: Greg Blake (4 years), Vice President, Operations: Dave Anderson (9+ years) Services: Elevated long-time leader from within Services. President: Loren Monty (12 years)

5 Strong Braden brand and European operations performance U.S. operations removed from OEM blacklists Positive feedback on progress Restructuring in 2017 to flatten organization and reduce costs Diverter damper products recognized as industry-leading Evaluating strategic alternatives Would benefit customers, employees and suppliers with increased capital Improves competitive position Includes potential sale of business Would benefit shareholders with reduced debt and improved liquidity Mechanical Solutions: Alternatives

6 Electrical Solutions moving forward Strategy to compete in mega houses uncovered process and capability needs Houston operations being improved Decision to reinstate previous leadership appears to be working Well-respected by customers Experienced in complex projects Progress is tangible Caldwell, ID and South Bend, IN operations performing well Improvements should lead to better performance in 2018 Premiere Koontz-Wagner brand well- recognized throughout the industry Electrical Solutions: Refining Focus

7 Services remains largest segment with good momentum Great Williams brand recognition and diversified service offerings Decades long relations with blue chip customer base Extended longstanding relationship with customer through GUBMK partnership (33%) 5-year contract Key role at Vogtle Units 3 & 4 Future revenues not yet known, but could be significant Recently awarded first decommissioning project Services: Building Momentum

($ in millions) 8 2016 Revenue Mechanical Solutions Down $10.6 million, of which $6.2 million was related to sale of TOG Braden Europe had record year, driven by large diverter dampers and aftermarket orders Continued impact from prior-years’ quality issues Electrical Solutions Down $7.9 million on lower control house sales due to lower available backlog 2015 revenue benefitted from $9.9 million multi-unit generator enclosures shipment Services $65.1 million decline from loss of maintenance and modification contract and related projects Nuclear facility completion accounted for approximately $66.4 million of decline 2015 revenue included $27.3 million in scheduled outage services

($ in millions) 9 2016 Gross Profit Mechanical Solutions Gross profit up $6.8 million on $10.6 million lower revenue Better project execution $4.3 million reduction in warranty expense $3.9 million reduction in liquidated damages Electrical Solutions Gross profit up $3.2 million on $17.5 million lower revenue Efficiencies gained from facility rationalization $2.5 million reduction in warranty expense Services Gross profit declined $13.6 million on $142.3 million lower revenue Loss of maintenance and modification contract in second half of 2015 Construction on nuclear facility restart completed Timing of customer’s outage service schedule 8.9%

Selling & Marketing $2.6 million decrease due to lower bad debt expense, lower commissions, and enhanced cost containment efforts General & Administrative Reduced $6.5 million in expenses primarily from staff reductions and strong cost discipline Depreciation & Amortization $1.4 million decrease related to TOG and pending Hetsco sales *Non-recurring items included in Total Operating Expenses 2015 included $47.8 million in impairment expense 2015 included $3.2 million bargain purchase gain 2016 included $8.8 million in losses associated with TOG and pending Hetsco sales 2016 included $1.9 million in net losses on sale-leasebacks 2016 restatement expenses were $6.7 million, down $7.6 million from 2015 ($ in millions) 10 2016 Operating Expenses $75.8 $65.3

($ in millions) 11 2016 Operating Loss Mechanical Solutions Operating income up $35.2 million in 2016 from higher gross profit $4.0 million decline in operating expenses $0.7 million reduction in TOG operating expenses 2015 included $24.4 million impairment expense Electrical Solutions Reduced operating loss and improved performance 2015 included $19.1 million impairment expense 2015 included $3.2 million bargain purchase gain Services Achieved break-even despite significant revenue decline Operating income was $8.3 million before the loss for then pending sale of Hetsco Operating expenses decreased by $7.5 million related to cost reduction initiatives (excluding the impact of the loss for then pending sale of Hetsco) Corporate Lower restatement expenses in 2016

12 As expected, 2016 Adjusted EBTIDA was slightly positive EBITDA adjustments relating to liquidity initiatives were as follows: Loss of sale of TOG in July 2016 of $0.5 million on $4.8 million of net proceeds Loss on the then pending Hetsco sale (January 2017) of $8.3 million Net loss of $1.9 million on sale-leasebacks of Franklin, IN, Auburn, MA and Houston, TX facilities in December 2016 on $12.2 million of net proceeds Slightly Positive Adjusted EBITDA 2016 Adjusted EBITDA is a non-GAAP measure. Global Power believes that providing non-GAAP information, such as Adjusted EBITDA, is important as that information is used as analytical indicators by Global Power's management to better understand operating performance. Global Power’s credit facility also contains ratios based on EBITDA. Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies. See the attached tables for additional important disclosures regarding Global Power’s use of Adjusted EBITDA, as well as the reconciliation of GAAP net income to Adjusted EBITDA. ($ in millions)

13 EBITDA Reconciliation Global Power Equipment Group Inc. Adjusted EBITDA Reconciliation Year Ended December 31, ($ in thousands) 2016 2015 Net loss $ (43,613) $ (78,729) Add back: Depreciation and amortization expense 9,417 11,072 Loss on sale of business and net assets held for sale 8,812 - Interest expense, net 8,398 4,484 Restatement expenses 6,738 14,385 Stock-based compensation 2,434 3,744 Loss on sale-leasebacks, net 1,857 - Income tax expense (benefit) 1,702 (6,946) Facility exit costs 1,679 - Bank restructuring costs 1,320 - Severance costs 1,149 1,250 Asset disposition costs 664 - Franchise taxes 362 301 Other expense, net - 12 Impairment expense - 47,755 Bargain purchase gain - (3,168) Foreign currency gain (217) (1,014) Non-GAAP Adjusted EBITDA $ 702 $ (6,854) Non-GAAP Financial Measure: Adjusted EBITDA is defined as consolidated net income before interest expense, net, income tax expense (benefit), franchise taxes, depreciation and amortization expense, impairment expenses, bargain purchase gain, foreign currency gain, other expense, net, stock-based compensation, restatement expenses, asset disposition costs, net loss on sale-leasebacks, loss on sale of business and net assets held for sale, bank restructuring costs, facility exit costs and severance costs. Adjusted EBITDA is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP. Nevertheless, Global Power believes that providing non-GAAP information such as Adjusted EBITDA is important for investors and other readers of Global Power's financial statements, as they are used as analytical indicators by Global Power's management to better understand operating performance. Global Power’s credit facility also contains ratios based on EBITDA. Because Adjusted EBITDA is a non-GAAP measure and is thus susceptible to varying calculations, Adjusted EBITDA, as presented, may not be directly comparable to other similarly titled measures used by other companies.

Refinanced Debt & Liquidity Position 14 During 2016, long-term debt was reduced by $24.7 million to $45.3 million Current outstanding debt balance is approximately $60.9 million At September 5, 2017, cash was $29.3 million, including $14.0 million of restricted cash New Lending Agreement Date: Source: Terms June 2017 $45 million credit facility, senior secured term loan Initial interest is LIBOR +9% per year, payable in cash, plus 10% payable in-kind (“PIK”) interest Prepayment premium range: 0% - 3% January 1, 2018: Without $25 million loan payment, PIK rate increases to 15% Term end: December 16, 2021 August 2017 $10 million expansion with first-out payment Same as above Term end: September 30, 2018 A default under the current agreement would allow lenders to exercise their rights to collect then-outstanding amounts, which may include foreclosure on substantially all of the Company’s assets. This action could have a material adverse effect on the business. Please refer to the Company’s 2016 Annual Report on Form 10-K for additional risks and discussions relative to the Company’s liquidity status.

Current Liquidity Efforts 15 Improve margins and focus on project execution Review strategic alternatives for Mechanical Solutions Sell assets Manufacturing facility in Mexico Office facility in the Netherlands Lower costs Integrate information systems Flatten organization Reduce SG&A expenses Reduce restricted cash Repatriate cash from foreign subsidiaries

Preliminary 2017 Estimates 16 Preliminary first half (“1H”) 2017 revenue estimate: down ~$60 million from 1H 2016 Preliminary Mechanical Solutions revenue estimate: down ~$31.0 million from 1H 2016 Preliminary Electrical Solutions revenue estimate: down ~$15.0 million from 1H 2016 Preliminary Services revenue estimate: down ~$14.0 million from 1H 2016 $8.7 million of decline related to Hetsco sale in January 2017 2017 reporting plan: First three quarters of 2017 are expected to be filed by the end of the year Goal: 2017 Annual Report on Form 10-K filed by March 2018 deadline NOTE: Please refer to the slide titled “Forward-Looking Statements” at the front of this presentation for important factors that could cause actual results to differ from the preliminary estimates provided below.

Goals and Expectations 17 Advance strategic alternatives initiatives to generate additional liquidity Improve Electrical Solutions operations Regain customer loyalty; simplify business Continue progress with Services segment Strong pipeline of opportunities increasing scope with current customers and adding new customers Expect stronger performance in 2018 Become current in SEC filings

2016 Financial Results and Operational Update