Item 2.05 Costs Associated with Exit or Disposal Activities

As of January 12, 2009, Performance Technologies, Inc. ("the Company") has implemented a strategic reduction of its existing workforce in response to the challenging global economic environment. As a result of this action, the Company has eliminated twenty positions, or approximately 8% of its global workforce. This action is expected to yield annual operating expense savings in excess of $1.0 million. In connection with this reduction, the Company expects to incur first quarter 2009 pre-tax restructuring charges of approximately $.5 million, primarily for employee-related costs. Substantially all of these charges will result in cash expenditures.

Despite the challenges which the global economy presents, the Company continues to maintain a strong financial position, with approximately $33.2 million of cash and investments and no debt as of December 31, 2008.