Exhibit 10.1

DISTRIBUTOR AGREEMENT

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CONTENTS

 

1.

DEFINITIONS

  3    2.

APPOINTMENT AND DURATION

  5    3.

GENERAL OBLIGATIONS OF THE DISTRIBUTOR

  5    4.

SERVICE RESPONSIBILITIES OF THE DISTRIBUTOR

  9    5.

DIRECT SUPPLY

  10    6.

SPECIFIED PREMISES

  10    7.

IMPROVEMENTS TO PRODUCTS

  11    8.

COMPANY RESPONSIBILITIES

  11    9.

AUTHORISED DEALERS

  12    10.

INSPECTIONS, REPORTS AND PROCEDURES

  12    11.

ORDERING PROCEDURES, CONDITIONS OF SALE AND PRICES

  13    12.

DISTRIBUTOR’S CONDITIONS OF PURCHASE AND SALE

  14    13.

TERMS AND METHOD OF PAYMENT

  14    14.

CHANGES TO AGREEMENT

  15    15.

CHANGES IN SPECIFICATIONS

  15    16.

ENQUIRIES

  15    17.

CONFIDENTIALITY

  15    18.

RELATIONSHIP BETWEEN THE PARTIES

  16    19.

ASSIGNMENT AND TRANSFER

  17    20.

TERMINATION

  17    21.

RESULTS OF TERMINATION

  18    22.

WAIVER OF DEFAULT AND GENERAL LIABILITY

  19    23.

GENERAL

  20    SCHEDULE 1: DISTRIBUTOR TERRITORY   23    SCHEDULE 2: TERMS AND METHOD
OF PAYMENT   24   

 

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THIS AGREEMENT is made the 1st day of January 2015

BETWEEN

Perkins Engines Company Limited of Eastfield, Frank Perkins Way, Peterborough,
PE1 5FQ, England (hereinafter called “the Company”)

AND

Power Great Lakes, a division of Power Solution International Inc. of 201 Mittel
Drive Wood Dale, Illinois 60191 (hereinafter called “the Distributor”) and
collectively referred to as “the Parties” or individually “the Party”.

WHEREAS

 

(A) The Company desires to secure sales, support and servicing of its products
in the territory as hereinafter defined and the Distributor wishes to take on
the responsibilities of a Company distributor in that territory.

 

(B) Therefore the Parties have agreed that the Company will appoint the
Distributor on the terms hereinafter set out.

NOW IT IS AGREED as follows:

1. DEFINITIONS

 

  1.1 In this Agreement unless the context otherwise requires the following
expressions bear the following meanings:

“Agreement” means this Agreement, its Schedules and any other documents
specifically referenced herein;

“Authorised Dealers” means persons appointed by the Distributor as dealers in
the Territory pursuant to Article 8 hereof;

“Commencing Date” means 1 January 2015;

“Competing Item” means any goods of similar description to or which in the
Company’s reasonable opinion are competitive with any of the Products including
but not limited to any Distributor remanufactured Product;

“Parts” means parts, assemblies, sub-assemblies and components (including
proprietary items except as otherwise agreed) supplied by the Company or a
Perkins Supplying Company for use as replacements in Perkins Engines;

 

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“Perkins Engines” means each of those types of Perkins branded engine (new or
reconditioned) which are from time to time designated by the Company to the
Distributor for application to the agricultural, vehicle, and industrial sectors

“Perkins Group” means collectively Perkins Engines Company Limited and each of
those companies falling within the definition of a “subsidiary” of the ultimate
“holding company” of Perkins Group Ltd as defined in section 1159 of the
Companies Act 2006;

“Perkins Standards” means those standards of business performance issued and
produced by the Company from time to time applicable to all its distributors;

“Perkins Supplying Companies” means either the Company or those entities
designated by the Company to accept orders from the Distributor including but
without limitation to Perkins Engines Inc.;

“Price List” means the price list issued by the Company on behalf of Perkins
Supplying Companies during the term hereof and notified to the Distributor;

“Products” means Perkins Engines and/or Parts;

“Specified Premises” means those premises which are from time to time agreed by
the parties in writing and from which the Distributor shall carry out its sales
and/or service obligations hereunder; Specified Premises shall expressly exclude
any premises owned or occupied by Authorised Dealers unless otherwise agreed by
the Company;

“Territory” means North Dakota, South Dakota, Minnesota, Wisconsin, Iowa,
Michigan, Ohio, Indiana, Illinois, Missouri, Nebraska, Kansas, Pennsylvania, New
Jersey, Delaware, Maryland (including Washington, District of Columbia), West
Virginia, New Hampshire, Vermont, Massachusetts, Maine, Rhode Island,
Connecticut, New York as more specifically described in Schedule 1 of this
Agreement;

“Trade Mark Agreement” means the licence on the agreed terms entered into by the
Parties on the date of this Agreement; and

“UK” means the United Kingdom of Great Britain and Northern Ireland, the Channel
Islands and the Isle of Man.

 

  1.2 The headings in this Agreement are for convenience only and shall not
affect its construction or interpretation.

 

  1.3 Words signifying the singular shall include the plural and vice versa
where the context so admits.

 

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2. APPOINTMENT AND DURATION

 

  2.1 Subject to the terms hereof the Company appoints the Distributor, on a
non-exclusive basis, as its Distributor for the Territory and the Distributor
accepts such appointment.

 

  2.2 The Distributor’s appointment shall be deemed to have commenced on the
Commencing Date.

 

  2.3 Unless sooner terminated under the provision of Article 3.11 or 20 hereof,
this Agreement shall remain in force for an initial period of 3 years from the
Commencing Date. It shall continue in force thereafter until terminated by
either Party giving to the other at least 6 months prior written notice of
termination to expire at the end of such initial period or at any time
thereafter.

3. GENERAL OBLIGATIONS OF THE DISTRIBUTOR

 

  3.1 The Distributor acknowledges that it has been entrusted with considerable
responsibility for developing and exploiting the business potential for the
Products in the Territory. The Distributor undertakes diligently to discharge
such responsibility in the interests of optimising sales and service of the
Products in the Territory. In particular the Distributor agrees at all times and
at its own expense except as provided in Articles 3.1.4 and 8.2 below:

 

  3.1.1 To use all reasonable endeavours to give full and proper representation
of the Products throughout the Territory;

 

  3.1.2 To identify, promote and realise opportunities for supply of the
Products in the Territory;

 

  3.1.3 To publicise the Distributor’s appointment as an authorised Perkins
Distributor within the Territory such publicity to include the use of prominent
signs at the Specified Premises and on the Distributor’s service and parts
vehicles, which signs shall conform strictly to designs and specifications from
time to time laid down by the Company;

 

  3.1.4

To advertise and promote interest in the Products in the Territory in an
extensive and effective manner. This shall include (but shall not be limited to)
the use of local communications media and exhibition or display facilities and
have due regard to such advice on

 

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  advertising policy as may from time to time be issued by the Company. The
Distributor may, with the Company’s prior written consent, exhibit and be
involved in exhibiting any of the Products at any exhibition and take part in,
support or be involved in competitions, competitive trials or demonstrations of
the Products. The Distributor shall upon the Company’s reasonable request
withdraw at its own expense any particular advertisements, catalogues, sales
literature or other printed matter relating to the Products;

 

  3.1.5 To provide service training courses in line with appropriate Company
guidelines in respect of the Products within the Territory;

 

  3.1.6 To distribute current sales and service literature supplied by the
Company in respect of the Products throughout the Territory; and

 

  3.1.7 To maintain adequate Products in stock in accordance with Article 4.3
and ensure that they are available for supply to customers.

 

  3.2 For the avoidance of doubt, this Article 3 is without prejudice to the
Trade Mark Agreement and the Distributor shall perform its obligations under
this Agreement strictly in accordance with the terms of the Trade Mark
Agreement. If there is any inconsistency or conflict between the terms of this
Agreement and the Trade Mark Agreement in relation to the use of the licensed
Perkins trademarks as defined therein, the provisions of the Trade Mark
Agreement shall prevail.

 

  3.3 The Distributor shall perform its obligations hereunder in accordance with
the business plan agreed by the parties. The plan shall include the following
information for a projected one-year and/ or longer period, as appropriate:

 

  3.3.1 the Distributor’s marketing objectives, including sales and
penetrations; and

 

  3.3.2 the resources and facilities required to achieve its objectives.

 

  3.4 The Parties shall review the plan at least annually and agree a revised
plan following each such review.

 

  3.5 The Distributor shall, unless otherwise agreed in writing by the Company,
purchase from the Company or Perkins Supplying Companies or another Perkins
distributor all of its requirements for the Products whether for supply to
Authorised Dealers or to other entities requiring the same for use within the
Territory.

 

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  3.6 Subject to Articles 3.5 and 3.7 the Distributor shall not without the
Company’s prior written consent:

 

  3.6.1 hold any Competing Item in stock in the Territory; or

 

  3.6.2 solicit or be directly or indirectly engaged or interested in soliciting
orders in the Territory for any Competing Item; or

 

  3.6.3 supply or be directly or indirectly engaged or interested in the supply
in the Territory of any Competing Item.

 

  3.7 The prohibition contained in Article 3.6 above shall not in any way
preclude the Distributor from:

 

  3.7.1 holding in stock, supplying or advertising for supply other products
(which are not Competing Items) manufactured or purchased by the Distributor in
the ordinary course of its business. These products may include those Perkins
Engines as an integral and subsidiary part or in which Perkins Engines are
installed; or

 

  3.7.2 servicing or remanufacturing engines other than Perkins Engines and
holding in stock, supplying and advertising for supply parts for the purpose of
such servicing or remanufacture, provided that in the reasonable opinion of the
Company, the Distributor’s performance as a distributor of Products is not
adversely affected by such activity.

 

  3.8 The Distributor shall not, without the Company’s prior written consent,
solicit outside the Territory customers for any of the Products, nor for the
purpose of delivery of the same establish branches or warehouses outside the
Territory, nor advertise any of the Products outside the Territory. This shall
not prevent the Distributor from advertising in a publication in circulation
both within and outside the Territory.

 

  3.9 The Distributor shall comply in all respects with the Perkins Standards
with regard to its activities hereunder to the extent that such standards have
been notified in writing to the Distributor.

 

  3.10 The Distributor shall ensure so far as is reasonably practicable that:

 

  3.10.1 the Perkins Engines supplied by it or its Authorised Dealers are
installed and applied by customers in accordance with the limitations and
specifications laid down by the Company;

 

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  3.10.2 the purchaser of the Perkins Engines is fully aware of and properly
instructed in all aspects of the operation and maintenance thereof;

 

  3.10.3 it shall make available to a prospective purchaser all brochures,
booklets and other literature and information provided by the Company and which
the Company designates as intended for such users.

 

  3.11 The Distributor represents and warrants that it has read, understands,
and has been in compliance, and agrees that it shall comply, with all applicable
laws, rules, regulations, directives, ordinances, orders, or statutes
(collectively, the “Laws”), including, but not limited to, the UK Bribery Act
2010, the U.S. Foreign Corrupt Practices Act and any applicable anti-bribery
Laws of other countries, the UK Export Control Regulations, the U.S. Export
Administration Regulations, the International Traffic in Arms Regulations, and
any applicable sanctions regulations including but not limited to the sanctions
regulations administered by the U.K. Department for Innovation, Business and
Skills (BIS) and the U.S. Treasury Department Office of Foreign Assets Control.

Further, Distributor represents and warrants that it has not acted, will not
act, and has not and will not cause, directly or indirectly, any other party to
act, in any manner that would cause Company, or any of its affiliates or persons
employed by Company, to violate the Laws. Upon Company’s request, Distributor
shall at its expense provide to Company in a timely manner any and all material,
documentation, information, data, or certification(s) regarding Distributor’s
compliance with the Laws and this Article 3.11.

If Company has reason to believe that Distributor is not in compliance with the
Laws or this Article 3.11, Company reserves the right to audit, or to have
Company’s authorised representatives conduct audits, to ascertain the extent of
Distributor’s non-compliance with the Laws and this Article. Distributor agrees
to indemnify, defend, and hold harmless Company, Company’s affiliates, and
Company’s and Company’s affiliates’ respective directors, officers, employees,
agents, successors, and assigns, against demands, liabilities, fines, penalties,
losses, and damages (including costs, investigation and litigation expenses and
counsel fees incurred in connection therewith) arising out of or related to
Distributor’s obligations under this Article 3.11. In the event of any
enforcement action against Distributor relating to Distributor’s non-compliance
with the Laws that reasonably relate to Distributor’s performance under this
Agreement, Distributor shall provide to Company written notice of such
enforcement action prior to any publication or disclosure of such enforcement
action, and in no event later than ten (10) business days following such
enforcement action.

 

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In the event of a change to the Laws or a significant change to the Company’s
policy which at the Company’s sole discretion negatively impacts the Company’s
ability pursuant to this Agreement to perform its obligations to Distributor,
Company shall be entitled to suspend deliveries to, refuse orders from
Distributor and or serve notice to terminate this Agreement during the initial
period as defined in Article 2.3 or any time after the initial period.

4. SERVICE RESPONSIBILITIES OF THE DISTRIBUTOR

 

  4.1 Subject to the proviso in Article 4.4 below, the Distributor shall provide
a repairs and warranty service for the Products (whether or not supplied by the
Distributor) in the Territory. It shall also carry out repairs to the Products
to a standard of workmanship acceptable to the Company. It shall also provide a
warranty service for all Products in accordance with the procedures from time to
time laid down by the Company either in the Perkins Service Warranty Manual (as
supplied and updated by the Company from time to time) or in notices issued by
the Company and notified in writing to the Distributor.

 

  4.2 The Distributor undertakes to the Company that it shall at all times
comply with the provisions of the law in force in the Territory from time to
time including but not limited to that regarding warranty and the provision of
technical and essential health and safety literature which provisions shall
prevail in the event of any conflicts with the Perkins requirements.

 

  4.3 The Distributor shall ensure that it maintains adequate resources
including personnel, equipment and facilities and stocks to perform its
obligations hereunder.

 

  4.4 The Distributor shall also provide a repair and warranty service as
specified in Article 4.1 above for Products in the Territory which have been:

 

  4.4.1 Supplied by the Company or any other member of the Perkins Group direct
to an entity within or outside the Territory; or

 

  4.4.2 Incorporated in or attached to original equipment manufactured or
assembled within or outside the Territory.

However the above obligation will not apply where Products are subject to a
separate repair and warranty service agreement between the original equipment
manufacturer (“OEM”) and the Company.

 

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  4.5 The Distributor shall be paid for the provision of the repairs and
warranty services provided under Articles 4.1 and 4.4 above in accordance with
the pricing schedules contained in the Perkins Service Warranty Manual referred
to in Article 4.1.

5. DIRECT SUPPLY

 

  5.1 The Distributor acknowledges that the terms of this Agreement do not in
any way limit the right of the Company for itself, the companies within the
Perkins Group and their licensees the right at all times to supply Products
direct to any entity in the Territory, including but not limited to:

 

  5.1.1 any central, local or municipal government authorities or departments or
state owned or controlled organisations;

 

  5.1.2 OEM’s wishing to incorporate the Products in their own product line;

 

  5.1.3 recognised export houses within the Territory whose main purpose is to
re-export the Products outside the Territory;

 

  5.1.4 as provided in Article 21.4 below.

The Company shall notify the Distributor in writing and, where time permits,
consult the Distributor where it decides to exercise this right.

 

  5.2 The Distributor shall promptly notify the Company of any opportunity for
supply of the Products within the Territory which it considers likely to be
advanced by the direct intervention or support of the Company or other members
of the Perkins Group or its licensees.

 

  5.3 The Company shall have no liability to the Distributor where any of the
Products are brought into the Territory by reason of the direct supply of
Products by the Company to any entity in the Territory.

6. SPECIFIED PREMISES

 

  6.1 The Distributor shall install by a date agreed with the Company and
thereafter maintain in full working order adequate equipment and facilities in
accordance with Article 4.3 at each of the Specified Premises.

 

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  6.2 The Distributor shall take out and maintain throughout its appointment
insurances sufficient for the Specified Premises, the Products held thereon and
all work in progress relating to its activities. Certificates of insurance shall
be provided to the Company within a reasonable period of time after its request.

 

  6.3 The Distributor shall be able to use the Specified Premises for purposes
other than its activities hereunder, provided that such alternative uses do not
in any way affect the extent and standard of its performance hereunder. The
Company shall be entitled to its absolute discretion to require the Distributor
to take appropriate remedial action where it reasonably believes the
Distributors performance has been or is likely to be materially affected by such
alternative uses.

 

  6.4 The Distributor shall notify the Company in writing of its intention
either to reduce the facilities available within the Specified Premises or to
effect any significant alteration in the land or buildings comprising the
Specified Premises, and consult with the Company prior to taking any action.

7. IMPROVEMENTS TO PRODUCTS

The Distributor shall notify the Company forthwith in writing of all particulars
of any improvement applicable to any Products (whether patentable or not) that
it discovers or which comes to its or its Authorised Dealer’s attention during
the term hereof. In any such case the Parties shall actively consider how and on
what terms such improvements may be made available to the Company, and any other
member of the Perkins Group or its licensees.

8. COMPANY RESPONSIBILITIES

 

  8.1 The Company shall support the Distributor’s performance hereunder by both
providing those facilities and services and carrying out its obligations all as
detailed herein in an efficient, professional and timely manner.

 

  8.2 The Company will from time to time and where possible in advance, notify
the Distributor in writing as to the extent to which the Company will in any one
year reimburse to the Distributor expenses incurred by the Distributor in
discharge of its obligations under Article 3.1.4 above. The Company shall not be
obliged to make reimbursement of any expenses so incurred except to the extent
notified by the Company.

 

  8.3 The Company will actively continue to seek ways of improving the services
provided to the Distributor and thus enhancing the value of this Perkins’
distributorship.

 

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  8.4 The Company shall, notwithstanding the general policy as stated in Article
11.4 below, endeavour to adjust and maintain its prices for the Products to be
competitive with those of most major competitors for their own comparable
products.

 

  8.5 The Company shall as soon as is reasonably practicable notify the
Distributor in writing of any additions, deletions or modifications from time to
time made to the Perkins Standards, its standard terms and conditions of
purchase and sale, the Perkins Service Procedure Manual and its Price Lists as
far as they relate to this Agreement.

9. AUTHORISED DEALERS

 

  9.1 The Distributor shall have the right to appoint Authorised Dealers within
the Territory for the purpose of providing proper representation throughout the
Territory for the supply and servicing of Products, subject to the following
provisions:

 

  9.1.1 the Distributor shall consult with the Company prior to appointing any
Authorised Dealer;

 

  9.1.2 the appointment of Authorised Dealers shall automatically terminate upon
termination of this Agreement;

 

  9.1.3 the Distributor shall ensure that the Company’s authorised
representatives shall be permitted access to the premises of Authorised Dealers
for the purposes described in Article 10.1.2.

 

  9.2 The Distributor shall remain solely liable to the Company for its
performance hereunder, notwithstanding its appointment of any Authorised
Dealers.

10. INSPECTIONS, REPORTS AND PROCEDURES

 

  10.1 The Distributor shall:

 

  10.1.1 Instigate and maintain an accurate system of engine and parts stock
control, workshop control and job card system;

 

  10.1.2 permit the Company’s authorised representatives to have access to the
Specified Premises at any time during normal business hours to inspect the
equipment installed and the work carried out in connection with the maintenance
and repair of the Products, and to inspect and check the Distributor’s stock of
Products and the stock records applicable thereto;

 

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  10.1.3 deliver to the Company a written monthly report stating its stocks,
sales and estimates of future requirements for the Products;

 

  10.1.4 establish and maintain procedures for:

 

  (a) registering supplies of the Products;

 

  (b) dealing with warranty claims;

 

  (c) regulating any other matters in connection with the supply and servicing
of the Products, such procedures to ensure compliance with the relevant Perkins
Standards;

 

  10.1.5 submit a copy of the Distributor’s annual audited accounts, (if the
Distributor is required to submit any such accounts to the Registrar of
Companies or to any similar statutory body in its country of registration) not
later than 6 months either from the end of the financial year to which such
accounts relate or from the end of each calendar year during the term hereof,
whichever is earlier;

 

  10.1.6 submit to the Company such financial and other information as the
Company may reasonably require (including profit and loss accounts and operating
expenses);

 

  10.1.7 report in writing immediately to the Company full details of any
material change or proposed change occurring either in the Distributor’s
constitution, management or control, or that of any company under the same
ultimate direction, management or control as itself which handles Competing
Items.

11. ORDERING PROCEDURES, CONDITIONS OF SALE AND PRICES

 

  11.1 Orders for Products required by the Distributor shall be placed by the
Distributor with such Perkins Supplying Company as the Company may from time to
time designate for the purpose.

 

  11.2 Each order addressed to a Perkins Supplying Company may be accepted or
(upon giving to the Distributor reasons for such rejection) rejected by that
Perkins Supplying Company. No order placed will be deemed accepted until a
formal acceptance has been despatched to the Distributor by the relevant Perkins
Supplying Company which is accepting the Order or until delivery of the Products
has been made.

 

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  11.3 Each order placed on and accepted by a Perkins Supplying Company as per
Article 11.2 will (whether or not expressly stated in the order or acceptance)
be deemed to have been so accepted subject to the standard Conditions of Sale
(including warranty) of the Perkins Supplying Company current at the time of
acceptance of such order to the extent that such conditions have been previously
notified to the Distributor in writing.

 

  11.4 Prices for the Products shall be those specified in the Price List
current at the date of delivery by the Perkins Supplying Company. Prices as
stated in the Price List shall be determined by the Perkins Supplying Company at
its absolute discretion. Unless the contrary is stated in the Price List the
cost of packing, transport and insurance will be payable as an addition to the
price of the Products.

 

  11.5 The Distributor shall be solely responsible for all fiscal, tax, customs
duties, fees and other charges howsoever arising out of its orders on the
Company for Products.

12. DISTRIBUTOR’S CONDITIONS OF PURCHASE AND SALE

 

  12.1 Any and all terms of business stated on any Distributor originated orders
or other related documentation and passing between the Parties (including any
Perkins Supplying Companies) are hereby expressly excluded and superseded by
those terms referred to in Article 11.3 above.

 

  12.2 In supplying Products acquired by the Distributor from the Company, the
Distributor shall ensure that the purchaser of the Products is provided with a
warranty no less favourable to the purchaser than the warranty given to the
Distributor by the Company and in accordance with the law in force in the
Territory from time to time.

13. TERMS AND METHOD OF PAYMENT

 

  13.1 The Distributor acknowledges that its obligation to make payment strictly
in accordance with the agreed programme and terms of payment for each order is a
fundamental obligation of this Agreement and each such order.

 

  13.2 The detailed terms and method of payment applicable to all purchases of
Products by the Distributor hereunder shall be those set out in Schedule 2.

 

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14. CHANGES TO AGREEMENT

For any amendment to this Agreement or any part thereof to be valid and binding
on the Parties, it must be reduced to writing and signed by authorised
representatives of each Party.

15. CHANGES IN SPECIFICATIONS

 

  15.1 The Company may make modifications to the design of or fitments to any of
the Products or make improvements to them at any time. The Company shall be
under no obligation to apply the same to any of the Products previously
purchased by the Distributor except on such occasions as the Company deems it
necessary to initiate a campaign to rectify known product defects.

 

  15.2 The Company reserves the right to discontinue the manufacture of any of
the Products without incurring any obligation or liability to the Distributor.
In such cases the Company will promptly notify the Distributor and will use all
reasonable endeavours to do so at least six months prior to discontinuing
manufacture.

 

  15.3 The Distributor agrees, except with the prior approval of the Company,
not to make any modifications to or in any material way vary, the specification
of Products supplied to it by the Company or Perkins Supplying Companies or to
be repaired or serviced by it.

16. ENQUIRIES

 

  16.1 If the Company refers enquiries to the Distributor for the repair,
servicing or supply of the Products within the Territory, the Distributor shall
as and when reasonably required by the Company report upon progress in respect
of such enquiries.

 

  16.2 In order to aid the Company’s monitoring of its distributors’
performance, the Distributor shall keep the Company advised of enquiries
relating to the Products which it receives either from persons outside the
Territory or from persons (other than OEMs) situated in the Territory who intend
to resell the Products outside the Territory.

17. CONFIDENTIALITY

 

  17.1

Where either Party discloses to the other any information, data or drawings
(whether visually, orally, in writing or in machine readable form) -
“Information” - then, to the extent the originating Party specifically marks or
identifies such Information as confidential, the receiving Party shall treat it
as confidential and

 

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  shall not disclose the same to any third party without the prior written
consent of the originating Party. The receiving Party may only use the
Information for the purposes hereof and shall ensure that only those of its
employees with a need to know actually receive it. The receiving Party shall be
solely liable to the originating Party for the acts and omissions of its
employees in this respect.

 

  17.2 The above obligations shall not apply where the receiving Party can show
that the Information is:

 

  17.2.1 in or comes into the public domain at any time otherwise than through a
breach by either Party of any of its obligations hereunder, or is made available
to the general public without restrictions by the originating Party;

 

  17.2.2 known to the receiving Party at the time of disclosure or is
independently developed by it or its employees without reference to or use of
the disclosed Information;

 

  17.2.3 received from a duly entitled third party without restriction and
without breach of these terms;

 

  17.2.4 required to be disclosed pursuant to applicable law, government
authority, duly authorised subpoena, or court order, in which case the receiving
Party will provide prompt notice to the originating Party and endeavour to give
the originating Party an opportunity to respond prior to such disclosure.

 

  17.3 At any time during the term hereof or upon termination hereof howsoever
caused, the originating Party may require the receiving Party to return all
Information disclosed to it.

 

  17.4 The above obligations of Article 17 shall survive the termination of this
Agreement for a period of 5 years.

18. RELATIONSHIP BETWEEN THE PARTIES

 

  18.1 The Distributor agrees it is not and shall not represent itself to be an
agent of the Company or any member of the Perkins Group or its licensees for any
purpose and shall not incur any obligations nor make any promise or
representation on behalf of the same.

 

  18.2 This Agreement does not in any way create an employer/employee
relationship between the Company or any member of the Perkins Group and the
Distributor and/or the Distributor’s employees.

 

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  18.3 The Distributor shall be solely responsible for the discharge of its
obligations and liabilities to third parties and shall have no right to
indemnity or contribution from the Company or any member of the Perkins Group in
respect thereof, except insofar as expressly provided herein or in the Company’s
warranty as from time to time current.

 

  18.4 The Distributor acknowledges that, save for the licence granted under the
Trade Mark Agreement, it does not have any right, title or interest in any
intellectual property owned by the Company or any member of the Perkins Group.

19. ASSIGNMENT AND TRANSFER

This Agreement shall be binding on the Parties hereto. It is personal to the
Distributor who may not assign, transfer or sublet the whole or any part of it
without the Company’s prior written consent. The Company shall have absolute
discretion as to whether or not to give such consent and as to the terms on
which it is given.

20. TERMINATION

 

  20.1 In addition to any other rights to terminate contained herein, the
Company may by written notice to the Distributor terminate this Agreement
forthwith upon:

 

  20.1.1 any attempted assignment or transfer without the Company’s prior
approval by the Distributor of this Agreement or any part thereof or any rights
or obligations thereunder; or

 

  20.1.2 the commencement or happening of any occurrence connected with
insolvency, bankruptcy, dissolution, administration, receivership or liquidation
(or the national equivalent of any of the above within the Territory or any part
thereof) of the Distributor; or

 

  20.1.3 a breach of any of the terms of any payment guarantee referenced in
Schedule 2 by any party giving that guarantee to the Company; or

 

  20.1.4 a breach of Article 3.10 of this Agreement; or

 

  20.1.5 termination or breach of any term of the Trade Mark Agreement.

 

  20.2

Subject to Article 20.3 relating specifically to deficient performance, if the
Distributor is in breach of any of its obligations hereunder, the Company may
serve written notice on the

 

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  Distributor requiring it to remedy the same within 45 days thereof. Where the
Distributor fails, in the Company’s opinion, to so remedy, the Company may serve
a written notice on the Distributor forthwith terminating this Agreement.

 

  20.3 If during the term hereof, the Company is in its absolute discretion
dissatisfied with the Distributor’s performance including without limitation,
the Distributors failure to perform in accordance with the agreed business plan,
it may notify the Distributor in writing, detailing the required remedial
actions that must be taken within the following 3 months. If the Company remains
dissatisfied at the end of the 3 months period, it may thereafter terminate this
Agreement by serving not less than 3 months written notice of termination on the
Distributor.

 

  20.4 The Company may terminate this Agreement by 3 months written notice to
the Distributor if there is any change after the Commencing Date in the
management, constitution or circumstances of the Distributor which the Company
in its absolute discretion deems materially detrimental to its interests
hereunder.

Without prejudice to the generality of the foregoing provision, where the
Distributor is a company, the acquisition of shares representing 25% or more of
the issued share capital or controlling 25% or more of the voting rights in the
Distributor by any person or entity not previously approved in writing by the
Company shall be deemed detrimental to the Company’s interests. In addition if
the acquiring party is engaged directly or indirectly in a business competing
with that of the Company, this too shall also be deemed to be detrimental to the
Company.

21. RESULTS OF TERMINATION

 

  21.1 The termination of this Agreement by the Company for cause shall operate
as a cancellation of all unfulfilled orders for any of the Products received by
the Company or any Perkins Supplying Company from the Distributor prior to the
date of such termination. The Distributor shall have no express or implied right
to receive any compensation from the Company as a result directly or indirectly
from such cancellation.

 

  21.2 Upon termination howsoever arising, the Company shall have the right to
purchase any or all of the Products held by the Distributor or its Authorised
Dealers at the date of termination, subject to the following conditions:

 

  21.2.1 the Company may oblige the Distributor or its Authorised Dealers to
deliver such Products free of any liens or encumbrances to the Company or its
nominee;

 

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  21.2.2 the Company shall pay the invoiced cost of such Products as incurred by
the Distributor less the cost of any necessary modifications, refinishing or
reconditioning of the same as determined by the Company in its absolute
discretion to restore them to their original condition less a 15% handling
charge.

 

  21.2.3 The Distributor shall not be obliged to sell and the Company may not
purchase any Products which are the subject of a binding contract of sale or
supply entered into by the Distributor or any of its Authorised Dealers with any
third party prior to the date of termination.

The Company may exercise its right hereunder by written notice during any
termination notice period or within 120 days after the effective date of any
such termination.

 

  21.3 The termination hereof (howsoever caused) shall be without prejudice to
any rights or obligations which shall have accrued prior to such termination.
Such termination shall not affect any provision hereof expressed to continue or
come into force after the termination including those relating to
confidentiality and intellectual property rights.

 

  21.4 During any termination notice period the Company may supply the Products
direct to any customers within the Territory where this will serve the best
interests of such customers or the customer has so requested. In such cases the
Distributor shall have no right to compensation or commission.

 

  21.5 Upon expiry or termination of this Agreement howsoever arising the Trade
Mark Agreement shall automatically terminate.

22. WAIVER OF DEFAULT AND GENERAL LIABILITY

 

  22.1 No waiver by one party of any breach, default or omission by the other in
the performance or observance of any of its obligations hereunder shall be valid
unless agreed to in writing signed on behalf of the other. No such waiver shall
apply to or be deemed a waiver of any other breach, default or omission
hereunder. The failure of one party to enforce at any time any of the provisions
hereof or to require at any time performance by the other of any of its
obligations hereunder shall not be construed to be a waiver of such provisions
or obligations.

 

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  22.2 Notwithstanding any other provision herein, neither party shall have any
liability for any indirect or consequential loss or damage suffered by the other
including but not limited to loss of profits, trade, contracts or production,
howsoever arising out of or in relation to this Agreement.

23. GENERAL

 

  23.1 Any notice hereunder shall be delivered by hand at or sent by prepaid
first class post (or airmail if outside the UK) to the registered address of the
Party upon whom it is being served or any such other address as notified in
writing for the purpose of serving notices hereunder. If posted any such notice
shall be deemed to have been served at the expiration of 48 hours after it was
posted. In proving such service it shall be sufficient to show that the envelope
containing the notice was both duly addressed, stamped and delivered into the
custody of the Post Office. Where the Party being notified has an address
outside the UK, then the period of 48 hours shall be extended to 96 hours.

 

  23.2 “Force Majeure” means any act or event outside the reasonable control of
one of the Parties affecting its ability to perform one or more of its
obligations hereunder. The affected Party shall forthwith inform the other in
writing of the matters constituting the Force Majeure and thereby affecting its
performance. It shall keep that Party fully informed with regard thereto and of
any change therein. If Force Majeure continues for longer than 6 months then
either Party may forthwith by notice in writing to the other terminate this
Agreement. Neither Party shall be entitled to claim any compensation from the
other for breach of the Agreement or for any contract entered into pursuant to
this Agreement arising out of a termination under this Article 23.2.

 

  23.3 Any element of this Agreement which is or may be held to be void or
unenforceable shall, to the extent of such invalidity or unenforceability, be
deemed severable and shall not affect any other elements hereof.

 

  23.4 This Agreement constitutes the entire agreement between the Parties
concerning the subject matter hereof and supersedes and replaces any prior
communications, representations or agreements (whether oral or in writing).

 

  23.5 This Agreement shall be deemed to be an agreement made in England and
shall be read and construed and take effect in all respects in accordance with
the Laws of England and the Parties hereby submit to the jurisdiction of the
English Courts.

 

  23.6

To the extent that there is no reciprocal enforcement procedures between the
United Kingdom and the country in which the

 

20

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  Distributor is located, the Parties agree to submit any dispute arising
between them that cannot amicably be settled to arbitration. The arbitration
shall be held in London, England before a single arbitrator appointed by the
Parties or failing agreement the matter shall be referred upon either Party’s
application to the then current President of the Institute of Arbitrators in
London. His nomination of an arbitrator shall be binding on the Parties. The
arbitration shall be governed by the UNCITRAL rules of arbitration and the
Parties agree to be finally bound by any and all awards made thereunder by the
arbitrator.

 

  23.7 Where the arbitration procedures are applicable, nothing shall prevent
the Company from applying to the appropriate court for any injunction or other
like remedy to restrain the Distributor from committing any breach or any
anticipated breach of this Agreement and for consequential relief.

 

21

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IN WITNESS WHEREOF this Agreement has been entered into the day and year first
before written.

 

SIGNED for and on behalf of SIGNED for and on behalf of Perkins Engines Company
Limited Power Solution International Inc. by:

/s/ Ramin Younessi

by:

/s/ Gary Winemaster

Name: Ramin Younessi Name: Gary Winemaster Position: Vice President of Perkins
Engines Company Limited Position: Chief Financial Officer

 

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SCHEDULE 1: DISTRIBUTOR TERRITORY

 

S.1.1 North Dakota, South Dakota, Minnesota, Wisconsin, Iowa, Michigan, Ohio,
Indiana, Illinois, Missouri, Nebraska, Kansas, Pennsylvania, New Jersey,
Delaware, Maryland (including Washington, District of Columbia), West Virginia,
New Hampshire, Vermont, Massachusetts, Maine, Rhode Island, Connecticut, New
York

 

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SCHEDULE 2: TERMS AND METHOD OF PAYMENT

 

S.2.1 This Schedule details the terms of payment applicable to all purchases of
products by the Distributor as ascribed by Article 13.2 of the Agreement.

 

S.2.2 Company agrees (but reserves the right to withdraw such agreement at any
time on notifying the Distributor) that the Distributor shall make payment on
the terms of payment set out in Article S2.5 of this Schedule. During each
calendar month the Company shall send a statement of account for the products
invoiced to the Distributor before the first week of the said calendar month
detailing which is due and payable by the Distributor.

 

S.2.3 The Distributor shall make payments by electronic transfer into the
Company’s nominated bank account to ensure that payment is received by the
Company on or before the agreed due date. The Company reserves the right to
charge interest on all invoices that remain unpaid on their due date until
actual payment is received. Delay payment interest will be charged at a rate of
4% above the prevailing Lloyds Bank Group PLC interest rate. These provisions
are without prejudice to the generality of the Companies rights to set off in
Article S2.4 below.

 

S.2.4 The Company shall have the right to apply in or towards the payment of any
amount due to it, any funds or credits belonging or due to it which may be in
the others possession.

 

S.2.5 Terms of Payment for Engines and/ or Parts

The Company is prepared to trade with the Distributor on the following terms of
payment:

 

  S.2.5.1 Payment Terms

Payment for all orders placed on the Company shall be due on the 15th of the
second month following date of invoice unless otherwise advised by the Company.
Payment for all order placed on Perkins Supplying Companies (including but
without limitation to Perkins Engines Inc.) shall be due 120 days following date
of invoice unless otherwise advised by the Company.

 

  S.2.5.2 All prices in quotations and acceptances are in the currency stated in
the quotation or invoice unless otherwise stated and the prices to be paid shall
be those ruling at the date of delivery.

 

S2.6 Company reserves the right to request a parent company guarantee or other
such security from the Distributor in respect of its financial obligations to
the Company and in the absence of which the Company may review and revise any
credit limit then offered to the Distributor.

 

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