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EXHIBIT 10.2
Confidential
Execution Copy
 PURCHASE AGREEMENT
 Agreement st Effective Date Caterpillar ASV party parties
 Recitals
 A.
    
    ASV desires to supply to Caterpillar, and Caterpillar desires to purchase from
ASV, rubber-tracked undercarriages for certain multi-terrain loader (MTL) machines
manufactured by Caterpillar or its affiliates pursuant to the terms herein.B.
    
    In connection with this Agreement, the parties are simultaneously entering into
an agreement which will govern the terms and conditions under which ASV will register
the shares of ASV common stock held by Caterpillar (the Registration Rights
Agreement).
  1.
    
    Products Covered by this Agreement.
 a.
    
    Description. This Agreement sets forth the terms and conditions under which
ASV will develop and manufacture for use, sale or distribution by Caterpillar (1) those
ASV undercarriage systems set forth on Exhibit A attached hereto and
incorporated herein by reference (the ASV Product), for the Caterpillar A Series, B
Series and ***** MTL machines set forth on Exhibit A (collectively, the
Caterpillar Machines) and (2) replacement parts and components used in the
manufacturing of ASV Product (OEM Aftermarket Parts, together with ASV Product,
Product). Unless otherwise agreed upon by the parties, Caterpillar Machines shall
not include ***** MTL machines or any other machine or product not listed on
Exhibit A. Loegering Mfg. Inc. and its products and parts are expressly
excluded from the scope of this Agreement.b.
    
    Features. ASV Product will be incorporated on Caterpillar Machines in
accordance with agreed upon written specifications, as may be amended or updated from
time to time in writing by the mutual agreement of both parties (the Base Product
Specifications), including those component and functional specifications requested by
Caterpillar (unless ASV can provide reasonable written evidence to Caterpillar that ASV
has already used or conceived of such specifications, features or components prior to
Caterpillars request) under a request for proposal, and agreed upon by ASV, which
specifications differentiate Caterpillar Machines and ASV Product from similar machines
and undercarriages in the market, including those set forth on Exhibit B,
attached hereto and incorporated herein by reference, as amended from time to time by a
written amendment signed by both parties (the Cat Specifications, together with Base
Product Specifications, the Specifications). Any
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




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 subsequent feature, specification and resulting design, process or engineering change to
an ASV Product or the Specifications requires the agreement of the parties prior to
introduction of such change. If ASV does not agree upon a feature change to the ASV
Product reasonably requested by Caterpillar, then Caterpillar may develop, make, have
made, sell or distribute or outsource the development, manufacture, sale or distribution
of, the affected ASV Product incorporating the feature change subject to the terms and
conditions of Section 11(b) should the product contain any ASV intellectual property.c.
    
    Development and Production Schedule. ASV will develop and validate each ASV
Product for ***** Caterpillar Machines to meet agreed upon reliability and quality
requirements of Caterpillars new product development plan for the ***** Caterpillar
Machines. ASV will complete such development of the ASV Product for ***** Caterpillar
Machines for pilot production and full production within the timeframe set forth in the
applicable, agreed upon Caterpillar new product introduction program.
 2.
    
    Purchase and Sale of ASV Product.
 a.
    
    Scope.Subject to ASV meeting, to Caterpillars satisfaction, the QCLDM Goals
(defined in Section 3) and the other terms and conditions set forth herein, Caterpillar
will purchase from ASV one hundred percent (100%) of its sales and manufacturing
requirements in North American markets for those undercarriages produced to the
Specifications for the Caterpillar Machines as set forth on Exhibit A and ASV
will sell to Caterpillar one hundred percent (100%) of Caterpillars requirements for
undercarriages produced to the Specifications. Until such time as current export
markets are sourced outside of North America pursuant to Section 2(b), such export
markets are included within the scope of Caterpillars sales and manufacturing
requirements with respect to North American markets under this Agreement. ASV
understands that Caterpillar makes no guarantee as to the quantity of Product it will
require or that it will require Product at all.b.
    
    Other Sources.
 (1)
    
    Notwithstanding anything contained herein to the contrary, Caterpillar
may source Product from suppliers other than ASV to the extent necessary to enable
Caterpillar to meet, outside of North America, governmentally determined local
country sourcing or minimum content requirements, whether mandated or established
by other means such as quotas, duties or fiscal incentives or penalties; provided,
however, that such alternative sourcing shall be permitted solely with respect to
Caterpillars sales and manufacturing requirements outside of North America and
shall be permitted only if ASV cannot meet the Local Requirements under Section
2(b)(2).(2)
    
    If Caterpillar sources or manufactures Caterpillar Machines outside of
North America, then, subject to ASV meeting, to Caterpillars satisfaction, the
capacity requirements for the applicable geographic area, as provided to ASV
pursuant to Section 2(c) (Capacity Requirements), the Caterpillar sourcing
requirements for the specified geographic areas (the Sourcing Requirements), and
the local country minimum content requirements (Content Requirements, together
with the Sourcing Requirements, the Local
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 2




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 Requirements), then Caterpillar will purchase one hundred percent (100%) of its
requirements, for sales outside of North America, of ASV undercarriages produced to
the Specifications for inclusion on the Caterpillar Machines set forth in
Exhibit A. ASV will submit a proposal for or decline such business within
the reasonable timeframe indicated by Caterpillar.(3)
    
    If ASV is unwilling or ASV has indicated it is unable to meet the Local
Requirements, then ASV would grant to Caterpillar a license to the ASV intellectual
property necessary to fulfill Caterpillars requirements with respect to the
specified geographic area under the terms and conditions set forth in Section
11(b). If ASV is unwilling or ASV has indicated it is unable to meet the Capacity
Requirements, then ASV would grant to Caterpillar a license to the ASV intellectual
property necessary to fulfill Caterpillars requirements with respect to the
specified geographic area under the terms and conditions set forth in Section
11(c). Alternatively, if ASV is unwilling or ASV has indicated it is unable to
meet the Local Requirements or the Capacity Requirements, then Caterpillar may
source undercarriages for Caterpillar Machines from a third party for Caterpillars
sales and manfacturing requirements only for geographic areas outside of North
America providedthat Caterpillar does not utilize ASV intellectual property.
 c.
    
    Forecasts.Monthly, Caterpillar will provide ASV a non-binding, written
forecast of its requirements for ASV Product for the following twelve (12) month
period. Unless otherwise agreed to by the parties, the first three (3) months of such
updated forecasts shall be firm on the parties, and the remaining nine (9) months shall
be the parties best estimate but shall not be binding on either party. Annually,
Caterpillar will provide ASV a non-binding written forecast of its long-term capacity
requirements for a period of approximately two to five years following the date of
delivery of such written long-term capacity forecast.d.
    
    New Machines.
 (1)
    
    The parties may, from time to time, engage in formal discussions (i.e.,
initiated when Caterpillar submits a written request for proposal (RFP) to ASV)
regarding development of undercarriages (Discussions) for any Caterpillar machine
not included in the definition of Caterpillar Machines (a New Machine).
 (A)
    
    If the New Machine Discussions could represent a new, exclusive
opportunity for ASV, ASV agrees to maintain such Discussions on a confidential
and exclusive basis with Caterpillar until Caterpillar provides ASV Notice (as
defined below) or until the transaction is complete.(B)
    
    If the New Machine Discussions would only represent an
existing, non-exclusive opportunity for ASV, then (i) ASV could pursue this
opportunity with others in the marketplace, subject to the other terms of this
Agreement and Caterpillar and (ii) Caterpillar would be free to purchase all,
some or none of its requirements for undercarriages for the New Machines from
ASV or any other supplier.(C)
    
    ASV will send a written notice to Caterpillar within ten (10)
days of the date of Caterpillars RFP, indicating in such notice if this
opportunity would constitute a new opportunity for ASV or if ASV is already
formally discussing a similar opportunity with a third party for a machine
within the same size class, and competitive with, the New Machine proposed by
Caterpillar.
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 (2)
    
    If, as a result of such Discussions, the parties reach agreement on
various commercial terms, including pricing, related to ASVs supply of
undercarriages for such New Machine, then the parties will negotiate a separate
joint development agreement.(3)
    
    If after engaging in Discussions with ASV regarding development of an
undercarriage for a New Machine, Caterpillar decides to source undercarriages for
the New Machine from another supplier, or to manufacture such undercarriage itself,
then Caterpillar will notify ASV of this decision (Notice). Caterpillar will
provide to ASV a Notice upon the completion of the applicable Caterpillar A
Review.(4)
    
    Except as otherwise set forth herein, beginning three (3) months after
the date of such Notice, ASV may sell undercarriages to OEMs (other than
Caterpillar and its affiliates) for incorporation on machines that compete with or
are similar to the New Machine listed in such notice (but not competitive with
Caterpillar Machines) (Permitted OEM Machines) so long as those ASV
undercarriages do not use or incorporate any Cat Specifications or intellectual
property obtained from Caterpillar, including, but not limited to, any Caterpillar
specification included in Caterpillars RFP, other than any specification, feature
or component for which ASV can provide reasonable written evidence that ASV used or
conceived of such specification, feature or component prior to the date of ASVs
receipt of such RFP, and, in the case of the ***** Caterpillar Machine, either (A)
Caterpillar is selling and distributing the particular New Machine or (B) 18 months
has passed from the date of the Notice. Notwithstanding anything herein to the
contrary, under no circumstances will ASV sell, or license others to sell,
undercarriages for a New Machine, or any other undercarriage, made using or
incorporating any Cat Specifications or any other intellectual property obtained
from Caterpillar.(5)
    
    ASV may sell ASV Product produced to Cat Specifications only to (1)
Caterpillar, or Caterpillar affiliates designated by Caterpillar, for inclusion on
Caterpillar Machines or (2) ASV dealers for inclusion on ASV machines. ASV may not
sell, directly or indirectly, ASV Product to any third party manufacturing,
distributing or selling Competitive Machines (defined below). Except as otherwise
set forth herein, nothing will prevent ASV from developing, manufacturing and
selling its undercarriages to other machine manufacturers, including without
limitation undercarriages for New Machines as contemplated under Section 2(d)
above, unless(1) the undercarriages sold incorporate any Cat Specifications, any
Cat intellectual property or any other intellectual property obtained from
Caterpillar or (2) the machines for which the undercarriages are sold compete with
Caterpillar Machines (Competitive Machines). Further, ASV will not license, or
purport to license, to any third party, (A) any Caterpillar intellectual property
or other intellectual property obtained from Caterpillar, (B) any Cat
Specifications or (C) any ASV intellectual property in a manner that would result
in such third party competing with Caterpillar with respect to the Caterpillar
Machines in a manner that would be otherwise be prohibited under the terms of this
Agreement had the activities of such third party been conducted directly by ASV.
Competitive Machines include MTLs, compact track loaders, all surface loaders and
other rubber track loaders within the same size class (based on rated operating
capacity) as the Caterpillar Machines on Exhibit A (except with respect to
any Permitted OEM Machines). Competitive Machines
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 4




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 do not include Permitted OEM Machines that compete with New Machines included in a
Notice.
 e.
    
    If ASV violates Section 2(a) or 2(d), then, in addition to other remedies that
Caterpillar may have under law or equity, Caterpillar will no longer be required to
purchase its requirements for undercarriages from ASV and will be allowed to
manufacture, or outsource the manufacture of, ASV Product using the relevant ASV
intellectual property without restriction and pursuant to the Product License described
in Section 11(c).f.
    
    Purchase and Sale of Aftermarket Parts.
 (1)
    
    Caterpillar will purchase 100% of its requirements for ASV proprietary
OEM Aftermarket Parts from ASV so long as ASV remains competitive in terms of cost,
quality, reliability and pricing of substitutable parts and components. A current
listing of the ASV proprietary and non-proprietary OEM Aftermarket Parts is set
forth on Attachment 1 to Exhibit C. Proprietary OEM Aftermarket Parts
are defined as those parts that are designed and built specifically for the ASV
Product. Non-Proprietary OEM Aftermarket Parts are defined as those parts that
are not designed and built specifically for the ASV Product. Caterpillar may
purchase Non-Proprietary OEM Aftermarket Parts from sources other than ASV, but
must not represent such parts as ASV OEM Aftermarket Parts.(2)
    
    Caterpillar and ASV will sell OEM Aftermarket Parts only to their
respective authorized machine dealers and not through other parts resellers.
 3.
    
    Quality, Cost, Logistics, Development and Management. Caterpillar will monitor ASVs
performance under this Agreement using quality, cost, logistics, development and management
goals agreed upon in writing by the parties (QCLDM Goals). The QCLDM Goals will be
reviewed and agreed upon by the parties on an annual basis.
 4.
    
    ASV Product Prices. Both ASV and Caterpillar are committed to controlling and
reducing costs, and both recognize that effective cost control is of the essence to this
Agreement. While this Agreement is in effect, ASV will maintain a cost control and reduction
program with respect to Product, and will review costs on a regular basis for progress toward
the objective of reducing ASVs prices to Caterpillar. A constant interaction between
Caterpillars and ASVs engineering personnel is essential. Any cost increases or
engineering, processes, design or material changes in Product must be documented and agreed to
in advance in writing by both parties.
 a.
    
    Price for ASV Product included on B Series Caterpillar Machines. ASV will sell
to Caterpillar and designated Caterpillar affiliates ASV Product for inclusion on
existing B Series Caterpillar Machines at the prices set forth on Table 1 of
Exhibit C attached hereto and incorporated herein by reference (the B Series
Prices). *****.
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 5




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 b.
    
    Price for ASV Product included on***** Caterpillar Machines.
 (1)
    
    Subject to Section 4(b)(4), the price for ASV Product included on *****
Caterpillar Machines will be the lesser of: (A) ASV Manufacturing Costs plusan
amount to generate a *****% gross profit margin for ASV; and (B) the applicable
maximum price set forth on Table 2 of Exhibit C. Similar to the current
methodology being used by the parties, ASV Manufacturing Costs will include the
actual costs incurred by ASV, in accordance with US GAAP, in connection with
manufacturing ASV Product for Caterpillar for (W) direct material, (X) direct
labor, (Y) direct burden, including shipping and delivering ASV Product to
Caterpillar and (Z) the overhead allocated at ASVs overhead application rate and
based upon manufacturing overhead expenses agreed upon by the parties incurred as a
result of manufacturing, testing, painting, shipping and delivering ASV Product to
Caterpillar. Caterpillar or its representatives may audit ASVs books and records
to confirm the ASV Manufacturing Costs used in determining Production Price
(defined in Section 4(b)(2)).(2)
    
    Subject to Section 4(b)(1), the parties will determine the price
referenced in Section 4(b)(1)(A) above for ***** Caterpillar Machines at two points
in time: first, upon the initial production of the ***** Caterpillar Machines
(Initial Production Price); and second, upon completion of ASVs production ramp
up, i.e., ***** (Production Price). Subject to Section 4(b)(1), if mutually
agreed by the parties, the *****.(3)
    
    Subject to Section 4(b)(1), the lesser of: (A) the Initial Production
Price; and (B) the applicable maximum price set forth on Table 2 of Exhibit
C will apply to ASV Product sold to Caterpillar for ***** Caterpillar Machines
during the 2006 calendar year. Subject to Section 4(b)(1), the lesser of: (Y) the
Production Price; and (Z) the applicable maximum price set forth on Table 2 of
Exhibit C will apply to ASV Product sold to Caterpillar for *****
Caterpillar Machines during the 2007 calendar year.(4)
    
    Beginning on *****, a *****% year-over-year price reduction will apply
to the current Production Price for the remainder of the term set forth in Section
6(b).(5)
    
    *****.(6)
    
    Exhibit D accurately details ASVs cost build-up of the
Production Prices and maximum prices set forth on Table 2 of Exhibit C.
 c.
    
    Shipping Costs. The margins/prices listed on Table 2 of Exhibit C
include ASVs freight and delivery costs to ship ASV Product to the Caterpillar
facility located in Sanford, North Carolina (the Facility). The parties will agree
in advance upon the allocation of freight and delivery costs for transportation of ASV
Product to facilities other than the Facility. Both parties will review such shipping
costs annually. However, if Caterpillar or ASV identifies a lower cost shipping source
which meets each partys quality, cost and delivery requirements, ASV will have the
option to either (1) change to the identified source to allow Caterpillar to realize
the full amount of such cost reduction or (2) reduce the purchase price by the
identified reduction.
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 6




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 5.
    
    Payment. Caterpillar or the applicable Caterpillar affiliate will pay all correct
invoices submitted pursuant to this Agreement within ***** from receipt of invoice for
undercarriage production supply and within ***** of receipt of invoice for OEM Aftermarket
Parts.
 6.
    
    Term. This Agreement shall commence as of the Effective Date and continue through:
 a.
    
    for ***** Caterpillar Machines, the earlier to occur of (1) Caterpillar
termination of production of B Series Caterpillar Machines or (2) November 1, 2010; andb.
    
    for ***** Caterpillar Machines, November 1, 2010;unless sooner terminated by either party, pursuant to the provisions set forth in Section
13. THIS AGREEMENT SHALL AUTOMATICALLY RENEW FOR SUCCESSIVE ONE-YEAR RENEWAL TERMS UNLESS
EITHER PARTY PROVIDES TO THE OTHER PARTY HERETO AT LEAST SIX (6) MONTHS WRITTEN NOTICE OF
TERMINATION PRIOR TO THE EXPIRATION OF THE THEN-CURRENT TERM OF THIS AGREEMENT OR UNLESS
TERMINATED PURSUANT TO SECTION 13.
 7.
    
    Aftermarket Parts.
 a.
    
    ASV will sell to Caterpillar and Caterpillar affiliates OEM Aftermarket Parts
for inclusion on A Series Caterpillar Machines and B Series Caterpillar Machines (A
and B Series Parts) at the prices determined within the pricing guidelines set forth
on Table 3 of Exhibit C and set forth in further detail on Attachment 1 to
Exhibit C, subject to Section 7(c).b.
    
    ASV will sell to Caterpillar and Caterpillar affiliates OEM Aftermarket Parts
for inclusion on ***** Caterpillar Machines (***** Parts) at prices determined within
the pricing guidelines set forth on Table 4 of Exhibit C, subject to Section
7(c). The parties will create a list of ***** Parts and specific prices similar to
Attachment 1 to Exhibit C prior to ASVs initiation of full production of *****
Parts.c.
    
    Both parties will review and update the ASV proprietary OEM Aftermarket Parts
listed on Exhibit C on an annual basis for competitive pricing and content.
During that review, ASV will update the OEM Aftermarket Parts pricing lists on an
annual basis within the percentages set forth in Tables 3 and 4 in Exhibit C.
Caterpillar or its representatives may audit ASVs books and records to confirm the ASV
Manufacturing Costs used in determining OEM Aftermarket Parts Prices as part of the
parties annual price reviews contemplated by Section 4.d.
    
    For a period of ***** years following the termination or expiration of this
Agreement, ASV will sell to Caterpillar OEM Aftermarket Parts at the applicable parts
prices listed in Exhibit C. If ASV for whatever reason ceases supplying any or
all of the OEM Aftermarket Parts, ASV will grant to Caterpillar an irrevocable,
worldwide, royalty-free, non-exclusive license for Caterpillar to manufacture (or
outsource the manufacture of), use, distribute and
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 7




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 sell such parts incorporating ASV intellectual property to support the Caterpillar
aftermarket for the period of ***** years following the termination or expiration of the
Agreement.e.
    
    ASV will take all necessary action to permit Caterpillar access to an
alternative source of supply should ASV for whatever reason cease to be able to supply
any or all of the OEM Aftermarket Parts.f.
    
    While this Agreement is in effect, ASV agrees not to compete with Caterpillar
for the sale of OEM Aftermarket Parts.
 8.

    Warranty. ASV warrants that each Product shall be in full conformity with ASVs and
Caterpillars specifications, drawings, and data, including but not limited to, the
Specifications. ASV further warrants that Product will be free from defects in design,
material and workmanship. *****.*****.
 9.
    
    Indemnification.
 a.
    
    ASV agrees to indemnify, defend, and hold harmless Caterpillar, its
subsidiaries, affiliates, directors, officers, employees, agents, successors and
assigns from and against all claims, demands, liabilities, losses, damages, costs, and
expense, of whatsoever nature, including attorneys fees, arising from the injury or
death of any person or loss or damage to property and the environment (including any
damage caused by ASVs failure to comply with any state or federal environmental rules
and regulations), to the extent arising out of or connected with, directly or
indirectly, (1) any defect of design, material, or workmanship of Product or failure of
Product to conform with the Specifications, drawings, and data, including but not
limited to, any recall of Product and related costs, (2) any act or omission to act by
ASV or its employees, agents or contractors, (3) ASVs breach of this Agreement and (4)
infringement of any third party intellectual property rights arising because or on
account of the design, manufacture, use or sale of the Product. It is expressly
understood that this Section does not apply to the extent any suit, action, or
proceeding is based upon actual or alleged infringement by improvements developed by
Caterpillar, Caterpillar-supplied components or Caterpillar-supplied component parts.b.
    
    Caterpillar agrees to indemnify, defend, and hold harmless ASV, its
subsidiaries, affiliates, directors, officers, employees, agents, successors and
assigns from and against all claims, demands, liabilities, losses, damages, costs, and
expense, of whatsoever nature, including attorneys fees, arising from the injury or
death of any person or loss or damage to property and the environment (including any
damage caused by Caterpillars failure to comply with any state or federal
environmental rules and regulations), to the extent arising out of or connected with,
directly or indirectly, (1) any defect of design, material, or workmanship of the
Caterpillar Machines (except with respect to the Product used in such Caterpillar
Machines), including but not limited to, any recall of Caterpillar Machines and related
costs, (2) any act or omission to act by Caterpillar or its employees, agents or
contractors, (3) Caterpillars breach of this Agreement and (4) infringement of any
third party intellectual
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. 8




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 property rights arising because or on account of the design, manufacture, use or sale of
the Caterpillar Machine, excluding the Product used in such machines. It is expressly
understood that this Section does not apply to the extent any suit, action, or
proceeding is based upon actual or alleged infringement by improvements developed by
ASV, ASV-supplied components or ASV-supplied component parts.
 10.
    
    Confidential Information. Each party hereto agrees to hold in confidence any
proprietary technical and business information observed at the Facility or otherwise received
from the other party hereto (e.g., information relating to the disclosing partys products or
manufacturing methods or both, including, but not limited to, technical specifications,
diagrams, discoveries, economic models, pro forma and other financial information, designs,
business opportunities, cost and pricing data, records, customer lists, vendor lists and
engineering, manufacturing, and marketing know-how) (the Confidential Information). The
receiving party may only use Confidential Information for the purposes stated herein during
the term of this Agreement. The receiving party shall obtain a signed copy of an Employee NDA
(defined below) from each of its employees and subcontractors, prior to such employee or
subcontractor performing services for the disclosing party. Upon request, the receiving party
agrees to make the Employee NDAs signed by its employees and subcontractors available to the
disclosing party for inspection. Each party shall use and shall not alter, except for filling
in names and dates, the disclosing partys standard employee and/or subcontractor
nondisclosure agreement for signature by the receiving partys employee or subcontractor, as
the case may be (each an Employee NDA). Each party shall be responsible for any breach of
this Section or any Employee NDA by its employees or agents.Each party may be required to access the other partys computer or other electronic systems
in the performance of Services. At either partys request, the other party hereto shall
sign such partys Nondisclosure and Security Agreement or comparable agreement used to
protect similar proprietary information of such party.The obligations and restrictions on use and disclosure of Confidential Information shall
survive the termination and/or expiration of this Agreement for a period of five (5) years
after such termination and/or expiration.
 11.
    
    Product Development and License.
 a.
    
    ASV at its own cost will be responsible for designing, developing,
manufacturing, painting, improving and testing Product to meet the Specifications. In
addition, ASV will perform such product tests agreed upon by both parties. Caterpillar
will be responsible at its own cost for validation of the Caterpillar Machines equipped
with Product.b.
    
    Upon expiration of this Agreement, or at any time during the term of this
Agreement if so agreed upon by the parties, ASV shall grant to Caterpillar a
royalty-bearing, nonexclusive, worldwide license to ASVs intellectual property on
terms agreed upon by both parties.c.
    
    Upon termination of this Agreement by ASV other than in accordance with Section
13 or by Caterpillar in accordance with Section 13, or if ASV cannot or will not
provide, or continue to provide, to Caterpillar ASV Product or OEM Aftermarket Parts or
the products described in Sections 2(f) or 7(d) (each a Triggering Event), ASV shall
grant and hereby grants to Caterpillar a royalty-bearing, nonexclusive, irrevocable,
worldwide license (the Product License) to ASVs intellectual property that is
necessary or useful for Caterpillar to continue using said intellectual property and to
make, have made, sell, offer to sell, and import
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 products that are the same or similar to ASV Products or OEM Aftermarket Parts using the
relevant ASV intellectual property and incorporate ASV Product into Caterpillar Machines
for sale and distribution. If the defaulting party has not cured its default to the
satisfaction of the terminating party within a Cure Period (as defined in Section 13),
then the parties shall negotiate in good faith the royalty of the Product License with
the said royalty being no less favorable than those terms (1) currently in place with
existing licensees of ASV for products that are the same or similar to the ASV Products
or (2) if ASV does not have licensees, representing approximately the typical royalty
rates for similar intellectual property currently prevailing in the MTL machines
undercarriage industry, and taking into account whether such license is being granted as
a result of either partys breach of the terms of this Agreement. In the event that the
parties are unable to agree upon commercially reasonable royalty for the Product License
within 60 days following a Cure Period and the breach has not been cured, then the
parties shall appoint an independent certified public accountant who is familiar with
MTL undercarriage market intellectual property royalty rates and who is acceptable to
both parties (Expert) or, in the absence of an acceptable Expert, appointed on the
application of either party by the President and CEO of the American Institute of
Certified Public Accountants providedthat the Expert appointed shall be an independent
certified public accountant who is familiar with MTL undercarriage market intellectual
property royalty rates. Both parties shall cooperate in good faith with the Expert and
shall supply him or her in confidence all relevant data and information. The Expert so
appointed shall act as an expert, shall make his or her determination as expeditiously
as practicable, but in any event, within 60 days from selection or appointment of the
Expert (the 60-Day Period). The Experts determination shall be binding on the
parties. The expenses of the Expert shall be borne equally by the parties. All aspects
of the proceeding (including the existence, content and result of the proceeding) shall
be treated as Confidential Information. During the 90-Day Period and 60-Day Period,
Caterpillar shall have access to the Product License, but shall pay the
finally-determined royalty for use during those periods and thereafter.d.
    
    Any and all intellectual property created solely by ASV during the course of
this Agreement shall be solely owned by ASV, and, except as otherwise set forth herein,
nothing herein shall be deemed to imply any license to or ownership interest in,
Caterpillar of any such intellectual property so created. In the event that ASV shares
any of ASVs intellectual property with Caterpillar during the course of this
Agreement, the shared ASV intellectual property shall remain the property of ASV, and
nothing herein shall be deemed to imply any license to or ownership interest in,
Caterpillar of any such intellectual property of ASV. Caterpillar shall only be
permitted to use such intellectual property in its Development Efforts, in accordance
with ASVs instructions, or upon the occurrence of a Triggering Event, and in all cases
in accordance with the terms of this Agreement, and any further use of the shared
intellectual property by Caterpillar other than for the benefit of ASV shall be
pursuant to a license in accordance with Section 11(b), in the case of Development
Efforts, and in accordance with Section 11(c), in the case of a Triggering Event.e.
    
    Any and all intellectual property created solely by Caterpillar during the
course of its Development Efforts shall be solely owned by Caterpillar, and nothing
herein shall be deemed to imply any license to, or ownership interest in, ASV of any
such intellectual property so created. In the event that Caterpillar shares any of
Caterpillars intellectual property with ASV during the course of this Agreement, the
shared intellectual property shall remain the property of Caterpillar and ASV shall
only be permitted to use such intellectual property in accordance with Caterpillars
instructions, and any further use of the shared intellectual property by ASV other than
for the benefit of Caterpillar shall be pursuant to a license upon terms similar to
those set forth in Section 11(b). Notwithstanding Caterpillars
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 purchasing obligations set forth in Section 2 to this Agreement, Caterpillar shall not
be prevented during the term of this Agreement or at anytime thereafter from developing
its own product that is similar to the ASV Product (the Development Efforts). To that
end, Caterpillar may only use ASVs intellectual property pertaining to the ASV Product
in Caterpillars said Development Efforts, and in connection with any commercial sales
by or for Caterpillar of product developed as a result of such Development Efforts and
which incorporates ASV intellectual property, pursuant to a license granted under
Section 11(b).f.
    
    This Agreement shall govern the ownership of any intellectual property created
under this Agreement by the parties pertaining to the products in question
notwithstanding those provisions of any prior agreements between the parties,
including, but not limited to, the Multi-Terrain Rubber Tracked Loader Alliance
Agreement dated October 31, 2000 (the MTL Alliance Agreement).
 12.
    
    Additional Terms.
 a.
    
    ASV Purchase of Caterpillar Components. ASV agrees to continue to purchase
components as practicable from applicable Caterpillar component divisions in accordance
with the parties current business practices.b.
    
    Termination of Other Agreements. The parties hereby terminate the following
agreements by and between the parties: Termination Agreement dated January 22, 2004;
MTL Alliance Agreement and Amendment No. 2. to the MTL Alliance Agreement dated April
3, 2003; Tradename License Agreement dated April 13, 1999; Management Services
Agreement dated January 29, 1999; Marketing Agreement dated January 29, 1999;
Commercial Alliance Agreement dated October 14, 1998; Securities Purchase Agreement
dated October 14, 1998, and the Amendment to the Securities Purchase Agreement dated
January 30, 2003; and Securities Purchase Agreement dated October 31, 2000.c.
    
    Disposition of Certain ASV Assets. Upon termination of the MTL Alliance
Agreement, Caterpillar will either (1) return to ASV the ASV-owned assets previously
purchased by ASV pursuant to the MTL Alliance Agreement, located at the Facility and
identified on Exhibit F attached hereto and incorporated herein by reference
(the ASV Assets) or (2) purchase the ASV Assets pursuant to Caterpillars standard
equipment purchase order for an amount in cash equal to the net book value of the ASV
Assets, as reflected in ASVs most recent regularly-prepared and audited financial
statements.
 13.
    
    Termination and Other Remedies for Breach.
 a.
    
    Caterpillar Termination Rights. Caterpillar may terminate this Agreement at
any time, either totally or partially, in the event any of the following items shall
occur:
 (1)
    
    Quality  Any Product fails to meet the Specifications or the quality
goals set forth in the QCLDM Goals and ASV does not remedy such failure within the
Cure Period as set forth in Section 13(d)(2) or a Product experiences consistent
and recurring failures or other quality-related problems which disrupt
Caterpillars business whether or not such failures are remedied.(2)
    
    Delivery  ASV consistently fails to meet Caterpillar schedules with
timely shipments and daily shipments, if required, or the QCLDM Goals related to
delivery, and such failure results from any action or inaction on the part of ASV
or its agents or suppliers.
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 To that end, Caterpillar should not have to expedite normal deliveries. It is the
obligation of ASV to maintain an up-to-date schedule. Upon cases of non-delivery
resulting from ASV action or inaction, in addition to any other rights hereunder or
provided by law, Caterpillar may purchase the needed part or product in the open
market, and ASV shall reimburse Caterpillar the cost-to-cover charges either
through a cash payment within 30 days of Caterpillar paying for the replacement part
or products or through an offset by Caterpillar of any amounts owed to ASV
hereunder.(3)
    
    Competitiveness  ASV fails to be responsive to the market place or
fails to remain competitive on a worldwide basis with other manufacturers of
comparable parts or products in terms of price, quality, quantity, availability,
engineering, services, technology, reliability and timely delivery.(4)
    
    Breach  ASV materially breaches this Agreement or the Registration
Rights Agreement.
 b.
    
    Other Termination Rights.
 (1)
    
    Insolvency  Either party may terminate this Agreement if the other
party becomes insolvent or intends to dissolve or otherwise generally be unable to
pay debts as they come due, or makes a general assignment for the benefit of
creditors.(2)
    
    Bankruptcy  Either party may terminate this Agreement if a petition
under any bankruptcy act or similar statute is filed or is intended to be filed by
a creditor of the other party and is not vacated within ten (10) days through court
order.(3)
    
    Caterpillar Breach  ASV may terminate this Agreement if Caterpillar
does not make a payment owed to ASV hereunder in accordance with Section 5 or
otherwise materially breaches this Agreement, or if Caterpillar breaches Section 4
of the Registration Rights Agreement.
 c.
    
    Additional Remedies for Breach.In addition to the other rights granted under
this Agreement, whether or not Caterpillar terminates this Agreement pursuant to
Section 13, provided Caterpillar has a basis for termination under Section 13, ASV
agrees to pay for all ASV and Caterpillar reasonable expenses incurred as a result of
such breach, including, but not limited to: material, tooling, labor, downtime and
transportation expenses.d.
    
    Effect of Termination.
 (1)
    
    License. Upon termination, Caterpillar will receive the
Product License described in Section 11(c).(2)
    
    Termination Plan. Prior to the Agreement being terminated by
the respective party under Section 13(a) or 13(b)(3), Caterpillar and ASV will meet
to establish a 90-day corrective action plan to address the concern of the
terminating party (the Cure Period). If at the end of the Cure Period the
defaulting party has not cured its default to the satisfaction of the terminating
party, the parties agree to construct a termination plan to allow Caterpillar
sufficient time to secure another acceptable source of undercarriages and related
parts to avoid disruption to Caterpillars business. Upon Caterpillars reasonable
determination that it has secured an acceptable source of undercarriages and
related parts, Caterpillar shall provide ASV with at least 30 days prior written
notice of final termination.
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 14.
    
    Notices. When written notice is required by this Agreement, it shall be sent by
certified mail, by courier, or by such method as will permit the sender to verify delivery, to
the addresses set forth below:
 For Caterpillar:
    
    For ASV:Caterpillar Inc.
    
    A.S.V., Inc.5000 Womack Road
    
    840 Lily LaneSanford, North Carolina 27330
    
    Grand Rapids, Minnesota 55744-4089Attn: SSL/MTL Product Manager
    
    Attn: Chief Executive OfficerFax: (919) 777-2032
    
    Fax: (218) 327-9123With a copy to:
    
    With a copy to:Caterpillar Inc.
    
    Dorsey & Whitney LLP100 N.E. Adams Street
    
    50 South Sixth Street, Suite 1500Peoria, Illinois 61629
    
    Minneapolis, Minnesota 55402Attn: General Counsel
    
    Attn: Philip E. BauerFax: (309) 675-6620
    
    Fax: (612) 340-7800
 Written notice may also be sent by facsimile to the numbers listed above, but notice
delivered in such manner shall only be effective upon the sender receiving electronic
confirmation that the notice was faxed successfully. Notice shall be deemed received when
actually delivered to the recipient as demonstrated by shipping records of a nationally
recognized courier, the electronic confirmation or when delivered in person. The addresses
and transmittal numbers set forth above can be changed only by written notice that complies
with the requirements of this Section.15.
    
    Shipping Instructions. Orders will be placed using Caterpillars standard purchase
order and shipping instruction forms. Any special freight charges occurring as a result of
ASVs lack of performance will be ASVs responsibility. Any special freight charges occurring
as a result of Caterpillars lack of performance will be Caterpillars responsibility.16.
    
    Inspection. Caterpillar shall have the right (but not the obligation) at reasonable
times, to inspect materials, work in process, finished Product, and records relating thereto,
at any facilities at which Product is manufactured or such records are kept. Caterpillar
assumes no responsibility and waives no rights as a result of any such inspection.19.
    
    Force Majeure. Neither Caterpillar nor ASV shall be liable to the other for any
delay in or failure of performance of their respective obligations hereunder if such
performance is rendered impossible or impracticable by reason of fire, flood, hurricane,
severe weather, explosion, earthquake, drought, embargo, war, riot, act of God or of public
enemy, an act of governmental authority, agency or entity beyond the reasonable control of the
party whose performance is affected, irrespective of whether such contingency is specified
herein or is presently occurring or anticipated by either party. In the event either party is
prevented from fulfilling its obligations under this Agreement because of such a force majeure
as described herein, both ASV and Caterpillar shall make every effort to continue to maintain
as much as possible the supplier-customer relationship established under this Agreement.
However, if either Caterpillar or ASV are unable to meet its obligations hereunder because of
the conditions described above and such inability continues for a period of 60 days, the other
party shall have the right to terminate this Agreement upon 30 days prior written notice.
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 20.
    
    Assignment; Subcontracting. This Agreement is not assignable by transfer,
disposition, sale or otherwise, by either party without the written consent of the other
party, such consent not to be unreasonably withheld; provided, however, that Caterpillar may
assign this Agreement to a Caterpillar affiliate or subsidiary without ASVs consent. ASV
must notify Caterpillar in writing at least sixty (60) days prior to subcontracting any work
or manufacturing required to be performed hereunder. ASV shall remain responsible for all of
its obligations, whether or not those obligations are subcontracted to a third party.
Further, ASV will make its subcontractors, agents and employees aware of the ASV obligations
contained herein only to the extent such information is necessary to perform the subcontracted
work or to prevent harm to Caterpillar. To that end, ASV shall be responsible for a breach of
any ASV obligation contained herein by its subcontractors, agents and employees. Further, ASV
shall be solely responsible for payment for the services of all of its agents, servants, or
employees (including without limitation all salaries, taxes, insurance, fringe benefits or
other costs and expenses of any kind), and shall be responsible for their direct supervision
in the performance of all services provided by ASV and its agents, services and employees
hereunder. It is understood and agreed that this Agreement shall be binding upon and inure to
the benefit of the parties and their respective parent(s), subsidiaries, representatives,
attorneys, agents, successors and assigns.21.
    
    No Third Party Beneficiaries. Except as set forth in Section 9, nothing contained in
this Agreement, express or implied, shall be deemed to confer any rights or remedies upon, nor
obligate any of the parties hereto, to any person other than the parties and their affiliates
unless specifically stated herein to the contrary.22.
    
    Relationship of Parties. The parties relationship to each other is one of
independent contractor and nothing contained in this Agreement shall be construed to imply
that either party, or its officers, employees or agents, is an employee or agent of the other
party for any purpose. Each party is responsible for the supervision, direction and control
and assignment of their respective employees and agents. Neither party shall have the right,
power or authority to create any obligation, expressed or implied, or to make any
representation on behalf of the other party. Nothing herein is to imply an agency, joint
venture or partner relationship between the parties.23.
    
    Trademarks. ASV shall not use in advertising, publicity, promotion, marketing, or
other activity, any name, trade name, trademark, service mark or other designation of, or
owned by, Caterpillar except upon the prior written permission of the Caterpillar Public
Affairs Department.24.
    
    Applicable Law; Jurisdiction. This Agreement shall be deemed to have been entered in
the State of Illinois. It shall be governed by and construed in accordance with the laws of
the State of Illinois, without regard to the conflict of laws provisions thereof. Any and all
disputes concerning this Agreement may be instituted and maintained in the applicable federal
court of competent jurisdiction in the State of Illinois.25.
    
    Entire Agreement. This Agreement, the Binding Term Sheet Provisions, the
Registration Rights Agreement by and between the parties dated as of the date hereof, the
QCLDM Goals, the exhibits attached hereto and the terms and conditions referenced in any
purchase order issued by Caterpillar in connection with this Agreement (to the extent not
inconsistent with this Agreement) constitute the entire agreement and understanding between
the parties with respect to the subject matters herein and therein, and supersede and replace
any and all prior agreements and understandings, whether oral or written, between them with
respect to such matters, including the MTL Alliance Agreement. Both parties agree that the
terms and conditions of any ASV quotation, offer, acknowledgment or similar document, however
designated, shall not apply.
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 26.
    
    Survival. Sections 7 through 11, 12(b), 13(c), 13(d), 14, 20-24 and 29 shall survive
termination of this Agreement.27.
    
    Waiver. The provisions of this Agreement may be waived, altered, amended, or
repealed in whole or in part only upon the written agreement of the parties. The waiver by
either party of any breach of this Agreement shall not be deemed or construed as a waiver of
any other breach, whether prior, subsequent or contemporaneous, to this Agreement.28.
    
    Change in Control. During this Agreement, if there is a change in control of ASV,
Caterpillar shall have the right to terminate this Agreement effective immediately upon
written notice. For purposes of this Section, a change in control shall be deemed to have
occurred if and when any one or more third parties acting individually or jointly
(Purchaser) (a) purchases substantially all of the assets of ASV, or its parent company, if
applicable, or (b) becomes a beneficial owner, directly or indirectly, of securities
representing in excess of 50% of the combined voting power of the then outstanding securities
of ASV. Where the Purchaser is a competitor to Caterpillar, then a change of control shall
include a purchase of substantially all of the ASV manufacturing assets or intellectual
property related to this Agreement or if Purchaser becomes the beneficial owner, directly or
indirectly, of ASV securities representing a combined voting power equal to or greater than
twenty percent (20%).29.
    
    Severability; Injunctive Relief. Invalidation of any of the provisions contained
herein, or the application of such invalidation thereof to any person, by legislation,
judgment or court order shall in no way affect any of the other provisions hereof or the
application thereof to any other person, and the same shall remain in full force and effect,
unless enforcement as so modified would be unreasonable or grossly inequitable under all the
circumstances or would frustrate the purposes hereof. It is the intention of the parties that
if any of the restrictions or covenants contained herein is held to cover a geographic area or
to be for a length of time that is not permitted by applicable law, or in any way construed to
be too broad or to any extent invalid, such provision shall not be construed to be null, void
and of no effect, but to the extent such provision would be valid or enforceable under
applicable law, a court of competent jurisdiction shall construe and interpret or reform
Section 2 to provide for a covenant having the maximum enforceable geographic area, time
period and other provisions (not greater than those contained herein) as shall be valid and
enforceable under such applicable law. The parties acknowledge that monetary damages may not
be adequate to protect a party from breach of Section 2 of this Agreement by the other party
and accordingly acknowledge that the nonbreaching party shall be entitled to seek, in addition
to any other remedies it may have, specific performance, temporary and permanent injunctive
relief or such other equitable remedies as may be available from any court of competent
jurisdiction without the necessity of proving actual damage.30.
    
    Public Disclosures. Neither ASV nor Caterpillar shall issue any press release or
make any other public disclosure (including disclosure to public officials) with respect to
this Agreement, except as required by law, without the prior written approval of the other
party.31.
    
    Construction. The parties have participated jointly in the negotiation and drafting
of this Agreement. In the event an ambiguity or question of intent or interpretation arises,
this Agreement shall be construed as if drafted jointly by the parties and no presumption or
burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of
any of the provisions of this Agreement.32.
    
    Section Headings. Section headings contained herein are for ease of reference only
and shall not be given substantive effect.
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Execution Copy
 33.
    
    Counterparts; Signatures. This Agreement may be signed in one or more counterparts,
each to be effective as an original. This Agreement shall not be binding on any party unless
signed by both parties hereto.
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  Caterpillar Inc.
    
    
    
    A.S.V., Inc.By: /s/ Dan Murphy
    
    
    
    By: /s/ Gary D. LemkeName: Dan Murphy
    
    
    

Name: Gary D. LemkeTitle: Vice President  Global Purchasing
    
    Title: Chief Executive OfficerandBy: /s/ Edward J. RappName: Edward J. RappTitle: Vice President  Building Construction Products
 [Signature Page to the Purchase Agreement]
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Execution Copy
 Exhibit A
 ASV Product
 Caterpillar Machines
    
    ASV ProductA-series
    
    B-seriesCAT part # A-series
    
    ASV Part# A-series
    
    CAT part # B-Series
    
    ASV part #247/257RH Undercarriage
    
    
    212-6554
    
    
    
    0702-093
    
    
    
    218-5861
    
    
    
    0702-242LH Undercarriage
    
    
    212-6555
    
    
    
    0702-092
    
    
    
    218-5862
    
    
    
    0702-243Front Torsion Axle
    
    
    225-9259
    
    
    
    0702-001
    
    
    
    225-9259
    
    
    
    0702-001Rear Torsion Axle
    
    
    206-3809
    
    
    
    0702-002
    
    
    
    206-3809
    
    
    
    0702-002Spacer
    
    
    212-6686
    
    
    
    0702-060
    
    
    
    212-6686
    
    
    
    0702-060267/277Undercarriage Arrangement
    
    
    199-5258
    
    
    
    0700-056220-8151
    
    
    
    0700-225230-3758
    
    
    
    0700-236RH Undercarriage
    
    
    220-8153
    
    
    
    0700-265
    
    
    
    252-0401
    
    
    
    0700-272LH Undercarriage
    
    
    220-8154
    
    
    
    0700-266
    
    
    
    252-0402
    
    
    
    0700-273Front Torsion Axle
    
    
    197-4909
    
    
    
    0700-028
    
    
    
    197-4909
    
    
    
    0700-028Rear Torsion Axle
    
    
    197-4914
    
    
    
    0700-029
    
    
    
    197-4914
    
    
    
    0700-029Tightener GP
    
    
    205-8108
    
    
    
    0700-112Tool GP
    
    
    
    
    
    
    
    
    
    
    218-6994
    
    
    
    0700-267Handle
    
    
    
    
    
    
    
    
    
    
    218-6995
    
    
    
    0700-268Pin
    
    
    
    
    
    
    
    
    
    
    209-2360
    
    
    
    0700-132287RH Undercarriage
    
    
    215-3949
    
    
    
    0703-056
    
    
    
    252-0351
    
    
    
    0703-166LH Undercarriage
    
    
    215-3951
    
    
    
    0703-055
    
    
    
    252-0352
    
    
    
    0703-167Front Torsion Axle
    
    
    257-7385
    
    
    
    0703-182
    
    
    
    257-7385
    
    
    
    0703-182Rear Torsion Axle
    
    
    257-7386
    
    
    
    0703-183
    
    
    
    257-7386
    
    
    
    0703-183Spacer
    
    
    230-3729
    
    
    
    0201-148
    
    
    
    230-3729
    
    
    
    0201-148Spacer
    
    
    230-3730
    
    
    
    0201-147
    
    
    
    230-3730
    
    
    
    0201-147
 A-1




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Execution Copy
 Caterpillar Machines
    
    ASV Product*****
    
    CAT Part #
    
    ASV part #1 Speed, Single-Level Suspension UndercarriageRH Side
    
    258-2901
    
    2035-030LH Side
    
    258-2902
    
    2035-0311 Speed, Dual-Level Suspension UndercarriageRH Side
    
    258-3001
    
    2035-199LH Side
    
    258-3002
    
    2035-200*****, Dual-Level Suspension UndercarriageRH Side
    
    258-3701
    
    2035-244LH Side
    
    258-3702
    
    2035-352Used on All Suspensions options*****
    
    *****
    

**********
    
    *****
    

**********
    
    *****
    

**********
    
    *****
    

*****277 / 287 LH Front Torsion Axle
    
    258-3603
    
    2035-274277 / 287 RH Front Torsion Axle
    
    258-3604
    
    2035-275277 / 287 LH Rear Torsion Axle
    
    258-3605
    
    2035-276277 / 287 RH Rear Torsion Axle
    
    258-3606
    
    2035-277Spacer
    
    230-3729
    
    0201-148Spacer
    
    230-3730
    
    0201-147Washer
    
    258-3013
    
    2035-249End Cap
    
    258-3009
    
    2035-356
 Notes:
 1.
    
    Products include the current part numbers and any new or replacement part numbers issued by
Caterpillar and agreed upon by Caterpillar and ASV.2.
    
    Prices are firm except as set forth in Section 4 of the Agreement.
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. A-2




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Execution Copy
 Exhibit B
 Cat Specifications
 §
    
    *****
 §
    
    *****
  
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. B-1




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Execution Copy
 Exhibit C
 Pricing
 Table 1
 *****price reductionsB Series
    
    4/1/05  12/31/05
    
    1/1/06  12/31/06
    
    thereafterAlpha undercarriage
    
    $*****
    
    $*****
    
    $*****Beta undercarriage
    
    $*****
    
    $*****
    
    $*****Charlie undercarriage
    
    $*****
    
    $*****
    
    $*****
 Table 2
 Maximum Price for
    
    Maximum Price for*****
    

1/1/06  12/31/07
    

1/1/08àASV Single
Level Beta 1-speed
    
    $
    *
    ****
    
    *****     % price reduction
on the adjusted Production price in effect as of December
31st of the prior yearASV Dual
Level Beta 1-speed
    
    $
    *
    ****
    
    *****     % price reduction
on the adjusted Production price in effect as of December
31st of the prior yearASV Dual
Level Beta*****
    
    $
    *
    ****
    
    *****     % price reduction
on the adjusted Production Price in effect as of December
31st of the prior year
 Table 3***
 A Series and B Series
    
    Until 10/31/05
    
    11/1/05 àAlpha undercarriage
    
    ***** * - *****%
    
    ***** ASV / ***** Cat ***** **Beta undercarriage
    
    ***** * - *****%
    
    ***** ASV / ***** Cat ***** **Charlie undercarriage
    
    ***** * - *****%
    
    ***** ASV / ***** Cat ***** **
 
 ******
    
    means the ASV Dealer Net Price after all discounts to their
dealers are applied.**
    
    The parties agree that under the ***** / ***** ***** ,
the price Caterpillar will pay for A and B Series Parts will not exceed, on a
weighted-average basis, ***** minus***** %.*****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.  C-1




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 ***
 Table 4**
 *****
    
    From Date of Full ProductionASV Single Level
    
    ***** ASV / *****Beta 1-speed
    
    Cat ***** *ASV Dual Level
    
    ***** ASV / *****Beta 1-speed
    
    Cat ***** *ASV Dual Level
    
    ***** ASV / *****Beta *****
    
    Cat ***** *
 
  *
    
    The parties agree that under the ***** / ***** *****, the ***** price will not exceed, on a weighted average basis, ***** minus
***** %.**
    
    Sell also Attachment 2 [to be completed by the parties pursuant to Section 7(b)]*****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934. C-1




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Execution Copy
 Attachment 1 to Exhibit C
 A Series and B Series OEM Aftermarket Parts Prices
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceNon Proprietary Parts:WASHER,4.05x2.1875x0.188
    
    224-9407
    
    0200-331
    
    $*****MOTOR,DRIVE,*****
    
    215-3898
    
    0201-141
    
    $*****NUT,HEX,JAM,1
1/4 - 7,RH
    
    212-6632
    
    0304-077
    
    $*****SNAP,RING
    
    006-8663
    
    0304-118
    
    $*****NUT,HEX,JAM,LOCKING,3/4-10UNC,
    
    212-6559
    
    0304-722
    
    $*****BEARING (62092RS)
    
    199-5358
    
    0307-039
    
    $*****BEARING,BALL,6207-OPEN
    
    199-9929
    
    0307-923
    
    $*****HOSE,DRIVE,MTL,-12
    
    204-1384
    
    0700-097
    
    $*****HOSE,DRIVE,MTL,-12
    
    204-1383
    
    0700-098
    
    $*****HOSE,DRAIN,MTL,-8
    
    204-1382
    
    0700-099
    
    $*****HOSE,BRAKE,MTL,-6
    
    204-1385
    
    0700-100
    
    $*****PIN,LOCK,1/4"
    
    209-2670
    
    0700-109
    
    $*****PIN,3/4x5.5
    
    209-2360
    
    0700-132
    
    $*****RETAINER
    
    210-4693
    
    0700-153
    
    $*****HOSE,-12,6000 PSI,53.5
    
    212-6655
    
    0700-203
    
    $*****HOSE,-12,6000 PSI,48.8
    
    212-6656
    
    0700-204
    
    $*****HOSE,-12,6000 PSI,63
    
    212-6657
    
    0700-205
    
    $*****MOTOR,HYD
    
    220-8142
    
    0700-217
    
    $*****WASHER,17.5x32.0x8.0
    
    220-8122
    
    0700-218
    
    $*****HOSE,-12,6000PSI,59.0
    
    222-5666
    
    0700-227
    
    $*****HOSE,-8,2000PSI,57.1
    
    222-5667
    
    0700-229
    
    $*****RING,SNAP,O.D,.125THICK,3.00"
    
    234-0743
    
    0700-235
    
    $*****HOSE,-12,6000PSI,47.6
    
    230-3711
    
    0700-237
    
    $*****HOSE,-12,6000PSI,77.6
    
    230-3708
    
    0700-238
    
    $*****HOSE,-12,6000PSI,50.8
    
    230-3709
    
    0700-239
    
    $*****HOSE,-12,6000PSI,50.4
    
    230-3710
    
    0700-240
    
    $*****HOSE,-6,2248PSI,38.6
    
    222-5669
    
    0700-244
    
    $*****HOSE,BRAKE,TIER II
    
    218-6979
    
    0700-269
    
    $*****BEARING,CONE
    
    212-6631
    
    0702-075
    
    $*****BEARING,CUP
    
    216-6119
    
    0702-076
    
    $*****BUSHING,DU,1.75 x 2.0
    
    212-6694
    
    0702-077
    
    $*****HOSE,DRIVE,RH,B
    
    210-4680
    
    0702-083
    
    $*****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceHOSE,DRIVE,LH,A
    
    210-4681
    
    0702-084
    
    $*****HOSE,DRIVE,RH,A
    
    210-4682
    
    0702-085
    
    $*****HOSE,DRIVE,LH,B
    
    210-4683
    
    0702-086
    
    $*****HOSE,CASE,LH
    
    210-4684
    
    0702-087
    
    $*****HOSE,BRAKE
    
    212-6551
    
    0702-089
    
    $*****BEARING,CUP
    
    216-6120
    
    0702-105
    
    $*****BEARING,CONE
    
    215-3966
    
    0702-106
    
    $*****O-RING,2-037,2-625 ODx2.5 IDx.
    
    3P-0815
    
    0702-113
    
    $*****RING,RETAINER,INT
    
    6V-1366
    
    0702-114
    
    $*****RING,SNAP,INT,PLATED
    
    216-6148
    
    0702-115
    
    $*****WASHER,BEARING
    
    216-6149
    
    0702-155
    
    $*****HOSE,CASE,RH
    
    233-5912
    
    0702-261
    
    $*****BUSHING,DU,2.50x3.50
    
    230-3755
    
    0703-025
    
    $*****HOSE,BRAKE,PORT Z
    
    222-5729
    
    0703-077
    
    $*****PIN,CLEVIS,.75x3.00
    
    238-7609
    
    0703-117
    
    $*****PIN,CLEVIS,.75x4.00
    
    238-7610
    
    0703-118
    
    $*****HOSE-12,6000 PSI,86.8"
    
    218-6637
    
    0703-170
    
    $*****HOSE-12,6000 PSI,90.2"
    
    218-6638
    
    0703-171
    
    $*****HOSE-8,2000 PSI,45.2"
    
    218-6639
    
    0703-172
    
    $*****HOSE-12,6000 PSI,70.9"
    
    218-6647
    
    0703-173
    
    $*****HOSE-12,6000 PSI,75.2"
    
    218-6648
    
    0703-174
    
    $*****NUT,HEX,NYLOCK,1/2-13 UNC,ZN
    
    9X-0941
    
    8040-606
    
    $*****NUT,HEX,NYLOCK,5/8-11 UNC,ZN
    
    3K-2889
    
    8040-726
    
    $*****NUT,HEX,1-8 UNC,STEEL LOCK,ZN
    
    212-6558
    
    8043-806
    
    $*****WASHER,SPRING LOCK,3/8,ZN
    
    113-0693
    
    8051-272
    
    $*****WASHER,SPRING LOCK,1/2,ZN
    
    113-0693
    
    8051-332
    
    $*****WASHER,SPRING LOCK,5/8,ZN
    
    155-1170
    
    8051-431
    
    $*****CAPSCREW,HH,3/8-16 UNCx1.0,GD8
    
    165-3926
    
    8102-222
    
    $*****CAPSCREW,HH,1/2-13UNCx1.75,GD8
    
    8T-8919
    
    8102-406
    
    $*****BOLT,CARRIAGE,1/2-13UNCx1.75,G
    
    223-8372
    
    8111-406
    
    $*****BOLT,CARRIAGE,1/2-13x2.00,GD8,
    
    220-8163
    
    8111-407
    
    $*****TUBE,COVER
    
    210-4646
    
    0200-003
    
    $*****TUBE,INNER
    
    210-4645
    
    0200-004
    
    $*****TOOTH,DRIVE,SPROCKET
    
    199-5332
    
    0302-635
    
    $*****SLEEVE,OUTER,TOOTH,SPROCKET
    
    199-5333
    
    0302-765
    
    $*****MOTOR,HYD
    
    222-5662
    
    0702-195
    
    $*****Proprietary Parts:
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceKIT,SCRAPER
    
    234-0796
    
    0200-436
    
    $*****SPACER, AXLE
    
    230-3730
    
    0201-147
    
    $*****RETAINER,AXLE
    
    230-3729
    
    0201-148
    
    $*****BEARING CONE,TAPERD END WHEEL
    
    111-2124
    
    0201-347
    
    $*****BEARING CUP,TAPERED END WHEEL
    
    111-2125
    
    0201-348
    
    $*****SEAL,APY,1.250x2.062x.450
    
    212-6681
    
    0303-141
    
    $*****SEAL,AP5,50x90x11.4
    
    199-5377
    
    0303-217
    
    $*****GUARD,BEARING
    
    215-3956
    
    0304-117
    
    $*****TENSIONER,TRACK
    
    238-7679
    
    0304-957
    
    $*****WHEEL,UHMW,OUTER,10"
    
    199-5428
    
    0307-009
    
    $*****PLUG,HOUSING,BEARING
    
    190-8103
    
    0307-074
    
    $*****PLATE,WHEEL,OUTER,6.5 x .1875
    
    200-0809
    
    0307-090
    
    $*****LOCK,AXLE,CARRIAGE
    
    204-1371
    
    0307-093
    
    $*****WLMT,SWING JOINT
    
    199-5277
    
    0307-113
    
    $*****WHEEL,SPLIT,14"
    
    199-5305
    
    0307-717
    
    $*****WHEEL,SPLIT,10"
    
    199-5429
    
    0307-718
    
    $*****SEAL,AP1TCY,34x72x23.5
    
    199-9928
    
    0307-801
    
    $*****AXLE,CARRIAGE
    
    204-1375
    
    0307-909
    
    $*****WLMT,TUBE,WHEEL
    
    199-5432
    
    0307-919
    
    $*****ASSY,TUBE,AXLE,W/NO WHEELS
    
    199-5424
    
    0307-926
    
    $*****ASSY,TUBE,WHEEL,10"
    
    199-5427
    
    0308-420
    
    $*****TRACK,220x18.0 -Rodless
    
    200-0796
    
    0310-666
    
    $*****WLMT,GUARD,SEAL
    
    204-1431
    
    0314-304
    
    $*****KIT,GUIDE,TRACK,MTL
    
    215-4007
    
    0402-463
    
    $*****WLMT,GUIDE,TRACK,A
    
    238-7701
    
    0402-612
    
    $*****WLMT,GUIDE,TRACK,B
    
    238-7702
    
    0402-615
    
    $*****WLMT,TABLE,I
    
    199-5326
    
    0700-016
    
    $*****WLMT,TABLE,II
    
    199-5327
    
    0700-017
    
    $*****WLMT,TUB,I
    
    199-5288
    
    0700-019
    
    $*****AXLE,TORSION,7000LB,-29DEG,41
    
    197-4909
    
    0700-028
    
    $*****AXLE,TORSION,7000LB,16DEG,41.4
    
    197-4914
    
    0700-029
    
    $*****WLMT,RACK,I
    
    204-1445
    
    0700-035
    
    $*****WLMT,RACK,II
    
    204-1369
    
    0700-036
    
    $*****WLMT,BEARING,I
    
    204-1425
    
    0700-038
    
    $*****WLMT,BEARING,II
    
    204-1426
    
    0700-039
    
    $*****WLMT,TUB,II
    
    199-5289
    
    0700-049
    
    $*****WLMT,BRIDGE
    
    199-5290
    
    0700-050
    
    $*****WLMT,PIVOT,CARRIAGE
    
    199-5370
    
    0700-059
    
    $*****RING,SPROCKET
    
    200-0996
    
    0700-065
    
    $*****WLMT,TENSIONER,TUBE
    
    205-8106
    
    0700-081
    
    $*****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceWLMT,ROD,RH
    
    205-8105
    
    0700-083
    
    $*****WLMT,ROD,LH
    
    205-8104
    
    0700-086
    
    $*****CAP,RATCHET
    
    205-8090
    
    0700-091
    
    $*****WLMT,RATCHET
    
    205-8107
    
    0700-096
    
    $*****HANDLE,EXTENSION
    
    209-2616
    
    0700-108
    
    $*****ASSY,JACK
    
    205-8108
    
    0700-112
    
    $*****SUB-ASSY,HOUSING,BEARING
    
    210-4672
    
    0700-148
    
    $*****ASSY,AXLE,14"
    
    210-4697
    
    0700-155
    
    $*****WLMT,SPROCKET,MACH
    
    210-4671
    
    0700-165
    
    $*****WLMT,CAP,14"WHEEL
    
    212-6593
    
    0700-174
    
    $*****WHEEL,14"
    
    212-6590
    
    0700-181
    
    $*****WHEEL,14",SPLIT
    
    212-6591
    
    0700-182
    
    $*****ASSY,AXLE,14"
    
    236-5095
    
    0700-184
    
    $*****WLMT,GUIDE,TRACK,1
    
    215-4008
    
    0700-187
    
    $*****WLMT,GUIDE,TRACK,2
    
    215-4009
    
    0700-190
    
    $*****AXLE,BETA,END
    
    236-5090
    
    0700-241
    
    $*****WLMT,CAP,14" WHEEL
    
    230-3772
    
    0700-247
    
    $*****ASSY,AXLE,14" W/O WHEELS
    
    230-3734
    
    0700-248
    
    $*****SUPPORT,BRIDGE,MACHINED
    
    238-7678
    
    0700-251
    
    $*****ASSY,WHEEL,14",TPRD CNTR WHL
    
    236-5089
    
    0700-252
    
    $*****WHEEL,14" SPLIT,1/2" BLT,LRG C
    
    236-5091
    
    0700-253
    
    $*****TRACK,220 IN,HIPLUG
    
    238-7664
    
    0700-260
    
    $*****ASSY,TURNBUCKLE,TENSIONER
    
    218-6994
    
    0700-267
    
    $*****ASSY,HANDLE,TENSIONER
    
    218-6995
    
    0700-268
    
    $*****AXLE,TORSION,7680LB,7DEG,36.83
    
    225-9259
    
    0702-001
    
    $*****AXLE,TORSION,7680LB,-32DEG,36.
    
    206-3809
    
    0702-002
    
    $*****TRACK,15 x 165.9
    
    207-9711
    
    0702-006
    
    $*****WLMT,PLATE,BEARING
    
    212-6530
    
    0702-024
    
    $*****CAP,2" x 1.25"
    
    252-0443
    
    0702-032
    
    $*****WLMT,SUSP,ALPHA
    
    206-3811
    
    0702-038
    
    $*****RING,SPROCKET,ALPHA
    
    210-4647
    
    0702-048
    
    $*****WHEEL,10"
    
    206-3812
    
    0702-057
    
    $*****ASSY,WHEEL,10"
    
    212-6628
    
    0702-059
    
    $*****SPACER,AXLE
    
    212-6686
    
    0702-060
    
    $*****ASSY,TENSIONER
    
    210-0825
    
    0702-064
    
    $*****ASSY,SEAL
    
    219-4302
    
    0702-098
    
    $*****CAP,WHEEL
    
    215-4006
    
    0702-111
    
    $*****RETAINER,SEAL
    
    216-6141
    
    0702-112
    
    $*****WLMT,TENSIONER
    
    210-0826
    
    0702-116
    
    $*****WLMT,ROD,LH
    
    210-4641
    
    0702-117
    
    $*****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceWLMT,ROD,RH
    
    210-4640
    
    0702-118
    
    $*****CAP,WHEEL
    
    212-6682
    
    0702-132
    
    $*****CAP,3/4-10
    
    224-9417
    
    0702-143
    
    $*****AXLE,MACHINED,10.32
    
    215-3968
    
    0702-145
    
    $*****AXLE,MACHINED,9.73
    
    215-3969
    
    0702-150
    
    $*****PLATE,WHEEL,10"
    
    215-4005
    
    0702-156
    
    $*****WLMT,HUB,WHEEL,10"
    
    215-4004
    
    0702-158
    
    $*****ASSY,HUB,WHEEL,10"
    
    215-4002
    
    0702-168
    
    $*****ASSY,HUB,WHEEL,10",1/2" BOLT H
    
    219-4303
    
    0702-169
    
    $*****WLMT,TABLE
    
    207-9741
    
    0702-184
    
    $*****WHEEL,10",W/HUB
    
    223-8399
    
    0702-200
    
    $*****ASSY,WHEEL,10",W/HUB
    
    223-8398
    
    0702-201
    
    $*****WHEEL,14",W/HUB
    
    223-8397
    
    0702-202
    
    $*****ASSY,WHEEL,14",W/HUB
    
    223-8396
    
    0702-203
    
    $*****WHEEL,10", BORED TO 1/2" BOLT
    
    215-4003
    
    0702-208
    
    $*****WASHER,4.41x2.00x.104
    
    224-9409
    
    0702-210
    
    $*****ASSY,INSTALLATION,TRACK
    
    224-9415
    
    0702-214
    
    $*****ASSY,TOOL,TRACK INSTALL,W/O BU
    
    224-9416
    
    0702-218
    
    $*****INSERT,WHEEL
    
    234-0778
    
    0702-219
    
    $*****TABLE,MACHINED,RH
    
    234-0740
    
    0702-227
    
    $*****TABLE,MACHINED,LH
    
    234-0741
    
    0702-228
    
    $*****SPROCKET,CAST,MACHINED
    
    234-0742
    
    0702-230
    
    $*****RAIL,ONE PIECE,AXLES
    
    218-5699
    
    0702-239
    
    $*****AXLE,ONE PIECE,CENTER
    
    218-5698
    
    0702-241
    
    $*****PLATE,BACKING
    
    252-0441
    
    0702-259
    
    $*****PLATE,BRACKET,TENSIONER
    
    252-0442
    
    0702-260
    
    $*****WLMT,RAIL,ALPHA,HEAVY
    
    252-0440
    
    0702-263
    
    $*****ASSY,TUBE,W/WHEELS,14"
    
    222-5685
    
    0703-001
    
    $*****AXLE,END,18"
    
    222-5686
    
    0703-003
    
    $*****WLMT,TUBE,AXLE,14"x3.5ID
    
    222-5683
    
    0703-004
    
    $*****ASSY,TUBE,W/WHEELS,10"
    
    222-5689
    
    0703-008
    
    $*****WLMT,HUB,WHEEL,10"
    
    234-0734
    
    0703-009
    
    $*****WLMT,TUBE,AXLE,10"
    
    222-5687
    
    0703-012
    
    $*****WLMT,SUSP,LH
    
    215-3953
    
    0703-017
    
    $*****AXLE,TORSION,10000 LB,15,29.5
    
    220-8146
    
    0703-019
    
    $*****AXLE,TORSION,10000 LB,15,33.25
    
    215-3948
    
    0703-020
    
    $*****WLMT,SUSP,RH
    
    220-8157
    
    0703-043
    
    $*****WLMT,TABLE,DRIVE,RH
    
    219-4390
    
    0703-044
    
    $*****WLMT,TABLE,DRIVE,LH
    
    220-8159
    
    0703-046
    
    $*****WLMT,BEARING PLATE, RH
    
    230-3741
    
    0703-058
    
    $*****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Description
    
    Cat Part #
    
    ASV Part #
    
    PriceWLMT,BEARING,LH
    
    222-5691
    
    0703-059
    
    $*****TRACK,HIPLUG,199.92@PL
    
    220-8161
    
    0703-061
    
    $*****WHEEL,UHMW,OUTER,10"
    
    238-7728
    
    0703-062
    
    $*****WHEEL,SPLIT,UHMW,INNER,10"
    
    238-7729
    
    0703-063
    
    $*****ASSY,TUBE,10",W/O WHEELS
    
    222-5688
    
    0703-064
    
    $*****ASSY,TUBE,14",W/O WHEELS
    
    230-3771
    
    0703-065
    
    $*****WHEEL,14"OUTER,1/2"HOLES
    
    230-3732
    
    0703-069
    
    $*****WHEEL,14",SPLIT,1/2" HOLES
    
    230-3733
    
    0703-070
    
    $*****WLMT,HUB,9.75,0.5
    
    222-5684
    
    0703-083
    
    $*****AXLE,CHARLIE END
    
    222-5682
    
    0703-086
    
    $*****LOCK,AXLE,END
    
    234-0789
    
    0703-090
    
    $*****MOUNT,AXLE,MACHINED
    
    234-0733
    
    0703-094
    
    $*****WLMT,BRKT,TENSIONER
    
    236-5094
    
    0703-106
    
    $*****PLATE,AXLE,EXT,0.5"
    
    238-7709
    
    0703-111
    
    $*****SCRAPER,W/ADJUSTABLE REAR
    
    238-7697
    
    0703-112
    
    $*****SCRAPER,W/ADJUSTABLE FRONT
    
    238-7698
    
    0703-113
    
    $*****ASSY,TENSIONER,CHARLIE
    
    236-5108
    
    0703-116
    
    $*****WLMT,TENSIONER,OPEN
    
    252-0328
    
    0703-162
    
    $*****AXLE,TOR,HRD,10K,15,15,29.5
    
    257-7385
    
    0703-182
    
    $*****AXLE,TOR,HRD,10K,15,33.25
    
    257-7386
    
    0703-183
    
    $*****WLMT,TUB,OPEN,RH
    
    238-7710
    
    2020-006
    
    $*****WLMT,TUB,OPEN,LH
    
    238-7711
    
    2020-007
    
    $*****WLMT,ROD,LH
    
    252-0339
    
    2020-029
    
    $*****END,TURNBUCKLE,RH
    
    252-0327
    
    2020-033
    
    $*****ASSY,TURNBUCKLE,LIGHT
    
    238-7712
    
    2020-034
    
    $*****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




---



##### 



Confidential
Execution Copy
 Exhibit D
 Cost Build Up
 Single Level U/C
    
    
    Dual Level U/C
    
    
    Dual Level U/C1 Speed Motor
    
    
    1 Speed Motor
    
    
    *****New Material Cost
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****Labor (Assembly)
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Labor (Loading)
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Freight in @ *****
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Freight Out @ *****/mile
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Tarp Charge (Nov. - May)
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Sub Total
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Margin @ *****
    
    
    *
    ****
    
    
    *
    ****
    
    
    *
    ****Actual Sell Price to Cat
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****
 
 *****
    
    Denotes confidential information that has been omitted from the exhibit and filed separately,
accompanied by a confidential treatment request, with the Securities and Exchange Commission
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934.




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Confidential
Execution Copy
 Exhibit E
 Warranty
 1.
    
    Periods: ASV shall warrant Product pursuant to Section 8 for the same periods for
which Caterpillar warrants Caterpillar Machines to the end users under Caterpillars standard
warranty periods. In line with Caterpillars current standard warranty periods, ASVs
warranty will begin on the delivery date of the Caterpillar Machine to the end user as
recorded in Caterpillars warranty system or the applicable replacement parts warranty start
date (each, the Warranty Start Date) and extend for the following periods:
 a.
    
    Product:***** in service for Product and all components used therein, except
machine undercarriage rubber belts.b.
    
    Machine undercarriage rubber belts:***** operating hours, whichever occurs
first. If a disabling defect in material or workmanship is found during the warranty
period, ASV will provide an allowance toward the purchase of a new rubber belt. Such
allowance will be based on accrued hours. The allowance will be calculated as follows:User Allowance:**********c.
    
    Replacement parts:***** days after Warranty Start Date.
 ASV may amend the warranty periods set forth above only with Caterpillars prior written
consent.
 2.
    
    Exclusions:
 
    
    Caterpillar is responsible for providing timely notice of a warranty failure and
proof of the delivery date to the first user.
    
    ASV shall not be responsible for the cost associated with transporting the product
to and from the place of business of a Caterpillar dealer or other source approved by
ASV. Nor will ASV be responsible for travel, time and mileage to the customer
location.
    
    ASV shall not bear labor costs or local taxes, if applicable.
    
    ASV shall not be responsible for parts shipping charges in excess of those which are
usual and customary.
 3.
    
    Limitations:
 
    
    ASV is not responsible for failures resulting from:
    
    Any use or installation which ASV reasonably judges as improper.
    
    Abuse, neglect and/or improper repair.
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.




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##### 



Confidential
Execution Copy
 
    
    Delay by the user or Caterpillar in making the product available after being notified of a
potential product problem.
 4.
    
    Warranty Administration: Caterpillar will provide to ASV a monthly Field Incident
Report (FIR) documenting standard warranty claims paid by Caterpillar in the previous month.
The FIR will include, in Caterpillars sole discretion: the Caterpillar Factory Claim
Number, Dealer Code, Caterpillar Model Designation, Caterpillar Product Serial Number,
hours/miles/kilometers on the Caterpillar Machine, hour/miles/kilometers on the Product,
Caterpillar Machine build date, Caterpillar Machine delivery date, description of the Product
repaired or replaced, replacement Products Warranty Start Date, repair date, warranty claim
paid date, Warranty Costs (as defined in Section 8) and warranty claim story.ASV will review the FIR and deliver to Caterpillar a summary report within thirty (30) days
of date of the FIR, which report will detail the warranty claims for which ASV accepts
responsibility, otherwise ASV will be deemed to have accepted responsibility for all claims
(Accepted Claims). ASV will reimburse Caterpillar for all Accepted Claim within sixty
(60) days of the date of the FIR or Caterpillar may offset payments due under Section 5
against the amount of the Accepted Claims.If Caterpillar disputes ASVs decision regarding rejected warranty claims or Warranty Costs
(a Dispute), then the parties will meet or hold a discussion via telephone conference to
attempt to resolve the Dispute within sixty (90) days of the date of the FIR. If the
parties are unable to resolve the Dispute, then both parties will engage senior management
to resolve the Dispute. If a Dispute cannot be resolved under this process, then the
parties may seek other rights available to them under the Agreement, in equity or law.5.
    
    Return of Failed Product: Failed Product shall not be returned to ASV unless ASV
specifically requests such return, and then such product shall be returned at ASVs sole
expense.Returned failed Product becomes the property of ASV upon resolution of the claim; however,
ASV may not reuse, repair, or resell the returned failed Product in connection with this
Agreement without prior approval from Caterpillar.6.
    
    Improvement; Review: ASV will, if applicable, take action to improve the reliability
of Product furnished and will reduce future failure rates through the use of FIR data. The
parties will review this warranty program annually to assure that it is meeting the intent of
both parties to improve product reliability and reduce warranty cost.




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##### 



Confidential
Execution Copy
 Exhibit F
 ASV Assets
 
 Depreciation
    
    
    
    
    
    Accum Depr
    
    
    Annual
    
    
    NBV @Date Purchased
    
    Description
    
    Life/Method
    
    Cost
    
    
    @ 12/31/2004
    
    
    Depr Exp
    
    
    9/30/2005May 14, 2001
    
    3-Ton Free Standing Tube Structure
    
    10 yr SL
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****September 13, 2001
    
    DC Electric Transducer Control Tool Kit
    
    10 yr SL
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****October 26, 2001
    
    Bridge Crane
    
    10 yr SL
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****
    
    $
    *
    ****Total
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    *
    ****
 
 *****
    
    Denotes confidential information that has been
omitted from the exhibit and filed separately, accompanied by a confidential
treatment request, with the Securities and Exchange Commission pursuant to Rule
24b-2 of the Securities Exchange Act of 1934.