Document:

Exhibit
10.8

 

SECURITY
ASSIGNMENT AGREEMENT

 

THIS
SECURITY ASSIGNMENT AGREEMENT (this “Agreement”) is made and entered into as of this 27th day of January, 2017
by and among American Power Group Corporation, a Delaware corporation (the “Company”), and (ii) the parties
identified on Schedule A hereto (together with any subsequent parties, or transferees, who become parties hereto as “Investors”
pursuant to the terms hereof, collectively the “Investors”).

 

RECITALS

 

A.
Concurrently with the execution of this Agreement, the Company and certain of the Investors are entering into a Convertible Note
Purchase Agreement (the “Purchase Agreement”) providing for the sale and purchase of the Company’s Subordinated
Contingent Convertible Promissory Notes (the “Notes”).

 

B.
It is a condition to the Investors’ obligations to purchase the Notes that the Company and the Investors execute and deliver
this Agreement for the purpose of providing certain collateral to secure the Company’s obligations under the Notes.

 

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration
the receipt and adequacy of which are hereby acknowledged, the Company and each Investor agree as follows:

 

1.
Assignment. The Company does hereby assign and pledge to the Agent, as such term is defined below, on behalf of the Investors,
and subject to the last sentence of this Section 1, as collateral security for payment of the Notes, all of its right, title and
interest in, to the following instruments, each as amended and/or restated to date and as the same may be amended and/or restated
in the future (collectively, the “Contracts):

 

	 	●	The
    Loan and Security Agreement dated as of June 30, 2015, by and between Trident Resources LLC (“Trident”)
    and the Company;
	 	 	 
	 	●	The
    Amended and Restated Senior Secured Demand Note dated as of December 1, 2015, in the principal amount of $497,190, issued
    by Trident in favor of the Company;
	 	 	 
	 	●	The
    Secured Personal Guaranty dated as of June 30, 2015, issued by Thomas Lockhart (the “Guarantor”) in favor
    of the Company;
	 	 	 
	 	●	The
    Security Agreement dated as of June 30, 2015, between the Guarantor and the Company; and
	 	 	 
	 	●	Any
    and all financing statements, instruments and other rights relating to any of the foregoing (together with the Contracts,
    the “Collateral”).

 

The
Investors acknowledge that the Company has previously granted to Iowa State Bank (the “Bank”) a first priority
security interest in the Collateral and that the security interest and collateral assignment granted herein are and shall be entirely
subordinate to the Bank’s rights in the Collateral.

 

    	 	 	 

    	 	 	 

    

 

2.
Appointment of the Agent. The Investors hereby appoint Arrow LLC as collateral agent for the Investors under this Agreement
(in such capacity, the “Agent”) to serve from the date hereof until the termination of the security interest
and collateral assignment granted herein. Each Investor hereby irrevocably authorizes the Agent to take such action and to exercise
such powers hereunder as provided herein or as requested in writing by the holders of fifty-one percent (51%) of the aggregate
principal amount of the Notes outstanding in accordance with the terms hereof, together with such powers as are reasonably incidental
thereto. Without limiting the generality of the foregoing, each Investor hereby irrevocably appoints and authorizes the Agent
to act as the agent of such Investor for purposes of acquiring, holding and enforcing any and all security interests and rights
in the Collateral granted by the Company therein, together with such powers and discretion as are reasonably incidental thereto.
The Agent may exercise any rights available under applicable law that the Agent reasonably deems necessary or advisable to secure
the rights, for the benefit of the Investors, in and to the Collateral.

 

3.
Remedies Upon Event of Default. Upon the occurrence and during the continuance of an Event of Default, as such term is
defined in the Notes, the Agent, on behalf of the Investors, shall have the right (but not the obligation) to assume all rights
and obligations of the Company under the Collateral and to enforce such rights against Trident and the Guarantor. Nothing herein
contained shall be deemed to affect or impair any rights which the Agent or any Investor may have under the Notes or the other
Transaction Documents, as such term is defined in the Purchase Agreement.

 

4.
Application of Proceeds. The Agent, upon realizing on any Collateral in whatever manner the Agent deems necessary or advisable
for the benefit of the Investors in accordance with applicable law, shall pay to each Investor the monies realized from the Collateral
in the following order and priority, notwithstanding any provision in any Note that could be construed to the contrary: (i) first:
to pay the Agent all of the Agent’s reasonable costs and expenses associated with the enforcement of its rights pursuant
to this Agreement; (ii) second: until such time as all accrued and unpaid interest owed to each Investor under the Notes
is paid in full or converted into equity securities of the Company, to each Investor, an amount equal to their accrued and unpaid
interest under the Note held by the Investor and, if insufficient to fully satisfy same, then to each Investor, a pro rata amount
based on a fraction, the numerator of which is the amount of the unpaid principal under the Note held by the Investor and the
denominator of which is the total principal amount of all Notes; and (iii) third: until such time as all principal owed
to each Investor under the Notes is paid in full or converted into equity securities of the Company, to each Investor, an amount
equal to their unpaid principal under each Note and, if insufficient to fully satisfy same, then to each Investor, a pro rata
amount based on a fraction, the numerator of which is the amount of the unpaid principal under the Note and the denominator of
which is the total principal amount of all Notes. In the event any party hereto obtains, accepts, receives or retains any monies,
collateral, assets or properties of or from the Company to which it is not entitled to so obtain, accept, receive or retain pursuant
to this Agreement, such party shall hold such monies, collateral, assets or properties in trust for the other party(ies) hereto
and shall immediately deliver such monies, collateral, assets or properties to the Agent in the form received, together with such
endorsements as may be necessary or appropriate to so transfer such monies, collateral, assets or properties to the Agent.

 

    	 	2	 

    	 	 	 

    

 

5.
Exculpation of the Agent. Each Investor agrees that the Agent hereunder shall have the same rights and powers in its capacity
as an Investor in the Company as any other Investor and may exercise the same as though it were not the Agent, and that the Agent
shall not have any fiduciary or other duties or obligations to any Investor except those expressly set forth herein. Without limiting
the generality of the foregoing, the Agent shall not have any duty to take any discretionary action or exercise any discretionary
powers or take any action that in the Agent’s opinion or the opinion of the Agent’s counsel, may expose the Agent
to liability or that is contrary to any Transaction Document or applicable law; shall not, except as expressly set forth herein
and in the other Transaction Document, have any duty to disclose, and shall not be liable for the failure to disclose, any information
relating to the Company; and shall not be liable for any action taken or not taken by it in its capacity as the Agent in good
faith or in the absence of its own grow negligence or willful misconduct. The Agent shall be entitled to rely in good faith upon,
and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document
or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it
to be genuine and to have been signed, sent or otherwise authenticated by the proper person. The Agent also may rely in good faith
upon any statement made to it orally or by telephone and believed by it to have been made by the proper person, and shall not
incur any liability for relying thereon.

 

6.
Representations, Warranties and Covenants. The Company hereby represents and warrants to the Investors that: (a) no previous
assignment of its interest in the Collateral has been made other than to the Bank, (b) the Contracts are in full force and effect
and constitutes valid and legally enforceable obligations of the parties thereto. The Company agrees not to assign, sell, pledge,
transfer, mortgage or otherwise encumber its interest in the Collateral as long as this Assignment is in effect, or amend the
Contracts without the Agent’s prior written consent, which shall not be unreasonably withheld or delayed.

 

7.
Termination. This Agreement, and the security interest and collateral assignment of the Company’s rights in the Collateral,
shall automatically terminate and become null and void, without further action by or notice to any party, upon the payment in
full of all principal and accrued interest under the Notes or the conversion thereof into equity securities of the Company; and
thereupon Agent and the Investors shall execute and deliver to the Company any instruments which may be necessary or appropriate
to terminate such security interest and assignment and to reassign the Collateral to the Company.

 

8.
Modification; Waiver. Any terms and conditions of this Agreement may be changed, amended or waived with the written consent
of the Company and the Investors holding Notes representing 67% of the principal amount of the Notes outstanding from time to
time; provided, however, that no such change, amendment or waiver that would impair the rights or alter the obligations
of the Agent shall be binding upon the Agent without with its written consent.

 

9.
Notices. Any notice, request or other document required or permitted to be given or delivered to any party hereunder shall
be delivered in accordance with the notice provisions of the Purchase Agreement.

 

    	 	3	 

    	 	 	 

    

 

10.
Severability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law,
such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such
provisions or the remaining provisions of this Agreement.

 

11.
Counterparts. This Agreement may be executed and delivered in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. Counterparts may be delivered via facsimile,
electronic mail (including pdf) or other transmission method and any counterpart so delivered shall be deemed to have been duly
and validly delivered to be valid and effective for all purposes.

 

12.
Headings. The headings used in this Agreement are for the convenience of reference only and shall not, for any purpose,
be deemed a part of this Agreement.

 

13.
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall
be determined in accordance with the provisions of the Purchase Agreement.

 

14.
WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY,
EACH APRTY KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY,
IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRIAL BY JURY.

 

[Signature
Page Follow]

 

    	 	4	 

    	 	 	 

    

 

IN
WITNESS WHEREOF, the parties have executed this Security Assignment Agreement as of the date first written above.

 

	DEBTOR:	AMERICAN
    POWER GROUP CORPORATION	 
	 	 	 
	 	By:	/s/
    Charles E. Coppa	 
	 	Name:	Charles
    E. Coppa, Chief Financial Officer	 

 

	SECURED
    PARTY:	 	 
	 	 	 
	 	 	 
	 	By:
    	 
	 	Name:
    	 
	 	 	 
	 	Address:	 
	 	 	 

 

[Secured
party signature pages to this agreement are on file with

American
Power Group Corporation and are intentionally omitted]

 

    	 	5Exhibit
10.9

 

SUBORDINATION
AGREEMENT

 

THIS
SUBORDINATION AGREEMENT (this “Subordination Agreement”) is entered into as of January 27, 2017, among
IOWA STATE BANK (“Senior Lender”), the parties who have executed this Agreement as “Junior Lenders”,
together with such additional parties who may execute a counterpart signature page hereto (collectively, “Junior Lenders”),
and AMERICAN POWER GROUP CORPORATION (“APGC”) and AMERICAN
POWER GROUP, INC. (“APGI”). Hereinafter, all references to the “Company” shall
be understood to refer to both APGC and APGI as individual entities, consistent with fully protecting the security interests of
the Senior Lender.

R
E C I T A L S:

 

A.       Senior
Lender has made or will make one or more loans to APGI, a subsidiary of APGC, on or prior to the date hereof (the “Senior
Debt”) pursuant to the Loan Agreement.

 

B.       The
Company has granted Senior Lender liens on its assets to secure the repayment of the Senior Debt.

 

C.       Junior
Lenders have agreed to loan the Company an aggregate of up to $3,000,000.

 

D.       It
is the agreement of the parties that the Junior Debt shall be subordinate to Senior Debt and the security therefor, all as hereafter
provided.

 

NOW,
THEREFORE, for good and valuable consideration, the receipt, sufficiency and adequacy which are hereby acknowledged, the parties
hereto agree as follows:

 

1.       Definitions.
The following terms shall have the respective meanings specified below or in the Section or Recital referred to below:

 

“Bankruptcy
Proceeding” means any proceeding by or against any party for relief under any bankruptcy, reorganization or insolvency
law or laws relating to the relief of debtors, or any receivership, insolvency or assignment for the benefit of creditors, or
any proceeding for any liquidation, liquidating distribution, dissolution or other winding up of such party, voluntary or involuntary,
whether or not involving insolvency or bankruptcy proceedings.

 

“Collateral”
See Section 12.

 

“Enforcement
Action” means any action to enforce or attempt to enforce any right or remedy available to Junior Lenders to collect
the Junior Debt, including any action or proceeding (a) to accelerate the maturity of, or demand as immediately due and payable,
all or any part of the Junior Debt, or (b) to commence, continue or participate in any judicial, arbitral or other proceeding
or any collection or enforcement action of any kind, against the Company or the Company’s assets seeking, directly or indirectly,
to enforce any rights or remedies, or to enforce any of the obligations incurred by the Company, under or in connection with the
Junior Debt.

 

“Junior
Debt” means the indebtedness of the Company payable to Junior Lenders in the original principal sum of up to $3,000,000
pursuant to the terms of those certain Subordinated Contingent Convertible Promissory Notes dated on or after January 27, 2017.

 

    	Page 1

    	 

    

 

“Junior
Liens” See Section 3.

 

“Loan
Agreement” means that certain Business Loan Agreement between APGI and Senior Lender dated as of September 14, 2016
as it has been and may be amended, restated or otherwise modified from time to time.

 

“Permitted
Payments” See Section 4.

 

“Senior
Debt” See Paragraph A of the Recitals hereof.

 

“Senior
Liens” See Section 3.

 

“Subordination
Event” means the occurrence of an Event of Default as defined in the Loan Agreement.

 

2.       Subordination.
The Junior Debt will be subordinate and junior in right of payment and collection to the payment and collection in full of
all indebtedness, obligations and liabilities of the Company to Senior Lender pursuant to the Senior Debt.

 

3.       Lien
Subordination. Junior Lenders hereby agrees that any and all liens, rights, and security interests owned, claimed,
or held, or to be owned, claimed, or held by Junior Lenders as security for the Junior Debt (the “Junior Liens”)
are and shall be in all things subordinate and inferior to any and all liens, rights, and security interests owned, claimed, or
held, or to be owned, claimed, or held by Senior Lender as security for the Senior Debt (the “Senior Liens”).
Junior Lenders represent that the Junior Debt is unsecured as of the date of this Subordination Agreement.

 

4.       Limitations
on Payments. Except as is hereinafter set forth in this Section 4, no payment shall be made by the Company
on account of or for application against the Junior Debt if, at the time of or immediately after such payment, any of the Senior
Debt shall remain outstanding, and no distribution or payment of any kind shall be received by the Junior Lenders from the Company
in respect of the Junior Debt, and Junior Lender will not otherwise receive any amount whatsoever from the Company on account
of or for application against the Junior Debt, whether as a result of setoff, realization upon collateral or otherwise, until
the Senior Debt shall have been fully paid and satisfied. The provisions of the first sentence of this Section 4 notwithstanding,
for so long as no Subordination Event shall have occurred and be continuing or shall occur as a result of any payment, the Company
may pay the Junior Lenders and the Junior Lenders may receive the payments of principal and interest payable on the Junior Debt
(collectively, the “Permitted Payments”) in accordance with its terms. Upon the occurrence of a Subordination
Event, all further payments of Permitted Payments to Junior Lenders shall immediately be suspended until the Subordination Event
no longer exists. Once a Subordination Event no longer exists, the payment of Permitted Payments by the Company to the Junior
Lenders may resume, including past due Permitted Payments so long as the payment of such past due Permitted Payments would not
result in an Event of Default under the Loan Agreement. Notwithstanding the foregoing, or any other provision of this Agreement,
nothing herein shall be deemed to prohibit the Junior Lenders from, at any time and from time to time, converting all or any portion
of the Junior Debt into equity securities of the Company or from exercising warrants to purchase equity securities of the Company.

 

    	Page 2

    	 

    

 

5.       Certain
Distributions. Junior Lenders agree that in the event of any distribution, division or any application, partial or
complete, voluntary or involuntary, by operation of law or otherwise, of all or any part of the assets of the Company or the proceeds
thereof to creditors of the Company or upon the indebtedness of the Company, in any case for reason of the liquidation, dissolution
or winding up of the Company or the Company’s business, or in the event of any sale, receivership, insolvency or Bankruptcy
Proceeding or assignment for the benefit of creditors, or any proceeding by or against the Company for any relief under any bankruptcy
or insolvency law or laws relating to the relief of debtors, the adjustment of indebtedness, reorganizations, compositions or
extensions, then and in any such event any payment or distribution of any kind or character, either in cash, property, securities
or otherwise, which shall be payable or deliverable by the Company upon or with respect to any or all indebtedness of the Company
to Junior Lenders shall be paid or delivered directly to Senior Lender for application on the Senior Debt, until the Senior Debt
shall have been fully paid and satisfied. Junior Lenders hereby grant Senior Lender the right to file proofs of claim on account
of the Junior Debt in any Bankruptcy Proceeding in the event Junior Lender fails to do so within ten (10) days of the bar date
pertaining thereto.

 

6.       Remedies
Standstill. Until the Senior Debt has been paid in full, the Junior Lenders shall not, without the prior written consent
of the Senior Lender, take any Enforcement Action with respect to the Junior Debt, provided, however, that (i) nothing herein
shall prohibit the Junior Lenders from accelerating all or any portion of the Junior Debt in accordance with its terms without
the consent of the Senior Lender and (ii) following the expiration of the Standstill Period (as defined below), the Junior Lenders
may take an Enforcement Action. All Enforcement Actions taken by the Junior Lenders hereunder shall at all times be and remain
subject to the terms of this Agreement and any and all payments and collections received by the Junior Lenders in respect of the
Junior Debt pursuant to any Enforcement Action shall be paid over to the Senior Lender for application to the payment in full
of the Senior Debt (whether or not then due) in such order and manner as the Senior Lender shall determine until all obligations
under the Senior Debt have been paid and discharged in full in cash. Notwithstanding the foregoing, the Junior Lenders may, subject
to the terms hereof, without the consent of the Senior Lender, file proofs of claim and vote such claims in any Insolvency Proceeding
involving the Company or its assets. For purposes of this Agreement, “Standstill Period” shall mean the period commencing
on the date of the occurrence of and Event of Default and ending upon the earliest to occur of (i) the date which is 90 days after
the Senior Lender shall have received a written notice from any of the Junior Lenders of such default; and (ii) the date of the
commencement of any Bankruptcy Proceeding with respect to any Obligor or its assets.

 

7.       Additional
Agreements. Other than as specifically provided for herein, Junior Lenders agree (a) that they will not commence or
pursue in any action of any kind (including any Enforcement Action or Bankruptcy Proceeding) to prohibit, limit or impair the
commencement or pursuit by Senior Lender of any of its rights or remedies under or in connection with the Senior Debt or otherwise
available to Senior Lender under applicable law; and (b) that any instrument evidencing the Junior Debt shall expressly provide
that the Junior Debt is subject to the provisions of this Subordination Agreement.

 

8.       Treatment
of Payments. If, notwithstanding the provisions of this Subordination Agreement, any cash or distribution of assets
of the Company, whether in cash, property, securities or otherwise, which, under the provisions of this Subordination Agreement
should not have been paid to Junior Lenders, is received by any of Junior Lenders or any person on behalf of any of them, or provision
is made for such payment or distribution, such payment or distribution shall be held in trust for the benefit of and shall immediately
be paid and delivered directly to Senior Lender, with any necessary endorsement, for application to the payment of the Senior
Debt; whether or not due, until the Senior Debt shall have been fully paid and satisfied.

 

    	Page 3

    	 

    

 

9.       No
Impairment. The provisions of this Subordination Agreement are intended solely for the purpose of defining the relative
rights of the Junior Lenders or any holder of the Junior Debt, on one hand, and Senior Lender or any holder of the Senior Debt,
on the other hand, and nothing contained in this Subordination Agreement is intended to or shall impair, as between the Company,
other creditors, and Junior Lenders or any holder of the Junior Debt, all amounts due and payable in accordance with the Junior
Debt, or to affect the relative rights of the Junior Lenders or any holder of the Junior Debt and creditors of the Company other
than Senior Lender or holders of the Senior Debt, nor shall anything herein or therein prevent Junior Lenders or any holders of
the Junior Debt from exercising all remedies against the Company otherwise permitted by applicable law, subject to the rights
of Senior Lender under the provisions of this Subordination Agreement.

 

10.       Obligations
Hereunder Not Affected. No action or inaction of Senior Lender or any other person, and no change of law or circumstances,
shall release or diminish the obligations, liabilities, agreements or duties hereunder of the Junior Lenders or the Company, or
affect this Subordination Agreement in any way or provide any party any recourse against Senior Lender.

 

11.       Specific
Performance. Senior Lender is hereby authorized to demand specific performance of this Subordination Agreement at
any time when any other party shall have failed to comply with any of the provisions of this Subordination Agreement applicable
to it. The Company and Junior Lenders hereby irrevocably waive any defense based upon the adequacy of a remedy at law which might
be asserted as a bar to such remedy of specific performance and waive any requirement of the posting of any bond which might otherwise
be required before such remedy of specific performance is granted.

 

12.       Deed
in Lieu of Foreclosure. As to any of the assets and properties subject to the Senior Liens (the “Collateral”),
Senior Lender may at any time after the occurrence and during the continuance of a default under the Senior Debt accept a full
or partial deed in lieu or assignment in lieu of foreclosure in its own name or in the name of its designee or nominee or otherwise.

 

13.       Subrogation.
No payment or distribution to Senior Lender pursuant to the provisions of this Subordination Agreement shall entitle Junior
Lenders to exercise any rights of subrogation in respect thereof until the Senior Debt shall have been paid and satisfied in full.
After the payment of the Senior Debt in full and provided no payments are voidable, Junior Lenders shall be subrogated to the
rights of Senior Lender to receive payments or distributions applicable to the Senior Debt to the extent the distributions otherwise
payable to the Junior Lenders have been applied to the payment of the Senior Debt.

 

14.       Choice
of Law. THIS SUBORDINATION AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF IOWA.

 

15.       Waivers
and Amendments. This Subordination Agreement may not be amended, waived, terminated, or otherwise modified except
in writing executed by Senior Lender, and in the case of amendments and modifications, by (a) Junior Lenders holding not less
than 67% of the principal amount of the outstanding Junior Debt and (b) the Company.

 

16.       No
Implied Waiver. Any delay in the exercise of or any failure to exercise any right or remedy of any party to this Subordination
Agreement shall not be deemed a waiver of any such right or remedy.

 

    	Page 4

    	 

    

 

17.       Binding
Effect. This Subordination Agreement shall be binding upon the parties and their respective successors, transferees
and assigns. Each reference in this Subordination Agreement to Junior Lenders shall include any assignee or transferee of the
Junior Debt and the Junior Liens, and each reference in this Subordination Agreement to Senior Lender shall include any assignee
or transferee of the Senior Debt and the Senior Liens.

 

18.       Invalid
Provisions. If any term or provision of this Subordination Agreement shall be determined to be illegal or unenforceable,
all other terms and provisions hereof shall nevertheless remain effective and shall be enforced to the fullest extent permitted
by law.

 

19.       Further
Assurances. The Junior Lenders agree and acknowledge that this Subordination Agreement may be filed for the record
for the purposes of giving notice of the subordination herein granted, and the Junior Lenders and the Company further agree to
execute such subordinations, financing statements and other documents that may be requested by Senior Lender to more fully give
effect to the provisions of this Subordination Agreement

 

20.       Notices.
All notices, requests, consents, demands and other communications required or permitted under this Subordination Agreement
shall be in writing and, unless otherwise specifically provided in this Subordination Agreement, (i) shall be deemed sufficiently
given or furnished (a) if delivered by a commercial messenger service regularly retaining receipts for such delivery, effective
on the date of delivery by the commercial messenger service; (b) if sent by registered or certified mail, return receipt requested,
effective three (3) business days after the date of deposit; (c) if sent by telephonic facsimile transmission on a business day
during normal business hours with a copy sent by regular mail, effective on the date imprinted on the facsimile transmission form;
or (d) if delivered by the air courier services known as FedEx, Express Mail, Airborne or Emory Air, effective two business days
after the date of delivery thereof to the courier for either next day or two-day delivery, and (ii) shall be addressed to the
parties as listed as follows, or, with respect to the Junior Lenders, as set forth on a counterpart signature page to this Subordination
Agreement:

 

Senior
Lender’s address:

 

IOWA
STATE BANK

5
E Call Street

Algona,
IA 50511

Attn:
______________________

 

Company’s
address:

 

AMERICAN
POWER GROUP CORPORATION and

AMERICAN
POWER GROUP, INC.

7
Kimball Lane, Building A

Lynnfield,
MA 01940

Attn:
Chief Financial Officer

 

21.       Counterparts.
This Subordination Agreement may be signed in any number of complete counterparts, each of which when so executed by all
parties hereto shall be deemed to constitute one and the same agreement; but in making proof of this Subordination Agreement it
will not be necessary to produce or account for more than one such counterpart executed by all parties hereto.

 

22.       Notice
of Final Agreement. THIS SUBORDINATION AGREEMENT REPRESENTS AND EMBODIES THE ENTIRE AND FINAL AGREEMENT AMONG THE PARTIES
WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDES ALL PRIOR WRITTEN OR ORAL AGREEMENTS AND UNDERSTANDINGS, IF ANY, RELATING
TO THE SUBJECT MATTER HEREOF. THIS SUBORDINATION AGREEMENT MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

[Signature
pages follow.]

 

    	Page 5

    	 

    

 

IN
WITNESS WHEREOF, this Subordination Agreement is executed as of the date first above written.

 

	 	JUNIOR
    LENDER:
	 	 
	 	 
	 	 
	 	By:
    	    
	 	Name:	 
	 	 	 
	 	Address:	 
	 	 	 

 

[Junior
Lender signature pages to this agreement are on file with 

American
Power Group Corporation and are intentionally omitted]

 

    	Page 6

    	 

    

 

SENIOR
LENDER:

 

	 	IOWA
    STATE BANK
	 	 
	 	By:
    	/s/
    Levi Trauger
	 	Name:	Levi
    Trauger
	 	Title:	Loan
    Officer

 

	 	COMPANY:
	 	 
	 	AMERICAN
    POWER GROUP CORPORATION
	 	 
	 	By:
    	/s/
    Charles E. Coppa
	 	Name:	Charles
E. Coppa
	 	Title:	Chief
    Financial Officer

 

	 	AMERICAN
    POWER GROUP, INC.
	 	 
	 	By:
    	/s/
    Charles E. Coppa
	 	Name:	Charles
E. Coppa
	 	Title:	Treasurer

 

    	Page 7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00266-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00266-of-00352.parquet"}]]