Very same thing happened to my engine, I assumed the clip somehow popped off. Very similar looking damage to what you have right there. Oh Well! - I ride 15 mi daily to and from work. Same bike on my 4th engine in as many years. I do well to get 3000 mi before a catastrophic failure. I don't abuse my bike-I try to find the happy rpm where it likes to run and keep it there. Nonetheless, I bought my replacement from DAX (balanced) runs very smooth, just feels like a real creamy happy motor. Gonna call him this afternoon and get one of those Puch looking compression heads. Good Luck! Amsoil interceptor mixed 32:1 1/2 oz K-100 anti ethanol per gallon.