Exhibit 3.1
THE SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
GROVE HOLDINGS LLC
(a Delaware limited liability company)
---------------------------------------
Dated as of July 31, 1998
---------------------------------------
TABLE OF CONTENTS
ARTICLE I. FORMATION; NAME; TERM. . . . . . . . . . . . . . . . . . . 1
1.1 Formation . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Name. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Effective Date; Term. . . . . . . . . . . . . . . . . . . . . . 1
1.4 Principal Place of Business . . . . . . . . . . . . . . . . . . 1
1.5 Registered Office . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Registered Agent. . . . . . . . . . . . . . . . . . . . . . . . 2
1.7 Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 Authorized Person . . . . . . . . . . . . . . . . . . . . . . . 2
1.9 Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.10 Powers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE II. INTERESTS; COMMITMENTS; CLOSING; CONTRIBUTIONS . . . . . . 4
2.1 Capital Contributions . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE III. DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1 Distributions . . . . . . . . . . . . . . . . . . . . . . . . . 5
ARTICLE IV. MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.1 Management of the Company . . . . . . . . . . . . . . . . . . . 5
4.2 Powers of the Management Committee. . . . . . . . . . . . . . . 6
4.3 Governance. . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.4 No Management by Other Persons or Entities. . . . . . . . . . . 8
4.5 By-laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
4.6 Reliance by Third Parties . . . . . . . . . . . . . . . . . . . 8
ARTICLE V. ACCOUNTING; FINANCIAL AND TAX MATTERS. . . . . . . . . . . 9
5.1 Accounting Method . . . . . . . . . . . . . . . . . . . . . . . 9
5.2 Accounting Records. . . . . . . . . . . . . . . . . . . . . . . 9
5.3 Fiscal Year and Taxable Year. . . . . . . . . . . . . . . . . . 9
5.4 Financial Statements. . . . . . . . . . . . . . . . . . . . . . 9
5.5 Bank and Investment Accounts. . . . . . . . . . . . . . . . . .10
5.6 Tax Matters Partner . . . . . . . . . . . . . . . . . . . . . .10
5.7 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
5.8 Classification as a Disregarded Entity. . . . . . . . . . . . .11
5.9 Accounting Decisions. . . . . . . . . . . . . . . . . . . . . .11
ARTICLE VI. LIABILITY; EXCULPATION; INDEMNIFICATION . . . . . . . . . . . .11
6.1 Liability of Members. . . . . . . . . . . . . . . . . . . . . .11
6.2 Exculpation . . . . . . . . . . . . . . . . . . . . . . . . . .11
ii
6.3 Duties and Liabilities of Covered Persons . . . . . . . . . . 12
6.4 Indemnification . . . . . . . . . . . . . . . . . . . . . . . 13
6.5 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . 14
ARTICLE VII. TERMINATION; DISSOLUTION; LIQUIDATION AND
WINDING-UP. . . . . . . . . . . . . . . . . . . . . . . . . . 14
7.1 Events of Dissolution . . . . . . . . . . . . . . . . . . . . 14
7.2 Liquidation and Winding-Up. . . . . . . . . . . . . . . . . . 15
7.3 Survival of Rights, Duties and Obligations. . . . . . . . . . 15
7.4 Claims of the Member. . . . . . . . . . . . . . . . . . . . . 16
ARTICLE VIII. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 16
8.1 Assignments . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.2 Resignation . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.3 Admission of Additional Members . . . . . . . . . . . . . . . 16
8.4 Liability of Members. . . . . . . . . . . . . . . . . . . . . 16
8.5 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . 16
8.6 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . 16
iii
THE SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
GROVE HOLDINGS LLC
This Second Amended and Restated Limited Liability Company Agreement
(this "Agreement") of Grove Holdings LLC, a Delaware limited liability company
(the "Company"), is made as of the 31st day of July 1998, by Grove Investors
LLC, as member (the "Member" or "Managing Member").
WHEREAS, the Company was formed under the laws of the State of
Delaware by filing a certificate of formation with the Secretary of the State of
Delaware pursuant to an Operating Agreement dated as of January 15, 1998 (the
"Original Agreement"); and
WHEREAS, the Company was operating in accordance with the Amended and
Restated Limited Liability Company Agreement dated as of April 29, 1998 (the
"Amended Agreement"), and the Company wishes to amend and restate the Original
Agreement and the Amended Agreement as set forth below:
ARTICLE I.
FORMATION; NAME; TERM
1.1 FORMATION. The Company was formed on January 15, 1998, pursuant
to the provisions of the Delaware Limited Liability Company Act, as amended from
time to time (the "ACT") upon the filing of the Certificate of Formation with
the Secretary of State of Delaware. The Company shall be governed by, and the
rights, duties and liabilities of the Member shall be as provided in, the Act
and this Agreement.
1.2 NAME. The name of the Company shall be "Grove Holdings LLC".
The business of the Company may be conducted upon compliance with all applicable
laws under any other name designated by the Management Committee (as defined in
Section 4.1).
1.3 EFFECTIVE DATE; TERM. This Agreement shall become effective upon
the execution of this Agreement by the Member. The Company shall continue in
existence until it is dissolved and its affairs wound up in accordance with the
Act and this Agreement or until it is terminated as provided in the Act or this
Agreement.
1.4 PRINCIPAL PLACE OF BUSINESS. The principal place of business of
the Company shall be at 1565 ▇▇▇▇▇▇▇▇ Trail East, ▇.▇. ▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇
▇▇▇▇▇ or at
1
such other or additional place or places as the Managing Member or Management
Committee shall determine from time to time. The Company may have other
offices, either within or outside of the State of Delaware, at such place or
places as the Managing Member or Management Committee may from time to time
designate or the business of the Company may require.
1.5 REGISTERED OFFICE. The address of the Company's registered
office in Delaware shall be c/o National Corporate Research, Ltd., ▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
1.6 REGISTERED AGENT. The name and address of the registered agent
of the Company for service of process on the Company in the State of Delaware
initially is National Corporate Research, Ltd., ▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The Management Committee may at any time and
from time to time designate another registered agent.
1.7 FILINGS. The Managing Member promptly shall cause the execution
and delivery of such documents and performance of such acts consistent with the
terms of this Agreement as may be necessary to comply with the requirements of
law for the formation, qualification and operation of a limited liability
company under the laws of each jurisdiction in which the Company shall conduct
business. All expenses of such filings shall be borne by the Company.
1.8 AUTHORIZED PERSON. ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ is hereby designated as
an authorized person, within the meaning of the Act, to execute, deliver and
file the certificate of formation of the Company, and any amendments and/or
restatements thereof.
1.9 PURPOSE. The Company is formed for the purpose of, directly or
indirectly, engaging in the business of designing, manufacturing, selling and
providing customer support for mobile hydraulic cranes, aerial work platforms,
truck mounted cranes and similar devices and in any and all activities and
transactions which are necessary, convenient, desirable or incidental to the
foregoing and in any lawful business, act or activity related thereto as the
Management Committee may determine from time to time and for which a limited
liability company may be organized under the Act, and in any and all activities
necessary, convenient, desirable or incidental to the foregoing.
1.10 POWERS. Except as otherwise limited in this Agreement,
(a) the Company shall have the power and authority to do any and
all acts necessary, appropriate, proper, advisable, convenient or incidental to
or for the furtherance of the purpose set forth in Section 1.9, including:
2
(i) to conduct its business, carry on its operations and
have and exercise the powers granted to a limited liability company by the Act
in any state, territory, district or possession of the United States, or in any
foreign country that may be necessary, convenient or incidental to the
accomplishment of the purpose of the Company;
(ii) to acquire by purchase, lease, contribution of property
or otherwise, own, hold, operate, maintain, finance, improve, lease, sell,
convey, mortgage, transfer, demolish or dispose of any real or personal property
that may be necessary, convenient or incidental to the accomplishment of the
purpose of the Company;
(iii) to enter into, perform and carry out contracts of
any kind, including, without limitation, contracts with any Member or any
Affiliate thereof, or any agent of the Company necessary to, in connection with,
convenient to, or incidental to the accomplishment of the purposes of the
Company;
(iv) to purchase, take, receive, subscribe for or otherwise
acquire, own, hold, vote, use, employ, sell, mortgage, lend, pledge, or
otherwise dispose of, and otherwise use and deal in and with, shares or other
interests in or obligations of domestic or foreign corporations, associations,
general or limited partnerships (including the power to be admitted as a partner
thereof and to exercise the rights and perform the duties created thereby),
trusts, limited liability companies (including the power to be admitted as a
member or appointed as a manager thereof and to exercise the rights and perform
the duties created thereby), or individuals or direct or indirect obligations of
the United States or of any government, state, territory, governmental district
or municipality or of any instrumentality of any of them;
(v) to lend money for any proper purpose, to invest and
reinvest funds and to take and hold real and personal property for the payment
of funds so loaned or invested;
(vi) to ▇▇▇ and be sued, complain and defend and participate
in administrative or other proceedings, in its name;
(vii) to appoint employees and agents of the Company,
define their duties and fix their compensation;
(viii) to indemnify any Person to the fullest extent
permitted by the Act and to obtain any and all types of insurance;
(ix) to cease its activities and cancel its Certificate;
3
(x) to negotiate, enter into, renegotiate, extend,
renew, terminate, modify, amend, waive, execute, acknowledge or take any
other action with respect to any lease, contract or security agreement in
respect of any assets of the Company;
(xi) to borrow money and issue evidences of
indebtedness, and to secure the same by a mortgage, pledge or other lien on
the assets of the Company;
(xii) to pay, collect, compromise, litigate, arbitrate or
otherwise adjust or settle any other claims or demands of or against the
Company or to hold such proceeds against the payment of contingent
liabilities; and
(xiii) to make, execute, acknowledge and file any and all
documents or instruments necessary, convenient or incidental to the
accomplishment of the purpose of the Company.
(b) The Company, and the Managing Member, on behalf of the
Company, may enter into and perform any and all documents, agreements and
instruments contemplated thereby, all without any further act, vote or approval
of any Member notwithstanding any other provision of this Agreement, the Act or
other applicable law. The Managing Member or Management Committee may authorize
any Person (including, without limitation, any other Member) to enter into and
perform any document on behalf of the Company.
(c) The Company may merge with, or consolidate into, another
Delaware limited liability company or other business entity (as defined in
Section 18-209(a) of the Act) upon the approval of the Managing Member or the
Management Committee.
ARTICLE II.
INTERESTS; COMMITMENTS; CLOSING; CONTRIBUTIONS
2.1 CAPITAL CONTRIBUTIONS. The Member shall contribute,
transfer, assign and convey (collectively, "CONTRIBUTE"), or cause to be
contributed, to the capital of the Company, an amount in cash equal to
$120,000,000 in exchange for 100% of the interest (an "Interest") in the
Company. The Member will have no interest in specific Company property.
4
ARTICLE III.
DISTRIBUTIONS
3.1 DISTRIBUTIONS.
(a) The Company shall, to the extent the Managing Member or
Management Committee determines that Company has cash available to do so, make
quarterly distributions of cash to the Member in an amount equal to (i) the
product of (A) the taxable income of the Company and (B) the maximum combined
Federal, state and local income tax rates applicable to an individual resident
of New York City or Los Angeles, California, whichever is higher, PROVIDED,
HOWEVER, that in determining such amount, the effect thereon of any net
operating loss carryforwards or other carryforwards or tax attributes, such as
alternative minimum tax carryforwards shall be taken into account, and adjusted
to take into account any applicable credits, deductions or other adjustments
allowed under both New York and California law to a direct or indirect owner of
an Interest in the Company for state and local income tax purposes.
(b) Additional distributions shall be made to the Member at the
times and in the aggregate amounts determined by the Managing Member or
Management Committee.
ARTICLE IV.
MANAGEMENT
4.1 MANAGEMENT OF THE COMPANY.
(a) The Company shall be managed by a Management Committee.
The Management Committee shall manage the Company in accordance with this
Agreement and the actions of the Management Committee taken in such capacity
and in accordance with this Agreement shall bind the Company.
(b) The Management Committee shall have full and complete
discretion to manage and control the business and affairs of the Company, to
make all decisions affecting the business and affairs of the Company and to
take all such actions as it deems necessary or appropriate to accomplish the
purpose of the Company as set forth herein. The Management Committee shall
be the sole person or entity with the power to bind the Company, except and
to the extent that such power is expressly delegated to any other person,
committee or entity by this Agreement or by the Management Committee, and
such delegation shall not cause the Management Committee to cease being the
Management Committee. There shall not be a "manager" (within the meaning of
the Act) of the Company.
5
(c) The Management Committee may appoint individuals with or
without such titles as it may elect, including the titles of Chairman, Chief
Executive Officer, Vice President, Treasurer, Assistant Treasurer, Secretary,
and Assistant Secretary, to act on behalf of the Company with such power and
authority as the Management Committee may delegate in writing to any such
persons, and otherwise such officers shall have all the powers and authority
customarily exercised by such officers.
(d) The Management Committee may adopt the By-laws of the
Company consistent with this Agreement and the Act.
4.2 POWERS OF THE MANAGEMENT COMMITTEE. The Management
Committee shall have the right, power and authority, in the management of the
business and affairs of the Company, to do or cause to be done, at the
expense of the Company, any and all acts deemed by the Management Committee
to be necessary or appropriate to effectuate the business, purposes and
objectives of the Company.
Without limiting the generality of the foregoing, the
Management Committee shall have the power and authority to:
(a) issue from time to time in one or more series of any
number of Interests, and with such powers, preferences, rights and
qualifications, limitations or restrictions thereof, and such distinctive
serial designations, all as shall hereafter be stated and expressed in the
resolution or resolutions adopted by the Management Committee. Each series
of Interests (a) may have such voting rights or powers, full or limited, or
may be without voting rights or powers; (b) may be subject to redemption at
such time or times and at such prices; (c) may be entitled to receive
allocations and distributions (which may be cumulative or non-cumulative) at
such rate or rates, on such conditions and at such times, and allocable and
payable in preference to, or in such relation to, the allocations and
distributions allocable and payable to any other class or classes or series
of Interests; (d) may have such rights upon the voluntary or involuntary
liquidation, winding up or dissolution of, or upon any distribution of the
assets of, the Company; (e) may be made convertible into or exchangeable for,
Interests of any other class or classes or of any other series of the same or
any other class or classes of interests of the Company at such price or
prices or at such rates of exchange and with such adjustments; (f) may be
entitled to the benefit of a sinking fund to be applied to the purchase or
redemption of Interests of such series in such amount or amounts; (g) may be
entitled to the benefit of conditions and restrictions upon the creation of
indebtedness of the Company or any subsidiary, upon the issue of any
additional Interests (including additional Interests of such series or of any
other series) and upon the making of allocations or distributions on, and the
purchase, redemption or other acquisition by the Company or any subsidiary
of, any outstanding Interests of the Company and (h) may have such other
relative, participating, optional or other special rights, qualifications,
limitations or restrictions thereof; all as shall be stated in said
resolution or resolutions providing for the issue of such Interests;
6
(b) cause the Interests of the Company to be represented by
certificates in such form and on the basis of such procedure as shall be
approved by the Management Committee, including with respect to the issuance
of new certificates to replace lost, destroyed, stolen or mutilated
certificates.
(c) establish a record date with respect to all actions to be
taken hereunder that require a record date be established, including with
respect to allocations and distributions;
(d) bring and defend on behalf of the Company actions and
proceedings at law or in equity before any court or governmental,
administrative or other regulatory agency, body or commission or otherwise;
and
(e) execute all documents or instruments, perform all duties
and powers and do all things for and on behalf of the Company in all matters
necessary, desirable, convenient or incidental to the purpose of the Company,
including, without limitation, all documents, agreements and instruments
related to the making of investments of Company funds.
In connection with the issuance of any Interests as
contemplated under Subsection (a) above, the Management Committee is hereby
authorized to enter into such amendments or supplements to this Agreement as
the Management Committee determines to be necessary or advisable to give
effect to such issuance, including to make appropriate adjustments to the
total number of Interests outstanding; provided, however, that such
adjustments shall not treat Members differently and adversely from the manner
in which other Members holding similar Interests are treated.
The expression of any power or authority of the Management
Committee in this Agreement shall not in any way limit or exclude any other
power or authority of the Management Committee which is not specifically or
expressly set forth in this Agreement.
Notwithstanding anything in this Agreement to the contrary, all
transactions between the Company or any Subsidiary and any Member, its
Affiliates or any officer, director, shareholder, partner, member, employee
or agent of a Member or an Affiliate of a Member or family members of the
foregoing shall be on an arms length basis.
4.3 GOVERNANCE.
(a) NUMBER. The Management Committee shall consist of one or
more members. Each Management Committee member shall hold office until a
successor is elected and qualified or until such member's death, resignation
or removal.
7
(b) ELECTION. Management Committee members shall be elected
by the Managing Member from time to time.
(c) RESIGNATION. Any Management Committee member may resign
at any time upon written notice to the Company.
(d) REMOVAL. Any or all of the Management Committee members
may be removed with or without cause by the Managing Member.
(e) TIMES AND PLACES OF MEETINGS. The times and places for
fixing meetings may be fixed from time to time by the Management Committee.
(f) QUORUM. A majority of the Management Committee members
shall be necessary and sufficient to constitute a quorum for the transaction
of business at any meeting of the Management Committee.
(g) ACTION BY MAJORITY VOTE. The act of a majority of the
Management Committee members present at a meeting at which a quorum is
present shall be the act of the Management Committee.
(h) ACTION WITHOUT A MEETING. Any action or permitted action
required to be taken at any meeting of the Management Committee may be taken
without a meeting, without prior notice and without a vote, if a consent in
writing, setting forth the action so taken, shall be signed by a majority of
the Management Committee members and such consent is filed with the minutes
of the proceedings of the Company.
4.4 NO MANAGEMENT BY OTHER PERSONS OR ENTITIES. Except and
only to the extent expressly delegated by the Management Committee, no person
or entity other than the Management Committee shall be an agent of the
Company or have any right, power or authority to transact any business in the
name of the Company or to act for or on behalf of or to bind the Company.
4.5 BY-LAWS. The Member or the Management Committee may adopt
by-laws consistent with this Agreement and the Act.
4.6 RELIANCE BY THIRD PARTIES. Any person or entity dealing
with the Company or the Management Committee or a Member, in his capacity as
a Member, may rely upon a certificate signed by the Management Committee as
to:
(a) the identity of the Management Committee or the Member;
8
(b) the existence or non-existence of any fact or facts which
constitute a condition precedent to acts by the Management Committee or the
Member or are in any other manner germane to the affairs of the Company;
(c) the persons who or entities which are authorized to
execute and deliver any instrument or document of or on behalf of the
Company; or
(d) any act or failure to act by the Company as to any other
matter whatsoever involving the Company or the Member.
ARTICLE V.
ACCOUNTING; FINANCIAL AND TAX MATTERS
5.1 ACCOUNTING METHOD. The Company shall keep its accounting
records and shall report its profits or losses on the accrual method of
accounting in accordance with the principles used by the Company for Federal
income tax purposes and otherwise in accordance with Generally Accepted
Accounting Principles ("GAAP") and, to the extent inconsistent therewith, in
accordance with this Agreement.
5.2 ACCOUNTING RECORDS. The Company shall keep complete and
accurate business and accounting records reflecting all transactions of the
Company. Such accounting records shall be kept in accordance with the
principles used by the Company for Federal income tax purposes and otherwise
in accordance with GAAP consistently applied and, to the extent inconsistent
therewith, in accordance with this Agreement. The Company shall also keep
all records required to be kept pursuant to the Act. The Company's records,
together with a copy of this Agreement and of the Certificate, shall be
maintained at the principal place of business of the Company and shall be
subject to inspection or examination by the Member or Management Committee at
all reasonable times for any purpose reasonably related to such Member's or
Management Committee's interest in the Company.
5.3 FISCAL YEAR AND TAXABLE YEAR. The accounting fiscal year
(the "Fiscal Year") of the Company shall end on the Saturday closest to the
last day of September of each year. The taxable year (the "Taxable Year") of
the Company shall end on December 31 of each year. The Fiscal Year and
Taxable Year may be changed by the Managing Member or Management Committee.
5.4 FINANCIAL STATEMENTS.
(a) As soon as practicable but in any event within 60 days
after the end of each of the first three quarters of each Fiscal Year of the
Company, the Management Committee or the financial officers of the Company
shall prepare quarterly financial statements
9
of the Company (which need not be examined or reported on by an independent
certified public accountant), which shall include a balance sheet of the
Company as of the end of such fiscal quarter, a statement of net income and
net loss for such fiscal quarter and a statement of cash flows of the Company
for such fiscal quarter, all in reasonable detail, setting forth in each case
in comparative form the information for the corresponding period (or periods)
of the previous Fiscal Year.
(b) As soon as practicable but in any event within 90 days
after the close of each Fiscal Year of the Company, the Company shall cause
to be prepared the following financial statements, accompanied by the audited
report thereon of the independent accountants for the Company: (i) a balance
sheet of the Company as at the end of such Fiscal Year; (ii) a statement of
net income and net loss for such Fiscal Year; (iii) a statement of cash flows
of the Company for such Fiscal Year; and (iv) a statement of the Members'
Capital Accounts and changes therein for such Fiscal Year, all in reasonable
detail, setting forth in each case in comparative form all the information
for the corresponding period (or periods) of the previous Fiscal Year.
5.5 BANK AND INVESTMENT ACCOUNTS. All funds of the Company
shall be deposited in its name, or in such name as may be designated by the
Managing Member or Management Committee, in such checking, savings or other
accounts, or held in its name in the form of such other investments as shall
be designated by the Managing Member or Management Committee. The funds of
the Company shall not be commingled with the funds of any Person. All
withdrawals of such deposits or liquidations of such investments by the
Company shall be made exclusively upon the signature or signatures of such
officer or officers of the Company as the Management Committee may designate.
5.6 TAX MATTERS PARTNER. The "TAX MATTERS PARTNER" (as such
term is defined in Section 6231(a)(7) of the Code) of the Company shall be
the Managing Member or any successor "tax matters partner" designated by the
Managing Member or Management Committee in accordance with this Agreement.
5.7 TAXES.
(a) The Company shall prepare, or cause to be prepared, and
shall file all tax returns, be they information returns or otherwise, which
are required to be filed with the Internal Revenue Service, state and local
tax authorities and foreign tax jurisdictions, if any. A copy of such
returns shall be furnished to the Member and the Management Committee.
(b) The Company shall furnish the Member with all Company
information required to be reported in the tax returns of the Member for tax
jurisdictions in which the Company is considered to be doing business,
including a report indicating the
10
Company's income, gain, credits, losses and deductions within 90 days after
the end of the Company's Taxable Year.
(c) All determinations as to tax elections shall be made by
the Tax Matters Partner.
5.8 CLASSIFICATION AS A DISREGARDED ENTITY. The Member
intends that the Company be disregarded as an entity separate from its owner
for Federal tax purposes effective as of the date of this Agreement. The Tax
Matters Partner shall not file an election for the Company to be taxable as
an association and shall, for and on behalf of the Company, take all steps as
may be required to maintain the Company's classification as disregarded as an
entity separate from its owner for Federal tax purposes.
5.9 ACCOUNTING DECISIONS. All determinations as to accounting
principles shall be made by the Managing Member or Management Committee.
ARTICLE VI.
LIABILITY; EXCULPATION; INDEMNIFICATION
6.1 LIABILITY OF MEMBERS. A Member shall not be personally
liable for any debt, obligation or other liability of the Company, whether
arising in contract, tort or otherwise, except that a Member shall remain
personally liable for the payment of any capital contributions required by
Article III, and as otherwise provided in this Agreement, the Act and any
other applicable law.
6.2 EXCULPATION.
(a) For purposes of this Agreement, "COVERED PERSON" shall
mean any Member, any Affiliate of a Member, any Management Committee member,
and any officer, director, shareholder, partner, member, employee or agent of
a Member or any Affiliate thereof, and any officer, employee or expressly
authorized agent of the Company or its Affiliates.
(b) No Covered Person shall be liable to the Company or any
other Covered Person for any loss, damage or claim incurred by reason of any
act or omission performed or omitted by such Covered Person in good faith on
behalf of the Company and in a manner reasonably believed to be within the
scope of authority conferred on such Covered Person by this Agreement, except
that a Covered Person shall be liable for any such loss, damage or claim
incurred by reason of such Covered Person's gross negligence or willful
misconduct.
11
(c) A Covered Person shall be fully protected in relying in
good faith upon the records of the Company and upon such information,
opinions, reports or statements presented to the Company by any Person as to
matters the Covered Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable
care by or on behalf of the Company, including information, opinions, reports
or statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets
from which distributions to Members might properly be paid.
6.3 DUTIES AND LIABILITIES OF COVERED PERSONS.
(a) To the extent that, at law or in equity, any Covered
Person has duties (including fiduciary duties) and liabilities related
thereto to the Company or to any other Covered Person, a Covered Person
acting under this Agreement shall not be liable to the Company or to any
other Covered Person for its good faith reliance on the provisions of this
Agreement. The provisions of this Agreement, to the extent that they
restrict the duties and liabilities of a Covered Person otherwise existing at
law or in equity, are agreed by the Members to replace such other duties and
liabilities of such Covered Person.
(b) Unless otherwise expressly provided herein, (i) whenever a
conflict of interest exists or arises between Covered Persons, or (ii)
whenever this Agreement or any other agreement contemplated herein provides
that a Covered Person shall act in a manner that is, or provides terms that
are, fair and reasonable to the Company or any Member, the Covered Person
shall resolve such conflict of interest, taking such action or providing such
terms, considering in each case the relative interest of each party
(including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any
customary or accepted industry practices, and any applicable generally
accepted accounting practices or principles. In the absence of bad faith by
the Covered Person, the resolution, action or term so made, taken or provided
by the Covered Person shall not constitute a breach of this Agreement or any
other agreement contemplated herein or of any duty or obligation of the
Covered Person at law or in equity or otherwise.
(c) Whenever in this Agreement a Covered Person is permitted
or required to make a decision (a) in its "discretion" or under a grant of
similar authority or latitude, the Covered Person shall be entitled to
consider only such interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give any consideration to
any interest of or factors affecting the Company or any other Person, or (b)
in its "good faith" or under another express standard, the Covered Person
shall act under such express standard and shall not be subject to any other
or different standard imposed by this Agreement or other applicable law.
12
6.4 INDEMNIFICATION.
(a) To the fullest extent permitted by applicable law, the
Company shall indemnify any Covered Person who was or is made a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding brought by or against the Company or otherwise, whether
civil, criminal, administrative or investigative, including, without
limitation, an action by or in the right of the Company to procure a judgment
in its favor, by reason of the fact that such Covered Person is or was a
Member, Affiliate, officer, employee or agent of the Company, or that such
Covered Person is or was serving at the request of the Company as an
Affiliate partner, member, director, officer, trustee, employee or agent of
another Person, against all expenses, including attorneys' fees and
disbursements, judgments, fines and amounts paid in settlement actually and
reasonably incurred by such Covered Person in connection with such action,
suit or proceeding. Notwithstanding the foregoing, no indemnification shall
be provided to or on behalf of any Covered Person if a judgment or other
final adjudication adverse to such Covered Person establishes that his or her
acts constituted intentional misconduct or gross negligence.
(b) Any indemnification under subsection (a) of this Section
(unless ordered by a court) shall be made by the Company only as authorized
in the specific case upon a determination that the indemnification of the
Covered Person is proper under the circumstances because he or she has met
the applicable standard of conduct set forth in subsection (a) of this
Section 6.4. Such determination shall be made by the Member or, if the Member
so directs, by independent legal counsel in a written opinion. Any
indemnification payment shall be payable only out of and to the extent of the
Company's assets, and no Covered Person shall have any liability therefor.
(c) The Company shall, in the discretion of the Member, pay
expenses incurred in defending any action, suit or proceeding described in
subsection (a) above (including reasonable legal fees and expenses of counsel
and other experts) in advance of the final disposition of such action, suit
or proceeding upon receipt by the Company of an undertaking, in form
satisfactory to the Managing Member or the Company's legal counsel, to repay
such amount if it shall be determined that the Covered Person is not entitled
to be indemnified as authorized by paragraph (a) above.
(d) The indemnification provided by this Section 6.4 shall not
be deemed exclusive of any other rights to indemnification to which those
seeking indemnification may be entitled under any agreement, or otherwise.
The rights to indemnification and reimbursement or advancement of expenses
provided by, or granted pursuant to, this Section 6.4 shall continue as to a
Covered Person who has ceased to be a Member, officer, employee or agent (or
other person indemnified hereunder) and shall inure to the benefit of the
executors, administrators, legatees and distributees of such person.
13
(e) The provisions of this Section 6.4 shall be a contract
between the Company, on the one hand, and each Covered Person who served in
such capacity at any time while this Section 6.4 is in effect, on the other
hand, pursuant to which the Company and each such Covered Person intend to be
legally bound. No repeal or modification of this Section 6.4 shall affect
any rights or obligations with respect to any state of facts then or
theretofore existing or thereafter arising or any proceeding theretofore or
thereafter brought or threatened based in whole or in part upon such state of
facts.
6.5 INSURANCE. The Company may purchase and maintain
insurance, to the extent and in such amounts as the Managing Member shall, in
its sole discretion, deem reasonable, on behalf of Covered Persons and such
other persons or entities as the Managing Member shall determine, against any
liability that may be asserted against or expenses that may be incurred by
any such person or entity in connection with the activities of the Company or
such indemnities, regardless of whether the Company would have the power to
indemnify such person or entity against such liability under the provisions
of this Agreement. The Managing Member, on behalf of the Company, and/or the
Company may enter into indemnity contracts with Covered Person and adopt
written procedures pursuant to which arrangements are made for the
advancement of expenses and the funding of obligations under Section 6.4
hereof and containing such other procedures regarding indemnification as are
appropriate.
ARTICLE VII.
TERMINATION; DISSOLUTION; LIQUIDATION AND WINDING-UP
7.1 EVENTS OF DISSOLUTION. The Company shall be dissolved
upon any of the following (each a "DISSOLUTION EVENT"):
(a) the entry of a decree of judicial dissolution under
Section 18-802 of the Act;
(b) the written consent to a dissolution of the Member;
(c) the expiration of 60 days after the assignment, sale,
transfer or other disposition of all or substantially all of the assets,
properties and business of the Company;
(d) the death, retirement, resignation, expulsion, bankruptcy
or dissolution of the Member or any other event that terminates the continued
membership of the Member.
14
7.2 LIQUIDATION AND WINDING-UP. If the Company is dissolved
pursuant to Section 7.1, the Company shall be liquidated and wound up in
accordance with the Act and the following provisions:
(a) The financial officers of the Company shall be directed to
prepare a balance sheet, income statement and statement of cash flows of the
Company in accordance with GAAP as of the date of dissolution and for the
period ended on such date, which balance sheet shall be reported upon by the
Company's independent public accountants.
(b) The assets, properties and business of the Company shall
be liquidated by the Managing Member as promptly as possible, but in an
orderly and businesslike manner so as not to involve undue sacrifice.
Notwithstanding the foregoing, if it is determined by the Managing Member not
to sell all or any portion of the properties and assets of the Company, such
properties and assets shall be distributed in kind in the order of priority
set forth in subsection (c); PROVIDED, HOWEVER, that the Fair Market Value of
such properties and assets, as determined in good faith by the Managing
Member, shall be used in determining the extent and amount of a distribution
in kind of such properties and assets in lieu of actual cash proceeds of any
sale or other disposition thereof.
(c) The proceeds of sale of all or substantially all of the
properties and assets of the Company and all other properties and assets of
the Company not sold, as provided in subsection (b) above, and valued at the
Fair Market Value thereof as provided in such subsection (b), shall be
applied and distributed as follows, and in the following order or priority:
(i) FIRST, to the payment of all debts and liabilities
of the Company and the expenses of liquidation not otherwise adequately
provided for;
(ii) SECOND, to the setting up of any reserves that are
reasonably necessary for any contingent unforeseen liabilities or obligations
of the Company or of the Member arising out of, or in connection with, the
Company.
(iii) THEREAFTER, to the Member.
(d) A Certificate of Cancellation shall be filed with the
Secretary of State of the State of Delaware by the Member.
7.3 SURVIVAL OF RIGHTS, DUTIES AND OBLIGATIONS. Termination,
dissolution, liquidation or winding up of the Company for any reason shall
not release any party from any liability which at the time of such
termination, dissolution, liquidation or winding up already had accrued to
any other party or which thereafter may accrue in respect to any act or
omission prior to such termination, dissolution, liquidation or winding up.
15
7.4 CLAIMS OF THE MEMBER. The Member shall look solely to the
Company's assets for the return of its contribution to the Company, and if
the assets of the Company remaining after payment of or due provision for all
debts, liabilities and obligations of the Company are insufficient to return
such contribution, the Member shall have no recourse against the Company.
ARTICLE VIII.
MISCELLANEOUS
8.1 ASSIGNMENTS. The Member may assign in whole or in part
its limited liability company Interest.
8.2 RESIGNATION. The Managing Member may resign from the
Company.
8.3 ADMISSION OF ADDITIONAL MEMBERS. One (1) or more
additional members of the Company may be admitted to the Company with the
consent of the Member.
8.4 LIABILITY OF MEMBERS. The Member shall not have any
liability for the obligations or liabilities of the Company except to the
extent provided in the Act.
8.5 AMENDMENT. This Agreement may be amended at any time by
the Member or the Management Committee.
8.6 GOVERNING LAW. This Agreement shall be governed by, and
construed under, the laws of the State of Delaware, all rights and remedies
being governed by said laws.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound
hereby, has duly executed this Limited Liability Company Agreement as of the
date and year first aforesaid.
GROVE INVESTORS LLC
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Executive Officer
16