LLC Management Option Plan

Grove Investors LLC


Management Option Plan


SECTION 1. Purpose. The purposes of this Grove Investors LLC Management Option Plan (the "Plan") are to promote the interests of Grove Investors LLC (the "Company") and its members by (i) attracting and retaining exceptional officers and other key employees of the Company and its Affiliates, specifically including the Company's indirect subsidiary, Grove Worldwide LLC and (ii) enabling such individuals to acquire an equity interest in and participate in the long-term growth and financial success of the Company.


SECTION 2. Definitions. As used in the Plan, the following terms shall have the meanings set forth below:


"Affiliate" shall mean (i) any entity that, directly or indirectly, controls or is controlled by or under common control with the Company and (ii) any entity in which the Company has a significant equity interest, in either case as determined by the Committee.


"Board" shall mean the Management Committee of the Company, as established pursuant to the LLC Agreement.


"Cause" shall mean (i) willful misconduct or willful malfeasance by the Participant in connection with his or her employment, (ii) the Participant's conviction of, or plea of guilty or nolo contendere to, any crime constituting a felony under the laws of the United States or any state thereof or any crime involving moral turpitude or (iii) the Participant's material breach of any of the provisions of any employment agreement or the LLC Agreement which is not cured by the Participant within 10 business days following written notice from his employer of such breach.


"Change in Control" shall mean the closing of any transaction whereby any Person other than FW Grove Coinvestors, L.P., Keystone, Inc. (including funds sponsored by Keystone, Inc.), FW Strategic Partners, L.P., Michael L. George or the George Group, Inc. or any of their respective Affiliates shall have become the beneficial owner of more than 50% of the Equity Securities (as defined in the LLC Agreement) of the Company or a reorganization, merger, consolidation, acquisition or other similar transaction, after which all or substantially all of the assets of the Company are controlled by an entity other than FW Grove Coinvestors, L.P., Keystone, Inc. (including investment funds sponsored by Keystone, Inc.), Michael L. George, the George Group Inc. and/or FW Strategic Partners, L.P. or their respective Affiliates.
2


"Code" shall mean the Internal Revenue Code of 1986, as amended from time to time.


"Committee" shall mean Compensation Committee of the Board or any person or persons designated by the Board or the Compensation Committee to administer the Plan.


"Class A Unit" shall mean a unit of interest in the Company based upon a notional amount of 75,000 units outstanding as of the Effective Date, with each Class A Unit representing a .001333% interest in the Company as of the Effective Date, subject to adjustment as provided in Section 6(d) and in the LLC Agreement.


"Company" shall mean Grove Investors LLC, a Delaware limited liability company, together with any successor thereto.


"Disability" shall mean a Participant's becoming physically or mentally incapacitated so that he is therefore reasonably expected to be unable with reasonable accommodation, for a period of six consecutive months or for an aggregate of nine months in any 18 consecutive month period to perform the essential functions of his job for the Company and its Affiliates.


"EBITDA" shall mean the net profit of the Company and its subsidiaries, after all expenses but before any (A) interest, (B) income taxes or other taxes based on profits, (C) amortization of goodwill, (D) depreciation, (E) cash expenses directly associated with the implementation of the operations improvement program, including consulting fees under the Consulting Agreement referred to in the LLC Agreement, and (F) to the extent determined by the Committee, any nonrecurring or unbudgeted extraordinary items of income or loss. The determination of EBITDA for purposes of the Plan shall be made by the Committee in good faith, which determination shall be conclusive and binding on the Company and the Participants, including any beneficiaries thereof.


"EBITDA Target" shall mean the target EBITDA for the Company and its subsidiaries determined for a fiscal year based on management's proposal and as approved by the Committee.


"Employment" and "termination of employment" and similar references shall include employment with and termination of employment from the Company and its Affiliates, including Grove.


"Effective Date" shall mean April 28, 1998.
3


"Fair Market Value" of Interests shall mean the fair market value of such Interests as determined in good faith by the Board. In the event of a Change in Control involving the sale of Interests or Interests of Grove Worldwide, the Fair Market Value of an Interest shall be based upon the price per Interest paid by the acquiror in connection with such Change in Control.


"Grove" shall mean Grove Worldwide LLC, a Delaware limited liability company, together with any successor thereto.


"Interest" shall mean an Interest as defined in the LLC Agreement.


"LLC Agreement" shall mean the Second Amended and Restated Limited Liability Company Agreement of Grove Investors LLC dated as of June __, 1998.


"Option" shall mean an option granted hereunder to acquire Class A Units, as set forth in Section 6.


"Option Agreement" shall mean any written agreement, contract, or other instrument or document (which may include provisions of an employment agreement to which the Company is a party) evidencing any Option granted hereunder, which may, but need not, be executed or acknowledged by a Participant.


"Participant" shall mean any officer or other key employee of the Company or its Affiliates eligible for an Option under Section 5 and selected by the Committee to receive an Option under the Plan.


"Person" shall mean any individual, corporation, partnership, association, joint-stock company, trust, unincorporated organization, government or political subdivision thereof or other entity.


"Plan" shall mean this Grove Investors LLC Management Option Plan.


SECTION 3. Administration.


(a) The Plan shall be administered by the Committee. Subject to the terms of the Plan and applicable law, and in addition to other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have full power and authority to: (i) designate Participants; (ii) determine the number of Class A Units (and underlying Interests) or fractions thereof to be covered by, or with respect to which payments, rights or other matters are to be calculated in connection with, the Options; (iii) determine the terms and conditions of any Option; (iv) determine whether, to what extent, and under what circumstances Options may be settled or exercised in cash, Interests, other securities or other property, or canceled, forfeited or suspended and the method or methods by which the Options may be settled, exercised, canceled, forfeited or


4


suspended; (v) interpret, administer, reconcile any inconsistency, correct any defect and/or supply any omission in the Plan and any instrument or agreement relating to, or Option made under, the Plan; (vi) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; and (vii) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan.


(b) Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Option shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon all Persons, including the Company, any Affiliate, any Participant, any holder or beneficiary of any Option and any member of the Company.


(c) No member of the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any Option hereunder.


SECTION 4. Class A Units and Interests.


(a) Class A Units Available. Subject to adjustment as set forth in Section 4(b), the aggregate number of Class A Units with respect to which Options may be granted under the Plan shall be 4,500. If, after the effective date of the Plan, any Class A Units covered by an Option granted under the Plan, are forfeited, or if an Option has expired, terminated or been canceled for any reason whatsoever (other than by reason of exercise) and in either such case a Participant has received no benefits of ownership with respect to the forfeited Class A Units or the Interests to which such expired, terminated or canceled Option relates, then the Class A Units covered by such Option shall again be available to be granted under Options hereunder.


(b) Adjustments. In addition to the adjustment in the Interests as described in Section 6(d), in the event that the Committee determines that any dividend or other distribution (whether in the form of cash, Interests, securities or other property), recapitalization, reorganization, merger, consolidation, issuance or exchange of Interests, other ownership interests or other securities of the Company, issuance of warrants or other rights to purchase Interests, other ownership interests or other securities of the Company or other similar corporate transaction or event affects the Interests such that an adjustment is determined by the Committee in its discretion to be appropriate in order to prevent inappropriate dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan, then the Committee may, in such manner as it may deem equitable, adjust any or all of (i) the number of Class A Units, other ownership interests or other securities of the Company (or number


5


and kind of other securities or property) with respect to which Options may be granted, (ii) the number of Class A Units, other ownership interests or other securities of the Company (or number and kind of other securities or property) subject to outstanding Options or the percentage of Interests, other ownership interests or other securities of the Company subject to Class A Units and (iii) the exercise price with respect to any Option or, if deemed appropriate, make provision for a cash payment to the holder of an outstanding Option in consideration for the cancellation of ...