EXHIBIT 3.6
OPERATING AGREEMENT
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of
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DOUGLAS DYNAMICS, L.L.C.
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A Delaware Limited Liability Company
THIS AGREEMENT is entered into this 29th day of June, 1995, by and between
ARMCO INC., an Ohio corporation ("Armco") and AJV INVESTMENTS CORP., a Delaware
corporation ("AJV").
WHEREAS, the parties have agreed to organize and operate a limited
liability company in accordance with the terms and subject to the conditions set
forth in this Agreement.
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties, intending legally to
be bound, agree as follows:
SECTION 1. DEFINED TERMS.
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The following capitalized terms shall have the meanings specified in this
Section I. Other terms are defined in the text of this Agreement and, throughout
this Agreement, those terms shall have the meanings respectively ascribed to
them.
"Act" means the Delaware Limited Liability Company Act, as amended from
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time to time.
"Adjusted Capital Account Deficit" means, with respect to any Interest
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Holder, the deficit balance, if any, in the Interest Holder's Capital Account as
of the end of the relevant taxable year, after giving effect to the following
adjustments:
(i) the deficit shall be decreased by the amounts which the Interest
Holder is deemed to be obligated to restore pursuant to the penultimate
sentences of Regulation Section 1.704-2(g) (1) and Regulation Section
1.704-2 (i) (5); and
(ii) the deficit shall be increased by the items described in
Regulation Section 1.704-1(b) (2) (ii) (d) (4), (5), and (6).
The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Treasury Regulation Section 1.704-1(b) (2) (ii)
(d) and shall be interpreted consistently therewith.
"Affiliate" means, with respect to any Member, any Person: (i) which owns
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more than twenty percent (20%) of the voting interests in the Member; or (ii) in
which the Member owns more than twenty percent (20%) of the voting interests; or
(iii)
in which more than twenty percent (20%) of the voting interests are owned by a
Person who has a relationship with the Member described in the preceding clause
(i) or (ii).
"Agreement" means this Operating Agreement, as amended from time to time.
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"Agreement of Merger" means the Agreement of Merger attached hereto as
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Exhibit A.
"Bankruptcy" means, with respect to any Member, the occurrence of any of
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the following events:
(i) the Member makes an assignment for the benefit of creditors;
(ii) the Member files a voluntary petition in bankruptcy;
(iii) the Member is adjudged bankrupt or insolvent, or has entered
against the Member an order for relief in any bankruptcy or insolvency
proceeding;
(iv) the Member files a petition or answer seeking for the Member any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any statute, law or regulation;
(v) the Member files an answer or other pleading admitting or failing
to contest the material allegations of a petition filed against the Member
in any proceeding described in the foregoing subsections (i) through (iv);
(vi) the Member seeks, consents to or acquiesces in the appointment of
a trustee for, receiver for or liquidator of the Member or of all or any
substantial part of the Member's properties; or
(vii) one hundred twenty (120) after the commencement of any
proceeding against the Member seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under
any statute, law or regulation, if the proceeding has not been dismissed,
or if within ninety (90) days after the appointment without the Member's
consent or acquiescence of a trustee, receiver or liquidator of the Member
or of all or any substantial part of its properties, the appointment is not
vacated or stayed, or within ninety (90) days after the expiration of any
such stay, the appointment is not vacated.
"Capital Account" means the account maintained by the Company for each
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Interest Holder in accordance with the following provisions:
(i) an Interest Holder's Capital Account shall be credited with the
Interest Holder's Capital Contributions, the amount of any Company
liabilities assumed by the Interest Holder (or which are secured by Company
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property distributed to the Interest Holder), the Interest Holder's
distributive share of Profits and any item in the nature of income or gain
specially allocated to such Interest Holder pursuant to the provisions of
Section IV (other than Section 4.2.3); and
(ii) an Interest Holder's Capital Account shall be debited with the
amount of money and the fair market value of any Company property
distributed to the Interest Holder, the amount of any liabilities of the
Interest Holder assumed by the Company (or which are secured by property
contributed by the Interest Holder to the Company), the Interest Holder's
distributive share of Losses and any item in the nature of expenses or
losses specially allocated to the Interest Holder pursuant to the
provisions of Section IV (other than Section 4.2.3).
If any Interest is transferred pursuant to the terms of this Agreement, the
transferee shall succeed to the Capital Account of the transferor to the extent
the Capital Account is attributable to the transferred Interest. If the book
value of Company property is adjusted pursuant to Section 4.2.3, the Capital
Account of each Interest Holder shall be adjusted to reflect the aggregate
adjustment in the same manner as if the Company had recognized gain or loss
equal to the amount of such aggregate adjustment. It is intended that the
Capital Accounts of all Interest Holders shall be maintained in compliance with
the provisions of Regulation Section 1.704-1(b), and all provisions of this
Agreement relating to the maintenance of Capital Accounts shall be interpreted
and applied in a manner consistent with that Regulation.
"Capital Contribution" means the total amount of cash and the fair market
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value of any other assets contributed (or deemed contributed under Regulation
Section 1.704-1(b) (2) (iv) (d)) to the Company by a Member, net of liabilities
assumed or to which the assets are subject.
"Capital Transaction" means any transaction not in the ordinary course of
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business which results in the Company's receipt of cash or other consideration,
other than Capital Contributions, including, without limitation, proceeds of
sales or exchanges or other dispositions of property not in the ordinary course
of business, financings, refinancings, condemnations, recoveries of damage
awards and insurance proceeds.
"Carrying Value" means, with respect to any asset, the asset's adjusted
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basis for federal income tax purposes, except as follows:
(i) the initial Carrying Value of any asset contributed (or deemed
contributed) to the Company shall be such asset's fair market value
(without reduction for associated liabilities) at the time of such
contribution;
(ii) if the Company elects to adjust the Capital Account balances of
the Interest Holders to reflect the fair market value of the Company's
assets at a given time in accordance with Regulation Section 1.704-1(b) (2)
(iv) (f),
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the Carrying Values of all assets of the Company shall be adjusted to
equal their respective fair market values (without taking into account
associated liabilities) at such time; and
(iii) the Carrying Value of an asset that has been determined pursuant
to paragraph (i) or (ii) shall thereafter be adjusted as would the asset's
adjusted basis for federal income tax purposes except that Depreciation and
similar deductions shall be computed as provided under the definition of
Depreciation.
"Cash Flow" means all cash funds derived from operations of the Company or
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from any Capital Transaction (including interest received on reserves), without
reduction for any depreciation, amortization or other non-cash charges, minus
cash funds used to pay operating expenses, debt payments (including debt
payments to Members), capital improvements and replacements and reasonable
reserves for future expenses or liabilities as determined by the Members, plus
any reduction in cash reserves previously established.
"Code" means the Internal Revenue Code of 1986, as amended, or any
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corresponding provision of any succeeding law.
"Company" means the limited liability company formed in accordance with
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this Agreement.
"Depreciation" means, for each fiscal year or other period of the Company,
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an amount equal to the depreciation, amortization or other cost recovery
deduction allowable with respect to an asset for such year or other period,
except that if the Carrying Value of an asset differs from its adjusted basis
for federal income tax purposes at the beginning of such year or other period,
Depreciation shall be an amount which bears the same ratio to such beginning
Carrying Value as the federal income tax depreciation, amortization or other
cost recovery deduction for such year or other period bears to such beginning
adjusted tax basis; provided, however that if the federal income tax
depreciation, amortization or other cost recovery deduction for such year is
zero, Depreciation shall be determined with reference to such beginning Carrying
Value using any reasonable method selected by the Tax Matters Partner.
"Interest" means a Person's share of the Profits and Losses of, and the
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right to receive distributions, from, the Company.
"Interest Holder" means any Person who holds an Interest, whether as a
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Member or as an unadmitted assignee of a Member.
"Majority Vote" means the affirmative vote, approval or consent, as the
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case may be, of Members holding more than fifty percent (50%) of the total
Percentages held by all Members (and not just of those constituting a quorum)
entitled to vote on, approve or consent to the particular matter, decision or
action.
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"Member" means each Person signing this Agreement and any Person who
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subsequently is admitted as a member of the Company in accordance with this
Agreement and the Act.
"Member Loan Nonrecourse Deductions" means any Company deductions that
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would be Nonrecourse Deductions if they were not attributable to a loan made or
guaranteed by a Member within the meaning of Regulation Section 1.704-2 (i).
"Membership Rights" means all of the rights of a Member in the Company,
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including without limitation a Member's: (i) Interest; (ii) right to inspect the
Company's books and records; and (iii) right to participate in the management of
and vote on matters coming before the Company.
"Minimum Gain" has the meaning set forth in Regulation Section 1.704-2 (d).
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Minimum Gain shall be computed separately for each Interest Holder in a manner
consistent with the Regulations under Code Section 704 (b).
"Negative Capital Account" means a Capital Account with a balance of less
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than zero.
"Nonrecourse Deductions" has the meaning set forth in Regulation Section
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1.704-2 (b) (1). The amount of Nonrecourse Deductions for a taxable year of the
Company equals the net increase, if any, in the amount of Minimum Gain during
that taxable year, determined according to the provisions of Regulation Section
1.704-2 (c).
"Nonrecourse Liability" means any liability of the Company with respect to
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which no Member has personal liability, determined in accordance with Code
Section 752 and the Regulations promulgated thereunder.
"Percentage" means, as to a Member, the percentage set forth in Section 3.1
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as the same may be changed in accordance with this Agreement, and as to an
Interest Holder who is not a Member, the Percentage of the Member whose Interest
has been acquired by such Interest Holder, to the extent the Interest Holder has
succeeded to that Member's Interest.
"Person" means and includes any individual, corporation, partnership,
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association, limited liability company, trust, estate, or other legal entity.
"Positive Capital Account" means a Capital Account with a balance greater
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than zero.
"Profits" and "Losses" means, for each taxable year of the Company (or
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other period for which Profits or Losses must be computed) the Company's taxable
income or loss determined in accordance with Code Section 703 (a), with the
following adjustments:
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(i) all items of income, gain, loss, deduction or credit required to
be stated separately pursuant to Code Section 703 (a) (1) shall be included
in computing taxable income or loss;
(ii) any tax-exempt income of the Company, not otherwise taken into
account in computing Profits or Losses, shall be included in computing
taxable income or loss;
(iii) any expenditures of the Company described in Code Section 705
(a) (2) (B) (or treated as such pursuant to Regulation Section 1.704-1 (b)
(2) (iv) (i)) and not otherwise taken into account in computing Profits or
Losses, shall be subtracted from taxable income or loss;
(iv) in the event the Carrying Value of any asset of the Company is
adjusted pursuant to the definition of Carrying Value, the amount of such
adjustment shall be taken into account as gain or loss from the disposition
of such asset for purposes of computing Profits or Losses;
(v) gain or loss resulting from any disposition of any asset with
respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Carrying Value of the asset disposed
of, notwithstanding that the adjusted tax basis of such asset differs from
its Carrying Value; and
(vi) notwithstanding any other provision of this definition, any items
which are specially allocated pursuant to Section 4.2 hereof shall not be
taken into account in computing Profits or Losses.
"Regulation or Regulations" means the income tax regulations, including any
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temporary regulations, from time to time promulgated under the Code.
"Secretary" means (i) the Secretary of State of Delaware.
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"Tax Matters Person" has the meaning set forth in Section 8.5.
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"Transfer" means, when used as a noun, any voluntary sale, hypothecation,
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pledge, assignment, attachment, or other transfer, and, when used as a verb,
means, voluntarily to sell, hypothecate, pledge, assign, or otherwise transfer.
"Unanimous Vote" means the affirmative vote, approval or consent, as the
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case may be, of all of the Members (and not just of those constituting a quorum)
entitled to vote on, approve or consent to the particular matter, decision or
action.
"Withdrawal" means (i) the death or adjudication of incompetence of a
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Member who is an individual, (ii) the retirement, resignation, expulsion or
Bankruptcy of a Member, (iii) the dissolution or termination of existence of a
Member which is a legal
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entity or (iv) any Transfer or other event which terminates the continued
membership of a Member in the Company.
SECTION II. FORMATION AND NAME; OFFICE; NATURE OF BUSINESS; TERM.
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2.1. Organization. The parties shall organize a limited liability company
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pursuant to the Act and the provisions of this Agreement and, for
that purpose, shall cause a Certificate of Formation in the form attached as
Exhibit B to be executed and filed for record with the Secretary.
2.2. Name of the Company. The name of the Company shall be Douglas
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Dynamics, L.L.C. The Company may do business under that name and under any other
name or names which the Members agree upon by Unanimous Vote.
2.3. Nature of Business Permitted; Powers. The Company may carry on any
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lawful business, purpose or activity permitted by the Act. The Company shall
possess and may exercise all of the powers and privileges granted by the Act or
by any other law or this Agreement, together with any powers incidental thereto,
so far as such powers and privileges are necessary to the conduct, promotion or
attainment of the business purposes or activities of the Company.
2.4. Term. The term of the Company shall begin upon the filing of the
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Certificate of Formation with the Secretary and shall continue until the
Company's existence is terminated pursuant to Section VII of this Agreement.
2.5. Registered Agent and Office; Principal Place of Business. The
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registered office of the Company in the State of Delaware shall be located at
1209 Orange Street, Wilmington, Delaware or at any other place within the State
of Delaware which the Members agree upon by Unanimous Vote. The principal office
of the Company shall be located at 7777 North 73rd Street, Milwaukee, WI 53223
or at such other place which the Members agree upon.
2.6. Initial Members. The Initial Members are Armco Inc. and AJV
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INVESTMENTS CORP.
SECTION III. MEMBERS; CAPITAL; CAPITAL ACCOUNTS.
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3.1. Initial Capital Contributions. Upon the execution of this Agreement,
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the Members shall contribute to the Company the initial Capital Contributions
described in Sections 3.1.1 and 3.1.2 below. Armco and AJV shall have initial
Percentages of 99% and 1%, respectively, until changed in accordance with this
Agreement. These Percentages shall not be affected by the merger contemplated by
the Agreement of Merger.
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3.1.1. Initial Capital Contributions by Armco. Armco will contribute to the
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Company, as its initial Capital Contribution, cash in the amount of $99.00,
within ten (10) days from the date hereof.
3.1.2. Initial Capital Contributions by AJV. AJV will contribute to the
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Company, as its initial Capital Contribution, cash in the amount of $1.00,
within ten (10) days from the date hereof.
3.2. Additional Capital Contributions. No Member shall be required or
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obligated to contribute any additional capital to the Company except upon a
Unanimous Vote. No Member shall have any personal liability for any obligation
of the Company solely by virtue of being a Member.
3.3. No Interest on Capital Contributions. Interest Holders shall not be
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paid interest on their Capital Contributions.
3.4. Return of Capital Contributions. Except as otherwise provided in this
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Agreement, no Interest Holder shall have the right to receive the return of any
Capital Contribution.
3.5. Form of Return of Capital. If an Interest Holder is entitled to
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receive a return of a Capital Contribution, the Interest Holder shall not have
the right to receive any property except cash in return of the Interest Holder's
Capital Contribution.
3.6. Capital Accounts. A separate Capital Account shall be maintained for
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each Interest Holder.
3.7. Loan. Except upon a Unanimous Vote, no Member may make any loan to
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the Company and no Member is obligated to make any loan to the Company.
3.8. No Restoration of Capital Account. No Interest Holder with a Negative
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Capital Account shall have any obligation to the Company or the other Interest
Holders to restore such Negative Capital Account solely as a result of the
existence thereof.
SECTION IV. PROFITS, LOSSES AND DISTRIBUTIONS.
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4.1. Distributions of Cash Flow and Allocations of Profits or Losses.
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4.1.1. Profits or Losses. After giving effect to the special allocations
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set forth in Sections 4.2 and 4.3 for any taxable year of the Company, Profits
or Losses shall be allocated in accordance to the Interest Holders in proportion
to their Percentages.
4.1.2. Distributions. Cash Flow for each taxable year of the Company shall
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be distributed from time to time to the Interest Holders upon a Unanimous Vote
in proportion to their Percentages.
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4.2. Regulatory Allocations.
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4.2.1. Qualified Income Offset. No Interest Holder shall be allocated
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Losses or deductions if the allocation causes an Interest Holder to have an
Adjusted Capital Account Deficit. If an Interest Holder receives (i) an
allocation of Losses or deduction (or item thereof) or (ii) any distribution,
which in either case causes the Interest Holder to have an Adjusted Capital
Account Deficit at the end of any taxable year, then all items of income and
gain of the Company (consisting of a pro rata portion of each item of Company
income, including gross income and gain) for that taxable year shall be
allocated to that Interest Holder, before any other allocation is made of
Company items for that taxable year, in the amount and in proportions required
to eliminate the excess as quickly as possible. This Section 4.2.1 is intended
to comply with, and shall be interpreted consistently with, the "qualified
income offset" provisions of the Regulations promulgated under Code Section 704
(b).
4.2.2. Minimum Gain Chargeback. Except as set forth in Regulation Section
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1.704-2 (f) (2), (3) and (4), if during any taxable year there is a net decrease
in Minimum Gain, each Interest Holder, prior to any other allocation pursuant to
this Section IV, shall be specially allocated items of gross income and gain for
such taxable year (and, if necessary, subsequent taxable years) in an amount
equal to such Interest Holder's share of the net decrease of Minimum Gain,
computed in accordance with Regulation Section 1.704-2 (g). Allocations of gross
income and gain pursuant to this Section 4.2.2 shall be made first from gain
recognized from the disposition of Company assets subject to nonrecourse
liabilities (within the meaning of the Regulations promulgated under Code
Section 752), to the extent of the Minimum Gain attributable to those assets,
and thereafter from a pro rata portion of the Company's other items of income
and gain for the taxable year. It is the intent of the parties hereto that any
allocation pursuant to this Section 4.2.2 shall constitute a "minimum gain
chargeback" under Regulation Section 1.704-2 (f).
4.2.3. Contributed Property and Book-Ups. In accordance with Code Section
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704 (c) and the Regulations thereunder, as well as Regulation Section 1.704-1
(b) (2) (iv) (d) (3), income, gain, loss and deduction with respect to any
property contributed (or deemed contributed) to the Company shall, solely for
tax purposes, be allocated among the Interest Holders so as to take account of
any variation between the adjusted basis of the property to the Company for
federal income tax purposes and its initial Carrying Value.
4.2.4. Code Section 754 Adjustment. To the extent an adjustment to the tax
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basis of any Company asset pursuant to Code Section 734 (b) or Code Section 743
(b) is required, pursuant to Regulation Section 1.704-1 (b) (2) (iv) (m), to be
taken into account in determining Capital Accounts, the amount of the adjustment
to the Capital Accounts shall be treated as an item of gain (if the adjustment
increases the basis of the asset) or loss (if the adjustment decreases basis),
and the gain or loss shall be specially allocated to the Interest Holders in a
manner consistent with the manner in which their Capital Accounts are required
to be adjusted pursuant to that Section of the Regulations.
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4.2.5. Nonrecourse Deductions. Nonrecourse Deductions for a taxable year
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or other period shall be specially allocated among the Interest Holders in
proportion to their Percentages.
4.2.6. Member Loan Nonrecourse Deductions. Any Member Loan Nonrecourse
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Deduction for any taxable year or other period shall be specially allocated to
the Interest Holder who bears the risk of loss with respect to the loan to
which the Member Loan Nonrecourse Deduction is attributable in accordance with
Regulation Section 1.704-2 (b).
4.2.7. Withholding. All amounts required to be withheld pursuant to Code
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Section 1446 or any other provision of federal, state or local tax law shall be
treated as amounts actually distributed to the affected Interest Holders for all
purposes under this Agreement.
4.3. Liquidation and Dissolution. If the Company is liquidated, the
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assets of the Company shall be distributed to the Interest Holders in accordance
with the balances in their respective Capital Accounts, after taking into
account the allocations of Profits or Losses pursuant to Sections 4.1.1, and
distributions, if any, of cash or property pursuant to Section 4.1.2.
4.4. General.
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4.4.1. Except as otherwise provided in this Agreement, the timing and
amount of all distributions shall be determined by the Members.
4.4.2. If any assets of the Company are distributed in kind to the
Interest Holders, those assets shall be valued on the basis of their fair market
value, and any Interest Holder entitled to any interest in those assets shall
receive such interest as a tenant-in-common with all other Interest Holders so
entitled. Unless the Members otherwise agree by Unanimous Vote, the fair market
value of the assets shall be determined by an independent appraiser who shall be
selected by the Members. The Profits or Losses for each unsold asset shall be
determined as if the asset had been sold at its fair market value, and the
Profits or Losses shall be allocated as provided in Section 4.2 and shall be
properly credited or charged to the Capital Accounts of the Interest Holders
prior to the distribution of the assets in liquidation pursuant to Section 4.3.
4.4.3. All Profits and Losses shall be allocated, and all distributions
shall be made, to the Persons shown on the records of the Company to have been
Interest Holders as of the last day of the taxable year for which the allocation
or distribution is to be made. Notwithstanding the foregoing, unless the
Company's taxable year is separated into segments, if there is a Transfer or
other Withdrawal during the taxable year, the Profits and Losses shall be
allocated between the original Interest Holder and the successor on the basis of
the number of days each of them was an Interest Holder during the taxable year;
provided, however, the Company's taxable year shall be segregated into
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two or more segments in order to account for Profits, Losses or proceeds
attributable to a Capital Transaction or to any other extraordinary
non-recurring items of the Company.
4.4.4. The Members shall, upon the advice of the Company's tax counsel,
amend this Section IV to comply with the Code and the Regulations promulgated
under Code Section 704(b); provided, however, that no amendment shall materially
affect an Interest Holder's right to distributions without such Interest
Holder's prior written consent.
SECTION V. MANAGEMENT; RIGHTS, POWERS, AND DUTIES.
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5.1. Management. The business and affairs of the Company shall be managed
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by its Members in accordance with the provisions of this Agreement and the Act.
The Company shall not have any Managers as defined in the Act. The Members shall
have full and complete authority, power and discretion to direct, manage and
control the business, affairs and properties of the Company, to make all
decisions regarding such matters and to perform any and all acts and to engage
in any and all activities necessary, customary or incident to the management of
the Company's business, affairs and properties. Subject to the rights of
officers of the Company to act on behalf of the Members by virtue of the
delegation of authority by the Members to the officers of the Company pursuant
to Section 5.2, a Unanimous Vote of the Members shall be required for all
actions by the Company. Without limiting the generality of the foregoing or the
powers granted to the Company by the Act, the specific authority of Members to
act on behalf of the Company shall include the following:
5.1.1. acquire by purchase, lease or otherwise, any real or personal
property, tangible or intangible;
5.1.2. construct, operate, maintain, finance and improve, and to own,
sell, convey, assign, mortgage or lease any real estate and any personal
property;
5.1.3. sell, dispose, trade or exchange Company assets in the ordinary
course of the Company's business;
5.1.4. enter into agreements and contracts and to give receipts, releases
and discharges;
5.1.5. purchase liability and other insurance to protect the Company's
properties and business;
5.1.6. borrow money for and on behalf of the Company, and, in connection
therewith, execute and deliver instruments authorizing the confession of
judgment against the Company;
5.1.7. execute or modify leases with respect to any part or all of the
assets of the Company;
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5.1.8. prepay, in whole or in part, refinance, amend, modify, or extend
any mortgages, trust deeds or security agreements which may affect any asset of
the Company, and in connection therewith to execute for and on behalf of the
Company any extensions, renewals or modifications of such mortgages, trust deeds
or security agreements;
5.1.9. execute any and all other instruments and documents which may be
necessary or advisable to carry out the intent and purpose of this Agreement,
including without limitation documents whose operation and effect extend beyond
the term of the Company;
5.1.10. make any and all expenditures which are necessary or appropriate in
connection with the management of the affairs of the Company and the carrying
out of its obligations and responsibilities under this Agreement, including
without limitation all legal, accounting and other related expenses incurred in
connection with the organization and financing and operation of the Company; and
5.1.11. enter into any kind of activity necessary to, in connection with or
incidental to the accomplishment of the purposes of the Company.
The Members hereby specifically authorize the Company to merge with D D
Merger Corp., a Delaware corporation, in accordance with the Agreement of
Merger. The officers of the Company, or any of them, are authorized and directed
to execute the Agreement of Merger and to execute such other documents and take
such other actions as may be necessary or advisable in his, her or their
judgment to consummate the merger contemplated by the Agreement of Merger.
5.2. Officers.
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The officers of the Company shall include a President, one or more Vice
Presidents, a Secretary and a Treasurer, and one or more assistant officers
appointed in accordance with the provisions of this Section 5.2. The following
provisions shall apply with respect to officers:
5.2.1. Any number of offices may be held by the same person.
5.2.2. Any officer may be removed, with or without cause, by the Members
or by such other officer, if any, upon whom such power of removal may be
conferred by the Members. Any officer may resign at any time by giving written
notice to the Company. Any resignation shall take effect at the time of the
receipt of such notice or at any later time specified in such notice. Unless
otherwise specified in such notice, acceptance of the resignation shall not be
necessary to make it effective.
5.2.3. Any vacancy in any office because of death, resignation, removal,
disqualification or other cause shall be filled by the Members. The President
may make
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temporary appointments to a vacant office (other than the President's office)
pending action by the Members.
5.2.4. The President shall be the principal executive officer of the
Company and, subject to the control and direction of the Members, shall in
general supervise and control all of the day-to-day business and affairs of the
Company unless the Members appoint another individual to so preside. An
individual chosen by Unanimous Vote of the Members from time to time shall
preside at all meetings of the Members. Subject to the other provisions of this
Agreement, the President shall have the authority, subject to such rules as may
be prescribed by the Members, to appoint such agents and employees of the
Company as he or she shall deem necessary, to prescribe their powers, duties and
compensation, and to delegate authority to them. Such agents and employees shall
hold office at the discretion of the President and the Members. Subject to any
required authorization by the Members acting on their behalf, the President
shall have authority to execute and acknowledge, on behalf of the Company, all
deeds, mortgages, bonds, contracts, leases and all other agreements, documents
and instruments necessary or proper to be executed in the course of the
Company's regular business.
5.2.5. In the absence of the President, or in the event of the President's
death, inability or refusal to act, or in the event for any reason it shall be
impracticable for the President to act personally, a Vice President (or in the
event there be more than one Vice President, the Vice Presidents in the order
designated by the Members, or in the absence of any designation, then in the
order of their appointment), if one is appointed, shall perform the duties of
the President, and when so acting, shall have all the powers of and be subject
to all the restrictions on the President. The execution of any agreement,
document or instrument of the Company by any Vice President shall be conclusive
evidence, as to third parties, of the Vice President's authority to act in the
stead of the President.
5.2.6. The Secretary shall: (i) keep (or cause to be kept) regular minutes
of all meetings of the Members in one or more books provided for that purpose;
(ii) use his or her best efforts to ensure that all notices are duly given in
accordance with the provisions of this Agreement or as required by law; (iii) be
custodian of the records of the Company; (iv) sign with the President, or a Vice
President, certificates representing Interests in the Company, if the issuance
thereof shall have been authorized by resolution of the Members; (v) have
general charge of the transfer books of the Company; and (vi) in general perform
all duties incident to the office of Secretary and have such other duties and
exercise such authority as from time to time may be delegated or assigned to him
or her by the President or by the Members.
5.2.7. The Treasurer, if one is appointed, shall: (i) have charge and
custody of and be responsible for all funds and securities of the Company; (ii)
receive and give receipts for moneys due and payable to the Company from any
source whatsoever, and deposit all such moneys in the name of the Company in
such banks, trust companies or other depositaries as shall be selected by the
Company; and (iii) in general perform all of the duties incident to the office
of Treasurer and have such other duties and
13
exercise such other authority as from time to time may be delegated or assigned
to him or her by the President or by the Members.
5.2.8. The Members may appoint such additional officers as they determine
by Unanimous Vote, each of whom shall hold office for such period and have such
authority and perform such duties as are provided for in this Agreement or as
they from time to time determine.
5.2.9. The Members shall have the power to appoint any person to act as
assistant to any officer, or as agent for the Company in the officer's stead, or
to perform the duties of such officer whenever for any reason it is
impracticable for such officer to act personally, and such assistant or acting
officer or other agent so appointed by the Members shall have the power to
perform all the duties of the office to which that person is so appointed to be
assistant, or as to which he or she is so appointed to act, except as such power
may be otherwise defined or restricted by the Members.
5.2.10. The salaries of the officers, if any, shall be fixed from time to
time by the Members.
5.2.11. Nothing contained in this Section 5.2 shall affect or be construed
as affecting the terms of any contract of employment between the Company and any
officer.
5.2.12. The initial officers of the Company are:
Name Title
---- -----
Robert A. Morrison President and Chief Executive Officer
John B. Corey Vice President
David A. Higbee Vice President
Gary R. Hildreth Secretary
James L. Bertsch Treasurer
Carlos M. Hernandez Assistant Secretary
James R. Roethle Assistant Secretary
5.2.13. Notwithstanding anything in this Section 5.2 to the contrary, the
officers shall not have the authority to do any of the following on behalf of
the Company unless the same has been specifically approved by the prior
Unanimous Vote of the Members acting directly and not through any officers:
(i) Engage in any act in contravention of this Agreement or the Act;
(ii) Confess a judgment against the Company in connection with any
threatened or pending legal action;
(iii) Possess any Company asset or assign the rights of the Company in
any Company property for other than a Company purpose;
14
(iv) Dissolve the Company;
(v) Amend the Company's Certificate of Formation or this Agreement;
(vi) Sell, lease, exchange or dispose of all, or substantially all, of
the property or assets of the Company, or merge or adopt a plan of merger;
(vii) Purchase any Interest;
(viii) Sell any Interest to any Person;
(ix) Make any distribution;
(x) Guarantee or otherwise act as a surety or accommodation party to
any indebtedness or liability of any Person, other than endorsement of checks in
the normal course of collection; or
(xi) Establish the compensation of officers.
5.3. Meetings of and Voting by Members.
---------------------------------
5.3.1. Meetings. Meetings of the Members, for any purpose or purposes,
--------
unless otherwise prescribed by the Act, may be called by any Member.
5.3.2. Place of Meetings. The Members by Unanimous Vote may designate any
-----------------
place, either within or outside of the State of Delaware, as the place of
meeting for any meeting of the Members. If no designation is made, the place of
meeting shall be the Company's principal place of business.
5.3.3. Notice of Meetings. Except as provided in Section 5.3.4. or as
------------------
required by the Act, written notice stating the place, day and hour of the
meeting shall be delivered not less than five (5) nor more than fifty (50) days
before the date of the meeting. Notice of an annual meeting need not describe
any purpose for which it is called, but notice of a special meeting shall
include a brief description of each purpose for which it is called. All notices
shall be given in the manner provided in Section 9.2. If an annual or special
meeting is adjourned to a different date, a new notice of the new date, time and
place is required to be given if and only if (i) a new record date is
established as provided in Section 5.3.5, or (ii) the date, time and place are
not announced at the originally scheduled meeting before adjournment.
5.3.4. Meeting of all Members. If all of the Members shall meet at any
----------------------
time and place, either within or outside of the State of Delaware, and consent
to the holding of a meeting at such time and place, such meeting shall be valid
without call or notice, and at such meeting any lawful action may be taken.
5.3.5. Record Date. For the purpose of determining Members entitled to
-----------
notice or to vote at any meeting of Members or any adjournment thereof, or
Members
15
entitled to receive payment of any distribution, the date on which notice of the
meeting is mailed or the date on which the resolution declaring such
distribution is adopted, as the case may be, shall be the record date for such
determination of Members. When a determination of Members entitled to vote at
any meeting of Members has been made as provided in this Section 5.3.5., such
determination shall apply to any adjournment thereof unless the adjournment is
for more than one hundred twenty (120) days, in which event a new record date
shall be established as provided in this Section 5.3.5.
5.3.6. Quorum. Members holding all of the Percentages, represented in
------
person or by proxy, shall constitute a quorum at any meeting of Members.
In the absence of a quorum at any such meeting, Members holding a majority of
the Percentages so represented may adjourn the meeting from time to time. The
Members present at a duly organized meeting may continue to transact business
for the remainder of the meeting and for any adjournment of that meeting unless
a new record date is or must be set for that adjourned meeting.
5.3.7. Required Vote. A Unanimous Vote of the Members present in person or
-------------
by proxy shall be the act of the Members, unless a different vote is required by
law or this Agreement. Unless otherwise expressly provided herein or required
under applicable law, Members who have an interest (economic or otherwise) in
the outcome of any particular matter may nevertheless participate in a vote or
consent upon such matter and their vote or consent shall be counted in
determining whether the requisite approval was given by the Members.
5.3.8. Proxies. At all meetings of Members, a Member may vote in person or
-------
by proxy executed in writing by the Member or a duly authorized
attorney-in-fact. Such proxy shall be filed with the Secretary of the Company
before or at the time of the meeting. No proxy shall be valid after eleven (11)
months from the date of its execution, unless otherwise expressly provided in
the proxy.
5.3.9. Action by Members Without a Meeting. Any action required or
-----------------------------------
permitted to be taken at a meeting of Members may be taken without a meeting if
the action is evidenced by one or more written consents describing the action
taken, signed by all of the Members. Such written consents shall be delivered to
the Secretary of the Company for inclusion in the minutes or for filing with the
Company records. Consents may be executed in counterparts. Action taken under
this Section 5.3.9 is effective when the last Member has signed the consent,
unless the consent specifies a different effective date. The record date for
determining Members entitled to take action without a meeting shall be the date
the first Member signs the written consent.
5.3.10. Waiver of Notice. When any notice is required to be given to any
----------------
Member, a waiver thereof in writing signed by such Member before, at or after
the time stated therein shall be equivalent to the giving of such notice.
5.3.11. Meetings By Telephone or Other Communication Technology. Any or all
-------------------------------------------------------
Members may participate in a meeting by, or conduct the meeting through the
16
use of, telephone or any other means of communication by which either: (a) all
participating Members may simultaneously hear each other during the meeting or
(b) all communication during the meeting is immediately transmitted to each
participating Member, and each participating Member is able to immediately send
messages to all other participating Members. If a meeting will be conducted
through the use of any means described in this Section 5.3.11, all participating
Members shall be informed that a meeting is taking place at which official
business may be transacted. A Member participating in a meeting by any means
described in this Section 5.3.11 is deemed to be present in person at the
meeting.
5.4. Duties of Members.
-----------------
5.4.1. The Members shall devote such time to the business and affairs of
the Company as is necessary to carry out their duties set forth in this
Agreement.
5.4.2. Except as otherwise expressly provided in Sections 5.4.3 and subject
to any restrictions on a Member as such Member agrees to in writing, nothing in
this Agreement shall be deemed to restrict in any way the rights of any Member,
or of any Affiliate of any Member, to conduct any other business or activity
whatsoever, and the Member shall not be accountable to the Company or to any
Member with respect to that business or activity even if the business or
activity competes with the Company's business; and the organization of the
Company shall be without prejudice to the Members' respective rights (or the
rights of their respective Affiliates) to maintain, expand or diversify such
other interests and activities and to receive and enjoy profits or compensation
therefrom.
5.5. Liability and Indemnification.
-----------------------------
5.5.1. No Member (or any officer or director thereof), and no officer of
the Company, shall be liable, responsible, or accountable, in damages or
otherwise, to any Member or to the Company for any act performed by such
individual within the scope of the authority conferred on the individual by this
Agreement, except for fraud, negligence or an intentional breach of this
Agreement.
5.5.2. The Company shall indemnify each Member, and its officers and
directors, and each officer of the Company (each an "Indemnified Party"), for
all liabilities, actions, damages, costs and expenses (including without
limitation reasonable attorneys' fees) incurred by the Indemnified Party as a
result of, arising out of or incidental to any act or omission of the
Indemnified Party with respect to the Company or its business, as and to the
full extent permitted by the Act, but in no event for fraud, negligence or an
intentional breach of this Agreement. The Company may in its discretion advance
expenses to the Indemnified Party, subject to an agreement that the Indemnified
Party repay such amounts if the Indemnified Party is determined to be not
entitled to indemnification hereunder. Whenever any indemnification has been
paid or expenses advanced to any Indemnified Party, such occurrence shall be
reported to the Members prior to or with the next notice of a meeting of
Members.
17
5.6. Expenses; Reimbursement to the Members. Except as otherwise
--------------------------------------
specifically provided in this Agreement, all expenses of the Company may be
billed directly to, and shall be paid by, the Company. The Members and their
Affiliates shall be reimbursed by the Company for all out-of-pocket expenses
reasonably incurred or paid by them on behalf of the Company, upon submission to
the Company of documentation substantiating such expenses. Each of the Members
shall be entitled to be reimbursed for all out-of-pocket costs and expenses,
including without limitation, attorneys' fees incident to the Company's
formation.
5.7. Salaries. No Member shall be paid any salary or other compensation
--------
except as approved from time to time by a Unanimous Vote.
5.8. Transactions with Members and Affiliates. The Company may enter into
----------------------------------------
agreements with any Member or any Affiliate thereof for the provision of
property, goods or services to the fullest extent permitted by the Act.
SECTION VI. TRANSFER OF INTERESTS AND WITHDRAWALS OF MEMBERS.
------------------------------------------------
6.1. Transfers.
---------
6.1.1. No Person may Transfer all or any portion of or any interest or
rights in the Person's Membership Rights or Interest.
6.1.2. Each Member hereby acknowledges the reasonableness of the
prohibition contained in this Section 6.1 in view of the purposes of the Company
and the relationship of the Members. The Transfer of any Membership Rights or
Interests in violation of the prohibition contained in this Section 6.1 shall be
deemed invalid, null and void, and of no force or effect.
6.2. Withdrawal. No Member shall have the right to cause such Member's
----------
Withdrawal from the Company. Any Member who shall intentionally or voluntarily
cause a Withdrawal shall be in breach of this Agreement and liable to the other
Members and the Company for damages.
SECTION VII. DISSOLUTION, LIQUIDATION AND TERMINATION OF THE COMPANY.
-------------------------------------------------------
7.1. Events of Dissolution. The Company shall be dissolved upon the
---------------------
happening of any of the following events:
7.1.1. upon an Unanimous Vote;
7.1.2. at 11:59 p.m. on December 31, 2050;
7.1.3. upon the Withdrawal of any Member; or
18
7.1.4. upon the entry of a decree of judicial dissolution under Section
18-802 of the Act.
7.2. Procedure for Winding Up and Dissolution. If the Company is
----------------------------------------
dissolved, the Members shall wind up its affairs. Upon the winding up of the
Company, the assets of the Company, after the provision for claims and
obligations referred to below, shall be distributed as follows:
7.2.1. To creditors, including Members who are creditors, to the extent
otherwise permitted by law, in satisfaction of liabilities of the Company
(whether by payment or the making of reasonable provision for payment thereof)
other than liabilities for which reasonable provision for payment has been made
and liabilities for distributions to Members under Section 18-601 or Section
18-604 of the Act;
7.2.2. To the Members and former Members in satisfaction of liabilities for
distributions under Section 18-601 or Section 18-604 of the Act; and
7.2.3. To the Interest Holders in accordance with the balances in their
respective Capital Accounts, after taking into account the allocations of
Profits or Losses pursuant to Section 4.1.1 and distributions, if any, of cash
or property pursuant to Section 4.1.2.
The Company shall pay or make reasonable provision to pay all claims and
obligations, including all contingent, conditional or unmatured claims and
obligations, known to the Company and all claims and obligations which are known
to the Company but for which the identity of the claimant is unknown. If there
are sufficient assets, such claims and obligations shall be paid in full and any
such provision for payment shall be made in full. If there are insufficient
assets, such claims and obligations shall be paid or provided for according to
their priority and, among claims and obligations of equal priority, ratably to
the extent of assets therefor. In the event that it is later determined that
funds reserved for anticipated claims and obligations exceed the amount of such
claims and obligations, such excess shall be distributed to the Interest Holders
in accordance with Section 7.2.3.
7.3. Filing of Certificate of Cancellation. If the Company is dissolved,
-------------------------------------
the Members shall promptly file a Certificate of Cancellation with the
Secretary. If there are no remaining Members, the Certificate shall be filed by
the last Person to be a Member; if there is no Person who last was a Member, the
Certificate shall be filed by the legal or personal representatives of the
Person who last was a Member.
SECTION VIII. BOOKS, RECORDS, ACCOUNTING AND TAX ELECTIONS.
--------------------------------------------
8.1. Bank Accounts. All funds of the Company shall be deposited in a bank
-------------
account or accounts maintained in the Company's name. The Members shall
determine the institution or institutions at which the accounts will be opened
and maintained, the
19
types of accounts, and the Persons who will have authority with respect to the
accounts and the funds therein.
8.2. Books and Records.
-----------------
8.2.1. The Members shall keep or cause to be kept complete and accurate
books and records of the Company and supporting documentation of the
transactions with respect to the conduct of the Company's business. The records
shall include, but not be limited to, all records required to be kept by the Act
and complete and accurate information regarding the state of the business and
financial condition of the Company, a copy of the Certificate of Formation, this
Agreement and all amendments thereto, a current list of the names and last known
business, residence and/or mailing addresses of each Member, and the Company's
foreign, federal, state and local tax returns.
8.2.2. The books and records shall be maintained in accordance with sound
accounting practices and shall be available at the Company's principal office
for examination by any Member or the Member's duly authorized representative at
any and all reasonable times during normal business hours.
8.2.3. Each Member shall reimburse the Company for all costs and expenses
incurred by the Company in connection with the Member's inspection and copying
of the Company's books and records.
8.3. Annual Accounting Period. The annual accounting period of the
------------------------
Company shall be its taxable year. The Company's taxable and fiscal year shall
be January 1 through December 31 unless the Members elect a different year.
8.4. Reports. Within seventy-five (75) days after the end of each taxable
-------
year of the Company, the Members shall cause to be sent to each Person who was a
Member at any time during the accounting year then ended unaudited financial
statements. However, upon the agreement of the Members, an independent certified
public accounting firm selected by the Members shall conduct an audit of the
Company's financial statements. The cost of each such audit shall be borne by
the Company. In addition, within seventy-five (75) days after the end of each
taxable year of the Company, the Company shall cause to be sent to each Person
who was an Interest Holder at any time during the taxable year then ended, such
tax information concerning the Company which is necessary for preparing the
Interest Holder's income tax returns for that year.
8.5. Tax Matters Person. Such individual designated from time to time in
------------------
writing by Armco shall be the Company's "Tax Matters Person. The Tax Matters
Person shall have all powers and responsibilities provided to so-called tax
matters partners under Code Section 6221, et seq., or such other provisions as
may become applicable to limited liability companies. The Tax Matters Person
shall keep all Members informed of all notices from government taxing
authorities which may come to the attention of the Tax Matters Person. The
Company shall pay and be responsible for all reasonable third-party costs and
expenses incurred by the Tax Matters Person in performing those duties. Such
20
a Member shall be responsible for any costs incurred by such Member with respect
to any tax audit or tax-related administrative or judicial proceeding against
any Member, even though it relates to the Company. The Tax Matters Person may
not compromise any dispute with the Internal Revenue Service without Unanimous
Vote of the Members.
8.6. Tax Elections. All elections permitted to be made by the Company
-------------
under federal or state income, franchise or other tax laws, including without
limitation the elections referred to in Sections 734, 743 and 754 of the Code,
shall be determined by a Unanimous Vote, and each of the members, upon request,
shall supply to the Company such information as may be necessary to give proper
effect to any such election.
8.7. Title to Company Property.
-------------------------
8.7.1. Except as provided in Section 8.7.2, all real and personal property
acquired by the Company shall be acquired and held by the Company in its name.
8.7.2. Upon a Unanimous Vote, legal title to all or any portion of the
Company's property be acquired or held in a name other than the Company's name.
Without limiting the foregoing, upon a Unanimous Vote title may be acquired and
held in a Members' name in the names of trustees or nominees for the Company. It
is expressly understood and agreed that the manner of holding title to the
Company's property (or any part thereof) is solely for the convenience of the
Company, and all of such property shall be treated as Company property.
SECTION IX. GENERAL PROVISIONS.
------------------
9.1. Assurances. Each Member shall execute all such certificates and
----------
other documents and shall do all such filing, recording, publishing and other
acts as the other Member reasonably deem appropriate to comply with the
requirements of law for the formation and operation of the Company and to comply
with any laws, rules and regulations relating to the acquisition, operation, or
holding of the property of the Company.
9.2. Notifications. Any notice, demand, consent, election, offer,
-------------
approval request or other communication (collectively, a "Notice") required or
permitted under this Agreement shall be in writing and either delivered
personally sent by certified or registered mail, postage prepaid, return receipt
requested sent by recognized overnight delivery service or by facsimile
transmittal. Each Notice shall be addressed to an Interest Holder at the
Interest Holder's last known address on the records of the Company. A Notice to
the Company shall be addressed to the Company's principal office. A Notice
delivered personally will be deemed given only when acknowledged in writing by
the person to whom it is delivered. A Notice that is sent by mail will be deemed
given three (3) business days after it is mailed. A Notice sent by recognized
overnight delivery service will be deemed given when received or refused. A
Notice sent by facsimile shall be deemed given when sent provided Notice by
personal delivery or overnight delivery service is made the next business day
following the day such facsimile transmission
21
occurs. Any party may designate, by Notice to all of the others, substitute
addresses or addressees for Notices; and, thereafter, Notices are to be directed
to those substitute addresses or addressees.
9.3. Specific Performance. The parties recognize that irreparable injury
--------------------
will result from a breach of any provision of this Agreement and that money
damages will be inadequate to fully remedy the injury. Accordingly, in the event
of a breach or threatened breach of one or more of the provisions of this
Agreement, any party who may be injured (in addition to any other remedies which
may be available to that party) shall be entitled to one or more preliminary or
permanent orders (i) restraining and enjoining any act which would constitute a
breach or (ii) compelling the performance of any obligation which, if not
performed, would constitute a breach.
9.4. Complete Agreement. This Agreement constitutes the complete and
------------------
exclusive statement of the agreement among the Members. It supersedes all prior
written and oral statements, including any prior representation, statement,
condition, or warranty. Except as expressly provided otherwise herein, this
Agreement may not be amended without the written consent of all of the Members.
9.5. Applicable Law. All questions concerning the construction, validity
--------------
and interpretation of this Agreement and the performance of the obligations
imposed by this Agreement shall be governed by the internal law, not the law of
conflicts, of the State of Delaware.
9.6. Section Titles. The headings herein are inserted as a matter of
--------------
convenience only, and do not define, limit or describe the scope of this
Agreement or the intent of the provisions hereof.
9.7. Binding Provisions. This Agreement is binding upon, and inures to
------------------
the benefit of, the parties hereto and their respective heirs, executors,
administrators, personal and legal representatives, successors and permitted
assigns.
9.8. Construction. Common nouns and pronouns shall be deemed to refer to
------------
the masculine, feminine, neuter, singular and plural, as the identity of the
Person may in the context require. References to Sections herein include all
subsections which are subsidiary to the Section referred to.
9.9. Separability of Provisions. Each provision of this Agreement shall
--------------------------
be considered separable. If, for any reason, any provision or provisions herein
are determined to be invalid and contrary to any existing or future law, such
invalidity shall not impair the operation of or affect those portions of this
Agreement which are valid.
9.10. Counterparts. This Agreement may be executed simultaneously in two
------------
or more counterparts, each of which shall be deemed an original and all of
which, when taken together, constitute one and the same document. The signature
of any party to any
22
counterpart shall be deemed a signature to, and may be appended to, any other
counterpart.
9.11. Estoppel Certificate. Each Member shall, within ten (10) days after
--------------------
written request by any Member, deliver to the requesting Person a certificate
stating, to the Member's knowledge, that: (a) this Agreement is in full force
and effect; (b) this Agreement has not been modified except by any instrument or
instruments identified in the certificate; and (c) there is no default hereunder
by the requesting Person; provided, however, that if there is any exceptions to
the foregoing, the certificate shall state in reasonable detail the nature and
extent thereof.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
set forth above.
ARMCO INC.
By: /s/ David G. Harmer
----------------------------------
Name: David G. Harmer
----------------------------------
Title: Corporate Vice President
----------------------------------
AJV INVESTMENTS CORP.
By: /s/ Carlos M. Hernandez
----------------------------------
Name: Carlos M. Hernandez
----------------------------------
Title: Vice President
----------------------------------
23
LIST OF EXHIBITS
----------------
Exhibit Description
------- -----------
A Agreement of Merger
B Certificate of Formation
AGREEMENT OF MERGER
OF
D D MERGER CORP.
INTO
DOUGLAS DYNAMICS, L.L.C.
THIS AGREEMENT OF MERGER (the "Agreement") is made as of this 27th day of
June, 1995 by and between D D Merger Corp., a Delaware corporation ("DDMC") and
Douglas Dynamics, L.L.C., a Delaware limited liability company ("Douglas").
RECITALS
WHEREAS, the Board of Directors of DDMC and the members of Douglas have
determined that the merger of DDMC into Douglas (the "Merger") is advisable,
fair and in the best interests of both entities; and
WHEREAS, the stockholders of DDMC, by resolutions duly adopted, have
approved and adopted the Merger and this Agreement.
NOW, THEREFORE, in consideration of the Recitals and of the mutual
agreements and covenants set forth in this Agreement of Merger and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, DDMC and Douglas hereby agree as follows:
ARTICLE I
EXISTENCE OF THE SURVIVING ENTITY
At the Effective Time of Merger, DDMC shall be merged with and into Douglas
which shall be the surviving entity. The identity, existence, purposes, powers,
franchises, privileges, assets, properties and rights of Douglas (hereinafter
sometimes referred to as the "Surviving Entity") shall continue unaffected and
unimpaired by the Merger and the identity, existence, purposes, powers,
franchises, privileges, assets, properties and rights of DDMC shall be merged
into the Surviving Entity and the Surviving Entity shall be fully vested
therewith. The separate existence of DDMC, except insofar as otherwise
specifically provided by law, shall cease at the Effective Time of Merger
whereupon DDMC and the Surviving Entity shall be and become one single entity.
ARTICLE II
CERTIFICATE OF FORMATION OF SURVIVING ENTITY
At the Effective Time of Merger, the Certificate of Formation of Douglas
shall remain the Certificate of Formation of the Surviving Entity, and shall be
unaffected by the Merger.
ARTICLE III
LIMITED LIABILITY COMPANY AGREEMENT OF SURVIVING ENTITY
The Limited Liability Company Agreement of Douglas as in effect immediately
prior to the Effective Time of Merger shall be the Limited Liability Company
Agreement of the Surviving Entity until amended in accordance with law.
ARTICLE IV
MEMBERS OF SURVIVING ENTITY
The members of Douglas immediately prior to the Effective Time of Merger
shall remain the members of the Surviving Entity.
ARTICLE V
SHARES OF DDMC STOCK
At the Effective Time of Merger, and without any action on the part of the
holders thereof, all shares of capital stock of DDMC that are issued and
outstanding shall be canceled and retired and cease to exist and no other
consideration shall be issued or delivered in exchange therefor.
ARTICLE VI
EFFECT OF THE MERGER
At the Effective Time of Merger, the effect of the Merger shall be as
provided in Section 18-209(g) of the Delaware Code.
ARTICLE VII
EFFECTIVE TIME OF MERGER
The Effective Time of Merger shall be the time of filing the Certificate of
Merger with the Delaware Secretary of State.
2
ARTICLE VIII
REGISTERED OFFICES OF CONSTITUENT ENTITIES
The registered offices of both DDMC and Douglas are located in New Castle
County, Delaware. The registered office of the Surviving Entity from and after
the Effective Time of Merger shall be located in New Castle County, Delaware.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement of
Merger to be executed on its behalf on the day and year first above written.
D D MERGER CORP.
By: /s/ John B. Corey
-----------------------------------------
John B. Corey,
Vice President
Attest: /s/ Gary R. Hildreth
-------------------------------------
Gary R. Hildreth,
Secretary
DOUGLAS DYNAMICS, L.L.C.
By: ARMCO INC., Member
By: /s/ David G. Harmer
------------------------------------
David G. Harmer
Corporate Vice President
By: AJV INVESTMENTS CORP.,
Member
By: /s/ Carlos M. Hernandez
------------------------------------
Carlos M. Hernandez
Vice President
3
CERTIFICATE OF FORMATION
OF
DOUGLAS DYNAMICS, L.L.C.
The undersigned, for purposes of forming a limited liability company in
accordance with the laws of the State of Delaware, hereby states as follows:
1. The name of the limited liability company is Douglas Dynamics, L.L.C.
2. The address of its registered office in the State of Delaware is
Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County
of New Castle. The name of its registered agent at such address is The
Corporation Trust Company.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Formation of Douglas Dynamics, L.L.C. this 26th day of June, 1995.
/s/ Thomas A. Simonis
-----------------------------
Thomas A. Simonis
Sole Organizer