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                                                                  Exhibit 10.16

                     SEVERANCE AGREEMENT AND GENERAL RELEASE

This Severance Agreement and General Release ("Agreement") is made as of the 6th
day of October, 1999, by and among GROVE INVESTORS LLC and GROVE WORLDWIDE LLC,
both Delaware limited liability companies, with their principal offices at 1565
Buchanan Trail East, Shady Grove, Pennsylvania 17256-0021 (hereinafter, and
together with their respective subsidiaries and affiliates, collectively
"Grove") and SALVATORE J. BONANNO, residing at P.O. Box 763, Blue Ridge Summit,
Pennsylvania 17214 ("Employee"). The parties agree as follows:

1.   This Agreement confirms the Employee's termination of employment with Grove
     effective October 19, 1999, pursuant to the written notice to Employee
     dated October 5, 1999. As consideration for this Agreement, Grove hereby
     agrees as follows:

         (a)      SEVERANCE PAY. During the period from October 19, 1999 through
                  October 18, 2001, Grove will pay Employee his current monthly
                  base salary ($41,667), subject to subparagraph (e) herein. All
                  of these payments will be paid monthly on normal pay dates net
                  of normal payroll deductions, and such payments will be mailed
                  to the Employee's residence;

         (b)      VACATION PAY. Within ten (10) days of Employee's signing this
                  Agreement, Grove will pay Employee $25,000 for thirteen (13)
                  remaining unused vacation days. Inasmuch as Employee will no
                  longer be employed by Grove after October 19, 1999, Employee
                  will no longer accrue any vacation after that date;

         (c)      BONUS PAYMENT. During the period from October 19, 1999 through
                  October 18, 2001, Grove will pay Employee a monthly bonus
                  severance of $41,666.67, equal to one-twelfth of Employee's
                  target bonus amount ($500,000) in effect for the year of
                  termination of employment, regardless of actual operating
                  results during such period. All of these payments will be paid
                  monthly, subject to subparagraph (i) herein, on normal pay
                  dates net of normal payroll deductions, and such payments will
                  be mailed to the Employee's residence;

         (d)      ADDITIONAL BONUS. Grove will pay the Employee a special bonus
                  in the amount of $450,000, net of normal payroll deductions,
                  to be paid on March 31, 2000;

         (e)      ACCELERATED PAYMENT FOR TAX PURPOSES. At Employee's request to
                  make additional cash available to Employee at the time his
                  income taxes for 1999 become due, Grove agrees that the
                  payment to Employee on March 31, 2000 (not including the
                  additional bonus in (d) above) will include portions of future
                  payments such that the gross amount shall be $250,000. Since
                  Employee would otherwise have been entitled to only a gross
                  amount of $83,333.67 ($41,667 in monthly severance and
                  $41.666.67 in monthly bonus, before normal payroll deductions
                  and any offset for payment against Note 1), Grove will advance
                  (from future payment entitlements) $166,666.33 to Employee on
                  this date. During each of the eighteen (18) months following
                  this payment (i.e., beginning in April 2000
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Severance Agreement and General Release
Salvatore J. Bonanno
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                  and continuing through September 2001), Grove will withhold
                  and offset $9,259.24 (one-eighteenth of the amount advanced)
                  from the monthly severance payment amount otherwise due to
                  Employee under subparagraph (a) above (I.E., Employee will
                  receive $32,407.76 in monthly severance pay, net of normal
                  payroll deductions, during these eighteen (18) months);

         (f)      MEDICAL BENEFITS. During the period from October 19, 1999
                  through October 18, 2001, Employee may elect to participate in
                  the following Grove programs (or the then current programs in
                  effect and available to active employees of Grove) provided
                  that Employee makes the same contributions as if he were an
                  active Grove employee:
                  (i)      Group Life Insurance;
                  (ii)     High Option Blue Cross and Blue Shield PPO Medical
                           Plan with Prescription Drug; and
                  (iii)    Group Comprehensive Dental/Vision.

                  During this same period, however, Employee is not eligible to
                  participate in (i) the Exec-U-Care Medical Plan; (ii) the
                  Grove U.S. L.L.C. Retirement Savings & Investment Plan; (iii)
                  the Grove Long Term Disability Income Plan; or (iv) the
                  executive car allowance program;

         (g)      RETURN OF GROVE PROPERTY. Employee shall immediately return
                  any and all property belonging to Grove, including (i)
                  computer equipment (laptop, printer, modem, ETC.); (ii) mobile
                  or cellular phone equipment; (iii) keys and identification
                  badges; and (iv) company credit cards, phone calling cards,
                  ETC.;

         (h)      TAX PREPARATION. The advice and services of KPMG's tax
                  consultants shall be available to Employee in preparation of
                  Employee's federal and state tax returns for tax year 1999;

         (i)      LOAN. Under a Promissory Note for $1,000,000 dated June 27,
                  1998 ("Note 1"), any unpaid Principal Amount and all unpaid
                  interest accrued thereon is due and payable by Employee to
                  Grove at the time the Employee receives proceeds from the
                  redemption of his ownership Interests (SEE Paragraph 6 below).
                  As of the Closing date (November 15, 1999, SEE Paragraph 5
                  below), the unpaid interest accrued on Note 1 will amount to
                  $111,349.31 (assuming Employee makes no payments prior to that
                  date). To the extent that any Principal Amount and accrued
                  interest thereon remains unpaid after this date, Grove shall
                  withhold and offset fifty percent (50%) of the after-tax
                  proceeds of the monthly bonus payments (I.E., net of normal
                  payroll deductions) under subparagraph (c) above until such
                  time as Employee's payment obligations under Note 1 are fully
                  satisfied;

         (j)      LOAN. Under a Second Amended and Restated Promissory Note for
                  $912,663 dated June 27, 1998 ("Note 2"), any unpaid Principal
                  Amount and all unpaid
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Severance Agreement and General Release
Salvatore J. Bonanno
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                  interest accrued thereon is due and payable by Employee to
                  Grove on June 27, 2005 (seven years), unless Note 2 is
                  forgiven upon the occurrence of certain events, including
                  involuntary discharge. Under the Amended and Restated
                  Promissory Note, a Forgivable Portion of $453,391 was to be
                  applied against the note upon the occurrence of certain
                  events, including involuntary discharge. Separately, under a
                  Bonus Cancellation Agreement, Employee waived all rights and
                  interests to a bonus payment of $450,000, originally scheduled
                  to be paid on March 31, 1999. This amount was added to the
                  Forgivable Portion and applied against Note 2. Further,
                  Employee made a cash payment of $9,272 for accrued interest on
                  Note 2 by check payable to Grove dated October 18, 1999. As a
                  result, Note 2 and all accrued interest related thereto will
                  be forgiven(1); and

         (k)      TERMINATION OF EMPLOYMENT. Nothing in this Agreement,
                  including, but not limited to, Grove's payment of
                  consideration to Employee under this Agreement, shall be
                  construed as evidence that Employee remains an employee of
                  Grove after October 19, 1999.

2.       In consideration of the payments and benefits being provided by Grove
         as set forth in Paragraph 1 above, Employee agrees to execute and
         fulfill the responsibilities and obligations set forth in this
         Agreement.

3.       Other than the bonus payments under Paragraph 1(c), there is no amount
         due for Incentive Compensation under the Grove Short Term Incentive
         Plan ("STIP") for the completed months of Employee's employment with
         Grove during fiscal year 1999. Employee will not be eligible to
         participate in or accrue any benefit under the STIP for fiscal year
         2000 or beyond.

4.       All of the Employee's options to obtain Class A units under the
         Management Option Plan are unvested, and hence are automatically
         canceled without consideration.

5.       Under the Call Notice provision of Section 11.1(d) of The Second
         Amended and Restated Limited Liability Company Agreement of Grove
         Investors LLC dated as of June 27, 1998 (as amended, the "LLC
         Agreement"), Grove Investors may exercise its Termination Call Right
         and elect to purchase the Employee's Interests at any time after the
         Employee's termination. This Agreement constitutes written notice of
         Grove Investors' Termination Call Notice under that provision. Pursuant
         to Section 11.1(e) of the LLC Agreement, the closing of the purchase of
         the Termination Called Interest shall be held on November 15, 1999 (the
         "Closing"), at which time the Employee will be paid the relevant
         termination call price, subject to Paragraph 6 below. Upon consummation
         of the Closing, Employee shall cease to be a Member of Grove Investors
         LLC.

----------
(1) Forgiveness of Note 2 under this Agreement is a realizable event for tax
purposes. The forgivable portion of Note 2 ($903,391) will be reported to the
IRS on a Form 1099 for tax year 1999.
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Severance Agreement and General Release
Salvatore J. Bonanno
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6.       Having given the Employee the Termination Call Notice, Grove Investors
         LLC shall purchase the Employee's Interests for an amount equal to the
         Fair Market Value of such Interests. (Section 11.1(b)(i)) The
         Management Committee has made a good faith determination that the Fair
         Market Value of Employees' Interests is $1,000,000 (50% of Employee's
         $2,000,000 initial equity investment). This amount, less any
         outstanding and unpaid Principal Amount and unpaid interest accrued
         thereon with respect to Note 1, shall be paid to Employee at the
         Closing. If the Fair Market Value of Employee's Interests is less than
         the outstanding and unpaid Principal Amount and unpaid interest accrued
         thereon under Note 1, any shortfall shall be withheld and offset from
         the monthly bonus payments under Paragraph 1(c).

7.       For and in consideration of the payments and benefits described above
         in Paragraph 1 to be paid by Grove, the sufficiency of which Employee
         hereby acknowledges, Employee agrees (for Employee, his heirs,
         executors, administrators, personal representatives and assigns) that
         he will, and hereby does, forever and irrevocably release and discharge
         the Members (as defined in the LLC Agreement), Grove, its parents,
         subsidiaries, affiliates and its and their respective officers,
         directors, employees, agents, predecessors, successors, purchasers,
         assigns, and representatives (hereinafter referred to as Releasees), of
         and from any and all actions, causes of action, claims, demands,
         grievances, damages, costs, expenses, compensation , and all
         incidental, consequential, or special damages, which he now has, has
         had, or may have up to and including the date Employee signs this
         Agreement, whether the same be at law, in equity, or mixed, on account
         of or in any way arising out of (i) Employee's ownership interest in
         Grove Investors LLC; or (ii) Employee's employment relationship with
         Grove, including but not limited to his separation from employment with
         Grove.

THIS IS A GENERAL RELEASE. EMPLOYEE EXPRESSLY ACKNOWLEDGES THAT THIS GENERAL
RELEASE INCLUDES, BUT IS NOT LIMITED TO, ANY AND ALL CLAIMS UNDER THE AGE
DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF
1990, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE OLDER WORKERS BENEFIT
PROTECTION ACT, THE EMPLOYEE RETIREMENT INCOME SECURITY ACT, THE PENNSYLVANIA
HUMAN RELATIONS ACT, AND ANY OTHER FEDERAL, STATE OR LOCAL LAW, REGULATION OR
ORDINANCE, AND/OR PUBLIC POLICY HAVING ANY BEARING WHATSOEVER ON THE TERMS AND
CONDITIONS AND/OR SEPARATION FROM EMPLOYEE'S EMPLOYMENT WITH GROVE OR EMPLOYEE'S
OWNERSHIP INTEREST IN GROVE INVESTORS LLC.

8.       Employee hereby represents and warrants that there are no actions of
         Employee pending against Grove or any benefit plans of Grove, and
         Employee agrees not to institute a lawsuit against any of the Releasees
         in any court of the United States or any State thereof based upon or
         relating to Employee's employment with Grove, the termination of
         Employee's employment with Grove, or the Employee's ownership interest
         in Grove Investors LLC. Notwithstanding any other language in this
         Agreement, the parties understand that this Agreement does not prohibit
         Employee from filing an administrative charge of alleged employment
         discrimination under Title VII of the Civil Rights Act of 1964, the Age
         Discrimination in Employment Act of 1967, the Americans With
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Severance Agreement and General Release
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         Disabilities Act of 1990 or the Equal Pay Act of 1963. Employee,
         however, waives his right to monetary or other recovery should any
         federal, state or local administrative agency pursue any claims on his
         behalf arising out of or relating to his employment with and/or
         separation from employment with Grove or any of the other Releasees.

THIS MEANS THAT BY SIGNING THIS AGREEMENT, EMPLOYEE WILL HAVE WAIVED ANY RIGHT
HE HAD TO BRING A LAWSUIT OR OBTAIN A RECOVERY IF AN ADMINISTRATIVE AGENCY
PURSUES A CLAIM AGAINST GROVE OR ANY OF THE RELEASEES BASED ON ANY ACTIONS TAKEN
BY ANY OF THE RELEASEES UP TO THE DATE OF THE SIGNING OF THIS AGREEMENT, AND
THAT EMPLOYEE WILL HAVE RELEASED THE RELEASEES OF ANY AND ALL CLAIMS OF ANY
NATURE ARISING UP TO THE DATE OF THE SIGNING OF THIS AGREEMENT.

9.       Employee agrees not to institute or to join in any lawsuit against
         Grove or any Releasees concerning any matter within the scope of this
         Agreement.

10.      Employee further acknowledges and agrees that Grove's agreement to
         provide the consideration contained in this Agreement is not to be
         construed as an admission of any liability on the part of Grove or
         Releasees, by whom any liability is expressly denied.

11.      Employee agrees to maintain and keep all written and oral business
         information, know-how, technical information, proprietary data and
         information (including Grove's patents and know-how), and all other
         confidential information of and concerning Grove and its parents,
         subsidiaries and affiliates (hereinafter "Information"), entirely
         confidential, and further agrees not to divulge same to any third party
         at any time after departure from employment at Grove. All such
         Information is and shall remain the exclusive property of Grove at all
         times. Employee agrees that Employee will return and deliver to Grove
         all confidential and proprietary information Employee received during
         his employment with Grove. In addition, Employee agrees that a
         violation of the terms of this Paragraph 11 regarding the
         confidentiality of such Information is a material breach of this
         Agreement, for which Grove may immediately seek legal, equitable,
         injunctive, monetary, or any other appropriate relief in a court of
         competent jurisdiction.

12.      The Employee recognizes that the services performed by him were
         special, unique and extraordinary and that, by reason of his employment
         with Grove, he acquired confidential information and trade secrets
         concerning the operation of Grove. Accordingly, for all purposes
         hereunder or in respect hereof, the Employee agrees that during the
         term of his employment and for a period of twelve (12) months following
         his termination from employment he will not, directly or indirectly, as
         an officer, director, stockholder, partner, member, associate,
         employee, consultant, owner, agent, creditor, co-venturer or otherwise,
         become or be interested in or be associated with any other corporation,
         firm or business engaged, in any geographical area in which Grove is
         engaged during the term of his employment or at the date of his
         termination from employment, in a "Competitive Business" with that of
         Grove at such time. A Competitive Business shall mean any business
         which derives 30% or more of its revenue directly or indirectly from
         designing, manufacturing, selling and/or providing customer support
         for, mobile hydraulic cranes,

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Salvatore J. Bonanno
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         self-propelled aerial work platforms and truck-mounted cranes. The
         Employee's ownership, directly or indirectly, of not more than five
         percent (5%) of the issued and outstanding stock of any corporation,
         the shares of which are regularly traded on a national securities
         exchange or in the over-the-counter market, shall not in any event be
         deemed to be a violation of the provisions hereof and the ownership of
         securities by the Employee of Grove shall not be deemed to be a
         violation hereof. Employee further agrees that a violation of the terms
         of this Paragraph 12 regarding non-competition is a material breach of
         this Agreement, for which Grove may immediately seek legal, equitable,
         injunctive, monetary, or any other appropriate relief in a court of
         competent jurisdiction.

13.      The Employee agrees, during the twelve (12) months following his
         termination of employment, that he shall not, on behalf of himself or
         any business he is interested in or associated with, employ or
         otherwise engage, or seek to employ or engage, any employee (Manager
         level or above) of Grove.

14.      Employee agrees that the terms, provisions, and conditions of this
         Agreement and the negotiations in pursuance thereof, are strictly
         confidential and have not been and shall not be disclosed to any other
         person or entity, except as required by law or by court order. Employee
         agrees he will not make any statement or otherwise engage in any
         communication (whether written or oral) which in any way disparages or
         denigrates Grove or any of its subsidiaries or affiliates, their
         former, present or future managements, products or business prospects.
         Employee further agrees that a violation of the terms of this Paragraph
         14 regarding the confidentiality of this Agreement is a material breach
         of this Agreement, for which Grove may immediately seek legal,
         equitable, injunctive, monetary, or any other appropriate relief in a
         court of competent jurisdiction.

15.      Employee hereby expressly warrants and represents to Grove that (a)
         before executing this Agreement, Employee has fully informed himself of
         its terms, contents, conditions, and effect; (b) in accepting this
         offer and release, Employee has had the benefit of the advice of legal
         counsel of his own choosing; (c) no promises or representations of any
         kind or character have been made to Employee by Grove or by anyone
         acting for Grove, except for those representations which expressly are
         referred to herein; (d) Employee fully understands that this is a full,
         complete, and final release; and (e) Employee enters into this
         Agreement voluntarily and of his own free will.

16.      Employee hereby acknowledges and agrees that this Agreement contains
         the entire agreement and understanding between Employee and Grove, that
         there are no additional promises or terms between Employee and Grove
         other than those contained herein, that the terms of this instrument
         are contractual in nature and not mere recitals, and that this
         Agreement shall not be modified except in writing signed by each of the
         parties.

17       This Agreement shall be binding upon, and inure to the benefit of,
         Employee and his assigns, heirs, executors, personal representatives,
         and administrators, and Grove and its
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         parents, subsidiaries, affiliates, and its and their officers,
         directors, employees, agents, predecessors, successors, purchasers,
         assigns, and representatives.

18.      This Agreement shall in all respects be interpreted, enforced, and
         governed under the laws of the State of Pennsylvania. The language of
         all parts of this Agreement shall in all cases be construed as a whole,
         according to the language's fair meaning, and not strictly for or
         against any of the parties. If any terms of this Agreement are found
         null, void, or inoperative for any reason, the remaining provisions
         will remain in full force and effect, at Grove's sole option.

19.      Grove hereby advises Employee to consult with an attorney, at
         Employee's own expense, prior to executing this Agreement.

20.      Employee understands that he has twenty-one (21) days from the date of
         his receipt of this Agreement to consider his decision to sign it, and
         that if he chooses to execute this Agreement less than twenty-one (21)
         days after receiving it, that is a voluntary choice by him, not
         demanded or requested by Grove. By signing this Agreement, Employee
         expressly acknowledges that his decision to sign this Agreement was of
         his own free will.

21.      Employee acknowledges that he may revoke this Agreement for up to and
         including seven (7) days after he signs this Agreement and that this
         Agreement shall not become effective until the expiration of seven (7)
         days from the date of execution of the Agreement. Notice of revocation
         shall be given to Keith R. Simmons, Senior Vice President General
         Counsel and Human Resources, located at Grove Worldwide LLC, principal
         office at 1565 Buchanan Trail East, Shady Grove, Pennsylvania
         17256-0021.


IN WITNESS WHEREOF, this Severance Agreement and General Release is duly signed,
as of the date first set forth above in two (2) counterparts, each of which
being deemed to be an original of this Agreement.


EMPLOYEE:                                    WITNESS:


-----------------------------                -----------------------------------
Salvatore J. Bonanno                         Signature of Witness

Date:                                        Date:
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Severance Agreement and General Release
Salvatore J. Bonanno
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GROVE WORLDWIDE LLC                          GROVE INVESTORS LLC


By:                                          By:
   --------------------------                   --------------------------------
   Keith R. Simmons                             Keith R. Simmons
Title: Senior Vice President                 Title: Vice President and Secretary
       General Counsel and Human Resources

Date:
     ------------------------