Exhibit 10.3

 

MGP INGREDIENTS, INC.
SEPARATION AGREEMENT AND RELEASE OF CLAIMS

 

WHEREAS, the undersigned employee wishes to voluntarily resign employment with
MGP Ingredients, Inc.;

 

WHEREAS, this Separation Agreement and Release of Claims (“Agreement”) is dated
as of April 17, 2009, is by and between Robert Zonneveld (“Employee”) and MGP
Ingredients, Inc. (“Employer”), and shall be effective upon the expiration of
the Agreement’s revocation period;

 

WHEREAS, MGP Ingredients is making available to the undersigned employee a
separation benefit in recognition of Employee’s efforts in the restructuring of
Employer and conditioned upon a release of all claims by the undersigned
employee; and

 

WHEREAS, the undersigned employee is not entitled otherwise to any separation
benefit and wishes to accept the separation benefit described below.

 

The undersigned employee agrees as follows:

 

1.             IN EXCHANGE FOR THE SEPARATION BENEFIT DESCRIBED BELOW, ROBERT
ZONNEVELD (“EMPLOYEE”) RELEASES AND FOREVER DISCHARGES MGP INGREDIENTS, INC.,
ITS PREDECESSORS, SUCCESSORS, ASSIGNS, OFFICERS, DIRECTORS, STOCKHOLDERS,
AGENTS, EMPLOYEES, AND ALL RELATED OR SUBSIDIARY COMPANIES OR DIVISIONS
(COLLECTIVELY REFERRED TO AS “EMPLOYER”) FROM ALL CLAIMS, DEMANDS, SUITS,
GRIEVANCES, LIABILITIES, OR CAUSES OF ACTION OF ANY KIND WHATSOEVER NOW EXISTING
INCLUDING BUT NOT LIMITED TO THOSE THAT IN ANY WAY

 

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RELATE TO OR ARE CONNECTED WITH OR ARISE DIRECTLY OR INDIRECTLY OUT OF THE
EMPLOYMENT OF EMPLOYEE BY EMPLOYER OR THE TERMINATION OF THAT EMPLOYMENT.

 

2.             THE CLAIMS RELEASED AND DISCHARGED BY EMPLOYEE AS OF THE
EFFECTIVE DATE OF THIS AGREEMENT INCLUDE, BUT ARE NOT LIMITED TO, CLAIMS THAT
MIGHT BE ASSERTED UNDER ANY FEDERAL, STATE OR LOCAL LAW, REGULATION, ORDINANCE,
OR DECISION CONCERNING EMPLOYMENT, DISCRIMINATION IN EMPLOYMENT, OR TERMINATION
OF EMPLOYMENT INCLUDING BUT NOT LIMITED TO:

 

A.                                   THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF
1967, AS AMENDED, 29 U.S.C.  SEC. 621, ET SEQ.;

 

B.                                     THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED, 29 U.S.C. SEC. 1001, ET SEQ.;

 

C.                                     THE KANSAS ACTS AGAINST DISCRIMINATION,
AS AMENDED, KAN. STATE. ANN.  SEC. 44-1001, ET SEQ.;

 

D.                                    TITLE VII OF CIVIL RIGHTS ACT OF 1964 AS
AMENDED, 42 U.S.C. SEC 2000E, ET SEQ.;

 

E.                                      AMERICANS WITH DISABILITIES ACT, 42
U.S.C. SEC. 12101, ET SEQ.:

 

F.                                      THE CIVIL RIGHTS ACT OF 1866, AS
AMENDED, 42 U.S.C. SEC. 1981;

 

G.                                     THE CIVIL RIGHTS ACT OF 1991, 42 U.S.C.
SEC. 1981A; AND

 

H.                                    FAMILY AND MEDICAL LEAVE ACT.

 

The claims released and discharged by Employee also include, but are not limited
to, any claim that Employer breached any contract, express or implied, with
Employee, made any misrepresentations to Employee, discharged Employee in
violation of public policy, or acted wrongfully in any way toward Employee.  The
claims released and discharged by Employee also include, but are not limited to,
any claim relating in any

 

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manner to personal injuries, fringe benefits, medical, dental, hospitalization,
life, disability, or other insurance benefits, pension or other retirement
benefits, and any claims for attorney’s fees, reinstatement or rehire.

 

Employee further agrees not to initiate any legal proceeding on Employee’s
behalf against Employer based on any fact or circumstance occurring up to and
including the effective date of this Agreement.

 

Employee’s last date of employment will be April 17, 2009.  By this Agreement,
Employee waives any claim for reinstatement and agrees not to seek re-employment
with Employer at any time in the future.  Employee agrees that any attempt to
obtain re-employment following his signing this Agreement will constitute a
breach of this Agreement, and that Employer may rely upon such breach in
refusing employment, or in discharging Employee from employment.

 

3.             THE SEPARATION BENEFIT SHALL BE PAID AFTER THE REVOCATION PERIOD
FOR THIS AGREEMENT HAS EXPIRED, AND SHALL BE AS FOLLOWS:

 

A.                                       EMPLOYEE SHALL RECEIVE GROSS
COMPENSATION OF THIRTY-SEVEN HUNDRED FIFTY DOLLARS ($3,750.00) PER WEEK FROM
APRIL 20, 2009 UNTIL JULY 17, 2009. COMPENSATION CHECKS WILL BE PAID AT NET PAY
AFTER NORMAL DEDUCTIONS. THE ABOVE AMOUNT IS INCLUSIVE OF ACCRUED VACATION THAT
WAS NOT PAID PRIOR TO APRIL 17, 2009.  IF EMPLOYEE DOES NOT ACCEPT THIS
AGREEMENT, ANY UNPAID ACCRUED VACATION WILL BE PAID TO EMPLOYEE.

 

B.                                      HEALTH CARE.  IF OTHERWISE ELIGIBLE,
EMPLOYEE MAY ELECT CONTINUING HEALTHCARE COVERAGE PURSUANT TO COBRA.  EMPLOYER
WILL PAY A ONE TIME AMOUNT OF $3,600.00 TO EMPLOYEE TO ASSIST IN COBRA PREMIUM
PAYMENTS.  EMPLOYEE WILL BE RESPONSIBLE TO SEND HIS PREMIUM MONTHLY UNLESS OTHER
ARRANGEMENTS ARE MUTUALLY AGREED TO.

 

C.                                       RETIREMENT.  EMPLOYEE MAY TAKE
DISTRIBUTION OF HIS DEFERRALS TO THE 401K PLAN AFTER MAY 1, 2009.

 

D.                                      WITHHOLDING.  ALL PAYMENTS HEREUNDER
WILL BE SUBJECT TO APPLICABLE WITHHOLDING.

 

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4.             EMPLOYER WILL PAY TO EMPLOYEE ANY AMOUNT OF SALARY DEFERRED
FROM  MARCH 8, 2009 THROUGH APRIL 19, 2009 ON JUNE 30, 2009 AS PREVIOUSLY AGREED
BY THE PARTIES.  SEE ATTACHMENT 1.

 

5.             EMPLOYEE IS NOT RELEASING EMPLOYER FROM ANY OBLIGATION CONCERNING
ANY CLAIM FOR UNEMPLOYMENT COMPENSATION EMPLOYEE MAY MAKE.  EMPLOYER AGREES NOT
TO PROTEST ANY UNEMPLOYMENT COMPENSATION CLAIM IF EMPLOYEE’S FACTUAL INFORMATION
PROVIDED TO SUPPORT THE CLAIM IS TRUTHFUL.

 

6.             EMPLOYEE ACKNOWLEDGES THAT HE CONTINUES TO BE BOUND BY
CONFIDENTIALITY OBLIGATIONS AS IMPOSED BY LAW OR AS REFERENCED IN THE
ACKNOWLEDGEMENT OF AND AGREEMENT WITH RESPECT TO ONGOING CONFIDENTIALITY
OBLIGATIONS, ATTACHED AS ATTACHMENT 2.

 

7.             EMPLOYEE FURTHER AGREES TO ASSIST IN A SMOOTH TRANSITION, TO NOT
BE DISRUPTIVE, AND TO COOPERATE WITH EMPLOYER CONCERNING THIS CHANGE IN
EMPLOYMENT STATUS.  EMPLOYER AGREES NOT TO DISPARAGE OR PORTRAY EMPLOYEE IN ANY
NEGATIVE LIGHT WHATSOEVER.

 

8.             EMPLOYEE WILL RETURN ON OR BEFORE APRIL 17, 2009, KEYS, ENTRY
CARD, AND OTHER COMPANY PROPERTY, IF ANY, IN HIS POSSESSION.  MOBILE PHONE WILL
BE RETURNED ON APRIL 22, 2009.

 

9.             EMPLOYEE UNDERSTANDS AND AGREES THAT THE PROVISIONS OF THIS
AGREEMENT AND THE REQUIREMENT THAT THE AGREEMENT BE SIGNED IN ORDER FOR EMPLOYEE
TO RECEIVE THE SEPARATION BENEFIT DO NOT CONSTITUTE AN ADMISSION OF ANY
LIABILITY TO EMPLOYEE AND THAT EMPLOYER EXPRESSLY DENIES ANY SUCH LIABILITY.

 

10.           EMPLOYEE DOES NOT WAIVE ANY RIGHTS OR CLAIMS THAT MAY ARISE AFTER
THE EFFECTIVE DATE OF  THIS AGREEMENT.

 

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11.           EMPLOYEE AGREES THAT PRIOR TO JUNE 30, 2009 HE WILL NOT, WITHOUT
THE PRIOR WRITTEN CONSENT OF THE COMPANY, (A) REPRESENT, APPROACH, SOLICIT, HIRE
OR OTHERWISE DEAL WITH, DIRECTLY OR INDIRECTLY, ANY CUSTOMER OR ANY PERSON
ASSOCIATED WITH A CUSTOMER OF THE COMPANY WITH WHOM HE HAD CONTACT DURING THE
PERIOD OF HIS EMPLOYMENT WITH EMPLOYER REGARDING THE WHEAT PROTEIN, STARCH OR
ALCOHOL BUSINESS (“BUSINESS”) OR (B) EMPLOY OR RETAIN OR SOLICIT FOR EMPLOYMENT
OR RETENTION BY ANY OTHER PERSON OR ENTITY, ANY EMPLOYEE OF THE EMPLOYER.
EMPLOYEE HEREBY ACKNOWLEDGES THAT THE REMEDIES AT LAW OF THE EMPLOYER FOR ANY
BREACH OF EMPLOYEE’S OBLIGATIONS CONTAINED IN THIS SECTION WOULD BE INADEQUATE
AND THE EMPLOYER SHALL BE ENTITLED TO INJUNCTIVE RELIEF OR ANY OTHER EQUITABLE
RELIEF FOR ANY VIOLATION HEREOF AND EMPLOYEE, IN ANY EQUITABLE PROCEEDING,
AGREES NOT TO CLAIM THAT A REMEDY AT LAW IS AVAILABLE TO THE EMPLOYER.

 

12.           EMPLOYER HEREBY ADVISES EMPLOYEE IN WRITING TO CONSULT WITH AN
ATTORNEY PRIOR TO EXECUTING THIS AGREEMENT, AND EMPLOYEE HAS BEEN GIVEN A PERIOD
OF AT LEAST 21 DAYS WITHIN WHICH TO CONSIDER THIS AGREEMENT, BUT EMPLOYEE MAY
ACCEPT OR REJECT ITS TERMS, IF HE CHOOSES, AT ANY TIME PRIOR TO THE EXPIRATION
OF THE 21 DAY PERIOD (05/08/09).  FOR A PERIOD OF SEVEN DAYS FOLLOWING THE
SIGNING OF THIS AGREEMENT, EMPLOYEE MAY REVOKE THE AGREEMENT AND THE AGREEMENT
SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS
EXPIRED.

 

13.           EMPLOYEE CERTIFIES THAT ALL TRANSACTIONS REPORTABLE UNDER
SECTION 16 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, BY HIM IN
EMPLOYER’S STOCK PRIOR TO THE DATE HEREOF HAVE BEEN REPORTED.

 

14.           EMPLOYEE ACKNOWLEDGES AND AGREES THAT NO PROMISE OR AGREEMENT NOT
EXPRESSED IN THIS AGREEMENT HAS BEEN MADE; THAT THIS AGREEMENT IS NOT EXECUTED
IN

 

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RELIANCE UPON ANY STATEMENT OR REPRESENTATION MADE BY EMPLOYER OR BY ANY PERSON
EMPLOYED BY OR REPRESENTING EMPLOYER OTHER THAN THE STATEMENTS CONTAINED IN THE
AGREEMENT ITSELF; THAT THE CONSIDERATION RECITED ABOVE IS THE SOLE AND ONLY
CONSIDERATION FOR THIS AGREEMENT; AND THAT THE TERMS OF THIS AGREEMENT ARE
CONTRACTUAL AND NOT MERE RECITALS.

 

 

Date: 5/7/09

/s/ Robert Zonneveld

 

Robert Zonneveld

 

 

 

/s/ David E. Rindom

 

Witness

 

 

Date: 5/7/09

/s/ David E. Rindom

 

Authorized Officer

 

MGP Ingredients, Inc.

 

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Attachment 1

 

AGREEMENT

 

THIS AGREEMENT, made and entered into this 23rd day of February, 2009, by and
between Robert Zonneveld (the “Executive”) and MGP Ingredients, Inc. (the
“Company”).

 

WITNESSETH:

 

WHEREAS, the Executive is employed by the Company as one of the Company’s
principal executives.

 

WHEREAS, the Company, because of current economic circumstances, has need for
additional liquidity by the reduction of expenses, and the Executive is willing
to assist the Company in dealing with short-term liquidity issues by agreeing to
a short-term base salary adjustment agreement.

 

NOW, THEREFORE, the parties here to agree as follows:

 

1.             The Executive agrees that the Executive’s base salary, for the
period commencing March 2, 2009, and ending as of June 26, 2009, may be
temporarily adjusted by reducing the Executive’s per-pay-period base salary from
$3,750.00 to $1,875.00 (the “Adjustment Amount”).

 

2.             For the period beginning July 1, 2009, the Adjustment Amount
shall no longer apply in a temporary reduction of the Executive’s base salary.

 

3.             The Company shall pay to the Executive in a lump sum the
cumulative amount of the Adjustment Amount, less applicable taxes, on June 30,
2009.

 

This Agreement executed as of the day and year first above written.

 

 

 

/s/ Robert Zonneveld

 

Robert Zonneveld

 

Executive

 

 

 

 

 

MGP INGREDIENTS, INC.

 

 

 

 

 

By:

/s/ Timothy Newkirk

 

Title:

CEO, President

 

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Attachment 2

 

Verification of Receipt

 

My signature below certifies that I have received, read and understand MGP
Ingredients, Inc. documents as follows:

 

·                  Code of Conduct

·                  Acknowledgement Of and Agreement With Respect To Ongoing
Confidentiality Obligations

 

 

 

Robert Zonneveld

 

 

 

Print Employee Name

 

 

 

 

 

 

 

 

 

/s/ Robert T. Zonneveld

 

 

8/8/2008

 

Employee Signature

 

 

Date

 

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