Exhibit 10.36

 

Guidelines for Issuance of Fiscal 2009 Restricted Share Awards
Adopted by the Human Resources Committee of the Board of Directors
of MGP Ingredients, Inc.

 

RECITALS:

 

1.     MGP INGREDIENTS, INC. has adopted the Stock Incentive Plan of 2004 (the
“Plan”).

 

2.     Under the provisions of Section 5 of the Plan, the Committee may grant
Stock Incentives in the form of Stock Awards.

 

3.     Under the provisions of the Plan, the Committee may provide for Stock
Awards in the form of restricted shares (herein “Restricted Shares”) to such
eligible persons as may be selected by the Committee in its discretion.

 

Pursuant to the authority granted to it under the provisions of Section 13(c) of
the Plan, the Committee adopts the following guidelines with respect to the
issuance in 2009 of Stock Awards in the form of Restricted Shares.

 

A.    Terms of Awards of Restricted Shares.  Restricted Shares awarded under the
Plan with respect to Fiscal 2009 are subject to the following terms and
conditions.

 

(i)            Vesting.  Subject to the provisions of paragraphs C and D of
these Guidelines, Restricted Shares issued as Stock Awards under the Plan shall
vest (i.e., become owned by the Participant without a substantial risk of
forfeiture) only upon the Participant’s completion of five (5) full years of
employment with the Company, commencing on the grant date (June 11, 2009) and
ending on the fifth anniversary of such date (June 11, 2014) (the “Restriction
Period”).

 

B.    Forfeiture.  Except as provided in paragraph C, if the employment of the
Participant to whom Restricted Shares has been issued terminates for any reason
prior to the end of the Restriction Period, such Restricted Shares shall be
immediately forfeited by such Participant and cancelled by the Company.

 

C.    Further Conditions on Vesting and Forfeiture.

 

(i)            In the event of a Participant’s death, Disability, Retirement or,
in the sole discretion of the Committee, involuntary termination of employment
without cause, in any such case after three years from the date of grant
specified in the agreement evidencing the Stock Award, the Restricted Shares
issued to such Participant shall vest as to the number of Restricted Shares
issued to such Participant multiplied by a fraction, the numerator of which
shall equal the number of months (including fractional months as full months)
that such Participant was employed by the Company, commencing as of the first
day of the Restriction Period and ending on the date of termination of
employment, and the denominator of which shall be sixty.  The balance of
Restricted Shares issued to such Participant shall be forfeited by the
Participant and cancelled by the Company.

 

(ii)           Any Restricted Shares shall become fully vested in the
Participant in the event of a Change of Control, as defined in the Plan.

 

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(iii)          As used herein,  the term “Disability” shall mean the inability
of a Participant to perform substantially such Participant’s duties and
responsibilities due to a physical or mental condition that would entitle such
Participant to benefits under the Company’s Long-Term Disability Plan (or any
successor to the plan in effect on the date of adoption of these Guidelines) or,
if no such plan is in effect, such condition as would enable the Participant to
receive an award for permanent and total disability from the Social Security
Administration, and the term “Retirement” means the attainment by the
Participant of age 62.

 

(iv)          The Committee’s determinations to permit vesting in the event of
involuntary terminations of employment without cause need not be uniform and may
be made selectively among participants, whether or not such participants are
similarly situated.

 

D.    Issuance of Restricted Shares.  After the Committee has approved the
making of a Stock Award, a certificate or certificates representing the number
of shares awarded as a Stock Award in the form of Restricted Shares shall be
issued from the Company’s treasury shares and registered in the Participant’s
name and may bear substantially the following legend:

 

“The shares evidenced by this Certificate have been issued pursuant to the MGP
Ingredients, Inc. Stock Incentive Plan of 2004 and a related agreement (the
“Agreement”) between the Company and the registered holder.  The holder’s rights
are subject to the restrictions, terms and conditions of the Plan and to the
Agreement, which restricts the transfer of the shares and subjects them to
forfeiture to the Company under the circumstances referred to in the Agreement. 
This legend may be removed when the holder’s rights to the shares vest under the
Agreement.”

 

All certificates so registered in the Participant’s name shall be deposited with
the Company, together with stock powers or other instruments of assignment, each
endorsed in blank with a guarantee of signature deemed appropriate by the
Company which would permit transfer to the Company of all or a portion of the
Restricted Shares in the event such award is forfeited in whole or in part. 
Upon vesting and provision for taxes required to be withheld, such certificate
or certificates evidencing unrestricted ownership of the requisite number of
shares of Common Stock shall be delivered to the holder of such Stock Award.

 

E.    Rights with Respect to Restricted Shares.  The holder of an award of
Restricted Shares shall have the following rights of a stockholder of the
Company: voting rights and the right to receive dividends during any applicable
Restriction Period.

 

F.    Non-Assignability.  Except as may be permitted by the Plan, until they
have vested, Restricted Shares may not, by operation of law or otherwise, be
sold, assigned, transferred, pledged, hypothecated or otherwise disposed of by
the holder thereof or be subject to execution, attachment or other legal
process.

 

G.    Provisions of Plan Apply.  Even though not set forth herein or in any
related grant agreement, the provisions of the Plan applicable to Stock Awards,
including those relating to adjustment of Stock Awards, shall apply to
Restricted Shares.

 

H.    Taxes.  No certificates evidencing ownership of shares shall be delivered
to the holder of a Stock Award upon vesting until the holder makes such
provision as the Company deems appropriate for the payment of any taxes which
the Company may withhold in connection

 

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with the vesting of such Stock Award.   Withholding taxes resulting from vesting
of Stock Awards may be settled with cash or shares of the Company’s Common Stock
in accordance with the following guidelines.

 

(ii Holders may deliver to the Company a personal check satisfactory to the
Company in the amount of the tax liability;

 

(ii)           Holders may elect to pay the tax liability in shares of the
Company’s Common Stock by directing the Company to withhold from the number of
shares to be delivered upon vesting that number of shares equal to the amount of
the tax liability divided by the fair market value (as defined by the Plan) of
one share of the Company’s common stock on the date the tax to be withheld is to
be determined (the “Tax Date”); or

 

(iii)          Holders may elect to pay the tax liability in shares of the
Company’s Common Stock by delivering to the Company good and marketable title to
that number of shares of Mature Stock (as defined in the Plan) owned by the
holder as shall equal the amount of the tax liability divided by the fair market
value of one share of the Company’s common stock on the Tax Date.

 

(iv)          If a holder does not notify the Company on or before the Tax Date
as to the manner the holder wishes to provide for withholding taxes, the Company
may, without notice to the holder, satisfy its withholding obligations as
provided in clause (ii) above or any other manner permitted by law.

 

(v)           No fractional shares will be issued in connection with any
election to satisfy a tax liability by paying in shares. The balance of any tax
liability representing a fraction of a share will be settled in cash by the
Participant.

 

(vi)          The amount of tax which may be paid  pursuant to a stock payment
election under clause (ii), (iii) or (iv) above will be the Company’s minimum
required federal (including FICA and FUTA) and state withholding amounts at the
time of the election to pay the taxes with surrendered or withheld shares.

 

(vii)         The foregoing provisions  relating to the use of stock to satisfy
obligations may be unilaterally revised by the Committee from time to time to
conform the same to any applicable laws or regulations.

 

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