Exhibit 10.1

Execution Copy

SEPARATION AND RELEASE AGREEMENT

THIS SEPARATION AND RELEASE AGREEMENT (this “Agreement”) is made effective as of
the 22nd day of December, 2008 (the “Agreement Date”), by and between MidWestOne
Financial Group, Inc. (the “Company”), and David A. Meinert (the”Executive”).

WHEREAS, Executive currently serves as the Chief Financial Officer of the
Company pursuant to an employment agreement by and between the Company and
Executive dated September 11, 2007 (the “Employment Agreement”);

WHEREAS, Executive has advised the Company of his intention to resign all
positions with the Company effective as of the close of business on December 31,
2008 (the “Termination Date”); and

WHEREAS, the parties intend that this Agreement shall be in complete settlement
of all rights of Executive relating to Executive’s employment with the Company.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, and
upon the other terms and conditions hereinafter provided, the parties hereby
agree as follows:

Section 1. Termination of Employment and Agreements; Resignation. Except as
otherwise specifically set forth herein, the Employment Agreement, the Executive
Deferred Compensation Agreement between Executive and MidWestOne Financial
Group, Inc. (formerly Mahaska Investment Company), dated January 1, 2003 (the
“Deferred Compensation Agreement”), the Salary Continuation Agreement between
Executive and MidWestOne Financial Group, Inc. dated July 1, 2004 (the “Salary
Continuation Agreement”) and Executive’s employment with the Company shall
terminate effective as of the close of business on the Termination Date.
Executive acknowledges that this Agreement shall serve as his resignation from
any and all officerships, directorships, committee memberships and all other
elected or appointed positions, of any nature, that Executive held immediately
prior to the Agreement Date with the Company and/or any of its affiliates, all
effective as of the close of business on the Termination Date. As a condition to
receipt of any payment hereunder, Executive agrees that he will execute any
documentation reasonably required by the Company to effectuate such
resignations.

Section 2. Severance Payments. In consideration for the promises made in this
Agreement, the Company agrees to pay, or provide to, Executive, in lieu of any
payments and/or other benefits otherwise due to Executive pursuant to the
Employment Agreement and/or the Salary Continuation Agreement, the following
(collectively, the “Severance Benefits”):

(a) On the Termination Date, Executive shall receive a single lump sum cash
payment equal to the value of all accrued but unpaid annual base salary and all
accrued but unused vacation pay through December 31, 2008, less applicable tax
withholding.

(b) On the later of the Termination Date or the Effective Date (as defined in
Section 7), a single lump sum cash payment in an amount equal to Eight Hundred
Thirty-Three Thousand Nine Hundred Twenty-Seven Dollars ($833,927.00), less
applicable tax withholding.

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(c) Executive will receive an aggregate amount of One Hundred Two Thousand Five
Hundred Dollars ($102,500), which shall be paid in twelve (12) approximately
equal monthly installments beginning on the first monthly anniversary of the
Termination Date.

(d) Subject to the approval of the Company’s board of directors at its regularly
scheduled January 2009 meeting, Executive’s outstanding vested stock options
shall be exercisable until the earlier of (A) their original expiration date, or
(B) eighteen (18) months following the Termination Date. Any outstanding
unvested stock options and/or equity incentive awards held by Executive shall be
forfeited as of the Termination Date and no payment or other benefit shall be
provided in lieu thereof.

(e) Executive shall be allowed to purchase the automobile (the “Automobile”)
which the Company had been providing for Executive’s use. The purchase price
shall be equivalent to the Kelley Blue Book wholesale value of the Automobile as
of the Termination Date.

(f) Within ten (10) days of the Termination Date, the Company shall reimburse
Executive for any business expenses that are payable under the Company’s normal
expense reimbursement policies and practices that were incurred by Executive
prior to the Termination Date. In addition, the Company shall reimburse
Executive’s legal fees and expenses incurred in connection with negotiating the
terms of this Agreement up to a maximum of Five Thousand Dollars ($5,000) and
for any legal fees and expenses necessary to enforce this Agreement.

(g) Executive acknowledges and agrees that all payments made, and benefits
provided, pursuant to this Agreement shall be subject to all applicable tax
withholding and reporting requirements.

(h) Notwithstanding the foregoing to the contrary, if the Company is prevented
by the Federal Deposit Insurance Corporation, or any other federal or state bank
regulatory authority, from making any payment, or providing any benefit,
described in this Section 2 on the date or at the time provided herein, any such
payment and/or benefit shall be paid to, or provided to, Executive as of the
earliest possible date allowed by such regulator. Any delay by the Company in
the making of any payment, or providing of any benefit, pursuant to this
subsection (h) shall have no effect on the obligations of Executive as set forth
or described in this Agreement.

Section 3. Termination of Benefits. Except as otherwise provided in this
Agreement, Executive’s continued participation in all compensation and other
benefit plans will cease as of the Termination Date; provided that nothing
contained herein shall limit or otherwise impair Executive’s right to receive
pension, welfare or similar benefit payments which are vested as of the
Termination Date under any applicable tax-qualified pension plan, welfare
benefit plan or other tax-qualified or non-qualified benefit plans, including
but not limited to the Deferred Compensation Agreement, pursuant and subject to
the terms and conditions of the applicable plan; provided, further, that nothing
contained herein shall limit or otherwise impair Executive’s (and/or his
eligible dependents’) right to elect coverage under the Company’s group health
insurance plans pursuant to the health care continuation rules set forth in the
Consolidated

 

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Omnibus Budget Reconciliation Act of 1985, with Executive required to pay the
same amount as he or she would pay if he or she continued in employment with the
Company or an Affiliate during such period.

Section 4. Equity Awards. Except as set forth in Section 2(e) above, outstanding
vested stock options and other equity incentive awards held by Executive shall
be governed by the applicable plan document and/or applicable grant agreement.

Section 5. Restrictive Covenants. Following the Termination Date, Executive
shall continue to be subject to the restrictive covenants set forth in Section 8
of the Employment Agreement for the time periods described in therein.

Section 6. General Release. In consideration of the promises made in this
Agreement, Executive, with full understanding of the contents and legal effect
of this Agreement and having the right and opportunity to consult with his
counsel, releases and discharges the Company, its shareholders, officers,
directors, supervisors, managers, employees, agents, representatives, attorneys,
parent companies, divisions, subsidiaries and affiliates, and all related
entities of any kind or nature, and its and their predecessors, successors,
heirs, executors, administrators, and assigns (collectively, the “Company
Released Parties”) from any and all claims, actions, causes of action,
grievances, suits, charges, or complaints relating to Executive’s employment
with the Company and the termination thereof, that he ever had or now has,
whether fixed or contingent, liquidated or unliquidated, known or unknown,
suspected or unsuspected, and whether arising in tort, contract, statute, or
equity, before any federal, state, local, or private court, agency, arbitrator,
mediator, or other entity, regardless of the relief or remedy, arising prior to
the execution of this Agreement. Without limiting the generality of the
foregoing, it being the intention of the parties to make this Section 6 as broad
and as general as the law permits, this Section 6 specifically includes any and
all subject matters and claims arising from any alleged violation by the
Released Parties under the Age Discrimination in Employment Act of 1967, as
amended; Title VII of the Civil Rights Act of 1964, as amended; the Civil Rights
Act of 1866, as amended by the Civil Rights Act of 1991 (42 U.S.C. §1981); the
Rehabilitation Act of 1973, as amended; the Iowa Civil Rights Act of 1965, and
other similar state or local laws; the Americans with Disabilities Act; the
Worker Adjustment and Retraining Notification Act; the Equal Pay Act; Executive
Order 11246; Executive Order 11141; and any other statutory claim, employment or
other contract or implied contract claim, claim for equity in the Company, or
common law claim for wrongful discharge, breach of an implied covenant of good
faith and fair dealing, defamation, or invasion of privacy arising out of or
involving his employment with the Company, the termination of his employment
with the Company, or involving any continuing effects of his employment with the
Company or termination of employment with the Company; provided, however, that
nothing herein waives or releases Executive’s rights to any payments or benefits
the Company is required to pay or provide pursuant to the terms of the
Employment Agreement or this Agreement or to indemnification which Executive may
have under the Company’s governing documents, by any agreement, under any
applicable law or otherwise and, nothing herein shall be construed to prevent
Executive from enforcing any rights Executive may have to recover vested
benefits under the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), or from filing a charge of discrimination with the Equal Employment
Opportunity Commission or any related state/local agency; provided, however,
Executive shall have no right to reap any economic or other benefit of any kind
whatsoever from, or as a result

 

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of, the filing, settlement or other disposition of any such charge of
discrimination. Executive further acknowledges that he is aware that statutes
exist that render null and void releases and discharges of any claims, rights,
demands, liabilities, action and causes of action which are unknown to the
releasing or discharging part at the time of execution of the release and
discharge. Executive hereby expressly waives, surrenders and agrees to forego
any protection to which he would otherwise be entitled by virtue of the
existence of any such statute in any jurisdiction including, but not limited to,
the State of Iowa. The Company shall use its reasonable best efforts to maintain
the level of coverage or benefits available to Executive under any indemnity
rights to which Executive was entitled prior to the date of this Agreement or
under any D&O or other insurance which currently provides liability insurance
coverage in favor of Executive.

Section 7. Representations by Executive. Executive warrants that Executive is
legally competent to execute this Agreement and that Executive has not relied on
any statements or explanations made by the Company or its attorney. Executive
agrees and represents that he shall re-execute this Agreement on December 31,
2008 and no payment shall be made unless Executive re-executes this Agreement.
Moreover, Executive hereby acknowledges that Executive has been afforded the
opportunity to be advised by legal counsel regarding the terms of this
Agreement, including the release of all claims and waiver of rights set forth in
Section 6. Executive acknowledges that Executive has been offered at least
twenty-one (21) days to consider this Agreement. After being so advised, and
without coercion of any kind, Executive freely, knowingly, and voluntarily
enters into this Agreement. Executive further acknowledges that Executive may
revoke this Agreement within seven (7) days after Executive has signed this
Agreement and further understands that this Agreement shall not become effective
or enforceable until seven (7) days after Executive has signed this Agreement as
evidenced by the date set forth below Executive’s signature (the “Effective
Date”). Any revocation must be in writing and directed to the Company,
Attention: Charles N. Funk, MidWestOne Financial Group, Inc. 102 South Clinton
Street, Iowa City, Iowa 52240. If sent by mail, any revocation must be
postmarked within the seven (7)-day period and sent by certified mail, return
receipt requested. In addition, Executive represents that Executive shall, no
later than December 31, 2008, return all property of the Company that is in
Executive’s possession, custody or control, including all documents, records and
tangible property that are not publicly available and reflect, refer or relate
to the Company or the Company’s business affairs, operations or customers, and
all copies of the foregoing.

Section 8. Covenant Not to Sue. Executive agrees not to bring, file, charge,
claim, sue or cause, assist, voluntarily join in or reap any economic or other
benefit from, or as a result of, any action, cause of action, or proceeding
regarding or in any way related to any of the claims described in Section 6
hereof, and further agrees that the release set forth in Section 6 is, will
constitute and may be pleaded as, a bar to any such claim, action, cause of
action or proceeding. If any government agency or court assumes jurisdiction of
any charge, complaint, or cause of action covered by the release set forth in
Section 6, Executive will not seek and will not accept any personal equitable or
monetary relief in connection with such investigation, civil action, suit or
legal proceeding. However, nothing herein shall be construed to prevent
Executive from enforcing any rights Executive may have to recover vested
benefits under ERISA or from filing a charge of discrimination with the Equal
Employment Opportunity Commission or any related state/local agency; provided,
however, Executive shall have no right to reap any economic or other benefit of
any kind whatsoever from, or as a result of, the filing, settlement or other
disposition of any such charge of discrimination.

 

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Section 9. No Disparaging, Untrue or Misleading Statements. Executive represents
that he has not made, and agrees that he will not make, to any third party any
disparaging, untrue, or misleading written or oral statements about or relating
to, respectively, the Company, its products or services (or about or relating to
any officer, director, agent, employee, or other person acting on the Company’s
behalf), or Executive. The Company represents that none of its senior officers
or members of its Board of Directors has made, and will not make, any
disparaging, untrue, or misleading written or oral statements about or relating
to Executive.

Section 10. Severability, Compliance with Section 409A. If any provision of this
Agreement shall be found by a court to be invalid or unenforceable, in whole or
in part, then such provision shall be construed and/or modified or restricted to
the extent and in the manner necessary to render the same valid and enforceable,
or shall be deemed excised from this Agreement, as the case may require, and
this Agreement shall be construed and enforced to the maximum extent permitted
by law, as if such provision had been originally incorporated herein as so
modified or restricted, or as if such provision had not been originally
incorporated herein, as the case may be. The parties further agree to seek a
lawful substitute for any provision found to be unlawful; provided, that, if the
parties are unable to agree upon a lawful substitute, the parties desire and
request that a court or other authority called upon to decide the enforceability
of this Agreement modify the Agreement so that, once modified, the Agreement
will be enforceable to the maximum extent permitted by the law in existence at
the time of the requested enforcement. It is the intent of the parties to comply
with all provisions of Section 409A of the Internal Revenue Code (“Section
409A”) so that Executive shall not be required to include in his gross income
for federal income tax purposes, prior to the actual receipt thereof, any
amounts received that may otherwise be considered to be deferred payments. In
the event that the interpretation or requirements of Section 409A change, the
parties will amend this Agreement, only as necessary, to comply with any such
change, if and to the extent such an amendment would be permitted by
Section 409A.

Section 11. Waiver. A waiver by either party of a breach of any provision of
this Agreement shall not operate or be construed as a waiver or estoppel of any
subsequent breach by. No waiver shall be valid unless in writing.

Section 12. Non-Disclosure. Executive agrees that he will keep the terms and
amounts set forth in this Agreement completely confidential and will not
disclose any information concerning this Agreement’s terms and amounts to any
person other than his attorney, accountant, tax advisor, or immediate family,
until such time as the information in this Agreement is disclosed by the Company
as may be required by law including disclosing the scope of the restrictive
covenants to a potential future employer.

Section 13. Representation. Executive hereby agrees that this Agreement is given
knowingly and voluntarily and acknowledges that:

(a) this Agreement is written in a manner understood by Executive;

 

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(b) this Agreement refers to and waives any and all rights or claims that he may
have arising under the Age Discrimination in Employment Act, as amended;

(c) Executive has not waived any rights arising after the date of this
Agreement;

(d) Executive has received valuable consideration in exchange for the Agreement
in addition to amounts Executive is already entitled to receive; and

(e) Executive has been advised to consult with an attorney prior to executing
this Agreement.

Section 14. Future Cooperation. In connection with any and all claims, disputes,
negotiations, investigations, lawsuits or administrative proceedings involving
the Company which relate to periods of time during the Employment Period (as
defined in the Employment Agreement), Executive agrees to make himself
reasonably available, upon reasonable notice from the Company and without the
necessity of subpoena, to provide information or documents, provide declarations
or statements to the Company, meet with attorneys or other representatives of
the Company, prepare for and give depositions or testimony, and/or otherwise
cooperate in the investigation, defense or prosecution of any or all such
matters. Executive shall be reimbursed for reasonable costs and expenses
incurred by him as a result of actions taken pursuant hereto. It is expressly
agreed and understood that Executive will provide only truthful testimony if
required to do so, and that any payment to him is solely to reimburse his
expenses and costs for cooperation with the Company. Nothing herein is intended
to require Executive to expend an unreasonable period of time in activities
required by this Section 14. The preceding notwithstanding, as a condition to
receiving payments hereunder, Executive agrees that he shall:

(a) Make himself reasonably available, upon reasonable notice from the Company,
during the four (4) months following the Termination Date for transition related
discussions with the Interim Chief Financial Officer and/or Chief Financial
Officer of the Company and to prepare, in written form, a summary of such
information as may be reasonably requested by the Interim Chief Financial
Officer and/or Chief Financial Officer of the Company, it being understood that,
for purposes of this Agreement, “reasonably available” shall mean available for
up to five (5) hours per week;

(b) Complete the Company’s fiscal year 2009 budget through December 31, 2008;

(c) Together with the Vice President and Controller of the Company, complete
staff performance appraisals for the period ended December 31, 2008; and

(d) Continue to work on the “goodwill impairment” matter through December 31,
2008.

If the Company should require further assistance or consultation with Executive
after the expiration of the four (4) month period following the Termination
Date, Executive shall be reimbursed for his time at a rate of $150 per hour and
for all reasonable costs and expenses incurred by him as a result of any further
consultation requested by the Company.

 

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Section 15. Amendment. This Agreement may not be altered, amended, or modified
except in writing signed by both Executive and the Company.

Section 16. Joint Participation. The parties hereto participated jointly in the
negotiation and preparation of this Agreement, and each party has had the
opportunity to obtain the advice of legal counsel and to review and comment upon
the Agreement. Accordingly, it is agreed that no rule of construction shall
apply against any party or in favor of any party. This Agreement shall be
construed as if the parties jointly prepared this Agreement, and any uncertainty
or ambiguity shall not be interpreted against one party and in favor of the
other.

Section 17. Binding Effect; Assignment. This Agreement and the various rights
and obligations arising hereunder shall inure to the benefit of and be binding
upon the parties and their respective successors, heirs, representatives and
permitted assigns. Neither party may assign its respective interests hereunder
without the express written consent of the other party.

Section 18. 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 laws of the State of
Iowa applicable to agreements made and wholly to be performed in such state
without regard to conflicts of law provisions of any jurisdiction and any court
action commenced to enforce this Agreement shall have as its sole and exclusive
venue the County of Johnson, Iowa.

Section 19. Execution of Agreement. This Agreement may be executed in several
counterparts, each of which shall be considered an original, but which when
taken together, shall constitute one Agreement.

[Signature page follows]

 

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IN WITNESS WHEREOF, this Agreement has been duly executed as of the dates set
forth below.

 

MIDWESTONE FINANCIAL GROUP, INC.

    DAVID A. MEINERT

/s/ Charles N. Funk

   

/s/ David A. Meinert

By:  

Charles N. Funk

    Signature Title:  

President and Chief Financial Officer

      Date:  

December 22, 2008

    Date:  

December 22, 2008

      Re-executed this 31st day of December, 2008      

 

      DAVID A. MEINERT

 

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