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.


 

















 


(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 


 

















 


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.