Document:

Deferred Equity Incentive Compensation Agreement for John Miller

 Exhibit 10.3 
  
 DEFERRED EQUITY INCENTIVE COMPENSATION AGREEMENT 
  
 JOHN MILLER 
  
 This Deferred Equity Incentive Compensation Agreement (“Agreement”) is dated August 6, 2003 and is made by John Miller
(“Executive”) and National Beef Packing Company, LLC, a Delaware limited liability company (the “Company”). 
  
 WHEREAS, Executive and Farmland National Beef Packing Company, L.P., a Delaware limited partnership (“Farmland”), are parties to a
Employment Agreement, dated May 25, 2000 (“Existing Employment Agreement”), pursuant to which Executive has been employed by Farmland as its Chief Executive Officer; 
  
 WHEREAS, pursuant to the terms of the Existing Employment Agreement, Farmland is obligated to pay the Executive an Annual
Bonus, a Long-Term Bonus and a Full-Term Bonus (as each such term is defined in the Existing Employment Agreement and, together, the “Accrued Bonuses” on or before October 1, 2003 (in the case of the Full-Term Bonus) and October 31,
2003 or such later date specified therein (in the case of the Annual and Long-Term Bonuses); 
  
 WHEREAS, as of the date hereof and pursuant to applicable provisions of Delaware law, Farmland effected a conversion to a Delaware limited liability company (the “Conversion”), by which Conversion the
Company became the successor of Farmland, and the Company and its members entered into a Limited Liability Company Agreement, dated as of the date hereof (the “LLC Agreement”), with respect to the Company’s equity interests,
governance, and other matters required and permitted by law; 
  
 WHEREAS, in connection with transactions related to the Conversion and the effectiveness of the LLC Agreement, the Executive and the Company have entered into, as of the date hereof, an Employment Agreement (the “New Employment
Agreement”), which by its terms supersedes the Existing Employment Agreement and sets forth the employment terms of the Executive as Chief Executive Officer of the Company; and 
  
 WHEREAS, the Executive and U.S. Premium Beef, Ltd. agreed by letter agreement dated July 28, 2003, that the Company will
issue to the Executive as deferred compensation certain equity interests of the Company described below, on the terms and upon the occurrence of the events described herein, in lieu of the payment in cash by Farmland or the Company of the Accrued
Bonuses in accordance with the terms of the Existing Employment Agreement; 
  
 NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 

 1. Definitions. Capitalized terms not otherwise defined herein shall have the meanings assigned to such terms in
the LLC Agreement. 
  
 2. Reservation of Units. The Company hereby agrees
that the Class A Units and Class C Units set forth on Schedule A (the “Class A Deferred Units” and the “Class C Deferred Units,” respectively, and, together, the “Deferred Units”) shall be
issued (and for all purposes of the LLC Agreement shall be deemed to be issued), without further consideration (including without limitation the making of any Capital Contribution to the Company), to the Executive in the amounts and upon the
occurrence of the events described in Section 3 of this Agreement without further action of any party. 
  
 3. Issuance of Units. The Company agrees: 
  
 (a) Upon the earliest to occur of (i) the fifth anniversary of the Effective Date, or such later date as the Executive and the Company may agree in writing following the date hereof, (ii) a Change of Control, or (iii)
the liquidation, dissolution or winding up of the Company, to immediately issue to the Executive all of the Deferred Units not previously issued to the Executive pursuant to Section 3(b) or 3(c) hereof, as of a time and in a manner, in the case of
an issuance pursuant to clauses (ii) or (iii) above, to ensure that the Executive receives the full economic benefits of ownership of such Deferred Units immediately prior to the occurrence of such events; 
  
 (b) Immediately upon the giving to the Executive or his Affiliates of a
notice of repurchase of Management Units pursuant to Section 3.7 of the LLC Agreement (“Repurchase Notice”), to issue to the Executive a number of Class C Deferred Units equal to the number of Class B-2 Units held by the Executive
or his Affiliates that the Company has indicated in the Repurchase Notice that it will repurchase pursuant to and in accordance with Section 3.7 of the LLC Agreement; and 
  
 (c) If an Initiating Seller (as defined in Section 12.2 of the LLC Agreement) shall become obligated to give a Notice of
Proposed Sale to the Executive or his Affiliates with respect to any Units held by the Executive or his Affiliates pursuant to Section 12.2.2 of the LLC Agreement, to issue to the Executive, effectively immediately prior to (and conditioned upon)
the consummation of the sale proposed in such Notice of Proposed Sale, (i) the number of Class A Deferred Units necessary to make the number of Class A Units held by the Executive and his Affiliates, together, after giving effect to such issuance,
equal the number of Class A Units which the Executive and his Affiliates, together, would be permitted to include in a Tag-Along Notice pursuant to Section 12.2.3 of the LLC Agreement in response to such Notice of Proposed Sale (assuming that the
total number of Class A Deferred Units were issued and outstanding and held by the Executive or such Affiliate) and (ii) a number of Class C Deferred Units equal to the number of Class B-2 Units which the Executive and his Affiliates, together, are
permitted to include in a Tag-Along Notice pursuant to Section 12.2.3 of the LLC Agreement in response to such Notice of Proposed Sale. 

 4. Representations and Warranties. The Company hereby represents and warrants to Executive as follows: (a) the
Company is a duly formed and validly existing limited liability company under the Act, with all necessary power and authority under the Act to enter into this Agreement and to issue the Deferred Units to be issued to the Executive on the terms and
conditions set forth herein; (b) when any or all of the Deferred Units are issued to the Executive as contemplated by this Agreement, such Deferred Units issued to the Executive will be duly and validly issued and no liability for any additional
Capital Contributions or for any obligations of the Company will attach thereto; (c) the Class A Deferred Units, upon issuance, will be considered Class A Units for all purposes under the LLC Agreement, and Class C Deferred Units, upon issuance,
will be considered Class C Units for all purposes under the LLC Agreement; and (d) the Executive, as a Member holding such Deferred Units upon issuance, shall hold all Interests, including without limitation the right to receive Distributions,
associated with Units of the respective Class of which such Deferred Units are a part. 
  
 5. Covenants. 
  
 (a) The
Company will not, directly or indirectly, create or otherwise cause or suffer to exist or become effective any restriction or encumbrance of any kind, whether by agreement with a third party or otherwise, on the ability of the Company to perform and
comply with its obligations under this Agreement, including without limitation its ability to issue the Deferred Units to the Executive. 
  
 (b) Without limiting the generality of Section 5(a) above, in case the Company shall amend the LLC Agreement or otherwise effect a capital reorganization
or reclassification of its Interests, proper provision shall be made in each such amendment, reorganization or reclassification so that, upon the basis and the terms and in the manner provided in this Agreement, the Executive, upon the issuance of
Deferred Units at any time after the consummation of such amendment, reorganization or reclassification, shall be entitled to receive, in lieu of the Deferred Units, the Interests that such holder would actually have been entitled to receive in
respect of such Deferred Units, or otherwise would have held, had they been issued in accordance with this Agreement immediately prior to the consummation of such amendment, reorganization or reclassification. 
  
 (c) The Executive shall be deemed to have made, with respect to each
Deferred Unit and as of the date of issuance of such Deferred Unit, the Capital Contribution set forth in Schedule A. Each Class A Deferred Unit shall be considered to have a Capital Account, as of the date of issuance, equal to the Capital
Account in respect of each other outstanding Class A Unit as of such date (after taking into account any adjustments to reflect the issuance of Deferred Units), appropriately adjusted to exclude that portion of the Capital Account in respect of each
outstanding Class A Unit that is attributable to allocations of gross income under Section 5.7.2 of the LLC Agreement that have not been offset by reductions of the Capital Account due to distributions under Section 5.2.1 and Section 5.2.2 with
respect to such Class A Unit, in either case prior to the date of issuance of such Class A Deferred Units. Each Class C Deferred Unit shall be considered to have a Capital Account, as of the date of issuance, equal to the Capital Account in respect
of each outstanding Class B-1 Unit as of such date (after taking into account any 

 
adjustments to reflect the issuance of Deferred Units), appropriately adjusted to exclude the effect on such Capital Account of all prior allocations of Net
Profit, Net Loss, or items of income or loss, except allocations of Net Loss previously made under Section 5.6.3(b) and not reversed, in each case prior to the date of issuance of such Class C Deferred Unit. It is the intent of the preceding two
sentences that the Capital Accounts with respect to Class A Deferred Units and Class C Deferred Units as of the date of issuance appropriately reflect the right to distributions with respect to such Units as set forth in Section 5.2 and 13.3 of the
LLC Agreement from and after the date of issuance, and the Company may adjust the Capital Accounts of the Deferred Units as of the date of issuance to the extent necessary to accomplish that intent; provided, however, that no
adjustments may be made to the Capital Contribution that the Executive shall be deemed to have made or to the rights of the Executive to distributions with respect to the Deferred Units from and after the date of issuance as set forth in the LLC
Agreement. 
  
 (d) The Company shall maintain a ledger of
Deferred Units of each Class that are issued to the Executive pursuant to Section 3, and upon each issuance of Deferred Units hereunder the Company shall notify the Executive in writing of the number of Deferred Units of each Class that remain
subject to issuance to the Executive hereunder. Upon issuance of Deferred Units, an amended Exhibit 3.1 to the LLC Agreement shall be promptly distributed to the Executive and all other Members. 
  
 6. Full Satisfaction. The Company’s agreement to issue the Deferred Units as set
forth herein shall satisfy in full, and shall be deemed to amend and supersede in their entirety, Farmland’s obligations to the Executive pursuant to Sections 3(b), (c) and (d) of the Existing Employment Agreement. 
  
 7. Assignment. This Agreement, and the rights and obligations of the parties
hereunder, shall be nonassignable and any purported assignment in violation of the foregoing shall be null and void; provided, however, that the Executive may direct the Company, upon issuance of Deferred Units pursuant to Section 3,
to issue some or all of such Deferred Units to his Affiliates or other Permitted Transferees. 
  
 8. Successors; Governing Law; Etc. This Agreement: (a) shall be binding upon the executors, administrators, estates, heirs and legal successors of the Company and the Executive, (b) shall be governed by and
construed in accordance with the laws of the State of Delaware, (c) may be executed in more than one counterpart, all of which together shall constitute one agreement and (d) together with the New Employment Agreement and the LLC Agreement, contains
the entire contract among the Members as to the subject matter hereof. The waiver of any of the provisions, terms or conditions contained in this Agreement shall not be considered as a waiver of any of the other provisions, terms or conditions
hereof. 
  
 9. Notices, Etc. All notices and other communications
required or permitted hereunder shall be in writing and shall be deemed effectively given upon personal delivery or receipt (which may be evidenced by a return receipt if sent by registered mail or by signature if delivered by courier or delivery
service), addressed (a) if to the Executive, at the address of the Executive set forth in the records of the Company or at such other address as the Executive shall have furnished to the 

 
Company in writing as the address to which notices are to be sent hereunder and (b) if to the Company, to it at: 
  
 National Beef Packing Company, LLC 
 c/o U.S. Premium Beef, Ltd. 
 12200 North
Ambassador Drive 
 Kansas City, Missouri 64164 
 Attention: Steven D. Hunt 
 Fax: 816-713-8810 
  
 10. Severability. If any provision of this Agreement is determined by a court to be invalid or unenforceable, that determination
shall not affect the other provisions hereof, each of which shall be construed and enforced as if the invalid or unenforceable portion were not contained herein. Such invalidity or unenforceability shall not affect any valid and enforceable
application thereof, and each such provision shall be deemed to be effective, operative, made, entered into or taken in the manner and to the full extent permitted by law. 
  
 11. No Third Party Rights. The provisions of this Agreement are for the benefit of the Company and the Executive, and no other
Person, including creditors of the Company or the Executive, shall have any right or claim against the Company or the Executive by reason of this Agreement or any provision hereof or be entitled to enforce any provision of this Agreement.

 IN WITNESS WHEREOF, the parties hereto have executed this agreement as of the day and year first above
written. 
  

	NATIONAL BEEF PACKING COMPANY, LLC
		
	 By:
	 	 /s/    Steven D. Hunt

	 	 	 A Duly Authorized Signatory

	 	 	 
	 /s/    John R. Miller

	 John R. Miller

 Schedule A 
  
 DEFERRED UNITS 
 JOHN MILLER 
  

	 Class

	  	Number of Units

	  	Deemed Capital
Contribution with
respect to each Unit

	 Class A Deferred Unit
	  	6,057,143	  	$	1.00
	 Class C Deferred Unit
	  	609,524	  	$	1.00Timothy M. Klein Employment Agreement

 Exhibit 10.4 
  
 EMPLOYMENT AGREEMENT 
  
 THIS EMPLOYMENT AGREEMENT (this “Agreement”) dated as of the 6th day of August, 2003, is made by and between National Beef Packing Company, LLC, a Delaware limited liability company (“National Beef”), and Timothy
M. Klein (“Executive”). 
  
 WHEREAS, Executive has been
employed by Farmland National Beef Packing, L.P., a Delaware limited partnership and a predecessor of National Beef (“Farmland L.P.”), pursuant to an employment agreement dated as of November 15, 2000, as amended (the “Prior
Agreement”); 
  
 WHEREAS, Executive and certain of his
affiliates are members of National Beef and have executed, in their capacities as members, the Limited Liability Company Agreement of National Beef dated as of the date hereof (the “LLC Agreement”), which LLC Agreement contains certain
rights and obligations of National Beef and Executive relating to Executive’s ownership of membership interests in National Beef; 
  
 WHEREAS, Executive and National Beef are parties to a Deferred Equity Incentive Compensation Agreement dated as of the date hereof (the “Deferred
Equity Incentive Compensation Agreement”), pursuant to which Executive will be issued as deferred compensation additional membership interests in National Beef on the terms and upon the occurrence of the events specified therein in lieu of
accrued but unpaid bonuses which upon the occurrence of certain events would be owed to Executive pursuant to the Prior Agreement; and 
  
 WHEREAS, National Beef desires to employ Executive and Executive desires to be employed by National Beef, and National Beef and Executive desire to
terminate the Prior Agreement and supersede it, in its entirety, with this Agreement and the Deferred Equity Incentive Compensation Agreement; 
  
 NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

  
 1. Employment. Subject to the terms and conditions
herein, National Beef will employ Executive, and Executive will be employed by National Beef, hereunder as the President and Chief Operating Officer (“President”) of National Beef, from the date hereof (the “Effective Date”)
until and including the earlier of: (a) the last day of the fiscal year ending on or about August 27, 2011, or such later date as the parties may agree (the “Expiration Date”); or (b) the date such employment shall otherwise have been
terminated in accordance with Section 4 (the “Termination Date”): (the period from the Effective Date until the earlier of the Expiration Date or the Termination Date being sometimes referred to herein as the “Term”). The
occurrence of either the Expiration Date or the Termination Date and the resulting discontinuation of Executive’s services to National Beef hereunder shall not affect the rights and obligations of Executive or any of his affiliates pursuant to
the LLC Agreement or the Deferred Equity Incentive Compensation Agreement except as may be otherwise expressly set forth in this Agreement, the Deferred Equity Incentive Compensation Agreement or the LLC Agreement. 

 2. Location of Employment. Executive’s principal places of employment shall be at the
principal executive offices of National Beef located in Kansas City, Missouri or at such other location as deemed necessary by National Beef. 
  
 3. Compensation. 
  
 a. Annual Salary. Executive shall be paid by National Beef a salary at the annual rate of $500,000 for each 12-month period during the Term,
pro-rated for any portion thereof, payable in substantially equal monthly installments on or before the last day of each monthly period with respect to each such period, less normal withholdings. 
  
 b. Quarterly Bonus. For each full fiscal quarter of National Beef
commencing on the first day of the fiscal year beginning on or about August 31, 2003 and continuing through the fiscal year ending on or about August 30, 2008, Executive shall, if he is employed by National Beef hereunder as of the last day of each
such fiscal quarter or as otherwise described herein, be paid by National Beef a quarterly bonus (a “Quarterly Bonus”) equal to $37,500 each fiscal quarter; provided, however, that if National Beef is prohibited during the first
thirty (30) days following the last day of any fiscal quarter from making a “Restricted Payment” of at least $1.00 pursuant to the Indenture governing National Beef’s Senior Notes due 2011 (after giving effect to all such Restricted
Payments made prior thereto during such thirty (30) day period), National Beef shall instead (a) pay the Executive $18,000 of such Quarterly Bonus with respect to such fiscal quarter, and (b) pay the Executive the balance, without interest, of such
Quarterly Bonus with respect to such Fiscal Quarter at the earliest possible date on which National Beef is permitted to make such a Restricted Payment in the amount of at least $1.00. Any Quarterly Bonus payable with respect to a fiscal quarter
shall be payable, less normal withholdings, on or before the date (the “Quarterly Bonus Date”) that is thirty (30) days following the end of such fiscal quarter, except to the extent deferred and payable as provided in clause (b) to the
proviso to the immediately preceding sentence. 
  
 c. Annual
Bonus. For each full fiscal year of National Beef during the Term, Executive shall, if he is employed by National Beef hereunder as of the last day of such fiscal year, or as otherwise described herein, be paid by National Beef an annual
incentive bonus (an “Annual Bonus”) equal to: (a) if National Beef’s earnings before taxes (“EBT”) for such fiscal year exceeds $20,000,000, one and three-eighths percent (1.375%) of the amount of such excess, up to EBT of
$80,000,000; plus (b) if EBT for such fiscal year exceeds $80,000,000, one-half of one percent (.5%) of such excess. 
  
 Any Annual Bonus accruing with respect to a fiscal year shall be payable, less normal withholdings, on or before the date (the “Annual Bonus
Date”) that is the later of: (a) sixty (60) days following the end of such fiscal year; or (b) ten (10) days following receipt by the National Beef Board of Managers (“Board”), from National Beef’s accountants, of all completed
financial statements that are relevant to the calculation of such Annual Bonus. For purposes of calculating any Annual Bonus under this Section 3(c), National Beef’s EBT shall be determined by National Beef’s accountants using generally
accepted accounting principles consistently applied. 
  

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 d. Long-Term Incentive Plan. 
  
 (i) Executive shall, if he is continuously employed hereunder through the last day of the fiscal year ending
on or about August 26, 2006, or as otherwise described herein, be paid by National Beef a long-term incentive bonus (“First Long-Term Bonus”), equal to: (a) if National Beef’s cumulative earnings before interest and taxes
(“EBIT”) during the period from the first day of the fiscal year beginning on or about August 31, 2003, through the last day of the fiscal year ending on or about August 26, 2006, exceeds $115,000,000, three and nine-tenths percent (3.9%)
of such excess, up to cumulative EBIT of $150,000,000 during such period; plus (b) if such cumulative EBIT exceeds $150,000,000, one and one-tenth percent (1.1%) of such excess, up to cumulative EBIT of $175,000,000; plus (c) if such
cumulative EBIT exceeds $175,000,000, six-tenths percent (.6%) of such excess. Any First Long-Term Bonus accruing under this Section 3(d)(i) shall be payable, less normal withholdings, on or before the date (“First Long-Term Bonus Date”)
that is the later of: (a) sixty (60) days following the last day of the fiscal year ending on or about August 26, 2006; or (b) ten (10) days following receipt by the Board from National Beef’s accountants, of all completed financial statements
that are relevant to the calculation of such First-Long-Term Bonus. 
  
 (ii) In addition to the First Long-Term Bonus, Executive shall, if he is continuously employed hereunder through the last day of the fiscal year ending on or about August 29, 2009, or as otherwise described herein, be
paid by National Beef another long-term incentive bonus (“Second Long-Term Bonus”) equal to: (a) if National Beef’s cumulative EBIT during the period from the first day of the fiscal year beginning on or about August 27, 2006 through
the last day of the fiscal year ending on or about August 29, 2009 exceeds $115,000,000, three and nine-tenths percent (3.9%) of such excess, up to cumulative EBIT of $150,000,000; plus (b) if such cumulative EBIT exceeds $150,000,000, one
and one-tenth percent (1.1%) of such excess, up to cumulative EBIT of $175,000,000; plus (c) if such cumulative EBIT exceeds $175,000,000, six-tenths percent (.6%) of such excess. Any Second Long-Term Bonus accruing under this Section
3(d)(ii) shall be payable, less normal withholdings, on or before the date (“Second Long-Term Bonus Date”) that is the later of: (a) sixty (60) days following the last day of the fiscal year ending on or about August 29, 2009; or (b) ten
(10) days following receipt by the Board from National Beef’s accountants, of all completed financial statements that are relevant to the calculation of such Second Long-Term Bonus. 
  
 (iii) In addition to the First Long-Term Bonus and the Second Long-Term Bonus, Executive shall, if he is
continuously employed hereunder through the last day of the fiscal year ending on or about August 27, 2011, or as otherwise described herein, be paid by National Beef another long-term incentive bonus (“Third Long-Term Bonus”) equal to:
(a) if National Beef’s cumulative EBIT during the period from the first day of the fiscal year beginning on or about 

  

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August 30, 2009 through the last day of the fiscal year ending on or about August 27, 2011 exceeds $76,667,000, three and nine-tenths percent (3.9%) of such
excess, up to cumulative EBIT of $100,000,000; plus (b) if such cumulative EBIT exceeds $100,000,000, one and one-tenth percent (1.1%) of such excess, up to cumulative EBIT of $116,667,000; plus (c) if such cumulative EBIT exceeds
$116,667,000, six-tenths percent (.6%) of such excess. Any Third Long-Term Bonus accruing under this Section 3(d)(iii) shall be payable, less normal withholdings, on or before the date (“Third Long-Term Bonus Date”) that is the later of:
(a) sixty (60) days following the last day of the fiscal year ending on or about August 27, 2011; or (b) ten (10) days following receipt by the Board from National Beef’s accountants, of all completed financial statements that are relevant to
the calculation of such Third Long-Term Bonus. 
  
 (iv) For purposes of calculating the First Long-Term Bonus, the Second Long-Term Bonus and the Third Long-Term Bonus under this Section 3(d), National Beef’s EBIT shall be determined by National Beef’s accountants using generally
accepted accounting principles consistently applied. 
  
 e.
Other Benefits. Executive shall be entitled to paid vacations, personal and sick days consistent with the policies of National Beef generally applicable to its management employees, as adopted and amended from time to time by the Board.
Executive shall receive such other compensation as shall be approved by the Board. Executive shall also be entitled to participate in all benefit plans which are made available from time to time to management employees of National Beef, on terms no
less favorable than those applicable to any other management employee (such plans including, without limitation, group medical, life, disability and accidental death and dismemberment insurance). 
  
 f. Support. During his employment hereunder, National Beef shall, at
its expense, cause to be provided for Executive’s use, office facilities at National Beef’s principal business locations and such secretarial services Executive may reasonably require in carrying out his obligations under this Agreement.

  
 g. Business Expenses. During his employment hereunder,
Executive shall also be reimbursed by National Beef for reasonable business expenses actually incurred or paid by him, consistent with the policies of National Beef, in rendering to National Beef the services provided for herein, upon presentation
of expense statements or such other supporting information as National Beef may customarily and reasonably require of its executives. 
  
 4. Termination. 
  
 a. The employment of Executive hereunder may be terminated by National Beef on at least thirty (30) days’ prior written notice if the Board
reasonably determines that Executive has become permanently disabled (as hereinafter defined). Such written notice shall provide reasonable detail regarding the basis for such determination. Executive shall be deemed to be “permanently
disabled,” as used in this subsection, if Executive has been substantially unable to discharge his duties and obligations hereunder with or without reasonable 

  

 4 

 
accommodation, by reason of illness, accident or disability for a period of 180 days in any twelve-month period. 
  
 b. The employment of Executive hereunder shall be automatically terminated on
the date of Executive’s death. 
  
 c. National Beef may
terminate Executive’s employment hereunder for cause (as hereinafter defined) by the vote of a majority of the full Board and in accordance with the LLC Agreement following: (i) notice to Executive of not less than fifteen (15) days setting
forth in detail the nature of such cause; and (ii) a hearing before the Board at which Executive shall be entitled to representation by counsel. National Beef shall have “cause” to terminate Executive, as used in this subsection, only if
Executive has: (i) refused or failed, after reasonable written notice that such refusal or failure would constitute a default hereunder, to carry out any reasonable and material order of the Board given to him in writing; (ii) materially and
willfully breached the terms of this Agreement; (iii) demonstrated gross negligence or willful misconduct in the execution of his material assigned duties where such gross negligence or willful misconduct has resulted, or would reasonably be
expected to result, in material damage to National Beef; or (iv) been convicted of a felony (A) constituting fraud, embezzlement or other illegal conduct related to his employment or (B) which has otherwise resulted, or would reasonably be expected
to result, in material damage to National Beef. With respect to clauses (ii) and (iii) of the previous sentence, National Beef shall have “cause” to terminate Executive only if the damage referred to therein or resulting therefrom is not
cured or avoided by Executive within thirty (30) days following the giving of the notice referred to above. 
  
 d. In addition to the circumstances set forth above in subsections (a), (b) and (c), National Beef may terminate Executive’s employment for any
reason or no reason and with or without cause upon thirty (30) days’ prior written notice to Executive. 
  
 e. Executive may terminate his employment hereunder for any reason or no reason upon thirty (30) days’ prior written notice to National Beef.

  
 f. Executive may terminate his employment hereunder forthwith
at any time for good reason (as hereinafter defined) upon written notice to National Beef. For purposes of this subsection, “good reason” shall mean the occurrence of any of the following (as would reasonably be determined by a president
of a company comparable in size and scope to National Beef): (i) a material reduction or adverse alteration in the duties, authorities or responsibilities of Executive as set forth in Section 5 hereof; (ii) removal of Executive from, or any failure
to re-elect Executive to, any titles, offices or positions held by Executive hereunder; (iii) a reduction by National Beef in Executive’s basic salary or bonuses herein provided or as the same may be increased from time to time; and (iv) a
material and willful breach by National Beef of any of its obligations to Executive hereunder. 
  
 g. If Executive’s employment is terminated pursuant to subsection (a) or (b) above, Executive (or in the case of a termination pursuant to subsection (b) above, his estate), shall be entitled to, and National
Beef’s obligation hereunder shall be limited to: (i) the payment of the compensation accrued under Section 3(a) hereof and the payment of other benefits under Section 3(e) hereof, to the date of such termination plus, until the earlier
of the first anniversary 

  

 5 

 
of such termination or the Expiration Date (such earlier date being the “Deemed Termination Date”), (A) monthly payments of salary pursuant to
Section 3(a) and in the case of disability, all other benefits pursuant to Section 3(e), and (B) quarterly payments of the Quarterly Bonus pursuant to Section 3(b); (ii) the payment (A) on or before the Annual Bonus Date for the fiscal year in which
such termination occurs, of the Annual Bonus payable pursuant to Section 3(c) for such fiscal year and (B) on or before the Annual Bonus Date for the fiscal year in which the Deemed Termination Date occurs, of a pro-rated amount (based on the number
of days in such fiscal year) through the Deemed Termination Date of the Annual Bonus that would have accrued if Executive had remained employed hereunder through the last day of such fiscal year, in each case less normal withholdings; and (iii) the
payment, on or before the First Long-Term Bonus Date (if the First Long-Term Bonus has not already been paid), the Second Long-Term Bonus Date (if the Second Long-Term Bonus has not already been paid) and the Third Long-Term Bonus Date, of a
pro-rated amount (based on the number of days in the period applicable to such bonus) through the Deemed Termination Date of the amount of the First Long-Term Bonus (if not already paid), the Second Long-Term Bonus (if not already paid) and the
Third Long-Term Bonus, that would have accrued if Executive had remained employed hereunder for the term applicable to such First Long-Term Bonus, Second Long-Term Bonus and/or Third Long-Term Bonus, in each case less normal withholdings.

  
 h. If Executive’s employment is terminated by National
Beef pursuant to subsection (c) above, or if Executive terminates his employment pursuant to subsection (e) above, National Beef’s obligation hereunder shall be limited to the payment of the compensation accrued under Section 3(a) hereof to the
date of such termination. 
  
 i. If Executive’s employment is
terminated pursuant to subsection (d) or (f) above, Executive shall be entitled to, and National Beef’s obligation hereunder shall be limited to: (i) the payment of the compensation accrued under Section 3(a) hereof to the date of such
termination plus continued monthly payment of salary under Section 3(a), and continuation of benefits under Section 3(e) (subject to any necessary consent of insurers, where applicable), in each case through the Expiration Date; (ii) the payment, on
or before the Quarterly Bonus Dates during the fiscal year in which such termination occurs and during each fiscal year thereafter through the Expiration Date, of the Quarterly Bonus that would have accrued during such fiscal year if Executive had
remained employed hereunder through the last day of such fiscal year, less normal withholdings; and (iii) the payment, on or before the Annual Bonus Date for the fiscal year in which such termination occurs and each fiscal year thereafter through
the Expiration Date, of the Annual Bonus that would have accrued for such fiscal year if Executive had remained employed hereunder through the last day of such fiscal year, less normal withholdings; and (iv) the payment, on or before the First
Long-Term Bonus Date (if the First Long-Term Bonus has not already been paid), the Second Long-Term Bonus Date (if the Second Long-Term Bonus has not already been paid) and the Third Long-Term Bonus Date, of the amount of First Long-Term Bonus (if
not already paid), the Second Long-Term Bonus (if not already paid) and the Third Long-Term Bonus, that would have accrued if Executive had remained employed hereunder through the Expiration Date, less normal withholdings. If consent of the
applicable insurers is not received within 30 days, then an amount in cash sufficient for Executive to obtain comparable coverage will be paid to Executive in equal monthly payments through the Expiration Date. 
  

 6 

 5. Responsibilities and Authority. In his capacity as President and Chief Operating Officer of
National Beef, Executive shall report to the Chief Executive Officer of National Beef, and shall have such responsibilities and authority to ensure effective management of National Beef as the CEO shall determine from time to time. Except as
otherwise provided herein, Executive shall observe and carry into effect all directions of the CEO, shall have authority to take any and all actions on behalf of National Beef granted by the CEO, and except to the extent otherwise required by the
Delaware Limited Liability Company Act, as amended from time to time, may execute all bonds, notes, debentures, instruments and documents providing for the acquisition, mortgage or disposition of property and other instruments and agreements for and
in the name of National Beef, to the extent that such authority is granted by the CEO and in accordance with the LLC Agreement. 
  
 6. Covenant Not to Compete. Executive acknowledges that during his employment with National Beef he, at the expense of National Beef, has been and
will be specially trained in the business of National Beef, has established and will continue to establish favorable relations with the customers, clients and accounts of National Beef and will have access to certain confidential and proprietary
information of National Beef, all of which having economic significance to National Beef. Therefore, in consideration of this Agreement and the training and relations incident to Executive’s employment and to further protect the confidential
and proprietary information of National Beef, Executive agrees that during his employment by National Beef hereunder during the Term and for a period of eighteen (18) months thereafter, he will not, directly or indirectly, without the prior written
consent of National Beef: 
  
 a. own, have any interest in, or
act as an officer, director, partner, member, manager, principal, employee, agent, representative, consultant or independent contractor of, or in any way assist in, any business located or doing business in the United States of America or in Mexico
that is engaged, or hereafter may become engaged, in slaughtering, processing, marketing or fabricating meat or boxed meat or which is otherwise engaged in competition in any manner with any other business engaged in by National Beef, or any
subsidiary of National Beef, at any time during the term of Executive’s employment hereunder; 
  
 b. divert, or attempt to divert, clients, customers (whether or not such persons have done business with National Beef once or more than once) or accounts
of National Beef, regardless of their location; or 
  
 c. entice,
induce or in any manner influence any person who is or shall be in the employ or service of National Beef to leave such employment or service (other than as contemplated by Section 5 hereof during his employment by National Beef). 
  
 Notwithstanding the foregoing, Executive may own not more than five percent
(5%) of the outstanding equity securities of any entity engaged in competition with National Beef. 
  
 If a final judicial determination is made that any of the provisions of this Section is an unenforceable restriction against Executive, the provisions of
this Section shall be rendered void only to the extent that such judicial determination finds such provisions unenforceable, and such unenforceable provisions shall automatically be reconstituted and become a part of this Section, 

  

 7 

 
effective as of the date first written above, to the maximum extent in favor of National Beef that is lawfully enforceable. The obligations of Executive and
the rights of National Beef under this Section shall survive the termination of this Agreement. 
  
 7. Specific Performance. Recognizing that the restrictions, covenants and assurances contained in Section 6 hereof are reasonable and necessary in
order to protect the legitimate business interests of National Beef, that any breach or threatened breach of any such restriction, covenant or assurance (a “Breach”) will result in substantial and irreparable damage to National Beef, and
that the remedies at law for any Breach will be inadequate, National Beef shall be authorized and entitled to obtain from any court of competent jurisdiction: (a) preliminary and permanent injunctive relief, including, without limitation, mandatory
injunctive relief requiring compliance with such restrictions, covenants and assurances or enjoining and restraining Executive, and each and every person, firm or company acting in concert or participation with him, from the continuation of any
Breach; (b) an equitable accounting of all profits or benefits arising out of any Breach; and (c) direct, incidental and consequential damages to National Beef arising from any Breach, including, without limitation, costs and reasonable
attorney’s fees sustained by National Beef by reason of the Breach: the foregoing rights and remedies being cumulative and in addition to such other rights and remedies which may be available to National Beef at law or in equity. 
  
 8. Indemnification. National Beef agrees, to the fullest extent
permitted by the Delaware Limited Liability Company Act and other applicable law, to indemnify Executive against any and all claims, losses, damages or costs related in any way to Executive’s employment with National Beef or to his service as
an officer or member of the Board or as a fiduciary or trustee of any benefit plan maintained by National Beef or any of its subsidiaries. National Beef will pay all attorney fees and other expenses relating in any way to this indemnification
agreement and shall advance any such fees and other expenses at the request of Executive, and all payments hereunder will be fully grossed up for any tax liabilities. This indemnification agreement will continue and survive following the termination
of all of Executive’s services, in any capacity, to National Beef, until the expiration of all applicable statutes of limitation. National Beef will carry a directors’ and officers’ liability insurance policy throughout the period
during which the foregoing indemnification agreement survives, with terms reasonably acceptable to Executive, but Executive’s right to indemnity hereunder shall not be limited by, or to the coverage of, such insurance policy. The foregoing
rights shall also not be exclusive of any other indemnification rights arising under the LLC Agreement or other agreement or resolution or other decision of the members or Board of National Beef and shall inure to the benefit of the heirs and legal
representatives of Executive. Notwithstanding the foregoing, any such indemnification of Executive shall be limited to circumstances or to events where (a) either (i) the Executive, at the time of the action or inaction in question, determined in
good faith that his course of conduct was in, or not opposed to, the best interests of the Company, or (ii) in the case of inaction by the Executive, the Executive did not intend his inaction to be harmful or opposed to the best interests of the
Company, and (b) the Executive’s conduct did not constitute fraud or willful misconduct by the Executive. 
  
 9. Executive’s Representation. Executive represents and warrants to National Beef that neither the execution nor delivery of this Agreement,
nor the performance of Executive’s obligations hereunder will conflict with, or result in a breach of, any term, condition, or 

  

 8 

 
provision of, or constitute a default under, any obligation, contract, agreement, covenant or instrument to which Executive is a party or under which
Executive is bound, including without limitation, the breach by Executive of a fiduciary duty to any former employer. 
  
 10. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the internal substantive law (but not the
conflict of law principles) of the State of Kansas. 
  
 11.
Costs of Enforcement. Subject to the provisions of Section 19 hereof, if either party brings any legal action against the other to enforce its rights under this Agreement, the prevailing party in such dispute shall be entitled to recover from
the other party all fees, costs and expenses of enforcing its rights under this Agreement including, without limitation, the reasonable fees and expenses of attorneys, accountants and expert witnesses, which shall include, without limitation, all
fees, costs and expenses of appeals. 
  
 12. Entire
Agreement. This Agreement, together with the Deferred Equity Incentive Compensation Agreement, shall constitute the whole agreement of the parties hereto in reference to any employment of Executive by National Beef and in reference to any of the
matters or things herein provided for or hereinabove discussed or mentioned in reference to such employment, and all prior agreements, promises, representations and understandings relative thereto are hereby superseded. Without limiting the
generality of the foregoing, this Agreement, together with the Deferred Equity Incentive Compensation Agreement, shall supersede and replace any and all existing employment agreements or arrangements which Executive may have with National Beef or
its predecessor in interest, including, without limitation, the Prior Agreement. 
  
 13. Assignability. 
  
 a. In the event that National Beef shall merge or consolidate with any other partnership, limited liability company, corporation, or business entity, or all or substantially all of National Beef’s business or
assets shall be transferred in any manner to any other partnership, limited liability company, corporation or business entity, then this Agreement shall automatically be assigned to the surviving entity of such merger or consolidation or the
purchaser of assets, who shall thereupon succeed to, and be subject to, all rights, interests, duties and obligations of, and shall thereafter be deemed for all purposes hereof to be, National Beef hereunder. 
  
 b. This Agreement is personal in nature and none of the
parties hereto shall, without the written consent of the other parties hereto, assign or transfer this Agreement or any rights or obligations hereunder, except by operation of law or pursuant to the terms of Section 13(a). 
  
 c. Nothing expressed or implied herein is intended or shall
be construed to confer upon or give to any person, other than the parties hereto, any right, remedy or claim under or by reason of this Agreement or of any term, covenant or condition hereof. 
  

 9 

 14. Amendments; Waivers. This Agreement may be amended, modified, superseded, canceled, renewed or
extended and the terms or covenants hereof may be waived only by written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance. The failure of any party at any time or times to require performance of
any provisions hereof shall in no manner affect the right at a later time to enforce the same. No waiver by any party of the breach of any term or provision contained in this Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be, or construed as, a further or continuing waiver of any such breach, or a waiver of the breach of any other term or covenant contained in this Agreement. 
  
 15. Notice. All notices, requests and other communications hereunder shall be in writing and: (i) if given by
telegram or telex, shall be deemed to have been validly served, given or delivered when sent; (ii) if given by personal delivery, shall be deemed to have been validly served, given or delivered upon actual delivery; (iii) if sent by overnight
courier service, shall be deemed to have been validly served, given or delivered on the next business day after delivery to such overnight courier service; (iv) if mailed, shall be deemed to have been validly served, given or delivered three
business days after deposit in the United States mail, as registered or certified mail, with proper postage prepaid and, in the case of (iii) or (iv) hereof, addressed to the party or parties to be notified, at the following addresses (or such other
address(es) as a party may designate for itself by like notice); and (v) if sent by facsimile, shall be deemed to have been validly served, given or delivered upon receipt of facsimile confirmation; 
  
 If to National Beef: 
  
 National Beef Packing Company, LLC 
 c/o U.S. Premium Beef, Ltd. 
 12200 North Ambassador Drive 
 Kansas City, Missouri 64163 
 Attention: Steven D. Hunt 
 Fax: (816) 713-8810 
  
 With a
copy to: 
  
 Lindquist & Vennum P.L.L.P.

 4200 IDS Center 
 80 South Eighth Street 
 Minneapolis, Minnesota 55402 
 Attention: Mark J. Hanson 
 Fax: (612) 371-3207 
  
 If to
Executive: 
  
 Timothy M. Klein 
 2100 Winding Woods Drive 
 Liberty, Missouri 64068 
 Fax: (816) 713-8852 
  

 10 

 With a copy to: 
  

Ropes & Gray LLP 
 One International Place 
 Boston, MA 02110-2624 
 Attention: C. Todd Boes 
 Fax: 617-951-7050 
  
 16.
Severability. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 
  
 17. Survivability. The rights and obligations of the parties to this Agreement under Sections 4, 6, 7, 8, 10, 11, 12,
13, 14, 15, 16, 17, 18, 19, 20, 21 and all provisions of this Agreement necessary for the enforcement of those rights and obligations, shall survive the termination of this Agreement. 
  
 18. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original and all of which together shall be deemed one Agreement. 
  
 19. Dispute Resolution. 
  
 a. To the fullest
extent permitted by law, and subject to the provisions of Section 4(c) and Section 7 hereof, the parties agree in the event of any alleged breach hereof to submit the dispute for resolution by “mini-trial,” unless either party believes
that such procedure is inappropriate for the matter in controversy. Such mini-trial shall be conducted in accordance with the Center for Public Resources (CPR) Mini-Trial Agreement for Business Disputes before a panel consisting of a person
with full decision-making authority designated by each party and a neutral advisor selected jointly by the parties. Limited discovery shall be permitted as agreed by the parties. The mini-trial shall be conducted in Kansas City, Missouri at an
agreed time, place and date. Arguments may be presented by counsel or others as each party deems appropriate. Each party shall have no more than three hours (which may be extended by mutual agreement) to present exhibits, testimonies, summaries of
testimony and argument. No recording of the proceeding shall be permitted. Executive may have present and consult with other advisors as deemed appropriate. Such proceeding shall be confidential and, unless a mutually agreeable settlement is
reached, no portion of the proceeding shall be used for any purpose in any subsequent proceeding. If a mutually agreeable settlement is reached, the panel shall prepare or cause to be prepared a written settlement agreement setting forth the terms
and conditions of the settlement which shall be executed by each party and shall be enforceable by and binding upon each party. In the event a mutually agreeable settlement is not reached through use of the mini-trial proceeding, either party may
initiate arbitration as provided in subsection (b) below. The neutral advisor shall be disqualified as a witness, consultant or expert in any subsequent proceeding. 
  

 11 

 b. Subject to the provisions of Section 4(c) and Section 7 hereof, in the event either party has
determined that the mini-trial procedure is not appropriate or if no mutually agreeable settlement is reached through use of the mini-trial procedure, the dispute shall be resolved by binding arbitration in Kansas City, Missouri in accordance with
the rules of the Uniform Arbitration Act. Such arbitration shall be initiated by either party by notifying the other party in the same manner as a summons or by registered mail return receipt requested and requesting a panel of five arbitrators from
the American Arbitration Association. Alternate strikes shall be made to the panel commencing with the party requesting the arbitration until one name remains. Such individual shall be the arbitrator for the controversy. The party requesting the
arbitration shall notify the arbitrator in the same manner as a summons or by registered mail return receipt requested who shall hold a hearing(s) within sixty (60) days of the notice. To the fullest extent permitted by law, reasonable discovery,
including depositions, shall be permitted. Discovery issues shall be decided by the arbitrator. Post-hearing briefs shall be permitted. The arbitrator shall render a decision within twenty (20) days after the conclusion of the hearing(s). Judgment
upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. All fees for such arbitration will be divided equally among the participating parties. 
  
 20. Confidentiality. 
  
 a. Executive acknowledges that he will obtain certain confidential information and trade secrets (“Confidential Information”) about National
Beef during his employment, that this information was obtained by National Beef at great expense and the information is zealously guarded by National Beef from unauthorized disclosure. In recognition of the foregoing, the Executive will not at any
time during his employment or following his termination of employment for any reason, disclose, use or make otherwise available to any third party any Confidential Information relating to National Beef’s business, including, but not limited to:
its products, business methods and techniques; trade secrets, data, specifications, developments, and research activity; marketing and sales strategies, information and techniques; long and short term plans; business policies; current and
prospective customer lists, contacts and information; financial, personnel and information system information; and any other information concerning the business of National Beef, except for disclosure necessary in the course of the Executive’s
duties. Confidential Information shall not include information that: (i) at the time of disclosure or thereafter is (x) in the public domain or becomes generally known to the public through no fault of Executive or (y) not treated as confidential by
National Beef; (ii) was available to the Executive on a non-confidential basis from a source other than National Beef, provided that such source was not known by the Executive to be bound by a confidentiality agreement with National Beef; (iii) is
known to Executive prior to receipt thereof from National Beef (or any predecessor of National Beef); or (iv) the Executive is legally compelled to disclose. This confidentiality provision is intended by the parties to be enforceable regardless of
whether the protected information legally constitutes “trade secrets.” 
  
 b. Executive agrees that, upon termination of his employment with National Beef, whether voluntary or involuntary, he will promptly deliver to National Beef (and will not keep in his possession or deliver to anyone
other than National Beef) all Confidential Information in his possession, including, without limitation, all records, data, notes, reports, 

  

 12 

 
proposals, lists, correspondence, business plans, and other documents or property pertaining to the Confidential Information and all reproductions and
extracts thereof. Executive acknowledges and agrees that all such materials are the sole property of National Beef and that he will certify to National Beef at the time of his termination that he has complied with this obligation. 
  
 21. Offset. National Beef shall not offset any amounts owing on the
compensation payable pursuant to Section 3(a) hereof, Quarterly Bonus, the Annual Bonus, the First Long-Term Bonus, the Second Long-Term Bonus or the Third Long-Term Bonus, absent a final judicial determination of a monetary damage award payable by
Executive to National Beef. 
  
 IN WITNESS WHEREOF, the parties
hereto have executed this Agreement date first above written. 
  

	
	 “Executive”
 /s/    Timothy M. Klein

	 Timothy M. Klein

	
	“National Beef”
	 National Beef Packing Company, LLC

		
	 By:
	 	 /s/    Steven D. Hunt

	 Its:
	 	 Chairman

  

 13

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