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Commitments and Contingencies
9 Months Ended
Sep. 30, 2016
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
Commitments and Contingencies.

Commitments. Open purchase order commitments at September 30, 2016 related to raw materials and packaging used in the ordinary course of business were $56,848 extending out to December 2017. Open purchase order commitments at September 30, 2016 related to the purchase of capital assets were $4,197.

In 2015, our Board of Directors approved a $20,200 major expansion in warehousing capacity on a 20-acre campus adjoining our current Lawrenceburg facility as part of the implementation of our five-year strategic plan to grow the whiskey category. In September 2016 an additional $8,800 was approved related to the next phases of this project. The total approved warehouse expansion investment at September 30, 2016, is $29,000. As of September 30, 2016, we had spent $17,676 of this approved investment amount.

Contingencies. There are various legal and regulatory proceedings involving the Company and its subsidiaries.  The Company accrues estimated costs for a contingency when management believes that a loss is probable and can be reasonably estimated.

Alcohol and Tobacco Tax Trade Bureau ("TTB")

The TTB performed a federal excise tax audit of the Company’s subsidiaries, MGPI of Indiana, LLC and MGPI Processing, Inc., for the periods January 1, 2012 through July 31, 2015 and January 1, 2013 through July 31, 2015, respectively. The Company is in the process of addressing the preliminary findings of the TTB audit regarding clerical errors and support for storage losses. The Company is unable to determine the probability that additional penalties will be owed. However, the Company believes it is probable that a penalty may be imposed by the TTB as a result of certain TTB audit findings, but it is unable to reasonably estimate the amount thereof.

Management expects that the aggregate liabilities, if any, arising from such legal and regulatory proceedings, including the TTB audit, would not have a material adverse effect on the consolidated financial position or results of operations of the Company.

Chemical Release

A chemical release occurred at the Company's plant in Atchison, Kansas, at approximately 8:00 a.m. on October 21, 2016, which resulted in emissions venting into the air. The emissions had dispersed by approximately 11:00 a.m. on that same day. Local officials reported some injuries, mostly respiratory issues, following the release.
MGP Ingredients reported the event to the EPA, OSHA and Kansas and local authorities on that date, and is cooperating fully to investigate and ensure that all appropriate response actions are taken. MGP has also engaged outside experts to assist the investigation and response. The Company believes that it is probable that a fine or penalty may be imposed by one or more regulatory authorities, but it is currently unable to reasonably estimate the amount thereof. It is also possible that private plaintiffs may initiate legal proceedings for damages resulting from the emission, but the Company is currently unable to estimate the probability thereof or to reasonably estimate the amount of any such damages that might be claimed. The Company's insurance is expected to provide coverage of any damages to private plaintiffs, subject to a deductible of $250, but certain regulatory fines or penalties may not be covered.
There was no significant damage to its Atchison plant as a result of this incident. No other MGP facilities, including its distillery in Lawrenceburg, Indiana, were affected by this incident.