Registration No. 33-67474
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________
POST-EFFECTIVE AMENDMENT NO. 1 TO
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
_____________________________
SANDERSON FARMS, INC.
(Exact name of registrant as specified in its charter)
Mississippi
64-0615843
(I.R.S. Employer
Identification No.)
(State or other jurisdiction
of incorporation or organization)
225 North 13th Ave.
39441-0988
Laurel, Mississippi
(Zip Code)
(Address of principal executive
offices)
Sanderson Farms, Inc. and Affiliates Stock Option Plan
(Full title of the plans)
D. Michael Cockrell, Esq.
Sanderson Farms, Inc.
225 North 13th Ave.
Laurel, Mississippi 39441-0988
(601) 649-3040
(Name, address and telephone number, including area code,
of agent for service)
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The document or documents containing the information specified in
Part I are not required to be filed with the Securities and Exchange
Commission (the Commission ) as part of this Form S-8 Registration
Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the Commission by Sanderson Farms,
Inc. (the Company ) are hereby incorporated herein by reference:
(a) The Company s Annual Report on Form 10-K for the fiscal
year ended October 31, 1996.
(b) The description of the Company s Common Stock, par value
$1.00 per share, contained in the Company s Registration
Statement on Form 8-A, as declared effective by the
Securities and Exchange Commission on March 2, 1988,
incorporated by reference from pages 24 and 25 of the
Company s Registration Statement of Form S-1,
Registration No. 33-13141.
(c) All documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, prior to the filing of a post-
effective amendment which indicates that all securities
offered have been sold or which deregisters all
securities then remaining unsold.
The foregoing documents are incorporated by reference into this
prospectus and may be obtained from the Company, without charge, upon
written or oral request to D. Michael Cockrell, Sanderson Farms, Inc., P.
O. Box 988, Laurel, Mississippi 39441. Additionally, participants may
receive free of charge, upon written or oral request, a copy of (i) the
Company s most recent Annual Report to Stockholders; (ii) the Company s
Annual Report on Form 10-K; (iii) any prospectus filed by the Company
pursuant to Rule 424(b) under the Securities Act of 1933 and all documents
comprising the prospectus for Common Stock issued through the Plan; and/or
(iv) the Company s effective Securities Exchange Act registration statement
on Form 10. All requests should be directed to the above referenced person
at the above address.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Article FOURTEENTH of the Company s Articles of Incorporation
provides that a director of the Company shall not be liable to the Company
or its shareholders for money damages for any action, or any failure to
take any action, as a director, except for: (a) the amount of a financial
benefit received by a director to which he is not entitled; (b) an
intentional infliction of harm on the Company or the shareholders; (c) a
violation of Section 79-4-8.33 of the Mississippi Code of 1972, as amended,
more commonly referred to as Section 8.33 of the Mississippi Business
Corporation Act, as presently in effect or as amended thereafter,
pertaining to liability for unlawful distributions; or (d) an intentional
violation of criminal law. If Mississippi law is amended to authorize
corporations to take corporate action further limiting or eliminating the
personal liability of directors, then the liability of each director of the
Company shall be limited or eliminated to the full extent permitted by
Mississippi law as so amended from time to time. Neither the amendment nor
repeal of Article FOURTEENTH, nor the adoption of any provision of the
Articles of Incorporation inconsistent with it eliminates or reduces its
effect in respect of any matter occurring, or any cause of action, suit or
claim that, but for Article FOURTEENTH, would accrue or arise, prior to
such amendment, repeal or adoption of an inconsistent provision.
Reference is also made to Section 79-4-8.50 through and including
Section 79-4-8.58 of the Mississippi Business Corporation Law which, taken
together, authorize and set forth the extent to which a Mississippi
business corporation shall and may indemnify its directors and
officers.
Article VI of the Company s By-Laws provides for mandatory
indemnification of the Company s directors and officers, and those of its
employees (if any) who are appointed by its President to serve on the
Company s Executive Committee, or are appointed by such Committee to be
Division Managers, to the fullest extent that directors and officers are
permitted to be indemnified by law, except in an action brought directly by
the Company against such a person. The mandatory indemnification includes
advancement of expenses to those persons who meet the requirements,
described above, for such advances. The right to indemnification applies
to acts or omissions occurring prior to or after the adoption of the new
by-law, continues as to a person who ceases to be a director, officer or
employee, and applies to the person s heirs. Article VI may be amended or
repealed at any time by the Board of Directors with or without approval by
the shareholders, but no such action will affect the right to
indemnification for acts or omissions which occurred prior to such
amendment or repeal.
The Company maintains insurance the general effect of which is to
provide (a) coverage for the Company with respect to amounts which it is
required or permitted to pay to officers or directors under the
indemnification provisions set forth in the Mississippi Business
Corporation Law and Article VI of the Company s By-Laws and (b) coverage
for the officers and directors of the Company for liabilities (including
certain liabilities under the Federal securities laws) incurred by such
persons in their capacities as officers or directors for which they are not
indemnified by the Company.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
EXHIBIT
NUMBER
EXHIBIT DESCRIPTION
3.1
Articles of Incorporation of the Company, as
amended
3.2
Restated By-Laws of the Company
4.1
Certificate of Designations relating to Series A
Junior Participating Preferred stock
(incorporated herein by reference to the
Company s Annual Report on Form 10-K for the
fiscal year ended October 31, 1989)
5
Opinion of Wise Carter Child & Caraway,
a
Professional
Association*
10.1
Sanderson Farms, Inc. and affiliates Stock
Option Plan (incorporated herein by reference to
the Company s Annual Report on Form 10-K for the
fiscal year ended October 31, 1992)
10.2
Amended and Restated Sanderson Farms, Inc. Stock
Option Plan
10.3
Form of Sanderson Farms, Inc. Non-Statutory
Stock Option Agreement
10.4
Form of Sanderson Farms, Inc. Incentive Stock
Option Agreement
10.5
Form of Sanderson Farms, Inc. Alternate Stock
Appreciation Rights Agreement
23.1
Consent of Wise Carter Child & Caraway, a
Professional Association (contained in Exhibit
5)*
23.2
Consent of Ernst & Young LLP, Independent
Auditors
24
Power of Attorney relating to subsequent
amendments (included on the signature page to
this Post-Effective Amendment No. 1 to the
Registration Statement)
_________________
* Previously filed.
Item 9. Undertakings.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
Registration Statement to include any material
information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any
material change to such information in the Registration
Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and
the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing
of the registrant s annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan s annual report pursuant to section
15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions,
or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-8, and has duly caused this Amendment
to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Laurel, State of
Mississippi, on this 4th day of June, 1997.
SANDERSON FARMS, INC.
By /s/ Joe F. Sanderson, Jr.
Joe F. Sanderson, Jr.
President and Chief Executive Officer
Each person whose signature appears below constitutes and appoints Joe F.
Sanderson, Jr., D. Michael Cockrell and James A. Grimes, and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead,
in any and all capacities, to sign any and all further amendments to this
Registration Statement, and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in connection therewith, as fully
to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or
either of them, or their or his substitute or substitutes, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed by the following persons in
the capacities indicated on June 4, 1997.
Name Title
/s/ Joe F. Sanderson, Jr.
Joe F. Sanderson, Jr. President, Chief Executive Officer
(Principal Executive Officer) and
Director
/s/ D. Michael Cockrell
D. Michael Cockrell Treasurer and Chief Financial Officer
(Principal Financial Officer)
/s/ James A. Grimes
James A. Grimes Secretary and Chief Accounting Officer
(Principal Accounting Officer)
/s/ Joe F. Sanderson, Jr.
Joe Frank Sanderson Chairman and Director
/s/ Dewey R. Sanderson, Jr.
Dewey R. Sanderson, Jr. Director
/s/ Donald W. Zacharias
Donald W. Zacharias Director
/s/ Phil K. Livingston
Phil K. Livingston Director
/s/ John H. Baker, III
John H. Baker, III Director
/s/ Charles W. Ritter, Jr.
Charles W. Ritter, Jr. Director
/s/ Rowan H. Taylor
Rowan H. Taylor Director
/s/ Robert Buck Sanderson
Robert Buck Sanderson Director
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER
EXHIBIT DESCRIPTION
3.1
Articles of Incorporation of the Company, as
amended
3.2
Restated By-Laws of the Company
4.1
Certificate of Designations relating to Series A
Junior Participating Preferred stock
(incorporated herein by reference to the
Company s Annual Report on Form 10-K for the
fiscal year ended October 31, 1989)
5
Opinion of Wise Carter Child & Ca
raway, a
Professional
Association*
10.1
Sanderson Farms, Inc. and affiliates Stock
Option Plan (incorporated herein by reference to
the Company s Annual Report on Form 10-K for the
fiscal year ended October 31, 1992)
10.2
Amended and Restated Sanderson Farms, Inc. Stock
Option Plan
10.3
Form of Sanderson Farms, Inc. Non-Statutory
Stock Option Agreement
10.4
Form of Sanderson Farms, Inc. Incentive Stock
Option Agreement
10.5
Form of Sanderson Farms, Inc. Alternate Stock
Appreciation Rights Agreement
23.1
Consent of Wise Carter Child & Caraway, a
Professional Association (contained in Exhibit
5)*
23.2
Consent of Ernst & Young LLP, Independent
Auditors
24
Power of Attorney relating to subsequent
amendments (included on the signature page to
this Post-Effective Amendment No. 1 to the
Registration Statement)
_________________
* Previously filed.
<PAGE>
Exhibit 3.1
ARTICLES OF INCORPORATION
OF
SANDERSON FARMS, INC.
[Filed October 31, 1978]
We, the undersigned natural persons of the age of twenty-one years
or more, acting as incorporators of a corporation under the Mississippi
Business Corporation Act, adopt the following Articles of Incorporation
for such corporation:
FIRST: The name of the corporation is SANDERSON FARMS, INC.
SECOND: The period of its duration is 99 years.
THIRD: The specific purpose or purposes for which the
corporation is organized stated in general terms are:
1. To purchase, own, and hold the stock of other corporations,
and to do every act and thing attendant to the ownership of
such stock and to direct the operations of other
corporations through the ownership of the stock therein;
2. To serve in an advisory, managerial, and consultative
capacity to corporations, associations, partnerships,
individuals, and others, and to establish and maintain
departments and laboratories, if necessary, for industrial,
financial, statistical, inventory, and other research work,
and to engage generally in the business of providing,
promoting, and establishing systems, methods, and controls
for industrial and managerial efficiency and operations.
3. To investigate systems, methods, and controls of
manufacturing, plant operations, packing, storing, shipping,
marketing, inventories, accounting, and other operations
integral to any and all types of businesses and to make
recommendations, revise, adapt, modernize, and establish
economies to effect industrial and managerial efficiency and
in connection therewith to take over the entire operation
and business of any type of industry or other forms of
endeavor and to do all such things and to perform all such
services as may be necessary to carry out the foregoing
purposes.
4. To devise, develop, create, inaugurate, and contract for the
establishment, installation, and sale and rental of systems,
methods, and controls for efficient operation and management
of industrial manufacturing, mercantile, commercial,
agricultural, or other business concerns, firms,
partnerships, associations, and corporations and to provide,
make available, and furnish maintenance and supervision and
to train and instruct individuals in the operation,
installation, and maintenance of such systems, methods and
controls.
5. To provide computer services to corporations, associations,
partnerships, individuals, and others and to establish
programs necessary for the proper operation and functioning
of such services.
6. So far as authorized by the law under which this certificate
is drawn: to examine and inspect the books and accounts of
others, to devise and install financial, checking,
correspondence, filing, and other office and business
systems; to take inventories; to make appraisals; to compile
statistics as an aid to the officers of the corporations and
other persons in the making of reports and statements; to do
all such things and perform or supply all such services as
are commonly done, performed, or supplied by business
management experts; and to warrant the accuracy of the work
done or services performed by it.
7. To do all the things necessary, convenient or desirable for
the accomplishment of any of the purposes or the attainment
of any of the objectives herein set forth and to do all
things incidental thereto which are not prohibited by law.
It is the intention that the objects and purposes specified in the
foregoing clauses of this Article Third shall also be construed as
powers and that the forgoing enumeration of specific objects, purposes,
and powers, shall not be held to limit or restrict in any manner the
powers of the corporation but shall be in furtherance of and in addition
to, and not in limitation of, the general powers conferred by the laws
of the State of Mississippi under the Mississippi Business Corporation
Act.
It is also the intention that except as otherwise expressed herein
the objects, purposes, and powers specified in any of the foregoing
clauses shall not in anywise be limited or restricted by reference to or
inference from the terms of any other clause of this certificate, and
that the objects, purposes, and powers specified in each of the clauses
of this Article Third shall be regarded as independent objects,
purposes, and powers.
FOURTH: The aggregate number of shares which the corporation
shall have authority to issue is Three Million (3,000,000) of the par
value of One Dollar ($1.00) each.
FIFTH: The corporation will not commence business until
consideration of the value of at least $1,000 has been received for the
issuance of shares.
SIXTH: The post office address of its initial registered
office is 208 Beacon Street, Laurel, Mississippi, 39440, and the name of
its initial registered agent at such address is JOE FRANK SANDERSON.
SEVENTH: The number of directors constituting the initial board
of directors of the corporation, which must be not less than three (3),
is six and the names and addresses of the persons who are to serve as
directors until the first annual meeting of shareholders or until their
successors are elected and shall qualify are:
NAME STREET AND POST OFFICE ADDRESS
D. R. Sanderson, Sr. 208 Beacon Street, Laurel, Mississippi 39440
Joe Frank Sanderson 208 Beacon Street, Laurel, Mississippi 39440
D. R. Sanderson, Jr. 208 Beacon Street, Laurel, Mississippi 39440
J. Odell Johnson 208 Beacon Street, Laurel, Mississippi 39440
Wyatt J. Davis, Jr. 208 Beacon Street, Laurel, Mississippi 39440
Thomas R. Ward Broadmoor Mart, Meridian, Mississippi 39301
EIGHTH: The name and post office address of each incorporator
is:
NAME STREET AND POST OFFICE ADDRESS
Joe Frank Sanderson 208 Beacon Street, Laurel, Mississippi 39440
Wyatt J. Davis, Jr. 208 Beacon Street, Laurel, Mississippi 39440
Dated October 19, 1978.
/s/ Joe Frank Sanderson
JOE FRANK SANDERSON
/s/ Wyatt J. Davis, Jr.
WYATT J. DAVIS, JR.
ACKNOWLEDGMENT
STATE OF MISSISSIPPI
COUNTY OF JONES
This day personally appeared before me, the undersigned authority,
JOE FRANK SANDERSON and WYATT J. DAVIS, Incorporators of the corporation
known as the SANDERSON FARMS, INC., who acknowledged that they signed
and executed the above and foregoing Articles of Incorporation as their
act and deed on this the 19th day of October, 1978.
/s/ Barbara C. Robinson
NOTARY PUBLIC
My Commission Expires:
September 22, 1981
(NOTARIAL SEAL)
<PAGE>
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
SANDERSON FARMS, INC.
[Filed March 23, 1987]
Pursuant to the provisions of Section 61 of the Mississippi
Business Corporation Act, the undersigned corporation adopts the
following Articles of Amendment to its Articles of Incorporation:
FIRST: The name of this corporation is SANDERSON FARMS, INC.
SECOND: The following amendment of the Articles of
Incorporation was adopted by the shareholders of the corporation on
March 23, 1987, in the manner prescribed by the Mississippi Business
Corporation Act:
Present Article FOURTH is hereby deleted in its entirety and
new Article FOURTH is inserted to read:
FOURTH:
Section 1. The aggregate number of shares which the
corporation is authorized to issue is thirty million (30,000,000),
divided into two classes. The designation of each class, the
number of shares of each class and the par value, if any, of the
shares of each class, or a statement that the shares of any class
are without par value, are as follows:
PAR VALUE PER
SHARE OR STATEMENT
NUMBER OF SERIES THAT SHARES ARE
SHARES CLASS (IF ANY) WITHOUT PAR VALUE
25,000,000 Common None $1.00
5,000,000 Preferred To be fixed and $1.00
determined by
Board of Directors
upon issuance
Section 2. The shares of preferred stock authorized by
these Articles of Incorporation shall have no voting rights except
as may otherwise be required by applicable law.
Section 3. The Board of Directors of the corporation shall
have the authority to establish one or more series of the
preferred stock authorized by these Articles of Incorporation and
to fix, with respect to each such series; the rate of dividend;
whether shares may be redeemed and, if so, the redemption price
and the terms and conditions of redemption; the amount payable
upon shares in the event of voluntary or involuntary liquidation;
sinking fund provisions, if any, for the redemption or purchase of
shares; and the terms and conditions, if any, on which shares may
be converted.
Section 4. No amendment to the Articles of Incorporation of
the corporation that would have the effect of reducing the number
of authorized shares of Common Stock or Preferred Stock or would
reduce the authority of the Board of Directors to fix terms or
conditions relating to any series of Preferred Stock, or would
have the effect of modifying the terms or conditions relating to
any series of Preferred Stock, once established by the Board of
Directors, shall be adopted unless such amendment shall receive
the affirmative vote of at least 75% of the total number of shares
of Common Stock outstanding; provided that this Section 4 shall
not apply to, and such 75% vote shall not be required for, any
such amendment recommended to the stockholders by the vote of at
least two-thirds of the full Board of Directors of the corporation
at a time when no person, corporation or other entity, either
singly or together with its affiliates and associates (as such
terms are defined in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934), other than
the Sanderson Family (as defined hereinbelow), is the beneficial
owner, directly or indirectly, of more than 25% of the outstanding
shares of stock of the corporation entitled to vote in elections
of directors. For purposes hereof, the Sanderson Family means
the children and grandchildren of D. R. Sanderson and Wilma W.
Sanderson and the spouses of such children, but not the spouses of
such grandchildren.
THIRD: The number of shares of the corporation outstanding at
the time of such adoption was 1,205,061; and the number of shares
entitled to vote thereon was 1,205,061.
FOURTH: The designation and number of outstanding shares of
each class entitled to vote thereon as a class were as follows:
NONE
FIFTH: The number of shares voted for such amendment was
1,151,347; and the number of shares voted against such amendment was
zero.
SIXTH: The number of shares of each class entitled to vote
thereon as a class voted for and against such amendment, respectively,
was:
NONE
SEVENTH: The manner, if not set forth in such amendment, in
which any exchange, reclassification, or cancellation of issued shares
provided for in the amendment shall be effected, is as follows:
NO CHANGE
EIGHTH: The manner in which such amendment effects a change in
the amount of stated capital, and the amount of stated capital
(expressed in dollars) as changed by such amendment, are as follows:
NO CHANGE
Dated: March 23, 1987.
SANDERSON FARMS, INC.
BY:/s/ J. Odell Johnson
Its President
BY:/s/ Wyatt J. Davis, Jr.
Its Secretary
STATE OF MISSISSIPPI
COUNTY OF JONES
I, Peggy Y. McKee, a notary public, do hereby certify that on this
23 day of March, 1987, personally appeared before me J. ODELL JOHNSON,
who, being by me first duly sworn, declared that he is the President of
SANDERSON FARMS, INC., that he executed the foregoing document as
President of the Corporation, and that the statements therein contained
are true.
/s/ Peggy Y. McKee
NOTARY PUBLIC
My Commission Expires:
April 23, 1989
<PAGE>
<PAGE> ARTICLES OF AMENDMENT [Filed April 21, 1989]
(Attach conformed copy.)
Profit Nonprofit
(Mark appropriate box)
The undersigned corporation, pursuant to Section 79-4-10.06 (if a
profit corporation) or Section 79-11-305 (if a nonprofit corporation) of
the Mississippi Code of 1972, hereby executes the following document and
sets forth:
1. The name of the corporation is: SANDERSON FARMS, INC.
2. Set forth the text of each amendment adopted. (Attach page.)
3. If a profit amendment provides for an exchange, reclassification,
or cancellation of issued shares, set forth the provisions for
implementing the amendment if they are not contained in the
amendment itself. (Attach page.)
4. The amendment(s) was (were) adopted: April 21, 1989
FOR PROFIT CORPORATION
(a) adopted by the incorporators X directors without
shareholder action and shareholder action was not required.
(Check appropriate box.)
FOR NONPROFIT CORPORATION
(b) adopted by board of directors incorporators without
member action and member action was not required. (Check
appropriate box.)
FOR PROFIT CORPORATIONS
5. If the amendment was approved by shareholders:
(a) The designation, number of outstanding shares, number of
votes entitled to be cast by each voting group entitled to
vote separately on the amendment, and the number of votes of
each voting group indisputably represented at the meeting
was:
No. outstanding No. of votes No. of votes
Designation shares entitled to be cast
indisputably
represented
Common 9,075,427 9,075,427
(b) Either the total number of votes cast for and against the
amendment by each voting group entitled to vote separately
on the amendment was:
Total no. of Total no. of
Voting group votes cast FOR votes cast AGAINST
_______________ _______________ _____________
_______________ _______________ _____________
or the total number of undisputed votes cast for the
amendment by each voting group was:
Total no. of undisputed
Voting group votes cast FOR the plan
Common 7,376,128
and the number cast for the amendment by each voting group
was sufficient for approval by that voting group.
FOR NONPROFIT CORPORATIONS
6. If the amendment was approved by the members:
(a) The designation, number of memberships outstanding, number
of votes entitled to be cast by each class entitled to vote
separately on the amendment, and number of votes of each
class indisputably represented at the meeting was:
No. memberships No. of votes No. of votes
Designation outstanding entitled to be cast
indisputably represented
_______________ _______________ _______________
_______________ _______________ _______________
(b) Either
(i) the total number of votes cast for and against the
amendment by each class entitled to vote separately on
the amendment was:
Total no. of Total no. of
votes cast votes cast
Voting class FOR the amendment AGAINST the
amendment
_______________ _______________ _______________
_______________ _______________ _______________
or
(ii) the total number of undisputed votes cast for the
amendment by each class was:
Total no. of
undisputed votes
cast
Voting group FOR the amendment
_______________ _______________
_______________ _______________
and the number cast for the amendment by each class was sufficient for
approval by that voting group.
BY: Joe Frank Sanderson, Chairman /s/ Joe Frank Sanderson<PAGE>
<PAGE>
CERTIFICATE OF DESIGNATIONS
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
SANDERSON FARMS, INC.
(Pursuant to Section 79-4-6.02 of the
Mississippi Business Corporation Law)
Sanderson Farms, Inc., a Mississippi corporation (the
Corporation ), hereby certifies that the following resolution was
adopted by the Board of Directors of the Corporation as required by
Section 79-4-6.02 of the Business Corporation Law at a meeting duly
called and held on April 21, 1989:
RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors of this Corporation (the Board of Directors or
the Board ) in accordance with the provisions of the Articles of
Incorporation, the Board of Directors hereby creates a series of
Preferred Stock, par value $100.00 per share (the Preferred Stock ), of
the Corporation and hereby states the designation and number of shares,
and fixes the preferences, limitations, and relative rights thereof as
follows:
Series A Junior Participating Preferred Stock:
Section 8. Designation and Amount. The shares of such series
shall be designated as Series A Junior Participating Preferred Stock
(the Series A Preferred Stock ) and the number of shares constituting
the Series A Preferred Stock shall be 500,000. Such number of shares
may be increased or decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series A
Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the
conversion of any outstanding securities issued by the Corporation
convertible into Series A Preferred Stock.
Section 9. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series A Preferred Stock with respect to dividends, the
holders of shares of Series A Preferred Stock, in preference to the
holders of Common Stock, par value $1.00 per share (the Common Stock ),
of the Corporation, and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds
legally available for the purpose, quarterly dividends payable in cash
on the first day of March, June, September and December in each year
(each such date being referred to herein as a Quarterly Dividend
Payment Date ), commencing on the first Quarterly Dividend Payment Date
after the first issuance of a share or fraction of a share of Series A
Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $1 or (b) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per share
amount of all cash dividends, and 100 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of Common Stock
or a subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or, with respect
to the first Quarterly Dividend Payment Date, since the first issuance
of any share or fraction of a share of Series A Preferred Stock. In the
event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the amount to which
holders of shares of Series A Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) of this
Section immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly Dividend Payment
Date, a dividend of $1 per share on the Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment
Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case dividends on
such shares shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment Date or is a
date after the record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which events
such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not
bear interest. Dividends paid on the shares of Series A Preferred Stock
in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The
Board of Directors may fix a record date for the determination of
holders of shares of Series A Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof.
Section 10. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote for the
stockholders of the Corporation. In the event the Corporation shall at
any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying such number by a fraction,
the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately
prior to such event.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock or any
similar stock, or by law, the holders of shares of Series A Preferred
Stock and the holders of shares of Common Stock and any other capital
stock of the Corporation have general voting rights shall vote together
as one class on all matters submitted to a vote of stockholders of the
Corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights
and their consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth herein) for
taking any corporate action.
Section 11. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series A Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Preferred Stock except dividends paid ratably on
the Series A Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total
amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred
Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any
shares of stock ranking on a parity with the Series A Preferred
Stock, except in accordance with a purchase offer made in writing
or by publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation would, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
Section 12. Reacquired Shares. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and may be reissued as
part of a new series of Preferred Stock subject to the conditions and
restrictions on issuance set forth herein, in the Articles of
Incorporation, or in any other Certificate of Designations creating a
series of Preferred Stock or any similar stock or as otherwise required
by law.
Section 13. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock ranking
junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Preferred Stock unless, prior thereto, the
holders of shares of Series A Preferred Stock shall have received $100
per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such
payment, provided that the holders of shares of Series A Preferred Stock
shall be entitled to receive an aggregate amount per share, subject to
the provision for adjustment hereinafter set forth, equal to 100 times
the aggregate amount to be distributed per share to holders of shares of
Common Stock, or (2) to the holders of shares of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, except distributions made
ratably on the Series A Preferred Stock and all such parity stock in
proportion to the total amounts to which the holders of all such shares
are entitled upon such liquidation, dissolution or winding up. In the
event the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the provisio in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately
prior to such event.
Section 14. Consolidation, Merger, etc. In case the corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash and/or any other property,
then in any such case each share of Series A Preferred Stock shall at
the same time be similarly exchanged or changed into an amount per
share, subject to the provision for adjustment hereinafter set forth,
equal to 100 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be, into
which or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment
of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the amount set forth
in the preceding sentence with respect to the exchange or change of
shares of Series A Preferred Stock shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 15. No Redemption. The shares of Series A Preferred Stock
shall not be redeemable.
Section 16. Rank. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets,
junior to all series of any other class of the Corporation s Preferred
Stock.
Section 17. Amendment. The Articles of Incorporation of the
Corporation shall not be amended in any manner which would materially
alter or change the powers, preferences or special rights of the Series
A Preferred Stock so as to affect them adversely without the affirmative
vote of the holders of at least two-thirds of the outstanding shares of
Series A Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, this Certificate of Designations is executed
on behalf of the Corporation by its Chairman of the Board and attested
by its Secretary this 21st day of April, 1989.
/s/ Joe Frank Sanderson
Joe Frank Sanderson, Chairman of the Board
Attest:
/s/ Wyatt J. Davis, Jr.
Secretary<PAGE>
<PAGE>
ARTICLES OF AMENDMENT [Filed April 25, 1989]
(Attach conformed copy.)
Profit Nonprofit
(Mark appropriate box)
The undersigned corporation, pursuant to Section 79-4-10.06 (if a
profit corporation) or Section 79-11-305 (if a nonprofit corporation) of
the Mississippi Code of 1972, hereby executes the following document and
sets forth:
1. The name of the corporation is: SANDERSON FARMS, INC.
2. Set forth the text of each amendment adopted. (Attach page.)
3. If a profit amendment provides for an exchange, reclassification,
or cancellation of issued shares, set forth the provisions for
implementing the amendment if they are not contained in the
amendment itself. (Attach page.)
4. The amendment(s) was (were) adopted:
April 21, 1989
FOR PROFIT CORPORATION
(a) adopted by the incorporators
directors without
shareholder action and shareholder action was not required.
(Check appropriate box.)
FOR NONPROFIT CORPORATION
(b) adopted by board of directors incorporators without
member action and member action was not required. (Check
appropriate box.)
FOR PROFIT CORPORATIONS
5. If the amendment was approved by shareholders:
(a) The designation, number of outstanding shares, number of
votes entitled to be cast by each voting group entitled to
vote separately on the amendment, and the number of votes of
each voting group indisputably represented at the meeting
was:
No. outstanding No. of votes No. of votes
Designation shares entitled to be cast
indisputably
represented
_______________ _______________ _______________
(b) Either the total number of votes cast for and against the
amendment by each voting group entitled to vote separately
on the amendment was:
Total no. of Total no. of
Voting group votes cast FOR votes cast
AGAINST
_______________ _______________ _______________
_______________ ______________ _______________
or the total number of undisputed votes cast for the
amendment by each voting group was:
Total no. of undisputed
Voting group votes cast FOR the plan
_______________ _______________
_______________ _______________
and the number cast for the amendment by each voting group
was sufficient for approval by that voting group.
FOR NONPROFIT CORPORATIONS
6. If the amendment was approved by the members:
(a) The designation, number of memberships outstanding, number
of votes entitled to be cast by each class entitled to vote
separately on the amendment, and number of votes of each
class indisputably represented at the meeting was:
No. memberships No. of votes No. of votes
Designation outstanding entitled to be cast
indisputably represented
_______________ _______________ _______________
_______________ _______________ _______________
(b) Either
(i) the total number of votes cast for and against the
amendment by each class entitled to vote separately on
the amendment was:
Total no. of Total no. of
votes cast votes cast
Voting class FOR the amendment AGAINST the
amendment
_______________ _______________ _______________
_______________ _______________ _______________
or
(ii) the total number of undisputed votes cast for the
amendment by each class was:
Total no. of
undisputed votes
cast
Voting group FOR the amendment
_______________ _______________
_______________ _______________
and the number cast for the amendment by each class was sufficient for
approval by that voting group.
BY: Joe Frank Sanderson, Chairman /s/ Joe Frank Sanderson<PAGE>
<PAGE>
AMENDMENTS TO THE
ARTICLES OF INCORPORATION
OF
SANDERSON FARMS, INC.
Pursuant to the provisions of Section 10.06 of the Mississippi
Business Corporation Act, the undersigned corporation hereby amends its
Articles of Incorporation as follows:
18. Present Article SECOND is hereby deleted in its
entirety and new Article SECOND is inserted to read:
SECOND: The period of its duration is perpetual.
19. Present Article FOURTH is hereby deleted in its
entirety and new Article FOURTH is inserted to read:
FOURTH:
Section 1. The aggregate number of shares which the
corporation is authorized to issue is one hundred five million
(105,000,000), divided into two classes. The designation of each
class, the number of shares of each class and the par value, if
any, of the shares of each class, or a statement that the shares
of any class are without par value, are as follows:
PAR VALUE PER
SHARE OR STATEMENT
NUMBER OF SERIES THAT SHARES ARE
SHARES CLASS (IF ANY) WITHOUT PAR VALUE
100,000,000 Common None $1.00
5,000,000 Preferred To be determined To be determined
by the Board of by the Board of
Directors before Directors before
issuance issuance
Section 2. The Board of Directors of the corporation shall
have the authority to establish one or more series of the
Preferred Stock authorized by these Articles of Incorporation and
to determine, in whole or in part, the preferences, limitations
and relative rights (within the limits set forth in Section 79-4-
6.01, Mississippi Code 1972, as amended) of (a) the Preferred
Stock before the issuance thereof, or (b) one or more series of
the Preferred Stock before the issuance of any shares of that
series.
Section 3. No amendment to the Articles of Incorporation of
the corporation that would have the effect of reducing the number
of authorized shares of Common Stock or Preferred Stock or would
reduce the authority of the Board of Directors to fix terms or
conditions relating to any series of Preferred Stock, or would
have the effect of modifying the terms or conditions relating to
any series of Preferred Stock, once established by the Board of
Directors, shall be adopted unless such amendment shall receive
the affirmative vote of at least 75% of the total number of shares
of Common Stock outstanding (in addition to and not in lieu of,
any other vote required under the Mississippi Business Corporation
Act); provided that this Section 3 shall not apply to, and such
75% vote shall not be required for, any such amendment recommended
to the stockholders in advance of adoption by the vote of at least
two-thirds of the full Board of Directors of the corporation at a
time when no person, corporation or other entity beneficially owns
(for which purpose the definition of beneficial ownership set
forth in Article NINTH on the date on which this Article FOURTH
becomes effective (without regard to any amendments to Article
NINTH, unless specifically incorporated into this Article FOURTH)
shall apply, but without regard to Paragraph 4 of Section B
thereof) 20% or more of the outstanding shares of Common Stock of
the corporation or 20% or more of the total voting power of the
corporation entitled to vote with respect to such amendment.
20. Present Articles SEVENTH is hereby deleted in its entirety
and new Article SEVENTH is inserted to read:
SEVENTH:
Section 1. The number of directors constituting the Board
of Directors shall be fixed by the Board of Directors in the By-
laws and may be changed by it from time to time.
Section 2. The terms of directors of the corporation shall
be staggered by dividing the total number of directors into three
classes, with each class containing one-third, or as close to one-
third as possible, of the total. With respect to directors who
are elected at the first annual stockholders meeting where a
classified Board of Directors is elected, the terms of directors
in the first class shall expire at the first annual stockholders
meeting after their election, the terms of the second class shall
expire at the second annual stockholders meeting after their
election, and the terms of the third class shall expire at the
third annual stockholders meeting after their election. At each
annual stockholders meeting held after such first meeting,
directors shall be chosen for a term of three years to succeed
those whose terms expire.
Section 3. Directors shall be elected at each annual
meeting or at any special meeting of stockholders called for that
purpose by the affirmative vote of a majority, and not a
plurality, of the shares entitled to vote and represented, in
person or by proxy, at such meeting at which a quorum is present.
There shall be no cumulative voting.
Section 4. No amendment to this Article SEVENTH shall have
the effect of shortening any term of office that commenced prior
to the adoption of such amendment, unless such amendment
specifically provides that it has that effect and is recommended
to the stockholders in advance of adoption by the vote of at least
two-thirds of the full Board of Directors of the corporation at a
time when no person, corporation or other entity beneficially owns
(for which purpose the definition of beneficial ownership set
forth in Article NINTH on the date on which this Article SEVENTH
becomes effective (without regard to any amendments to Article
NINTH, unless specifically incorporated into this Article SEVENTH)
shall apply, but without regard to paragraph 4 of Section B
thereof) 20% or more of the outstanding shares of Common Stock of
the corporation or 20% or more of the total voting power of the
corporation entitled to vote with respect to such amendment.
21. New Article NINTH is hereby added to read:
NINTH: The provisions of the Mississippi Shareholder
Protection Act, Sections 79-25-1 through 79-25-9, Mississippi Code
1972 Annotated (the Act ), without regard to any future amendments
thereto but with the modifications set forth below, shall apply to
this corporation as if the corporation was a Corporation as
defined in the Act. The following modifications shall apply:
A. The 80% vote required by Section 79-25-5(a) of the Act
shall not apply, and the only vote required by this Article NINTH
shall be the two-thirds vote required by Section 79-25-5(b).
B. The term Beneficial Owner is defined as follows for
all purposes of this Article NINTH rather than as it is defined in
Section 79-25-3(d) of the Act.
1. Beneficial Owner , when used with respect to any
voting stock, means any person (i) that, individually or
with any of its affiliates or associates, beneficially owns
voting stock, directly or indirectly; or (ii) that,
individually or with any of its affiliates or associates,
has: (A) the right to acquire voting stock (whether such
right is exercisable immediately or only after the passage
of time), pursuant to any agreement, arrangement or
understanding, or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise;
provided, however, that a person shall not be deemed the
Beneficial Owner of, or to beneficially own, voting stock
tendered pursuant to a tender or exchange offer made by or
on behalf of such person or any of such person s Affiliates
or Associates until such tendered voting stock is accepted
for purchase or exchange; or (B) the right to vote voting
stock pursuant to any agreement, arrangement or
understanding; provided, however, that a person shall not be
deemed the Beneficial Owner of, or to beneficially own, any
voting stock if the agreement, arrangement or understanding
to vote such stock (1) arises solely from a revocable proxy
or consent given to such person in response to a public
proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations
promulgated under the Securities Exchange Act of 1934, as
amended, and (2) is not also then reportable on Schedule 13D
under that Act (or any comparable or successor report); or
(iii) that has any agreement, arrangement or understanding
for the purpose of acquiring, holding, voting, exercising
investment power over, or disposing of voting stock with any
other person that beneficially owns, or whose affiliates or
associates beneficially own, directly or indirectly, such
shares of voting stock.
2. Notwithstanding anything in this definition of
beneficial ownership to the contrary, the phrase then
outstanding, when used with reference to a person s
beneficial ownership of voting stock of the corporation,
shall mean the number of such voting stock not then actually
issued and outstanding which such person would be deemed to
own beneficially hereunder.
3. Further notwithstanding the foregoing, in
determining as of any particular time whether any member of
the Sanderson Family (as such term is defined in paragraph 5
hereof) beneficially owns voting stock of the corporation,
such member shall not be considered to be the beneficial
owner of any share that constitutes a Family Share (as
herein defined) at that time, even if such share would, in
the absence of this paragraph, be deemed to be beneficially
owned by such member. A Family Share is a share that meets
the description set forth in any of clauses (i) through (iv)
below and that, at the time as of which a determination of
beneficial ownership is to be made, continues to be a Family
Share pursuant to the provisions that follow those clauses.
A share is initially a Family Share if: (i) on the date
this Article NINTH becomes effective ( Effective Date ), all
or substantially all of the economic benefit of owning such
share is enjoyed by one or more members of the Sanderson
Family; or (ii) such share is distributed after the
Effective Date with respect to a share that is a Family
Share on the date of such distribution, in connection with
any stock dividend, stock split, recapitalization or similar
transaction affecting all shares of the same class or series
as the share with respect to which such distributed share is
distributed; or (iii) such share is issued after the
Effective Date upon exercise of any warrant, right or option
that is distributed with respect to a share that is a Family
Share on the date of such distribution, provided that such
distribution is made to all holders of shares of the same
class or series as the share with respect to which such
warrant, right or option is distributed, and further
provided that at all times after such distribution of such
warrant, right or option through the date of issuance of the
share all or substantially all of the economic benefit of
ownership of such warrant, right or option continues to be
enjoyed, without interruption, by any one or more members of
the Sanderson Family (regardless of any transfer of economic
enjoyment from any such member to any other such member); or
(iv) all or substantially all of the economic benefit of
ownership of such share is acquired at any time by a member
of the Sanderson Family pursuant to the Employee Stock
Ownership Plan and Trust Agreement of Sanderson Farms, Inc.
and Affiliates (the ESOP ) or pursuant to any employee
benefit plan of the Company approved by the Board of
Directors, and which is available without discrimination
either to all employees or all key employees of the
corporation. A share that is a Family Share initially, in
accordance with the preceding sentence, continues to be a
Family Share thereafter only for so long as all or
substantially all of the economic benefit of ownership
continues, without interruption, to be enjoyed by any one or
more members of the Sanderson Family (regardless of any
transfer of economic benefit from any such member to any
other such member). A share ceases to be a Family Share if
all or substantially all of the economic benefit of
ownership is transferred to, or becomes held by, a person
who or which is not a member of the Sanderson Family. Once
a share ceases to be a Family Share it does not thereafter
become a Family Share even if the economic benefit of its
ownership is reacquired by a member of the Sanderson Family,
unless such reacquisition is pursuant to a distribution or
exercise of the type described in clause (ii) or (iii)
above, or is from the ESOP or any employee benefit plan of
the type described in clause (iv) above. For all purposes
of determining whether a share is or remains a Family Share,
shares shall not be considered to be fungible. The economic
benefit of ownership of a share is deemed to be enjoyed by
the person or persons who are the principal beneficiaries of
dividends and other distributions made with respect to such
share and of the proceeds of any sale of such share. The
beneficiary of a trust, and not the trustee, enjoys the
economic benefit of a share owned by the trust. Similarly,
the participant in any employee benefit plan that owns a
share allocated to that participant, and not the trustee or
plan administrator, enjoys the economic benefit of ownership
of that share. The economic benefit of a share held by a
corporation is enjoyed by that corporation and not by its
shareholders.
4. Solely for the purposes of this Article NINTH,
notwithstanding the foregoing, all shares which would, but
for the special provisions set forth in paragraph 3 hereof,
be deemed to be beneficially owned by such member of the
Sanderson Family (without regard to manner or time of
acquisition) shall be deemed beneficially owned by such
member (i) for purposes of receiving payment for shares held
by such member from an Interested Shareholder in a business
combination pursuant to the terms of the Act; or (ii) after
such time as such member is, in accordance with the above
rules for determining beneficial ownership, deemed to be an
Interested Shareholder pursuant to the Act and this Article
NINTH.
5. Voting stock that, pursuant to the foregoing, is
not deemed beneficially owned by a member of the Sanderson
Family shall nevertheless be considered to be outstanding
shares for purposes of calculating beneficial ownership
percentages by such member of shares that are deemed
beneficially owned by such member, and for purposes of
calculating beneficial ownership of other persons. For
purposes of this Article NINTH, Sanderson Family shall mean
the children and grandchildren of D. R. Sanderson and Wilma
W. Sanderson and the spouses of such children, but not the
spouses of such grandchildren and shall also mean the estate
of any of the foregoing persons.
C. The supermajority vote required by the Act shall not
apply to a business combination which has been approved by at
least two-thirds of the Continuing Directors, and not by 80% of
the Continuing Directors as provided in Section 79-25-7(c) of the
Act.
D. No amendment to this Article NINTH shall apply to any
Business Combination with an Interested Shareholder who was an
Interested Shareholder either on the date on which such amendment
is proposed by the Board of Directors, or on the date on which
such amendment is approved by the stockholders, unless such
amendment (i) shall have been recommended to the stockholders in
advance of adoption by the vote of at least two-thirds of the full
Board of Directors of the corporation at a time when no person,
corporation or other entity beneficially owns 20% or more of the
outstanding shares of Common Stock of the corporation or 20% or
more of the total voting power of the corporation entitled to vote
with respect to such amendment, or (ii) is approved by at least
two-thirds of the Continuing Directors.
22. New Article TENTH is hereby added to read:
TENTH: Any amendment to Articles SEVENTH, NINTH, TENTH,
TWELFTH or THIRTEENTH of these Articles of Incorporation shall
require the affirmative vote of at least two-thirds of the total
number of shares of Common Stock outstanding (in addition to, and
not in lieu of, any other vote required under the Mississippi
Business Corporation Act); provided that such two-thirds vote
shall not be required for any such amendment which is recommended
to the stockholders in advance of adoption by the vote of at least
two-thirds of the full Board of Directors of the corporation at a
time when no person, corporation or other entity beneficially owns
(for which purpose the definition of beneficial ownership set
forth in Article NINTH on the date on which this Article TENTH
becomes effective (without regard to any amendments to Article
NINTH, unless specifically incorporated into this Article TENTH)
shall apply, but without regard to paragraph 4 of Section B
thereof) 20 % or more of the outstanding shares of Common Stock of
the corporation or 20% or more of the total voting power of the
corporation entitled to vote with respect to such amendment.
23. New Article ELEVENTH is hereby added to read:
ELEVENTH: The Board of Directors is authorized to adopt,
and amend from time to time, a By-law that increases, over the
percentage otherwise required by the Mississippi Business
Corporation Act, the percentage ownership of all of the votes
entitled to be cast on the issue to be considered at a special
meeting that is necessary to call a special meeting of
stockholders, and the percentage set forth in such By-law shall be
deemed to be set forth herein.
24. New Article TWELFTH is hereby added to read:
TWELFTH: Any merger, consolidation, share exchange,
combination of shares, sale of substantially all of the
corporation s assets other than in the regular course of business
or adoption of a plan of dissolution of the corporation shall
require the affirmative vote of at least two-thirds of the total
Common Stock outstanding and the affirmative vote of at least two-
thirds of all of the votes entitled to be cast on such transaction
by each voting group entitled to vote separately thereon.
25. New Article THIRTEENTH is hereby added to read:
THIRTEENTH: Any director of the corporation elected or
appointed by the stockholders of the corporation or by its Board
of Directors may be removed only by the vote of not less than two-
thirds of the total outstanding Common Stock. Any vacancy on the
Board of Directors resulting from the removal of a director as
provided in this Article THIRTEENTH shall be filled by the
stockholders; provided that, if the stockholders fail to fill any
such vacancy within 90 days of the date that the director was
removed, then the Board of Directors may fill such vacancy. No
amendment hereto shall apply during any term of office that
commenced prior to such amendment, unless such amendment
specifically provides that it shall apply during any such term of
office and is recommended to the stockholders in advance of
adoption by the vote of at least two-thirds of the full Board of
Directors of the corporation at a time when no person, corporation
or other entity beneficially owns (for which purpose the
definition of beneficial ownership set forth in Article NINTH on
the date on which this Article THIRTEENTH becomes effective
(without regard to any amendments to Article NINTH, unless
specifically incorporated into this Article THIRTEENTH) shall
apply, but without regard to paragraph 4 of Section B thereof)
20% or more of the outstanding shares of Common Stock of the
corporation or 20% or more of the total voting power of the
corporation entitled to vote with respect to such amendment.
Notwithstanding the foregoing, this Article THIRTEENTH shall not
apply to any Director elected by any class (other than Common
Stock) or series which may be or become entitled to elect a
director voting as a separate class or series, and the removal of
such a director shall be governed by the provisions relating to
that class or series.
Dated: April 21, 1989.
SANDERSON FARMS, INC.
BY:/s/ Joe Frank Sanderson
CHAIRMAN
BY:/s/ Wyatt J. Davis, Jr.
SECRETARY
<PAGE>
<PAGE>
ARTICLES OF
AMENDMENT [Filed February 21, 1992]
(Attach conformed copy.)
Profit Nonprofit
(Mark appropriate box)
The undersigned corporation, pursuant to Section 79-4-10.06 (if a profit
corporation) or Section 79-11-305 (if a nonprofit corporation) of the
Mississippi Code of 1972, hereby executes the following document and sets
forth:
1. The name of the corporation is: SANDERSON FARMS, INC.
2. Set forth the text of each amendment adopted. (Attach page.)
3. If a profit amendment provides for an exchange, reclassification, or
cancellation of issued shares, set forth the provisions for implementing
the amendment if they are not contained in the amendment itself.
(Attach page.)
4. The amendment(s) was (were) adopted: February 20, 1992
FOR PROFIT CORPORATION
(a) adopted by the incorporators directors without shareholder
action and shareholder action was not required. (Check
appropriate box.)
FOR NONPROFIT CORPORATION
(b) adopted by board of directors incorporators without member
action and member action was not required. (Check appropriate
box.)
FOR PROFIT CORPORATIONS
5. If the amendment was approved by shareholders:
(a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote
separately on the amendment, and the number of votes of each
voting group indisputably represented at the meeting was:
No. No. NO.
outstanding of votes of votes
Designation shares entitled to be cast indisputably
represented
Common 9,075,427 9,075,427 8,253,920
(b) Either the total number of votes cast for and against the
amendment by each voting group entitled to vote separately on the
amendment was:
Total no. of Total no. of
Voting group votes cast FOR votes cast AGAINST
_______________ _______________ _______________
_______________ _______________ _______________
or the total number of undisputed votes cast for the amendment by
each voting group was:
Total no. of undisputed
Voting group votes cast FOR the plan
Common 8,113,760
and the number cast for the amendment by each voting group was
sufficient for approval by that voting group.
FOR NONPROFIT CORPORATIONS
6. If the amendment was approved by the members:
(a) The designation, number of memberships outstanding, number of
votes entitled to be cast by each class entitled to vote
separately on the amendment, and number of votes of each class
indisputably represented at the meeting was:
No. memberships No. of votes No. of votes
Designation outstanding entitled to be cast
indisputably represented
_______________ _______________ _______________
_______________ _______________ _______________
(b) Either
(i) the total number of votes cast for and against the amendment
by each class entitled to vote separately on the amendment
was:
Total no. of votes cast Total no. of votes cast
Voting class FOR the amendment AGAINST the amendment
_______________ _______________ _______________
_______________ _______________ _______________
or
(ii) the total number of undisputed votes cast for the amendment
by each class was:
Total no. of
undisputed votes cast
Voting group FOR the amendment
_______________ _______________
_______________ _______________
and the number cast for the amendment by each class was sufficient for
approval by that voting
group.
BY: Joe F. Sanderson, Jr., President /s/ Joe F. Sanderson, Jr.<PAGE>
<PAGE> AMENDMENT TO THE
ARTICLES OF INCORPORATION
OF
SANDERSON FARMS, INC.
Pursuant to Section 79-4-10.06 of the Mississippi Code of 1972, as
amended, more commonly referred to as Section 10.06 of the Mississippi
Business Corporation Act, the undersigned corporation hereby amends its
Articles of Incorporation as follows:
26. New Article FOURTEENTH is added to read:
FOURTEENTH:
A director of the corporation shall not be liable to
the corporation or its shareholders for money damages for
any action, or any failure to take any action, as a
director, except for: (a) the amount of a financial benefit
received by a director to which he is not entitled; (b) an
intentional infliction of harm on the corporation or the
shareholders; (c) a violation of Section 79-4-8.33 of the
Mississippi Code of 1972, as amended, more commonly referred
to as Section 8.33 of the Mississippi Business Corporation
Act, as presently in effect or as amended thereafter,
pertaining to liability for unlawful distributions; or (d)
an intentional violation of criminal law. If Mississippi law
is hereafter amended to authorize corporations to take
corporate action further limiting or eliminating the
personal liability of directors, then the liability of each
director of the corporation shall be limited or eliminated
to the full extent permitted by Mississippi law as so
amended from time to time. Neither the amendment nor repeal
of this Article, nor the adoption of any provision of these
Articles of Incorporation inconsistent with this Article,
shall eliminate or reduce the effect of this Article in
respect of any matter occurring, or any cause of action,
suit or claim that, but for this Article, would accrue or
arise, prior to such amendment, repeal or adoption of an
inconsistent provision.
APPROVED BY A MAJORITY VOTE OF THE SHAREHOLDERS OF SANDERSON
FARMS, INC., ON FEBRUARY 20, 1992.
SANDERSON FARMS, INC.
BY:/s/ Joe F. Sanderson, Jr.
President
BY:/s/ Wyatt J. Davis, Jr.
Secretary
<PAGE>
<PAGE>
FOO12-Page 1 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P. O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
ARTICLES OF AMENDMENT
The undersigned person, pursuant to Section 79-4-10.06 (if a profit
corporation) or Section 79-11-305 (if a nonprofit corporation) of the
Mississippi code of 1972, hereby execute the following document and set
forth:
1. Type of Corporation
_X_Profit ___Nonprofit
2. Name of Corporation
Sanderson Farms, Inc.
3. The future effective date is
(Complete if applicable) __________
4. Set forth the text of each amendment adopted. (Attach page)
5. If an amendment for a business corporation provides for an exchange,
reclassification, or cancellation of issued shares, set forth the
provisions for implementing the amendment if they are not contained
in the amendment itself. (Attach page)
6. The amendment(s) was (were) adopted on
February 27, 1997 Date(s)
FOR PROFIT CORPORATION (Check the appropriate box)
Adopted by ____ the incorporators ____ directors without
shareholder action
and shareholder action
was not required.
FOR NONPROFIT CORPORATION (Check the appropriate box)
Adopted by ____ the incorporators ____ board of directors without
member action and member
action was not required.
FOR PROFIT CORPORATION
7. If the amendment was approved by shareholders
(a) The designation, number of outstanding shares, number of votes
entitled to be cast by each voting group entitled to vote separately
on the amendment, and the number of votes of each voting group
indisputably represented at the meeting were
Designation No. of outstanding No. of votes No. of votes
shares entitled indisputably
represented
Common 14,363,080 14,363,080 13,613,272
<PAGE>
FOO12-Page 2 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P. O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
ARTICLES OF AMENDMENT
(b) EITHER
(i)the total number of votes cast for and against the
amendment by each voting group entitled to vote separately on
the amendment was
Voting group Total no. of votes Total no. of votes cast
cast FOR AGAINST
___________ ____________ _____________
___________ ____________ _____________
OR
(ii)the total number of undistributed votes cast for the
amendment by each voting group was
Voting group Total no. of undisputed votes cast FOR the plan
Common 13,514,813
___________ ____________
and the number of votes cast for the amendment by each voting group
was sufficient for approval by that voting group.
FOR NONPROFIT CORPORATION
8. If the amendment was approved by the members
(a) The designation, number of memberships outstanding, number of
votes entitled to be cast by each class entitled to vote separately
on the amendment, and the number of votes of each class indisputably
represented at the meeting were
Designation No. of memberships No. of votes entitled No. of votes
outstanding to be cast indisputably
represented
___________ __________ __________ __________
___________ __________ __________ __________<PAGE>
<PAGE>
FOO12-Page 3 of 3 OFFICE OF THE MISSISSIPPI SECRETARY OF STATE
P. O. BOX 136, JACKSON, MS 39205-0136 (601) 359-1333
ARTICLES OF AMENDMENT
(b) EITHER
(i)the total number of votes cast for and against the amendment
by each class entitled to vote separately on the amendment was
Voting class Total no. of votes Total no. of votes cast
cast FOR AGAINST
___________ ____________ _________
___________ ____________ ___________
OR
(ii)the total number of undistributed votes cast for the
amendment by each class was
Voting class Total no. of undisputed votes cast FOR the
amendment
___________ __________
___________ __________
and the number of votes cast for the amendment by each voting group
was sufficient for approval by that voting group.
By: Signature /s/Joe F. Sanderson, Jr.
Prined Name Joe F. Sanderson, Jr. Title President<PAGE>
<PAGE>
<PAGE>
AMENDMENT TO THE
ARTICLES OF INCORPORATION
OF
SANDERSON FARMS, INC.
Pursuant to Section 10.06 of the Mississippi Code of 1972, as
amended, more commonly referred to as Section 10.06 of the Mississippi Business
Corporation Act, the undersigned corporation hereby amends its Articles
of Incorporation as follows:
1. New Article FIFTEENTH is inserted to read:
"FIFTEENTH":
"The Corporation may indemnify its directors and
officers for liability (as defined in Section 79-4-
8.50(5) of the Mississippi Code of 1972, as amended)
to any person for any action taken, or any failure to
take any action, as a director or officer, as the case
may be, except liability for (a) receipt of a
financial benefit to which he is not entitled, (b) an
intentional infliction of harm on the Corporation or
its shareholders, (c) violation of Section 79-4-8.33
of the Mississippi Code of 1972, as amended, or (d) an
intentional violation of criminal law."
APPROVED BY A MAJORITY VOTE OF THE SHAREHOLDERS
OF SANDERSON FARMS, INC., ON FEBRUARY 27, 1997.
SANDERSON FARMS, INC.
BY: /s/ Joe F. Sanderson, Jr., President
JOE F. SANDERSON, JR., President
BY:/s/ James A. Grimes, Secretary
JAMES A. GRIMES, Secretary
Exhibit 3.2
BY-LAWS OF
SANDERSON FARMS, INC.
(As restated on January 8, 1997)
Article I. Name and the Location.
Section 1. The name of this corporation shall be Sanderson Farms,
Inc.
Section 2. Its principal office shall be located in Laurel,
Mississippi.
Section 3. Other offices for the transaction of business shall be
located in such other places as the Board of Directors may from time to
time determine.
Article II. Capital Stock.
Section 1. The amount of capital stock shall be such amount as is
authorized by the Articles of Incorporation.
Section 2. All certificates of stock shall be signed by the
Chairman of the Board, the President and the Secretary and shall be
sealed with the corporate seal. Such signatures and seal may be
facsimile if the certificate is signed by the corporation's transfer
agent or registrar.
Section 3. Treasury stock shall be held by the corporation
subject to disposition by the Board of Directors and shall neither be
voted nor participate in dividends.
Section 4. Transfers of stock shall be made only on the books of
the corporation or the books of the duly appointed transfer agent; an
old certificate, properly endorsed, shall be surrendered and cancelled
before a new certificate is issued.
Section 5. In case of loss or destruction of a certificate of
stock, no new certificate shall be issued in lieu thereof except upon
satisfactory proof of affidavit of such loss or destruction; and upon
the giving of satisfactory security, by bond or otherwise (if the Board
of Directors so requires), against loss to the corporation.
Article III. Stockholder meetings
Section 1. The annual meeting of stockholders shall be held each
year on such day in the month of February, or in such other month, as
the Board of Directors shall determine, at the principal office of the
corporation or at such other suitable place, within or without the State
of Mississippi, and at such convenient time as may be determined by the
Board of Directors. At the annual meeting the stockholders shall elect
directors to serve until their successors have been elected and have
qualified.
Section 2. A special meeting of the stockholders, to be held at
any place at which the annual stockholders' meeting may be held, may be
called at any time by the Chairman, the Vice Chairman (if appointed),
the President or the Board of Directors. It shall be the duty of the
Chairman, the Vice Chairman (if appointed), the President or the Board
of Directors to call such a meeting whenever so requested or demanded by
one or more stockholders holding 10% or more of all the shares entitled
to vote on any issue proposed to be considered at the special meeting.
Section 3. Notice of the place, day and hour of all annual and
special stockholders' meetings shall be given by the Secretary of the
corporation to each stockholder entitled to vote at the meeting not
fewer than ten (10) nor more than sixty (60) days before the date of the
meeting by mailing said notice, with postage thereon prepaid, to the
address of such stockholder appearing on the stock records of the
corporation. In the case of a special meeting, the notice shall also
state the purpose or purposes for which the meeting is called.
Section 4. For the purpose of determining stockholders entitled
to notice of or to vote at any meeting of stockholders or any
adjournment thereof, or entitled to demand a special meeting or to
receive payment of any dividend, or in order to make a determination of
stockholders for any other proper purpose, the Board of Directors of the
corporation may fix the record date for such purpose, but such record
date may not be more than seventy (70) days before the meeting or
action requiring a determination of stockholders. If no record date is
fixed for the determination of stockholders entitled to notice of or to
vote at a meeting of stockholders, or stockholders entitled to demand a
special meeting or to receive payment of a dividend, or for any other
proper purpose, the close of business on the day before the day on which
notice of the meeting is mailed or the date on which the resolution of
the Board of Directors declaring such dividend is adopted, as the case
may be, shall be the record date for such determination of stockholders.
When a determination of stockholders entitled to notice of or to vote at
any meeting of stockholders has been made as provided in this section,
such determination shall be effective for any adjournment of the meeting
unless the Board of Directors fixes a new record date, which it must do
if the meeting is adjourned to a date more than one hundred, twenty
(120) days after the date fixed for the original meeting.
Section 5. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make, no later than
two (2) business days after notice of the meeting is given for which the
list was prepared, an alphabetical list of the names of all its
stockholders entitled to notice of a stockholders' meeting. The list
must be arranged by voting group (and within each voting group by class
or series of shares) and show the address of and number of shares held
by each stockholder. Such list shall be available at the principal
office of the corporation and shall be subject to inspection by any
stockholder at any time during usual business hours. Such list shall
also be available at the place identified in the meeting notice in the
city where the meeting will be held and shall be subject to the
inspection of any stockholder continuously through the meeting. The
original stock transfer books shall be prima facie evidence as to who
are stockholders entitled to examine such list or transfer books or to
vote at any meeting of stockholders.
Section 6. The Chairman of the Board shall preside at all
stockholder meetings. In the event the Chairman is unable to preside,
the next available officer shall be authorized to preside in this order:
Vice Chairman (if appointed), President, Executive Vice President (if
appointed), Vice President (by seniority if more than one is appointed),
Secretary or Treasurer.
Section 7. Each outstanding share, regardless of class, shall be
entitled to one vote on each matter submitted to a vote at a meeting of
stockholders, except to the extent that the voting rights of the shares
of preferred stock are limited or denied by the Articles of
Incorporation, the Board of Directors or as permitted by law.
Treasury shares shall not be voted at any meeting or counted in
determining the total number of outstanding shares at any given time.
A stockholder may vote either in person or by proxy appointed in
writing by the stockholder or by his duly authorized attorney-in-fact.
No proxy shall be valid after eleven (11) months from the date of its
execution, unless otherwise provided in the proxy.
Shares standing in the name of another corporation, domestic or
foreign but not a corporation the majority of the outstanding shares of
which are owned, directly or indirectly, by this corporation, may be
voted by any duly elected officer, or any duly appointed agent, in
person or by proxy, or as the Board of Directors of this corporation may
otherwise determine.
Shares held by an administrator, executor, guardian or conservator
may be voted by him, either in person or by proxy, without a transfer of
such shares into his name. Shares standing in the name of a trustee
may be voted by him, either in person or by proxy, but no trustee shall
be entitled to vote shares held by him without a transfer of such shares
into his name.
Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be
voted by such receiver without the transfer thereof into his name if
authority so to do be contained in an appropriate order of the court by
which such receiver was appointed.
A stockholder whose shares are pledged shall be entitled to vote
such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares
so transferred.
Redeemable shares are not entitled to vote after notice of
redemption is mailed to the holders and a sum sufficient to redeem the
shares has been deposited with a bank, trust company or other financial
institution under an irrevocable obligation to pay the holders the
redemption price on surrender of the shares.
Section 8. A majority of the votes represented in person or by
proxy entitled to be cast on a matter by the voting stockholders shall
constitute a quorum for the transaction of business at a meeting of
stockholders. If a quorum exists, action on a matter (other than the
election of directors) by the stockholders shall be approved if the
votes cast favoring the action exceed the votes cast opposing the
action, unless the Articles of Incorporation, the By-laws or the law
requires a greater number of affirmative votes.
Once a share is represented for any purpose at a meeting, it is
deemed present for quorum purposes for the remainder of the meeting and
for any adjournment of that meeting unless a new record date is or must
be set for that adjourned meeting.
An amendment to the Articles of Incorporation that adds, changes
or deletes a greater quorum or voting requirement must meet the same
quorum requirement and be adopted by the same vote required to take
action under the quorum and voting requirements then in effect or
proposed to be adopted, whichever is greater.
Directors shall be elected at such annual meeting of stockholders
at which their terms expire or at any special meeting of stockholders
called for that purpose by the affirmative vote of a majority, and not a
plurality, of the shares entitled to vote and represented, in person or
by proxy, at such meeting at which a quorum is present. There shall be
no cumulative voting.
Section 9. Nominations by stockholders for the election of
directors may be made by stockholders from the floor at any annual or
special meeting of stockholders called for the election of directors if
timely written notice of such nominations has been given to the
Secretary of the corporation. To be timely, such notice must be
received at the principal office of the corporation not later than the
close of business on the 15th day following the day on which notice of
the date of the meeting is given or made to stockholders in accordance
with these bylaws. A stockholder's notice to the Secretary must set
forth or be accompanied by (i) the name and address of record of the
stockholder who intends to make the nomination; (ii) a representation
that the stockholder is a holder of record of shares of the corporation
entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to nominate the person or persons specified in the
notice; (iii) the name, age, business and residence addresses, and
principal occupation or employment of each nominee; (iv) such other
information regarding each nominee proposed by such stockholder as would
be required to be included in a proxy statement filed by such
stockholder pursuant to the proxy rules of the Securities and Exchange
Commission, as then in effect; (v) the consent of each nominee to serve
as a director of the corporation if elected; and (vi) a representation
signed by each proposed nominee that states that such nominee meets all
of the qualifications set forth in Article IV of these bylaws.
Section 10. Only business properly brought before stockholders'
meetings in accordance with these bylaws shall be conducted at such
meetings. To be properly brought before a meeting, business must be (a)
specified in the notice of meeting (or any supplement thereto) given by
or at the direction of the Board of Directors, (b) otherwise properly
before the meeting by or at the direction of the Board of Directors, or
(c) otherwise (i) properly requested to be brought before the meeting by
a stockholder of record entitled to vote in the election of directors
generally, and (ii) constitute a proper subject to be brought before
such meeting. Any stockholder who wishes to bring a matter (other than
the election of directors) before a meeting of stockholders and is
entitled to vote on such matter must deliver written notice of said
stockholder's intent to bring such matter before the meeting of
stockholders so that such notice is received by the Secretary no later
than the close of business on the 15th day following the date on which
notice of the date of the meeting is given or made to stockholders in
accordance with these bylaws.
A stockholder's notice to the Secretary shall set forth as to each
matter the stockholder proposes to bring before the meeting of
stockholders (a) a brief description of the business desired to be
brought before the meeting and the reasons for conducting such business
at the meeting, (b) the name and address, as they appear on the
Corporation's books, of the stockholder intending to propose such
business, (c) the class and number of shares of stock of the Corporation
beneficially owned by the stockholder, and (d) any material interest of
the stockholder in such business. The Chairman of a meeting shall, if
the facts warrant, determine and declare to the meeting that the
business was not properly brought before the meeting in accordance with
the provisions hereof and, if he should so determine, he shall declare
such to the meeting and any such business not properly brought before
the meeting shall not be transacted.
Section 11. Action required or permitted to be taken at a
stockholders' meeting may be taken without a meeting if the action is
taken by all the stockholders entitled to vote on the action. The
action must be evidenced by one or more written consents describing the
action taken, signed by all the stockholders entitled to vote on the
action, and delivered to the corporation for inclusion in the minutes or
filing with the corporate records.
If not otherwise set by the Board of Directors, the record date
for determining stockholders entitled to take action without a meeting
is the date the first stockholder signs the written consent.
A consent signed under this section has the effect of a meeting
vote and may be described as such in any document.
Article IV. Directors.
Section 1. All corporate powers shall be exercised by or under
the authority of, and the business and affairs of the corporation
managed under the direction of, the Board of Directors, subject to any
limitation set forth in the Articles of Incorporation, which shall
consist of nine (9) members, at least two (2) of whom shall be
independent directors. For purposes of this Section, "independent
director" shall mean a person other than an officer or employee of the
corporation or its affiliates or any other individual having a
relationship that, in the opinion of the Board of Directors, would
interfere with the exercise of independent judgment in carrying out the
responsibilities of a director. Directors must be at least twenty-one
(21) years of age and be citizens of the United States, although
directors need not be stockholders of the corporation or residents of
the state of Mississippi.
The Board of Directors shall appoint a Chairman who shall preside
at meetings of the Board of Directors and of stockholders and shall
have such other duties as may from time to time be assigned to the
Chairman by the Board of Directors. Each director shall receive such
compensation for his services as may, by the Board of Directors, be
determined from time to time.
The terms of directors shall be staggered by dividing the total
number of directors into three (3) classes, with each class containing
one-third (1/3), or as close to one-third (1/3) as possible, of the
total. With respect to directors who are elected at the first annual
stockholders' meeting where a classified Board of Directors is elected,
the terms of directors in the first class shall expire at the first
annual stockholders' meeting after their election, the terms of the
second class shall expire at the second annual stockholders' meeting
after their election, and the terms of the third class shall expire at
the third annual stockholders' meeting after their election. At each
annual stockholders' meeting held after such first meeting, directors
shall be chosen for a term of three (3) years to succeed those whose
terms expire.
A decrease in the number of directors does not shorten an
incumbent director's term. A director elected to fill a vacancy,
whether such director is elected by the stockholders or the Board of
Directors, shall serve for the unexpired portion of the term of the
vacancy which is being filled. Despite the expiration of a director's
term, he shall continue to serve until his successor is elected and
qualifies or until there is a decrease in the number of directors.
Section 2. The directors shall hold five (5) regular meetings,
four (4) of which shall be held on such quarterly dates as the Board or
the Chairman shall determine from time to time, and shall be held at the
principal office of the corporation in Laurel, Mississippi, or at such
other place, within or without the State of Mississippi, as may be
determined by the Chairman of the Board. The remaining one (1) regular
meeting shall be held immediately after, and at the same place as, the
annual meeting of stockholders.
Section 3. Special meetings of the Board of Directors, to be held
at the principal office of the corporation in Laurel, Mississippi, or at
such other place, within or without the State of Mississippi, as may be
determined by the Board or the Chairman, may be called by the Chairman
or by any two members of the Board of Directors.
Section 4. Any or all directors may participate in a regular or
special meeting by, or conduct the meeting through the use of, any means
of communication by which all directors participating may simultaneously
hear each other during the meeting. A director participating in a
meeting by this means is deemed to be present in person at the meeting.
Section 5. Notice as to date, time and place of all regular and
special meetings of the directors shall be given to each director, by
the Secretary, at least two (2) days prior to the time fixed for the
meeting. Such notice shall be given in any manner to each director at
his usual address or location and shall be deemed to be delivered, if
mailed, when deposited four (4) days prior to the time fixed for the
meeting in the United States mail, so addressed, with postage thereon
prepaid. A director's attendance at or participation in a meeting shall
constitute a waiver of any required notice of such meeting, unless the
director at the beginning of the meeting (or promptly upon his arrival)
objects to holding the meeting or transacting business at the meeting
and does not hereafter vote for or assent to action taken at the
meeting.
Section 6. A quorum for the transaction of business at any
regular or special meeting of the directors shall consist of a majority
of the number of directors fixed by these Bylaws.
Section 7. The directors shall appoint the officers of the
corporation and fix the salary of the Chairman of the Board and the
President; the President, or in the absence of the President the
directors, shall fix the salaries of all other officers. Appointment of
officers shall be made at the directors' meeting following each annual
stockholders' meeting.
Section 8. Any vacancy on the Board of Directors resulting from
the removal of a director as provided in the Articles of Incorporation
shall be filled by the stockholders; provided that, if the stockholders
fail to fill any such vacancy within ninety (90) days after the date
that the director was removed, then the Board of Directors may fill such
vacancy. If a vacancy occurs on the Board of Directors for reasons
other than removal by stockholders, including a vacancy resulting from
an increase in the number of directors: (a) the stockholders may fill
the vacancy; (b) the Board of Directors may fill the vacancy; or (c)
if the directors remaining in office constitute fewer than a quorum of
the Board, they may fill the vacancy by the affirmative vote of a
majority of all the directors remaining in office.
A vacancy that will occur at a specific later date (by reason of a
resignation effective at a later date) may be filled before the vacancy
occurs but the new director may not take office until the vacancy
occurs.
Section 9. The affirmative vote of a majority of the directors
present at a meeting at which a quorum is present shall be the act of
the Board of Directors, unless the Articles of Incorporation or the
By-laws require the vote of a greater number of directors.
Section 10. A director of the corporation who is present at a
meeting of the Board of Directors or a committee of the Board of
Directors when corporate action is taken shall be deemed to have
assented to the action taken unless: (a) he objects at the beginning of
the meeting (or promptly upon his arrival) to holding it or transacting
business at the meeting; (b) his dissent or abstention from the action
taken is entered in the minutes of the meeting; or (c) he delivers
written notice of his dissent or abstention to the presiding officer of
the meeting before its adjournment or to the corporation immediately
after adjournment of the meeting. The right of dissent or abstention
shall not be available to a director who votes in favor of the action
taken.
Section 11. Any action required or permitted to be taken at a
Board of Directors' meeting may be taken without a meeting if the action
is taken by all members of the Board. The action must be evidenced by
one or more written consents describing the action taken, signed by each
director, and included in the minutes or filed with the corporate
records reflecting the action taken.
Action taken under this section is effective when the last
director signs the consent, unless the consent specifies a different
effective date.
A consent signed under this section has the effect of a meeting
vote and may be described as such in any document.
Section 12. A director may resign at any time by delivering
written notice to the Board of Directors, its Chairman or to the
corporation. A resignation is effective when the notice is delivered
unless the notice specifies a later effective date.
The stockholders may remove one or more directors with or without
cause unless otherwise provided by the Articles of Incorporation. The
removal of any director of the corporation elected or appointed by the
stockholders of the corporation or by its Board of Directors shall be
effected only by the vote of not less than two-thirds (2/3) of the total
outstanding Common Stock. Notwithstanding the foregoing, these voting
requirements for director removal shall not apply to any director
elected by any class (other than Common Stock) or series which may be or
become entitled to elect a director voting as a separate class or
series, and the removal of such a director shall be governed by the
provisions relating to that class or series.
A director may be removed by the stockholders only at a meeting
called for the purpose of removing him and the meeting notice must state
that the purpose, or one of the purposes, of the meeting is removal of
the director.
Section 13. The Board of Directors may create one or more
committees and appoint members of the Board of Directors to serve on
them. Each committee must have two (2) or more members, who serve at
the pleasure of the Board of Directors.
The creation of a committee and appointment of members to it must
be approved by a majority of all the directors in office when the action
is taken.
Prior to the annual meeting of stockholders, the Board of
Directors shall appoint a director nominating committee consisting of
three directors serving current terms, at least one of whom shall be an
independent director. The committee shall consider candidates for the
class of directorships to be filled at the meeting and shall submit a
slate of candidates or nominees for Board approval and inclusion in the
corporate proxy materials for the annual meeting and for vote by the
stockholders at the annual meeting. Such submission shall be deemed a
nomination of each person named. The committee may recommend one or
more than one candidate or nominee for each vacancy to be filled. Where
a vacancy on the Board of Directors exists that is to be filled by the
Board of Directors, a director nominating committee shall also be
appointed by the Board of Directors to consider and submit a slate of
candidates or nominees for vote by the directors.
The provisions of the By-laws which govern meetings, action
without meetings, notice and waiver of notice, and quorum and voting
requirements of the Board of Directors, shall apply to committees and
their members as well.
To the extent specified by the Board of Directors, each committee
may exercise the authority of the Board of Directors.
A committee may not, however: (a) authorize distributions; (b)
approve or propose to stockholders action that requires approval by
stockholders; (c) fill vacancies on committees of the Board of
Directors; (d) amend the Articles of Incorporation; (e) adopt, amend
or repeal by-laws; (f) approve a plan of merger not requiring
stockholder approval; (g) authorize or approve reacquisition of shares
except according to a formula or method prescribed by the Board of
Directors; or (h) authorize or approve the issuance or sale or contract
for sale of shares, or determine the designation and relative rights,
preferences and limitations of a class or series of shares, except that
the Board of Directors may authorize a committee (or a senior executive
officer of the corporation) to do so within limits specifically
prescribed by the Board of Directors.
The creation of, delegation of authority to, or action by a
committee does not alone constitute compliance by a director with the
standards of conduct required by law.
Section 14. Each director shall discharge his duties as a
director, including his duties as a member of a committee: (a) in good
faith; (b) with the care an ordinarily prudent person in a like position
would exercise under similar circumstances; and (c) in a manner he
reasonably believes to be in the best interests of the corporation.
In discharging his duties a director shall be entitled to rely on
information, opinions, reports or statements, including financial
statements and other financial data, if prepared or presented by: (a)
one or more officers or employees of the corporation whom the director
reasonably believes to be reliable and competent in the matters pre-
sented; (b) legal counsel, public accountants or other persons as to
matters the director reasonably believes are within the person's
professional or expert competence; or (c) a committee of the Board of
Directors of which he is not a member if the director reasonably
believes the committee merits confidence.
Article V. Officers.
Section 1. The officers of this corporation shall be a Chairman
of the Board, a Vice Chairman of the Board (if appointed by the Board
at its discretion), a President, an Executive Vice President (if
appointed by the Board at its discretion), one or more Vice Presidents,
a Secretary and a Treasurer, all of whom shall be appointed for the term
of one (1) year, and shall hold office until their successors are duly
elected and qualified. Such other officers and assistant officers as
may be deemed necessary may be appointed by the Board of Directors or by
the officers duly appointed by the Board of Directors. Any two or
more offices may be simultaneously held by the same person.
Section 2. The officers of the corporation shall be appointed
annually by the Board of Directors at the first meeting of the Board of
Directors held after each annual meeting of the stockholders. Officers
of the corporation may also be appointed by the Board of Directors to
serve until the next annual meeting, when a new office is created by
amendment to, or restatement of, these By-Laws or, in the absence of a
resignation, when an incumbent officer cannot perform the duties
conferred upon him by reason of absence or inability or unfitness to
carry out said duties. The appointment of an officer shall not itself
create contract rights. Officers shall serve at the pleasure of the
Board of Directors.
Section 3. An officer may resign at any time by delivering notice
to the corporation. A resignation is effective when the notice is
delivered unless the notice specifies a later effective date. If a
resignation is made effective at a later date and the corporation
accepts the future effective date, it may fill the pending vacancy
before the effective date if the successor does not take office until
the effective date. An officer's resignation shall not affect the
corporation's contract rights, if any, with the officer.
Section 4. Any officer appointed by the Board of Directors may be
removed by the Board of Directors at any time with or without cause
whenever in its judgment the best interests of the corporation would be
served thereby, but such removal shall not affect the contract rights
with the corporation, if any, of the officer so removed. Any office or
assistant officer, if appointed by another officer, may likewise be
removed by such officer.
Section 5. A vacancy in any office because of death, resignation,
removal, disqualification or otherwise, may be filled by the Board of
Directors for the unexpired portion of the term.
Section 6. The Chairman of the Board shall preside at all
directors' meetings; shall sign all stock certificates (which signature
may be by facsimile as provided in Article II, Section 2, of these
By-laws); and shall have authority to sign on behalf of the corporation,
bills, notes, receipts, acceptances, endorsements, checks, releases,
contracts and documents of every nature and kind, to issue checks or
otherwise draw upon the deposits or credits of the corporation,
excepting dividends, and to do such other acts not specifically
enumerated herein and which are not inconsistent with the purposes of
the business of the corporation and its charter authority or not
otherwise specifically delegated to any other officer.
Section 7. The Vice Chairman of the Board (if appointed by the
Board at its discretion) shall perform all the duties of the Chairman of
the Board at such times as the Chairman is unable to perform the duties
conferred upon him by reason of absence or inability or unfitness to
carry out said duties. The Vice Chairman shall further perform such
duties as may be directed to him by the Chief Executive Officer or by
the Board of Directors.
Section 8. The President shall be the chief executive officer of
the corporation. He shall sign all stock certificates (which signature
may be by facsimile as provided in Article II, Section 2, of these
By-laws) and shall perform all of the duties of the Chairman of the
Board at such times as the Chairman or Vice Chairman (if appointed) is
unable to perform the duties conferred upon him by reason of absence or
inability or unfitness to carry out said duties. He shall have general
supervision over the affairs of the corporation; shall perform the
duties generally conferred upon the chief executive officer of a
corporation, including the authority to conduct the affairs of the
corporation and to carry out the policies thereof; and shall have
authority to sign on behalf of the corporation, bills, notes, receipts,
acceptances, endorsements, checks, releases, contracts and documents of
every nature and kind, to issue checks or otherwise draw upon the
deposits or credits of the corporation, excepting dividends, to extend
credit to persons and in amounts as he may deem advisable, and to do
such other acts not specifically enumerated herein and which are not
inconsistent with the purposes of the business of the corporation and
its charter authority or not otherwise specifically delegated to any
other officer. He shall have general charge of the office and the plant
or plants of the corporation, with authority to employ and terminate
such office assistants and employees as he may deem advisable and
necessary, and to fix and pay salaries for such employment. The
President shall further perform such duties as may be directed to him by
the Board of Directors and shall have authority to delegate any of the
duties herein set forth.
Section 9. The Executive Vice President (if appointed by the
Board at its discretion) shall perform all the duties of the President
at such times as the President is unable to perform the duties conferred
upon him by reason of absence or inability or unfitness to carry out
said duties. The Executive Vice President shall further perform such
duties as may be directed to him by the President or by the Board of
Directors.
Section 10. The Vice President(s) shall perform such duties as may
be directed to him(them) by the President or by the Board of Directors.
Section 11. The Secretary shall issue notices of all directors'
and stockholders' meetings, and shall attend and keep the minutes of the
same; shall have charge of all corporate books, records and papers;
shall be the custodian of the corporate seal; shall authenticate records
of the corporation; shall attest with his signature and impress with the
corporate seal all stock certificates (which signature and seal may be
facsimile as provided in Article II, Section 2, of these By-laws) and
written contracts of the corporation, but such attestation shall not be
limited to the Secretary and the absence of such attestation shall not
affect the legal validity of any written contracts; and shall perform
all other such duties as are incidental to his office and that may be
specifically delegated to his office.
Section 12. The Treasurer shall have custody of all monies and
securities of the corporation, and he shall keep regular books of
account and shall submit them, together with all his vouchers, receipts,
records and other papers to the directors for their examination and
approval as often as they may require. The Treasurer, or such other
officer, if any, who has been designated as the chief financial officer
by the Board of Directors, shall have the fiscal responsibility for the
affairs of the corporation, including future operations, and shall from
time to time propose or otherwise institute such fiscal policy as may be
determined by the Board of Directors.
Section 13. The duties of the Secretary or Treasurer or any part
thereof may be from time to time delegated by the Secretary or
Treasurer, with the consent of the Board of Directors, to an Assistant
Secretary or Assistant Treasurer. The Assistant Secretary or Assistant
Treasurer shall have the authority to perform such acts as may be
delegated to him by the Secretary or Treasurer with the consent of the
Board of Directors.
Section 14. For their services, the Vice Chairman (if appointed),
the Executive Vice President (if appointed), the Vice President(s),
the Secretary, the Treasurer and the Assistant Secretary or Assistant
Treasurer (if appointed) shall each receive such salary and other
compensation as may be fixed by the President, or, in his absence, by
the directors.
Section 15. As assigned and directed by the Board of Directors,
the Vice President(s), the Secretary or the Treasurer shall perform
those duties of the Chairman, the Vice Chairman (if appointed), the
President or the Executive Vice President (if appointed) at such times
as the Chairman, the Vice Chairman (if appointed), the President or the
Executive Vice President (if appointed) is unable to perform the duties
conferred upon him by reason of absence or inability or unfitness to
carry out said duties.
Section 16. Any officer with discretionary authority shall
discharge his duties under that authority: (a) in good faith; (b) with
the care an ordinarily prudent person in a like position would exercise
under similar circumstances; and (c) in a manner he reasonably believes
to be in the best interests of the corporation.
In discharging his duties any officer is entitled to rely on
information, opinions, reports or statements, including financial
statements and other financial data, if prepared or presented by: (a)
one or more officers or employees of the corporation whom the officer
reasonably believes to be reliable and competent in the matters
presented; or (b) legal counsel, public accountants or other persons as
to matters the officer reasonably believes are within the person's
professional or expert competence.
Article VI. Indemnification of Directors, Officers and Other
Persons
Section 1. The Corporation shall indemnify its directors,
officers, those employees of the Corporation appointed by the President
to serve on the Corporation's Executive Committee and those employees
selected by the Executive Committee to be the Division Managers, to the
fullest extent permitted by law, except in an action brought directly by
the Corporation against such person, and except that such employees
shall be entitled to mandatory indemnification under this Article only
to the same extent to which officers are permitted by law to be
indemnified.
Section 2. To the extent permitted by law, the right to
indemnification conferred in this Article (a)shall apply to acts or
omissions antedating the adoption of this Article; (b)shall be
severable; (c)shall continue as to a person who has ceased to be such
director, officer or employee; and (d) shall inure to the benefit of the
heirs, executors and administrators of such person.
Section 3. This article may be repealed or amended from time to
time by the Board of Directors with or without shareholder approval;
provided however, that no such repeal or amendment shall limit the right
to indemnification conferred in this Article for liability for acts or
omissions which occurred prior to the time of such repeal or amendment.
Section 4. If the Corporation indemnifies or advances expenses to
a director under this Article, the Corporation shall, if required by
Section 79-4-16.21(a) of the Mississippi Code of 1972, as amended,
report the indemnification or advance in writing to the shareholders
with or before the notice of the next shareholder meeting.
Article VII. Dividends and Finance.
Section 1. Dividends may be declared from time to time by
resolution of the Board of Directors; but no dividends shall be paid if,
after giving them effect, (a) the corporation would not be able to pay
its debts as they become due in the usual course of business; or (b) the
corporation's total assets would be less than the sum of its total
liabilities plus (unless the Articles of Incorporation permit otherwise)
the amount that would be needed, if the corporation were to be dissolved
at the time of the distribution, to satisfy the preferential rights upon
dissolution of stockholders whose preferential rights are superior to
those receiving the distribution.
Section 2. The funds of the corporation shall be deposited in
those depository institutions designated by the Board of Directors, and
such funds may be withdrawn upon the check or demand of either the
Chairman of the Board, the President, the Vice President(s), the
Secretary or the Treasurer or by authority granted to some other
individual by the Chairman of the Board, the Vice Chairman of the
Board, or the President or the Executive Vice President (if any) and one
other officer of the corporation by appropriate notice directed to any
such banking institution or trust company.
Article VIII. Contracts and Loans.
The Board of Directors may authorize any officer or officers, and
any agent or agents to enter into any contract, make any loan or execute
and deliver any instrument in the name of and on behalf of the
corporation, and such authority may be general or confined to a specific
instance.
Article IX. Fiscal Year.
The fiscal year of the corporation shall end on the 31st day of
October in each year.
Article X. Corporate Seal.
The Board of Directors shall provide a corporate seal which shall
be circular in form and shall have inscribed thereon the name of the
corporation, the state of incorporation and the words "Corporate Seal."
The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
Article XI. Waiver of Notice.
Whenever any notice is required to be given to any stockholder or
director of the corporation under the provisions of these By-laws or
under the provisions of the Articles of Incorporation or under the
provisions of the Mississippi Business Corporation Act, a waiver thereof
in writing, signed by the person or persons entitled to such notice,
whether before or after the date and time stated in the notice, and
filed with the minutes or corporate records, shall be equivalent to the
giving of such notice.
Article XII. Transfer Agent.
The Board of Directors shall be authorized, in its discretion, to
contract with and employ a securities transfer agent, either within or
without the State of Mississippi for the general purposes of issuing and
cancelling stock and other security certificates of the corporation, of
transfer processing and of other related security services. The
services of any security transfer agent, for which the Board may
contract, may include, but not be limited to, all security processing,
stockholder record-keeping, election processing, dividend payment,
dividend reinvestment, tax information, notices and proxies, securities
regulation reporting, and corporate reorganization work related to
securities. Any transfer agent, if employed, shall be authorized and
empowered to affix official signatures and the seal of the corporation
to stock and other security certificates by facsimile and to sign on its
behalf any and all stock and other security certificates issued by the
corporation.
Article XIII. Amendments.
These By-laws may be altered, amended or repealed or new By-laws
may be adopted by the Board of Directors at any regular or special
meeting of the Board of Directors. Any alteration, amendment or repeal
of, or any addition to, these By-laws which affects classes of
directors, the filling of vacancies on the Board of Directors, the
removal of directors, super majority voting requirements, cumulative
voting and classes of stock including preferences, limitations and
relative rights thereof shall require an affirmative vote of two-thirds
(2/3) or more of all the directors in office when the action is taken;
provided that such two-thirds (2/3) vote shall not be required for any
such alteration, amendment or repeal of, or any addition to, these
By-laws at a time when no person, corporation or entity, other than a
member of the Sanderson Family (as such term is defined in Article NINTH
of the Articles of Incorporation), beneficially owns (as such term is
defined in Article NINTH of the Articles of Incorporation) 20% or more
of the outstanding shares of Common Stock of the corporation or 20% or
more of the total voting power of the corporation entitled to vote on
any such matter at a meeting of stockholders.
Exhibit 10.2
SANDERSON FARMS, INC. AND AFFILIATES STOCK OPTION PLAN
(Amended and Restated as of April 24, 1997)
ARTICLE I - GENERAL
1.01 Purpose.
The purposes of this Stock Option Plan (the Plan ) are to: (1)
closely associate the interests of the management of Sanderson Farms,
Inc. and its affiliates and subsidiaries (collectively referred to as
the Company ) with the stockholders by reinforcing the relationship
between participants rewards and stockholder gains; (2) provide
management with an equity ownership in the Company commensurate with
Company performance, as reflected in increased stockholder value; (3)
maintain competitive compensation levels; and (4) provide an incentive
to management for continuous employment with the Company.
1.02 Administration.
(a) The Plan shall be administered by the Board of Directors of
Sanderson Farms, Inc. (the Board ).
(b) The Board shall have the authority, in its sole discretion and
from time to time to:
(i) designate the employees or classes of employees eligible
to participate in the Plan;
(ii) grant awards provided in the Plan in such form and
amount as the Board shall determine;
(iii) impose such limitations, restrictions and conditions
upon any such award as the Board shall deem appropriate; and
(iv) interpret the Plan, adopt, amend and rescind rules and
regulations relating to the Plan, and make all other
determinations and take all other action necessary or advisable
for the implementation and administration of the Plan.
(c) Decisions and determinations of the Board on all matters
relating to the Plan shall be in its sole discretion and shall be
conclusive. No member of the Board shall be liable for any action taken
or decision made in good faith relating to the Plan or any award
thereunder.
(d) As to any particular employee or employees or class or classes
thereof and/or any particular grant award or awards, the Board may by
resolution identifying such employee(s) or class(es) and such award(s)
delegate some or all of its authority under the Plan to a committee of
the Board that is composed solely of two or more Non-Employee
Directors (as such term is defined in Rule 16b-3(b)(3)(i) under the
Securities Exchange Act of 1934), and with respect to any such delegated
authority all references herein to the Board shall mean such committee
of the Board.
1.03 Eligibility for Participation.
Participants in the Plan shall be selected by the Board from the
executive officers and other key employees of the Company who occupy
responsible managerial and professional positions and who have the
capability of making substantial contributions to the success of the
Company. In making this selection and in determining the form and
amount of awards, the Board shall consider any factors deemed relevant,
including the individual s functions, responsibilities, value of
services to the Company and past and potential contributions to the
Company s profitability and sound growth.
1.04 Types of Awards Under Plan.
Awards under the Plan may be in the form of any one or more of the
following:
(a) Nonstatutory Stock Options, as described in Article II;
(b) Incentive Stock Options, as described in Article III; and/or
(c) Alternate Stock Appreciation Rights, as described in Article
IV.
1.05. Aggregate Limitation on Awards.
(a) Shares of stock which may be issued under the Plan shall be
authorized and unissued shares of Common Stock, par value $1.00 per
share, of Sanderson Farms, Inc. ( Common Stock ). The maximum number of
shares of Common Stock which may be issued under the Plan shall be
750,000.
(b) For purposes of calculating the maximum number of shares of
Common Stock which may be issued under the Plan:
(i) all the shares issued (including the shares, if any,
withheld for tax withholding requirements) shall be counted when
cash is used as full payment for shares issued upon exercise of a
Nonstatutory Stock Option or an Incentive Stock Option;
(ii) only the shares issued (including the shares, if any,
withheld for tax withholding requirements) as a result of exercise
of a Stock Appreciation Right shall be counted; and
(iii) only the net shares issued (including the shares, if
any, withheld for tax withholding requirements) shall be counted
when shares of Common Stock are used as full or partial payment
for shares issued upon exercise of a Nonstatutory Stock Option or
Incentive Stock Option.
(c) Shares tendered by a participant as payment for shares issued
upon exercise of a Nonstatutory Stock Option or an Incentive Stock
Option shall be available for subsequent issuance under the Plan if the
shares tendered were acquired by earlier exercise of an option. Any
shares of Common Stock subject to a Nonstatutory Stock Option or an
Incentive Stock Option which for any reason is terminated, unexercised
or expires shall again be available for issuance under the Plan.
1.06. Effective Date, Plan Year and Term of Plan.
(a) The Plan shall become effective on the date approved by the
holders of a majority of the shares of Common Stock present in person or
by proxy and entitled to vote at the 1993 Annual Meeting of Stockholders
of Sanderson Farms, Inc., and adopted by a majority of the Board of
Directors at the 1993 Annual Meeting of the Board of Directors of
Sanderson Farms, Inc.
(b) The Plan Year of the Plan shall be a calendar year.
(c) No awards shall be made under the Plan later than ten years
after stockholder approval, provided, however, that the Plan and all
awards made under the Plan prior to such date shall remain in effect
until such awards have been satisfied or terminated in accordance with
the Plan and the terms of such awards.
ARTICLE II - NONSTATUTORY STOCK OPTIONS
2.01. Award of Nonstatutory Stock Options.
The Board may from time to time, and subject to the provisions of
the Plan and such other terms and conditions as the Board may prescribe,
grant to any participant in the Plan one or more nonstatutory stock
options to purchase for cash, or to exchange previously owned Common
Stock for, the number of shares of Common Stock ( Nonstatutory Stock
Options ) as specified by the Board. The date a Nonstatutory Stock
Option is granted shall mean the date selected by the Board as of which
the Board awards a specific number of shares to a participant pursuant
to the Plan.
2.02. Nonstatutory Stock Option Agreement.
The grant of a Nonstatutory Stock Option shall be evidenced by a
written Nonstatutory Stock Option Agreement, executed by the Company and
the holder of a Nonstatutory Stock Option (the optionee ), stating the
number of shares of Common Stock subject to the Nonstatutory Stock
Option evidenced thereby, and in such form as the Board may from time to
time determine.
2.03. Nonstatutory Stock Option Price.
The option price per share of Common Stock deliverable upon the
exercise of a Nonstatutory Stock Option shall be at or below the fair
market value of a share of Common Stock on the date the Nonstatutory
Stock Option is granted.
2.04. Term and Exercise.
Each Nonstatutory Stock Option may be exercised during a period
beginning one year after and ending ten years after the date of grant
thereof (the option term ). Unless a shorter period is provided by the
Board, each Nonstatutory Stock Option shall be exercised in accordance
with this section 2.04. During the first year of the option term, no
more than 25% of the initial total number of shares covered by the
Nonstatutory Stock Option may be exercised and purchased by the
optionee. During the second year of the option term, no more than 50%
of the initial total number of shares covered by the Nonstatutory Stock
Option may be exercised and purchased by the optionee, such percentage
to include the percentage, by number of shares, purchased in the
previous year of the option term. During the third year of the option
term, no more than 75% of the initial total number of shares covered by
the Nonstatutory Stock Option may be exercised and purchased by the
optionee, such percentage to include the percentages, by number of
shares, previously purchased in earlier years of the option term on a
cumulative basis. During the fourth year of the option term, 100% of
the initial total number of shares covered by the Nonstatutory Stock
Option may be exercised and purchased by the optionee, such percentage
to include the percentages, by number of shares, previously purchased in
earlier years of the option term on a cumulative basis. No fractional
shares shall be issued as a result of the exercise of a Nonstatutory
Stock Option. No Nonstatutory Stock Option shall be exercisable after
the expiration of its option term.
2.05. Manner of Payment.
Each Nonstatutory Stock Option Agreement shall set forth the
procedure governing the exercise of the Nonstatutory Stock Option
granted thereunder, and shall provide that, upon such exercise in
respect of any shares of Common Stock subject thereto, the optionee
shall pay to the Company, in full, the option price for such shares with
cash or with previously owned Common Stock.
2.06. Termination of Nonstatutory Stock Option.
(a) Except as provided in Section 2.06(b) and 2.06(c), or except
as otherwise determined by the Board, all Nonstatutory Stock Options, to
the extent not previously exercised, shall terminate upon the
termination of the optionee s employment or if the optionee is no longer
eligible to participate in the Plan by virtue of his or her appointment
to a position that no longer falls within the description set forth in
Section 1.03 of this Plan.
(b) Upon termination of the optionee s employment by reason of
death of the optionee, a Nonstatutory Stock Option may be exercised, but
only to the extent exercisable on the date of such death, within one (1)
year from and after the date of the optionee s death. A Nonstatutory
Stock Option may be exercised by the executor or administrator of the
deceased optionee s estate or by a person receiving the Nonstatutory
Stock Option by will or under the laws of descent and distribution of
the state in which the optionee resided.
(c) Upon termination of the optionee s employment by reason of
retirement or disability (as defined by the Board), a Nonstatutory Stock
Option may be exercised, but only to the extent exercisable on the date
of such retirement or disability, within three (3) months from and after
the date of such termination of the optionee s employment.
(d) A transfer of the optionee s employment from one affiliate to
another of the Company shall not be deemed to be a termination of the
optionee s employment.
(e) Notwithstanding any other provisions set forth herein or in
the Plan, if the optionee shall (i) commit any act of malfeasance or
wrongdoing affecting the Company, (ii) breach any covenant not to
compete or employment contract with the Company, or (iii) engage in
conduct that would warrant the optionee s discharge for cause (excluding
general dissatisfaction with the performance of the optionee s duties,
but including any act of disloyalty or any conduct clearly tending to
bring discredit upon the Company), then any unexercised portion of a
Nonstatutory Stock Option shall immediately terminate and be void.
2.07. Effect of Exercise.
The exercise of any Nonstatutory Stock Option shall cancel a
related Stock Appreciation Right, if any, proportionate in amount to the
number of shares of Common Stock purchased pursuant to the exercise of
said option.
ARTICLE III - INCENTIVE STOCK OPTIONS
3.01. Award of Incentive Stock Options.
The Board may, from time to time and subject to the provisions of
the Plan and such other terms and conditions as the Board may prescribe,
grant to any participant in the Plan one or more incentive stock
options intended to qualify as such under the provisions of Section 421
and 422 of the Internal Revenue Code of 1986 ( Code ), as amended
( Incentive Stock Options ), to purchase for cash, or to exchange
previously owned Common Stock for, the number of shares of Common Stock
as specified by the Board. The date an Incentive Stock Option is
granted shall mean the date selected by the Board as of which the Board
awards a specific number of shares to a participant pursuant to the
Plan. Notwithstanding the foregoing, Incentive Stock Options shall not
be granted to any owner (taking into account the attribution rules of
Section 424(d) of the Code) of 10% or more of the total combined voting
power of the Company or its subsidiaries.
3.02. Incentive Stock Option Agreement.
The grant of an Incentive Stock Option shall be evidenced by a
written Incentive Stock Option Agreement, executed by the Company and
the holder of an Incentive Stock Option (the optionee ), stating the
number of shares of Common Stock subject to the Incentive Stock Option
evidenced thereby, and in such form as the Board may from time to time
determine.
3.03. Incentive Stock Option Price.
The option price per share of Common Stock deliverable upon the
exercise of an Incentive Stock Option shall be 100% of the fair market
value of a share of Common Stock on the date the Incentive Stock Option
is granted.
3.04. Term and Exercise.
Each Incentive Stock Option may be exercised during a period
beginning one year after and ending ten years after the date of grant
thereof (the option term ). Unless a shorter period is provided by the
Board, each Incentive Stock Option shall be exercised in accordance with
this section 3.04. During the first year of the option term, no more
than 25% of the initial total number of shares covered by the Incentive
Stock Option may be exercised and purchased by the optionee. During the
second year of the option term, no more than 50% of the initial total
number of shares covered by the Incentive Stock Option may be exercised
and purchased by the optionee, such percentage to include the
percentage, by number of shares, purchased in the previous year of the
option term. During the third year of the option term, no more than 75%
of the initial total number of shares covered by the Incentive Stock
Option may be exercised and purchased by the optionee, such percentage
to include the percentages, by number of shares, previously purchased in
earlier years of the option term on a cumulative basis. During the
fourth year of the option term, 100% of the initial total number of
shares covered by the Incentive Stock Option may be exercised and
purchased by the optionee, such percentage to include the percentages,
by number of shares, previously purchased in earlier years of the option
term on a cumulative basis. No fractional shares shall be issued as a
result of the exercise of an Incentive Stock Option. No Incentive Stock
Option shall be exercisable after the expiration of its option term.
During the lifetime of the recipient, an Incentive Stock Option is
exercisable only by the recipient thereof or by his guardian or legal
representative.
3.05. Maximum Amount of Incentive Stock Option Grant.
(a) The aggregate fair market value (determined on the date the
option is granted) of Common Stock subject to an Incentive Stock Option
granted to an optionee by the Board in any calendar year shall not
exceed $100,000 .
(b) To the extent that the aggregate fair market value of Common
Stock (determined as of the time the option with respect to such Common
Stock is granted) with respect to which Incentive Stock Options are
exercisable for the first time by an optionee during any calendar year
exceeds $100,000, such options shall not be incentive stock options
for federal income tax purposes.
3.06. Termination of Incentive Stock Option.
(a) Except as provided in Sections 3.06(b), 3.06(c) and 3.06(d) of
this Agreement, all Incentive Stock Options, to the extent not
previously exercised, shall terminate immediately upon termination of
the optionee s employment, or if the optionee is no longer eligible to
participate in the Plan by virtue of his or her appointment to a
position that no longer falls within the description set forth in
Section 1.03 of this Plan.
(b) Upon termination of the optionee s employment by reason of
death of the optionee, an Incentive Stock Option may be exercised, but
only to the extent exercisable on the date of such death, within one (1)
year from and after the date of the optionee s death. An Incentive
Stock Option may be exercised by the executor or administrator of the
deceased optionee s estate or by a person receiving an Incentive Stock
Option by will or under the laws of descent and distribution of the
state in which the optionee resided.
(c) Upon termination of the optionee s employment by reason of
permanent and total disability as defined under Section 22(e)(3) of the
Code, an Incentive Stock Option may be exercised, but only to the extent
exercisable on the date of such permanent and total disability, within
one (1) year from and after the date of such termination of the
optionee s employment.
(d) Upon termination of the optionee s employment by reason of
retirement or disability, other than disability defined by Section
3.06(c), an Incentive Stock Option may be exercised, but only to the
extent exercisable on the date of such retirement or disability, within
three (3) months from and after the date of such termination of the
optionee s employment.
(e) A transfer of the optionee s employment from one affiliate to
another of the Company shall not be deemed to be a termination of the
optionee s employment.
(f) Notwithstanding any other provisions set forth herein or in
the Plan, if the optionee shall (i) commit any act of malfeasance or
wrongdoing affecting the Company, (ii) breach any covenant not to
compete or employment contract with the Company, or (iii) engage in
conduct that would warrant the optionee s discharge for cause (excluding
general dissatisfaction with the performance of the optionee s duties,
but including any act of disloyalty or any conduct clearly tending to
bring discredit upon the Company), then any unexercised portion of an
Incentive Stock Option shall immediately terminate and be void.
3.07. Tax Treatment of Incentive Stock Option.
Notwithstanding any provision of this Plan to the contrary, the
favorable tax treatment available pursuant to Section 422 of the Code
upon exercise of an Incentive Stock Option will not be available to an
optionee who makes a disposition of the Stock within two (2) years after
the Incentive Stock Option is granted or within one (1) year after the
Stock is transferred to the optionee.
3.08. Applicability of Nonstatutory Stock Option Sections.
Sections 2.05, Manner of Payment; and 2.07, Effect of Exercise,
applicable to Nonstatutory Stock Options, shall apply equally to
Incentive Stock Options. Said Sections are incorporated by reference in
this Article III as though fully set forth herein.
ARTICLE IV - ALTERNATE STOCK APPRECIATION RIGHTS
4.01. Award of Stock Appreciation Rights.
Concurrently with or subsequent to the award of any Nonstatutory
Stock Option or Incentive Stock Option to purchase one or more shares of
Common Stock, the Board may, subject to the provisions of the Plan and
such other terms and conditions as the Board may prescribe, award to the
optionee with respect to said option, a related stock appreciation right
( Stock Right ), permitting the optionee to be paid in cash, stock or a
combination of both the appreciation on the option, or portion thereof,
in lieu of exercising the option or portion thereof.
4.02. Stock Appreciation Rights Agreement.
A Stock Appreciation Right shall be evidenced by a written Stock
Appreciation Rights Agreement, executed by the Company and the holder of
a Stock Appreciation Rights Agreement (the optionee ), stating the
number of shares of Common Stock subject to the Stock Right evidenced
thereby, and in such form as the Board may from time to time determine.
4.03. Exercise.
An optionee who has been granted a Stock Right may in lieu of the
exercise of an option or portion thereof to which the Stock Right
relates, elect to exercise the Stock Right or portion thereof and
thereby become entitled to receive from the Company payment in cash or
in Common Stock the amount and form determined pursuant to Sections 4.04
and 4.05, or a combination of both. Stock Rights shall be exercisable
only to the same extent and subject to the same conditions as the
options to which they relate are exercisable, as provided in this Plan,
and only when the fair market value of a share of Common Stock on the
exercise date exceeds the exercise price of the options related to such
Stock Rights. The Board may, in its discretion, prescribe additional
conditions to the exercise of any Stock Right.
4.04. Amount of Payment.
The amount of payment to which an optionee shall be entitled upon
the exercise of a Stock Right, or portion thereof, shall be equal to
100% of the amount, if any, by which the fair market value of a share of
Common Stock on the exercise date exceeds the fair market value of a
share of Common Stock on the date the option related to said Stock Right
was granted or became effective, as the case may be, multiplied by the
number of shares with respect to which the Stock Right is exercised.
4.05. Form of Payment.
Payment may be made in cash or stock or a combination of both. To
the extent that payment is made in stock, the number of shares to be
paid shall be determined by dividing the amount of payment determined
pursuant to Section 4.04 by the fair market value of a share of Common
Stock on the exercise date of such Stock Right, provided that no
fractional share shall be issued as a result of the exercise of a Stock
Right. As soon as practicable after exercise, the Company shall deliver
to the optionee a certificate or certificates for such shares of Common
Stock.
4.06. Effect of Exercise.
The exercise of any Stock Right, or portion thereof, shall cancel
a Nonstatutory Stock Option or an Incentive Stock Option to which the
Stock Right relates or an equal number of shares under said option.
4.07. Termination of Stock Appreciation Right.
(a) If a Stock Right is awarded with respect to the award of a
Nonstatutory Stock Option, then such Stock Right shall terminate in
accordance with and pursuant to Section 2.06, Termination of
Nonstatutory Stock Option.
(b) If a Stock Right is awarded with respect to the award of an
Incentive Stock Option, then such Stock Right shall terminate in
accordance with and pursuant to Section 3.06, Termination of Incentive
Stock Option.
ARTICLE V - MISCELLANEOUS
5.01. Insider Trading Short-Swing Profit Liability Exemption
Requirements.
(a) Nontransferability. Nonstatutory Stock Options, Incentive
Stock Options and Alternate Stock Appreciation Rights granted under this
Plan shall be transferable (i) by the option holder only by will or
under the laws of descent and distribution of the state in which the
option holder resided on the date of his death,
and (ii)
by the Company
pursuant to a qualified domestic relations order as defined by the Code
or Title I of the Employee Retirement Income Security Act or the Rules
thereunder, except that, to any extent so provided in the Nonstatutory
Stock Option Agreement or Stock Appreciation Rights Agreement or an
amendment to either of them, a Nonstatutory Stock Option or related
Stock Appreciation Right may be transferred to members of the optionee s
immediate family or to trusts for their benefit or partnerships in which
such members hold the entire partnership interest, or as may otherwise
be provided in such agreement or amendment and approved by the Board.
(b) Stockholder Approval. This Plan has been approved by the
holders of a majority of the shares of Common Stock present in person or
by proxy and entitled to vote at the 1993 Annual Meeting of Stockholders
of Sanderson Farms, Inc.
5.02. General Restriction.
Each award under the Plan shall be subject to the requirement
that, if at any time the Board shall determine that (i) the listing,
registration or qualification of the shares of Common Stock subject or
related thereto upon any securities exchange or under any state or
federal law, or (ii) the consent or approval of any government
regulatory body, or (iii) an agreement by the grantee of an award with
respect to the disposition of shares of Common Stock, is necessary or
desirable as a condition of, or in connection with, the granting of such
award of the issue or purchase of shares of Common Stock thereunder,
such award may not be consummated in whole or in part unless such
listing, registration, qualification, consent, approval or agreement
shall have been effected or obtained free of any conditions not
acceptable to the Board.
5.03. Withholding Tax Requirement.
Whenever the Company proposes or is required to issue or transfer
shares of Common Stock under the Plan, the Company shall have the right
to require the optionee to remit to the Company an amount sufficient to
satisfy any federal, state and/or local withholding tax requirements
prior to the delivery of any certificate or certificates of such shares.
Alternatively, the Company may issue or transfer such shares of Common
Stock net of the number of shares sufficient to satisfy the withholding
tax requirements. For withholding tax purposes, the shares of Common
Stock shall be valued on the date the withholding obligation is
incurred. In addition, the Company shall have the right to withhold
from any cash otherwise payable to an optionee under Article IV an
amount sufficient to satisfy withholding tax requirements.
5.04. No Rights of Employment.
Neither the granting of a Nonstatutory Stock Option, an Incentive
Stock Option or a Stock Right nor the exercise of the same shall be
construed as granting to the optionee any right with respect to
continuance of employment with the Company. Except as may otherwise be
limited by a written agreement between the Company and the optionee, and
acknowledged by the optionee, the right of the Company to terminate at
will the optionee s employment with it at any time (whether by
dismissal, discharge, retirement or otherwise) is specifically reserved
by the Company.
5.05. Non-Uniform Determinations.
The Board s determinations under the Plan (including without
limitation determinations of the persons to receive awards, the form,
amount and timing of such awards, the terms and provisions of such
awards and the agreements evidencing same) need not be uniform and may
be made by it selectively among persons who receive, or are eligible to
receive, awards under the Plan, whether or not such persons are
similarly situated.
5.06. No Rights as a Stockholder.
An optionee under the Plan shall have no rights as a stockholder
with respect thereto unless and until certificates for shares of Common
Stock are issued to said optionee.
5.07. Definitions.
In this Plan the following definitions shall apply:
(a) Subsidiary means any corporation of which, at the time, more
than 50% of the shares entitled to vote generally in an election of
directors are owned directly or indirectly by Sanderson Farms, Inc., or
any subsidiary thereof.
(b) Affiliate means any person or entity which directly, or
indirectly through one or more intermediaries, controls, is controlled
by, or is under common control with Sanderson Farms, Inc.
(c) Fair market value as of any date and in respect of any share
of Common Stock means the closing price on such date or on the next
business day, if such date is not a business day, of a share of Common
Stock reflected in the NASDAQ National Market System traded under the
Symbol SAFM, provided that, if shares of Common Stock shall not have
been traded on NASDAQ for more than 10 days immediately preceding such
date or if deemed appropriate by the Board for any other reason, the
fair market value of shares of Common Stock shall be as determined by
the Board in such other manner as it may deem appropriate. In no event
shall the fair market value of any share of Common Stock be less than
its par value.
(d) Option means Nonstatutory Stock Option or Incentive Stock
Option.
(e) Option price means the purchase price per share of Common
Stock deliverable upon the exercise of a Nonstatutory Stock Option or an
Incentive Stock Option.
5.08. Leaves of Absence.
The Board shall be entitled to make such rules, regulations and
determinations as it deems appropriate under the Plan in respect of any
leave of absence taken by an optionee. Without limiting the generality
of the foregoing, the Board shall be entitled to determine (i) whether
or not any such leave of absence shall constitute a termination of
employment within the meaning of the Plan and (ii) the impact, if any,
of any such leave of absence on awards under the Plan theretofore made
to any optionee who takes such leave of absence.
5.09. Newly Eligible Employees.
The Board shall be entitled to make such rules, regulations,
determinations and awards as it deems appropriate in respect of any
employee who become eligible to participate in the Plan or any portion
thereof after the commencement of awards or grants of options and
rights.
5.10. Adjustments of and Changes in Stock of the Company.
In the event of a reorganization, recapitalization, change of
shares, stock split, spin-off, stock dividend, reclassification,
subdivision or combination of shares, merger, consolidation, rights
offering, or any other change in the corporate structure or shares of
capital stock of the Company, the Board shall make such adjustment as it
deems appropriate in the number and kinds of shares of stock subject to
the option or in the option price; provided, however, that no such
adjustment shall given an optionee any additional benefits under the
option.
5.11. Modifications, Amendments and Termination.
(a) The Board may, without further action by the stockholders and
without consent of or receiving further consideration from the
participants, amend, condition or modify awards under this Plan in
response to changes in securities or other laws or rules, regulations or
regulatory interpretations thereof applicable to this Plan or to comply
with stock exchange rules or requirements. The Board may amend awards
otherwise with the written consent of the optionee.
(b) The Board may at any time and from time to time terminate or
modify or amend the Plan in any respect, except that without stockholder
approval the Board may not (i) increase the maximum number of shares of
Common Stock which may be issued under the Plan (other than increases
pursuant to Section 5.10) , (ii) extend the term of the Plan or (iii)
change Plan provisions relating to the class of employees who are
eligible to receive awards under the Plan. The termination or any
modification or amendment of the Plan, except as provided in subsection
(a), shall not, without the consent of an optionee, effect the
optionee s rights under an award granted to the optionee.
(c) The amendments to this Plan adopted in 1997 shall apply only
to Options and Stock Rights awarded on or after April 24, 1997, the
effective date of the amendments.
5.12. Governing Law.
The validity, construction, interpretation and effect of this Plan
and instrument shall exclusively be governed by and determined in
accordance with the laws of the State of Mississippi, except to the
extent preempted by federal law, which shall to that extent govern.
APPROVED BY THE STOCKHOLDERS:
DATE: February 25, 1993
ADOPTED BY THE BOARD OF DIRECTORS:
DATE: February 25, 1993
1996 AMENDMENTS ADOPTED BY THE BOARD OF DIRECTORS:
DATE: October 24, 1996
1997 AMENDMENTS ADOPTED BY THE BOARD OF DIRECTORS:
DATE: April 24, 1997
Exhibit 10.3
SANDERSON FARMS, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
THIS NONSTATUTORY STOCK OPTION AGREEMENT ("Agreement"), dated as
of the ______ day of _______________, ______ (the "Date of Grant"), is
delivered by Sanderson Farms, Inc., and its subsidiaries and affiliates
(collectively referred to as "SFI") to
_____________________________________ (the "Optionee"), who is an
executive officer or key employee of SFI.
WHEREAS, the Board of Directors of Sanderson Farms, Inc. (the
"Board"), recommended stockholder approval of, the stockholders approved
and the Board adopted, the Sanderson Farms, Inc. Stock Option Plan (as
amended and restated to the date hereof, the "Plan");
WHEREAS, the Plan provides for the granting of nonstatutory stock
options by the Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) to executive officers and key
employees of SFI to purchase, or to exercise certain rights with respect
to, shares of the Common Stock of SFI, par value $1.00 per share (the
"Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) considers the
Optionee to be a person who is eligible for grant of a nonstatutory
stock option under the Plan, and has determined that it would be in the
best interest of SFI to grant the nonstatutory stock option documented
herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Grant of Nonstatutory Stock Option.
(a) Subject to the terms and conditions hereinafter set forth,
SFI, with the approval and at the direction of the Board (or, if
applicable, a committee thereof appointed pursuant to Section 1.02(d) of
the Plan), hereby grants to the Optionee, as of the Date of Grant, an
option to purchase up to ________ shares of Stock at a price of
$___________ per share, which price per share is at or below the present
fair market value. Such option is hereinafter referred to as the
"Nonstatutory Stock Option" and the shares of stock purchasable upon
exercise of the Nonstatutory Stock Option are hereinafter sometimes
referred to as the "Nonstatutory Stock Option Shares." Notwithstanding
any provision herein to the contrary, the Option is not intended by the
parties hereto to be, and shall not be treated as, an "incentive stock
option," pursuant to and as such term is defined under Sections 421 and
422 of the Internal Revenue Code of 1986, as amended (the "Code"), but
is intended by the parties hereto to be, and shall be treated as, a
"nonstatutory stock option."
(b) This Nonstatutory Stock Option is granted subject to
the following additional terms and conditions (if none, so indicate):
2. Term and Exercise.
This Nonstatutory Stock Option may be exercised during a period
beginning one year after and ending ten years after the date of grant
thereof (the "option term"). Unless a shorter period is provided by the
Board (or, if applicable, a committee thereof appointed pursuant to
Section 1.02(d) of the Plan), this Nonstatutory Stock Option shall be
exercised in accordance with this section 2. During the first year of
the option term, no more than 25% of the initial total number of shares
covered by the Nonstatutory Stock Option may be exercised and purchased
by the Optionee. During the second year of the option term, no more than
50% of the initial total number of shares covered by the Nonstatutory
Stock Option may be exercised and purchased by the Optionee, such
percentage to include the percentage, by number of shares, purchased in
the previous year of the option term. During the third year of the
option term, no more than 75% of the initial total number of shares
covered by the Nonstatutory Stock Option may be exercised and purchased
by the Optionee, such percentage to include the percentages, by number
of shares, previously purchased in earlier years of the option term on a
cumulative basis. During the fourth year of the option term, 100% of the
initial total number of shares covered by the Nonstatutory Stock Option
may be exercised and purchased by the Optionee, such percentage to
include the percentages, by number of shares, previously purchased in
earlier years of the option term on a cumulative basis. No fractional
shares shall be issued as a result of the exercise of this Nonstatutory
Stock Option. No Nonstatutory Stock Option shall be exercisable after
the expiration of its option term.
3. Termination of Nonstatutory Stock Option.
(a) Except as provided in Sections 3(b) and 3(c) of this
Agreement, upon termination of the Optionee's employment, the
Nonstatutory Stock Option, to the extent not previously exercised, shall
terminate immediately upon such termination of employment, or if the
optionee is no longer eligible to participate in the Plan by virtue of
his or her appointment to a position that no longer falls within the
description set forth in Section 1.03 of this Plan.
(b) Upon termination of the Optionee's employment by reason of
death of the Optionee, the Nonstatutory Stock Option may be exercised,
but only to the extent exercisable on the date of such death, within one
(1) year from and after the date of the Optionee's death. The
Nonstatutory Stock Option may be exercised by the executor or
administrator of the deceased Optionee's estate or by a person receiving
the Nonstatutory Stock Option by will or under the laws of descent and
distribution of the state in which the Optionee resided.
(c) Upon termination of the Optionee's employment by
reason of retirement or disability (as defined by the
Board (or, if
applicable, a committee thereof appointed pursuant to Section 1.02(d) of
the Plan),
the Nonstatutory Stock Option may be exercised, but only to
the extent exercisable on the date of such retirement or disability,
during the three (3) month period following the date of such termination
of the Optionee's employment.
(d) A transfer of the Optionee's employment from one affiliate
of SFI to another shall not be deemed to be a termination of the
Optionee's employment.
(e) Notwithstanding any other provisions set forth herein or in
the Plan, if the Optionee shall (i) commit any act of malfeasance or
wrongdoing affecting SFI, (ii) breach any covenant not to compete or
employment contract with SFI, or (iii) engage in conduct that would
warrant the Optionee's discharge for cause (excluding general
dissatisfaction with the performance of the Optionee's duties, but
including any act of disloyalty or any conduct clearly tending to bring
discredit upon SFI), then any unexercised portion of the Nonstatutory
Stock Option shall immediately terminate and be void.
4. Exercise of Nonstatutory Stock Option.
(a) During the Option Term, the Optionee may exercise the
Nonstatutory Stock Option with respect to all or any part of the number
of Nonstatutory Stock Option Shares then exercisable hereunder by giving
the Board of SFI (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) written notice of intent to
exercise substantially in the form attached hereto as Exhibit A. The
notice of exercise shall specify the number of Nonstatutory Stock Option
Shares as to which the Nonstatutory Stock Option is to be exercised and
the date of exercise thereof, which date shall be at least five days
after the giving of such notice unless an earlier date shall have been
mutually agreed upon.
(b) Full payment (in U.S. dollars) by the Optionee of the option
price for the Nonstatutory Stock Option Shares purchased shall be made
on or before the exercise date specified in the notice of exercise in
cash, or, with the prior written consent of the Board (or, if
applicable, a committee thereof appointed pursuant to Section 1.02(d) of
the Plan), in whole or in part through the surrender of previously
acquired shares of Stock at their fair market value on the exercise
date.
On the exercise date specified in the Optionee's notice or as soon
thereafter as is reasonably practicable, SFI shall cause to be delivered
to the Optionee, a certificate or certificates for the Nonstatutory
Stock Option Shares then being purchased (out of theretofore unissued
Stock or reacquired or surrendered Stock, as SFI may elect) upon full
payment for such Nonstatutory Stock Option Shares. The obligation of SFI
to deliver Stock shall, however, be subject to the condition that if at
any time the Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) shall determine in its
discretion that (i) the listing, registration or qualification of the
Nonstatutory Stock Option or the Nonstatutory Stock Option Shares upon
any securities exchange or under any state or federal law, or (ii) the
consent or approval of any governmental regulatory body or (iii) an
agreement by the Optionee with respect to the disposition of shares of
Common Stock, is necessary or desirable as a condition of, or in
connection with, the Option or the issuance or purchase of Stock
thereunder, the Nonstatutory Stock Option may not be exercised in whole
or in part unless such listing, registration, qualification, consent,
approval or agreement shall have been effected or obtained free of any
conditions not acceptable to the Board (or, if applicable, a committee
thereof appointed pursuant to Section 1.02(d) of the Plan).
(c) If the Optionee fails to pay for any of the Nonstatutory
Stock Option Shares specified in such notice or fails to accept delivery
thereof, the Optionee's right to purchase such Nonstatutory Stock Option
Shares may be terminated by SFI. The date specified in the Optionee's
notice as the date of exercise shall be deemed to be the date of
exercise of the Option, provided that payment in full for the
Nonstatutory Stock Option Shares to be purchased upon such exercise
shall have been received by such date.
5. Adjustment of and Changes in Stock of SFI.
In the event of a reorganization, recapitalization, change of
shares, stock split, spinoff, stock dividend, reclassification,
subdivision or combination of shares, merger, consolidation, rights
offering, or any other change in the corporate structure or shares of
capital stock of SFI, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) shall make such
adjustment as it deems appropriate in the number and kinds of shares of
Stock subject to the Nonstatutory Stock Option or in the option price;
provided, however, that no such adjustment shall give the Optionee any
additional benefits under the Nonstatutory Stock Option.
6. Fair Market Value.
"Fair market value" as of any date and in respect of any share of
Common Stock means the closing price on such date or on the next
business day, if such date is not a business day, of a share of Common
Stock reflected in the NASDAQ National Market System traded under the
Symbol SAFM, provided that, if shares of Common Stock shall not have
been traded on NASDAQ for more than 10 days immediately preceding such
date or if deemed appropriate by the Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan) for
any other reason, the fair market value of shares of Common Stock shall
be as determined by the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) in such other manner
as it may deem appropriate. In no event shall the fair market value of
any share of Common Stock be less than its par value.
7. No Rights as a Stockholder.
Neither the Optionee nor any personal representative shall be, or
shall have any of the rights and privileges of, a stockholder of SFI
with respect to any shares of Stock purchasable or issuable upon the
exercise of this Nonstatutory Stock Option, in whole or in part, prior
to the issuance of certificates for shares of Common Stock to said
person.
8. Insider Trading Short-Swing Profit Liability Exemption
Requirements.
Notwithstanding any other provision of this Agreement to the
contrary, the Nonstatutory Stock Option granted under this Agreement
shall be transferrable (i) by the option holder only by will or under
the laws of descent and distribution of the state in which the option
holder resided on the date of his death or (ii) by the Company pursuant
to a qualified domestic relations order as defined by the Code or Title
I of the Employee Retirement Income Security Act or the Rules thereunder
[except that it may be transferred to members of the Optionee s
immediate family or to trusts for their benefit or partnerships in which
such members hold the entire partnership interest].
9. No Rights of Employment.
Neither the granting of this Nonstatutory Stock Option nor its
exercise shall be construed as granting to the Optionee any right with
respect to continuance of employment with SFI. Except as may otherwise
be limited by a written agreement between SFI and the Optionee, and
acknowledged by the Optionee, the right of SFI to terminate at will the
Optionee's employment with it at any time (whether by dismissal,
discharge, retirement or otherwise) is specifically reserved by SFI.
10. Amendment of Nonstatutory Stock Option.
The Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) may, without further action by
the stockholders and without the consent of or further consideration
from the Optionee, amend, condition or modify this Nonstatutory Stock
Option in response to changes in securities or other laws or rules,
regulations or regulatory interpretations thereof applicable to the
Nonstatutory Stock Option or to comply with stock exchange rules or
requirements. The Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) may amend this
Nonstatutory Stock Option otherwise with the written consent of the
Optionee.
11. Notice.
Any notice to SFI provided for in this instrument shall be
addressed to it in care of its Secretary at its executive offices at
Post Office Box 988, Laurel, Mississippi 39441, and any notice to the
Optionee shall be addressed to the Optionee at the current address shown
on the payroll records of SFI. Any notice shall be deemed to be duly
given if and when properly addressed and posted by registered or
certified mail, postage prepaid.
12. Incorporation of Plan by Reference.
This Nonstatutory Stock Option is granted pursuant to the terms of
the Plan, which terms are incorporated herein by reference, and the
Nonstatutory Stock Option shall in all respects be interpreted in
accordance with the Plan. The Board (or, if applicable, a committee
thereof appointed pursuant to Section 1.02(d) of the Plan) shall
interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on
the parties hereto and any other person claiming an interest hereunder,
with respect to any issue arising hereunder or thereunder.
13. Governing Law.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance
with the laws of the State of Mississippi, except to the extent
preempted by federal law, which shall to that extent govern.
IN WITNESS WHEREOF, SFI has caused its duly authorized officers to
execute and attest this Nonstatutory Stock Option Agreement, and to
apply the corporate seal hereto, and the Optionee has placed his or her
signature hereon, effective as of the Date of Grant.
SANDERSON FARMS, INC.
ATTEST:
By:
Name:
Title:
ACCEPTED AND AGREED TO:
Optionee
<PAGE>
NOTICE OF EXERCISE OF NONSTATUTORY STOCK OPTION
SANDERSON FARMS, INC.
ATTENTION: The Board of Directors
Stock Option Committee
Gentlemen:
Notice is hereby given of the undersigned's intent to exercise the
Nonstatutory Stock Option granted to the undersigned pursuant to the
Nonstatutory Stock Option Agreement dated _______________, ______,
entered into by and between the undersigned and Sanderson Farms, Inc.
The Nonstatutory Stock Option shall be exercised with respect to
__________________ (______) shares of the common stock, par value $1.00
per share, of Sanderson Farms, Inc., at the exercise price of
$__________ per share. The date of exercise shall be _______________,
______, which is five days or more after the date of this notice.
In connection with the exercise of the Nonstatutory Stock Option,
the undersigned authorizes SFI to withhold all appropriate federal and
state income and payroll taxes where cash is paid. Where only stock is
transferred, the undersigned will remit to SFI an amount in cash equal
to the appropriate federal and state income and payroll taxes upon being
advised of the amount. Alternatively, SFI may reduce the number of
shares distributed by an amount or number equal in value to the
withholding amount.
Employee/Optionee
Dated: ,
Exhibit A
Exhibit 10-4
SANDERSON FARMS, INC.
INCENTIVE STOCK OPTION AGREEMENT
THIS INCENTIVE STOCK OPTION AGREEMENT ("Agreement"), dated as of
the day of ________________, ____ (the "Date of Grant"), is delivered by
Sanderson Farms, Inc., and its subsidiaries and affiliates (collectively
referred to as "SFI") to ________________________________________ (the
"Optionee"), who is an executive officer or key employee of SFI.
WHEREAS, the Board of Directors of Sanderson Farms, Inc. (the
"Board") recommended stockholder approval of, the stockholders approved
and the Board adopted the Sanderson Farms, Inc. Stock Option Plan (as
amended and restated to the date hereof, the "Plan");
WHEREAS, the Plan provides for the granting of incentive stock
options by the Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) to executive officers and key
employees of SFI to purchase, or to exercise certain rights with respect
to, shares of the Common Stock of SFI, par value $1.00 per share (the
"Stock"), in accordance with the terms and provisions thereof; and
WHEREAS, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) considers the
Optionee to be a person who is eligible for grant of an incentive stock
option under the Plan, and has determined that it would be in the best
interest of SFI to grant the incentive stock option documented herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Grant of Incentive Stock Option.
(a) Subject to the terms and conditions hereinafter set forth,
SFI, with the approval and at the direction of the Board (or, if
applicable, a committee thereof appointed pursuant to Section 1.02(d) of
the Plan), hereby grants to the Optionee, as of the Date of Grant, an
option to purchase up to _______ shares of Stock at a price of
$__________ per share, which price per share is at or above the present
fair market value. Such option is hereinafter referred to as the
"Incentive Stock Option" and the shares of stock purchasable upon
exercise of the Incentive Stock Option are hereinafter sometimes
referred to as the "Incentive Stock Option Shares." The Incentive Stock
Option is intended by the parties hereto to be, and shall be treated as,
an "incentive stock option," pursuant to and as such term is defined
under Sections 421 and 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
(b) This Incentive Stock Option is granted subject to the
following additional terms and conditions (if none, so indicate):
2. Term and Exercise.
This Incentive Stock Option may be exercised during a period
beginning one year after and ending ten years after the date of grant
thereof (the "option term"). Unless a shorter period is provided by the
Board (or, if applicable, a committee thereof appointed pursuant to
Section 1.02(d) of the Plan),
this Incentive Stock Option shall be
exercised in accordance with this section 2. During the first year of
the option term, no more than 25% of the initial total number of shares
covered by the Incentive Stock Option may be exercised and purchased by
the Optionee. During the second year of the option term, no more than
50% of the initial total number of shares covered by the Incentive Stock
Option may be exercised and purchased by the Optionee, such percentage
to include the percentage, by number of shares, purchased in the
previous year of the option term. During the third year of the option
term, no more than 75% of the initial total number of shares covered by
the Incentive Stock Option may be exercised and purchased by the
Optionee, such percentage to include the percentages, by number of
shares, previously purchased in earlier years of the option term on a
cumulative basis. During the fourth year of the option term, 100% of the
initial total number of shares covered by the Incentive Stock Option may
be exercised and purchased by the Optionee, such percentage to include
the percentages, by number of shares, previously purchased in earlier
years of the option term on a cumulative basis. No fractional shares
shall be issued as a result of the exercise of this Incentive Stock
Option. No Incentive Stock Option shall be exercisable after the
expiration of its option term.
3. Termination of Incentive Stock Option.
(a) Except as provided in Sections 3(b), 3(c) and 3(d) of this
Agreement, upon termination of the Optionee's employment, the Incentive
Stock Option, to the extent not previously exercised, shall terminate
immediately upon such termination of employment, or if the optionee is
no longer eligible to participate in the Plan by virtue of his or her
appointment to a position that no longer falls within the description
set forth in Section 1.03 of this Plan.
(b) Upon termination of the Optionee's employment by reason of
death of the Optionee, the Incentive Stock Option may be exercised, but
only to the extent exercisable on the date of such death, within one (1)
year from and after the date of the Optionee's death. The Incentive
Stock Option may be exercised by the executor or administrator of the
deceased Optionee's estate or by a person receiving the Incentive Stock
Option by will or under the laws of descent and distribution of the
state in which the Optionee resided.
(c) Upon termination of the Optionee's employment by reason of
permanent and total disability as defined under Section 22(e)(3) of the
Code, the Incentive Stock Option may be exercised, but only to the
extent exercisable on the date of such permanent and total disability,
during the one (1) year period following the date of such termination of
the Optionee's employment.
(d) Upon termination of the Optionee's employment by reason of
retirement or disability other than as defined by Section 3(c) of this
Agreement, the Incentive Stock Option may be exercised, but only to the
extent exercisable on the date of such retirement or disability, during
the three (3) month period following the date of such termination of the
Optionee's employment.
(e) A transfer of the Optionee's employment from one affiliate
of SFI to another shall not be deemed to be a termination of the
Optionee's employment.
(f) Notwithstanding any other provisions set forth herein or in
the Plan, if the Optionee shall (i) commit any act of malfeasance or
wrongdoing affecting SFI, (ii) breach any covenant not to compete or
employment contract with SFI, or (iii) engage in conduct that would
warrant the Optionee's discharge for cause (excluding general
dissatisfaction with the performance of the Optionee's duties, but
including any act of disloyalty or any conduct clearly tending to bring
discredit upon SFI), then any unexercised portion of the Incentive Stock
Option shall immediately terminate and be void.
4. Exercise of Incentive Stock Option.
(a) During the Option Term, the Optionee may exercise the
Incentive Stock Option with respect to all or any part of the number of
Incentive Stock Option Shares then exercisable hereunder by giving the
Board of SFI (or, if applicable, a committee thereof appointed pursuant
to Section 1.02(d) of the Plan) written notice of intent to exercise
substantially in the form attached hereto as Exhibit A. The notice of
exercise shall specify the number of Incentive Stock Option Shares as to
which the Incentive Stock Option is to be exercised and the date of
exercise thereof, which date shall be at least five days after the
giving of such notice unless an earlier date shall have been mutually
agreed upon.
(b) Full payment (in U.S. dollars) by the Optionee of the option
price for the Incentive Stock Option Shares purchased shall be made on
or before the exercise date specified in the notice of exercise in cash,
or, with the prior written consent of the Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan), in
whole or in part through the surrender of previously acquired shares of
Stock at their fair market value on the exercise date.
On the exercise date specified in the Optionee's notice or as soon
thereafter as is reasonably practicable, SFI shall cause to be delivered
to the Optionee, a certificate or certificates for the Incentive Stock
Option Shares then being purchased (out of theretofore unissued Stock or
reacquired or surrendered Stock, as SFI may elect) upon full payment for
such Incentive Stock Option Shares. The obligation of SFI to deliver
Stock shall, however, be subject to the condition that if at any time
the Board (or, if applicable, a committee thereof appointed pursuant to
Section 1.02(d) of the Plan) shall determine in its discretion that
(i) the listing, registration or qualification of the Incentive Stock
Option or the Incentive Stock Option Shares upon any securities exchange
or under any state or federal law, or (ii) the consent or approval of
any governmental regulatory body, or (iii) an agreement by the Optionee
with respect to the disposition of shares of Common Stock, is necessary
or desirable as a condition of, or in connection with, the Incentive
Stock Option or the issuance or purchase of Stock thereunder, the
Incentive Stock Option may not be exercised in whole or in part unless
such listing, registration, qualification, consent, approval or
agreement shall have been effected or obtained free of any conditions
not acceptable to the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan).
(c) If the Optionee fails to pay for any of the Incentive Stock
Option Shares specified in such notice or fails to accept delivery
thereof, the Optionee's right to purchase such Incentive Stock Option
Shares may be terminated by SFI. The date specified in the Optionee's
notice as the date of exercise shall be deemed to be the date of
exercise of the Incentive Stock Option, provided that payment in full
for the Incentive Stock Option Shares to be purchased upon such exercise
shall have been received by such date.
5. Adjustment of and Changes in Stock of SFI.
In the event of a reorganization, recapitalization, change of
shares, stock split, spinoff, stock dividend, reclassification,
subdivision or combination of shares, merger, consolidation, rights
offering, or any other change in the corporate structure or shares of
capital stock of SFI, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) shall make such
adjustment as it deems appropriate in the number and kinds of shares of
Stock subject to the Incentive Stock Option or in the option price;
provided, however, that no such adjustment shall give the Optionee any
additional benefits under the Incentive Stock Option.
6. Fair Market Value.
"Fair market value" as of any date and in respect of any share of
Common Stock means the closing price on such date or on the next
business day, if such date is not a business day, of a share of Common
Stock reflected in the NASDAQ National Market System traded under the
Symbol SAFM, provided that, if shares of Common Stock shall not have
been traded on NASDAQ for more than 10 days immediately preceding such
date or if deemed appropriate by the Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan) for
any other reason, the fair market value of shares of Common Stock shall
be as determined by the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) in such other manner
as it may deem appropriate. In no event shall the fair market value of
any share of Common Stock be less than its par value.
7. No Rights as a Stockholder.
Neither the Optionee nor any personal representative shall be, or
shall have any of the rights and privileges of, a stockholder of SFI
with respect to any shares of Stock purchasable or issuable upon the
exercise of this Incentive Stock Option, in whole or in part, prior to
the issuance of certificates for shares of Common Stock to said person.
8. Insider Trading Short-Swing Profit Liability Exemption
Requirements.
Notwithstanding
any other provision of this Agreement to the
contrary, the Incentive Stock Option granted under this Agreement shall
be transferrable (i) by the option holder only by will or under the laws
of descent and distribution of the state in which the option holder
resided on the date of his death, and (ii) by the Company pursuant to a
qualified domestic relations order as defined by the Code or Title I of
the Employee Retirement Income Security Act or the Rules thereunder.
9. No Rights of Employment.
Neither the granting of this Incentive Stock Option nor its
exercise shall be construed as granting to the Optionee any right with
respect to continuance of employment with SFI. Except as may otherwise
be limited by a written agreement between SFI and the Optionee, and
acknowledged by the Optionee, the right of SFI to terminate at will the
Optionee's employment with it at any time (whether by dismissal,
discharge, retirement or otherwise) is specifically reserved by SFI.
10. Amendment of Incentive Stock Option.
The Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) may, without further action by
the stockholders and without the consent of or further consideration
from the Optionee, amend, condition or modify this Incentive Stock
Option in response to changes in securities or other laws or rules,
regulations or regulatory interpretations thereof applicable to the
Incentive Stock Option or to comply with stock exchange rules or
requirements. The Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) may amend this
Incentive Stock Option otherwise with the written consent of the
Optionee.
11. Notice.
Any notice to SFI provided for in this instrument shall be
addressed to it in care of its Secretary at its executive offices at
Post Office Box 988, Laurel, Mississippi 39441, and any notice to the
Optionee shall be addressed to the Optionee at the current address shown
on the payroll records of SFI. Any notice shall be deemed to be duly
given if and when properly addressed and posted by registered or
certified mail, postage prepaid.
12. Incorporation of Plan by Reference.
This Incentive Stock Option is granted pursuant to the terms of
the Plan, which terms are incorporated herein by reference, and the
Incentive Stock Option shall in all respects be interpreted in
accordance with the Plan. The
Board (or, if applicable, a committee
thereof appointed pursuant to Section 1.02(d) of the Plan) shall
interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on
the parties hereto and any other person claiming an interest hereunder,
with respect to any issue arising hereunder or thereunder.
13. Governing law.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance
with the laws of the State of Mississippi, except to the extent
preempted by federal law, which shall to that extent govern.
IN WITNESS WHEREOF, SFI has caused its duly authorized officers to
execute and attest this Incentive Stock Option Agreement, and to apply
the corporate seal hereto, and the Optionee has placed his or her
signature hereon, effective as of the Date of Grant.
SANDERSON FARMS, INC.
ATTEST:
By:
Name:
Title:
ACCEPTED AND AGREED TO:
Optionee
<PAGE>
NOTICE OF EXERCISE OF INCENTIVE STOCK OPTION
SANDERSON FARMS, INC.
ATTENTION: The Board of Directors
Stock Option Committee
Gentlemen:
Notice is hereby given of the undersigned's intent to exercise the
Incentive Stock Option granted to the undersigned pursuant to the
Incentive Stock Option Agreement dated _______________, ______ entered
into by and between the undersigned and Sanderson Farms, Inc. The
Incentive Stock Option shall be exercised with respect to
______________________ (_____) shares of the common stock, par value
$1.00 per share, of Sanderson Farms, Inc., at the exercise price of
$______________ per share. The date of exercise shall be
_______________, ______ which is five days or more after the date of
this notice.
In connection with the exercise of the Incentive Stock Option, the
undersigned acknowledges that no withholding of income taxes is
required.
Employee/Optionee
Dated: ________________, ______
Exhibit A
Exhibit 10-5
SANDERSON FARMS, INC.
ALTERNATE STOCK APPRECIATION RIGHTS AGREEMENT
THIS ALTERNATE STOCK APPRECIATION RIGHTS AGREEMENT ( Agreement ),
dated as of the ______ day of _______________ , _____ (the Date of
Grant ), is delivered by Sanderson Farms, Inc., and its subsidiaries and
affiliates (collectively referred to as "SFI") to
______________________________________ (the Optionee ), who is an
executive officer or key employee of SFI.
WHEREAS, the Board of Directors of Sanderson Farms, Inc. (the
Board ), recommended stockholder approval of, the stockholders approved
and the Board adopted, the Sanderson Farms, Inc. Stock Option Plan (as
amended and restated to the date hereof, the Plan );
WHEREAS, the Plan provides for the granting of alternate stock
appreciation rights by the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) to executive officers
and key employees of SFI to receive the appreciation in value of shares
of the Common Stock of SFI, par value of $1.00 per share (the "Stock"),
in accordance with the terms and provisions thereof; and
WHEREAS, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) considers the
Optionee to be a person who is eligible for a grant of an alternate
stock appreciation right under the Plan, and has determined that it
would be in the best interest of SFI to grant the alternate stock
appreciation right documented herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Grant of Alternate Stock Appreciation Right.
(a) Subject to the terms and conditions hereinafter set forth,
SFI, with the approval and at the direction of the Board (or, if
applicable, a committee thereof appointed pursuant to Section 1.02(d) of
the Plan), hereby grants to the Optionee, as of the Date of Grant, an
alternate stock appreciation right related to a certain __________ Stock
Option granted pursuant to a certain __________ Stock Option Agreement
dated _______________, _____. The shares of stock purchasable upon
exercise of the related __________ Stock Option are hereinafter referred
to as "Option Shares." Notwithstanding any provision herein to the
contrary, the Alternate Stock Appreciation Right is not intended by the
parties hereto to be, and shall not be treated as, an "incentive stock
option," pursuant to and as such term is defined under Sections 421 and
422 of the Internal Revenue Code of 1986, as amended (the "Code").
(b) This Alternate Stock Appreciation Right is granted subject
to the following additional terms and conditions (if none, so indicate):
2. Exercise of Alternate Stock Appreciation Right.
The Optionee may, in lieu of the exercise of the ____________
Stock Option or portion thereof to which this Alternate Stock
Appreciation Right relates, exercise this Alternate Stock Appreciation
Right or portion hereof with respect to all or part of the option shares
then exercisable and shall be entitled to receive from SFI the
appreciated value of the option shares. The appreciated value of the
option shares shall be equal to 100% of the amount, if any, by which the
fair market value of a share of Common Stock on the date this Alternate
Stock Appreciation Right is exercised exceeds the fair market value of a
share of Common Stock on the date the option, to which this Alternate
Stock Appreciation Right was awarded as an alternate, was granted. This
Alternate Stock Appreciation Right shall be exercisable only to the
extent that, and subject to the same conditions as, the option to which
it relates is exercisable and only when the fair market value of a share
of Common Stock on the exercise date exceeds the exercise price of the
option to which this Alternate Stock Appreciation Right relates. The
Optionee may exercise this Alternate Stock Appreciation Right by giving
the Secretary of SFI written notice of intent to exercise substantially
in the form attached hereto as Exhibit A. The notice of exercise shall
specify the number of Option Shares as to which this Alternate Stock
Appreciation Right is to be exercised and the date of exercise thereof,
which date shall be at least five days after the giving of such notice
unless an earlier date shall have been mutually agreed upon. Payment of
the appreciated value of the Option Shares may be made in cash or in
Common Stock or a combination of both, provided that no fractional share
of Common Stock shall be issued as a result of the exercise of this
Alternate Stock Appreciation Right. The exercise of this Alternate Stock
Appreciation Right or portion hereof shall cancel the related option on
an equal number of shares of Common Stock under the __________ Stock
Option to which this Alternate Stock Appreciation Right relates.
3. Termination of Alternate Stock Appreciation Right Related to
Nonstatutory Stock Option.
(a) Except as provided in Sections 3(b) and 3(c) of this
Agreement, upon termination of the Optionee's employment, this Alternate
Stock Appreciation Right, to the extent not previously exercised, shall
terminate immediately upon such termination of employment, or if the
optionee is no longer eligible to participate in the Plan by virtue of
his or her appointment to a position that no longer falls within the
description set forth in Section 1.03 of this Plan.
(b) Upon termination of the Optionee's employment by reason of
death of the Optionee, this Alternate Stock Appreciation Right may be
exercised, but only to the extent exercisable on the date of such death,
within one (1) year from and after the date of the Optionee's death.
This Alternate Stock Appreciation Right may be exercised by the executor
or administrator of the deceased Optionee's estate or by a person
receiving this Alternate Stock Appreciation Right by will or under the
laws of descent and distribution of the state in which the Optionee
resided.
(c) Upon termination of the Optionee's employment by reason of
retirement or disability (as defined by the Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan),
this Alternate Stock Appreciation Right may be exercised, but only to
the extent exercisable on the date of such retirement or disability,
during the three (3) month period following the date of such termination
of the Optionee's employment.
(d) A transfer of the Optionee's employment from one affiliate
of SFI to another shall not be deemed to be a termination of the
Optionee's employment.
(e) Notwithstanding any other provisions set forth herein or in
the Plan, if the Optionee shall (i) commit any act of malfeasance or
wrongdoing affecting SFI, (ii) breach any covenant not to compete or
employment contract with SFI, or (iii) engage in conduct that would
warrant the Optionee's discharge for cause (excluding general
dissatisfaction with the performance of the Optionee's duties, but
including any act of disloyalty or any conduct clearly tending to bring
discredit upon SFI), then any unexercised portion of the Alternate Stock
Appreciation Right shall immediately terminate and be void.
4. Termination of Alternate Stock Appreciation Right Related to
Incentive Stock Option.
(a) Except as provided in Sections 4(b), 4(c) and 4(d) of this
Agreement, upon termination of the Optionee's employment, this Alternate
Stock Appreciation Right, to the extent not previously exercised, shall
terminate immediately upon such termination of employment, or if the
optionee is no longer eligible to participate in the Plan by virtue of
his or her appointment to a position that no longer falls within the
description set forth in Section 1.03 of this Plan.
(b) Upon termination of the Optionee's employment by reason of
death of the Optionee, this Alternate Stock Appreciation Right may be
exercised, but only to the extent exercisable on the date of such death,
within one (1) year from and after the date of the Optionee's death.
This Alternate Stock Appreciation Right may be exercised by the executor
or administrator of the deceased Optionee's estate or by a person
receiving the Alternate Stock Appreciation Right by will or under the
laws of descent and distribution of the state in which the Optionee
resided.
(c) Upon termination of the Optionee's employment by reason of
permanent and total disability as defined under Section 22(e)(3) of the
Code, this Alternate Stock Appreciation Right may be exercised, but only
to the extent exercisable on the date of such permanent and total
disability, during the one (1) year period following the date of such
termination of the Optionee's employment.
(d) Upon termination of the Optionee's employment by reason of
retirement or disability, other than disability defined by Section 4(c)
of this Agreement, this Alternate Stock Appreciation Right may be
exercised, but only to the extent exercisable on the date of such
retirement or disability, during the three (3) month period following
the date of such termination of the Optionee's employment.
(e) A transfer of the Optionee's employment from one affiliate
to another of SFI shall not be deemed to be a termination of the
Optionee's employment.
(f) Notwithstanding any other provision set forth herein or in
the Plan, if the Optionee shall (i) commit any act of malfeasance or
wrong-doing affecting SFI, (ii) breach any covenant not to compete or
employment contract with SFI, or (iii) engage in conduct that would
warrant the Optionee's discharge for cause (excluding general
dissatisfaction with the performance of the Optionee's duties, but
including any act of disloyalty or any conduct clearly tending to bring
discredit upon SFI), then any unexercised portion of the Alternate Stock
Appreciation Right shall immediately terminate and be void.
5. Adjustment of and Changes in Stock of SFI.
In the event of a reorganization, recapitalization, change of
shares, stock split, spinoff, stock dividend, reclassification,
subdivision or combination of shares, merger, consolidation, rights
offering, or any other change in the corporate structure or shares of
capital stock of SFI, the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) shall make such
adjustment as it deems appropriate in the number and kinds of shares of
Stock subject to the Alternate Stock Appreciation Right; provided,
however, that no such adjustment shall give the Optionee any additional
benefits under the Alternate Stock Appreciation Right.
6. Fair Market Value.
"Fair market value" as of any date and in respect of any share of
Common Stock means the closing price on such date or on the next
business day, if such date is not a business day, of a share of Common
Stock reflected in the NASDAQ National Market System traded under the
Symbol SAFM, provided that, if shares of Common Stock shall not have
been traded on NASDAQ for more than 10 days immediately preceding such
date or if deemed appropriate by the Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan) for
any other reason, the fair market value of shares of Common Stock shall
be as determined by the Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) in such other manner
as it may deem appropriate. In no event shall the fair market value of
any share of Common Stock be less than its par value.
7. No Rights as a Stockholder.
Neither the Optionee nor any personal representative shall be, or
shall have any of the rights and privileges of, a stockholder of SFI
with respect to any shares of Stock related to the exercise of the
Alternate Stock Appreciation Right, in whole or in part, prior to the
issuance of certificates for shares of Common Stock to said person.
8. Insider Trading Short-Swing Profit Liability Exemption
Requirements.
Notwithstanding any other provision of this Agreement to the
contrary, the Alternate Stock Appreciation Right granted under this
Agreement shall be transferrable (i) by the option holder only by will
or under the laws of descent and distribution of the state in which the
option holder resided on the date of his death or (ii) by the Company
pursuant to a qualified domestic relations order as defined by the Code
or Title I of the Employee Retirement Income Security Act or the Rules
thereunder [, except that, if the Alternate Stock Appreciation Right
granted hereby relates to a Nonstatutory Stock Option, it may be
transferred to members of the Optionee s immediate family or to trusts
for their benefit or partnerships in which such members hold the entire
partnership interest].
9. No Rights of Employment.
Neither the granting of this Alternate Stock Appreciation Right
nor its exercise shall be construed as granting to the Optionee any
right with respect to continuance of employment with SFI. Except as may
otherwise be limited by a written agreement between SFI and the
Optionee, and acknowledged by the Optionee, the right of SFI to
terminate at will the Optionee's employment with it at any time (whether
by dismissal, discharge, retirement or otherwise) is specifically
reserved by SFI.
10. Amendment of Alternate Stock Appreciation Right.
The Board (or, if applicable, a committee thereof appointed
pursuant to Section 1.02(d) of the Plan) may, without further action by
the stockholders and without the consent of or further consideration
from the Optionee, amend, condition or modify this Alternate Stock
Appreciation Right in response to changes in securities or other laws or
rules, regulations or regulatory interpretations thereof applicable to
the Alternate Stock Appreciation Right or to comply with stock exchange
rules or requirements. The Board (or, if applicable, a committee thereof
appointed pursuant to Section 1.02(d) of the Plan) may amend this
Alternate Stock Appreciation Right otherwise with the written consent of
the Optionee.
11. Notice.
Any notice to SFI provided for in this instrument shall be
addressed to it in care of its Secretary at its executive offices at
Post Office Box 988, Laurel, Mississippi 39441, and any notice to the
Optionee shall be addressed to the Optionee at the current address shown
on the payroll records of SFI. Any notice shall be deemed to be duly
given if and when properly addressed and posted by registered or
certified mail, postage prepaid.
12. Incorporation of Plan by Reference.
This Alternate Stock Appreciation Right is granted pursuant to the
terms of the Plan, which terms are incorporated herein by reference, and
the Alternate Stock Appreciation Right shall in all respects be
interpreted in accordance with the Plan. The Board (or, if applicable, a
committee thereof appointed pursuant to Section 1.02(d) of the Plan)
shall interpret and construe the Plan and this instrument, and its
interpretations and determinations shall be conclusive and binding on
the parties hereto and any other person claiming an interest hereunder,
with respect to any issue arising hereunder or thereunder.
13. Governing law.
The validity, construction, interpretation and effect of this
instrument shall exclusively be governed by and determined in accordance
with the laws of the State of Mississippi, except to the extent
preempted by federal law, which shall to that extent govern.
IN WITNESS WHEREOF, SFI has caused its duly authorized officers to
execute and attest this Alternate Stock Appreciation Right Agreement,
and to apply the corporate seal hereto, and the Optionee has placed his
or her signature hereon, effective as of the Date of Grant.
SANDERSON FARMS, INC.
ATTEST:
By:
Name:
Title:
ACCEPTED AND AGREED TO:
Optionee
<PAGE>
NOTICE OF EXERCISE OF ALTERNATE STOCK APPRECIATION RIGHT
SANDERSON FARMS, INC.
ATTENTION: The Board of Directors
Stock Option Committee
Gentlemen:
Notice is hereby given of the undersigned's intent to exercise the
Alternate Stock Appreciation Right granted to the undersigned pursuant
to the Alternate Stock Appreciation Rights Agreement dated
________________, _____ , entered into by and between the undersigned
and Sanderson Farms, Inc. The Alternate Stock Appreciation Right shall
be exercised with respect to ______________ (______) shares of the
Common Stock, $1.00 par value, of Sanderson Farms, Inc. The date of
exercise shall be _______________, ____, which is five days or more
after the date of this notice.
In connection with the exercise of the Alternate Stock
Appreciation Right, the undersigned authorizes SFI to withhold all
appropriate federal and state income and payroll taxes where cash is
paid. Where only stock is transferred, the undersigned will remit to SFI
an amount in cash equal to the appropriate federal and state income and
payroll taxes upon being advised of the amount. Alternatively, SFI may
reduce the number of shares distributed by an amount or number equal in
value to the withholding amount.
Employee/Optionee
Dated: _______________. _____
Exhibit A
EXHIBIT 23.2
AUDITORS CONSENT
CONSENT OF ERNST & YOUNG, INDEPENDENT AUDITORS
We consent to the incorporation by reference in Post-Effective
Amendment No. 1 to Registration Statement (Form S-8 No. 33-67474)
and related Prospectus pertaining to the Sanderson Farms, Inc. and
Affiliates Stock Option Plan of our report dated December 11,
1996, with respect to the consolidated financial statements and
schedules of Sanderson Farms, Inc. incorporated by reference in
its Annual Report (Form 10-K) for the year ended October 31, 1996,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Jackson, Mississippi
June 13, 1997
