Ex-10.7






Exhibit 10.7




AMENDMENT NO. 2




SANDERSON FARMS, INC. AND AFFILIATES


EMPLOYEE STOCK OWNERSHIP PLAN


(As Amended and Restated Effective August 1, 2006)



WHEREAS, Sanderson Farms Inc. (the “Corporation”) maintains the Sanderson Farms, Inc. and
Affiliates Employee Stock Ownership Plan (the “Plan”) for the benefit of the employees of the
Corporation and its participating affiliates (the “Employer”);


WHEREAS, Section 12.1 of the Plan provides that the Corporation, through action of its Board of
Directors, may amend the Plan at any time; and


WHEREAS, the Corporation desires to amend the provisions of the Plan relating to limitations on
annual additions to participant accounts to reflect final Treasury Regulations under Section 415 of
the Internal Revenue Code of 1986, as amended, effective for the Plan Year beginning on November 1,
2007.


NOW THEREFORE BE IT RESOLVED, that, effective November 1, 2007, Section 2.30 of the Plan shall be
restated in its entirety as follows:



Section 2.30 “Section 415 Compensation” means:



(a) Wages within the meaning of Section 3401(a) of the Code (for
the purposes of income tax withholding at the source) but
determined without regard to any rules that limit the remuneration
included in wages based on the nature or location of the
employment or the services performed (such as the exception for
agricultural labor in Section 340(a)(2) of the Code). Section 415
Compensation shall include any elective deferral (within the
meaning of Section 402(g)(3) of the Code) made by the Employer on
behalf of an Employee and any amount contributed or deferred by
the Employer at the election of the Employee which is not
includable in the Employee’s gross income by reason of Section 125
or 132(f)(4) of the Code. Section 415 Compensation shall include
only that compensation which is actually paid to an Employee
during a Plan Year and shall exclude any amount in excess of
$200,000, as adjusted by the Secretary in accordance with Section
401(a)(17)(B) of the Code. The cost-of-living adjustment in
effect for a calendar year shall apply to the annual compensation
limit of Section 401(a)(17)(B) of the Code for the Limitation Year
that begins with or within such calendar year.



(b) For Limitation Years beginning on and after November 1, 2007,
the term “Section 415 Compensation”





 









 








shall also include compensation paid by the later of 2 1/2 months
after an Employee’s severance from employment with the Employer
and the Affiliates or the end of the Limitation Year that includes
the date of the Employee’s severance from employment with the
Employer and the Affiliates if the payment is (i) for regular
compensation during the Employee’s regular working hours, or
compensation for services outside the Employee’s regular working
hours (such as overtime or shift differential), commissions,
bonuses, or similar payments, and absent a severance from
employment, the payments would have been paid to the Employee
while the Employee continued in employment with the Employer and
the Affiliates, (ii) for unused accrued bona fide sick, vacation
or other leave that the Employee would have been able to use if
employment had continued, or (iii) received by the Employee
pursuant to a nonqualified unfunded deferred compensation plan,
but only if the payment would have been paid to the employee at
the same time if the Employee had continued in employment with the
Employer and only to the extent that the payment is includible in
the Employee’s gross income.



(c) Any payments not described in Section 2.30(a) and (b) hereof
shall not be considered “Section 415 Compensation” if paid after
severance from employment with the Employer and the Affiliates,
even if they are paid by the later of 2 1/2 months after the date
of severance from employment or the end of the Limitation Year
that includes the date of severance from employment, except (i)
payments to an individual who does not currently perform services
for the Employer and the Affiliates by reason of qualified
military service (within the meaning of Section 414(u)(1) of the
Code) to the extent the payments do not exceed the amounts the
individual would have received if the individual had continued to
perform services for the Employer and the Affiliates rather than
entering qualified military service, or (ii) compensation paid to
an Employee who is permanently and totally disabled (within the
meaning of Section 22(e)(3) of the Code); provided that salary
continuation applies to all Participants who are permanently and
totally disabled for a fixed or determinable period or the
Employee was not a “highly compensated employee” (within the
meaning of Section 414(q) of the Code) immediately before becoming
disabled.



2









 








     IN WITNESS WHEREOF, the undersigned has executed this Amendment No. 2 to the Sanderson Farms,
Inc. and Affiliates Employee Stock Ownership Plan on this 23rd day of October, 2008.



	 	 	 	 	 
	 	SANDERSON FARMS, INC.

 	 
	 	By:  	/s/ Mike Cockrell
 	 
	 	 	Title: CFO and Treasurer 	 
	 	 	 	 
	 




3