INDEMNITY AGREEMENT


      This  Agreement  is made  the  15th  day of  June,  2000,  between  Joe F.
Sanderson,  Jr. and William Ramon  Sanderson,  not  individually,  but solely as
Co-Executors of the Estate of Joe Franklin Sanderson,  Deceased  ("Indemnitor"),
and Sanderson Farms,  Inc., a Mississippi  corporation with its principal office
at 225 North 13th Avenue, Laurel, Mississippi 39440 ("Company").

      It is hereby agreed:

      1. Credit Agreement. Effective March 21, 2000, a credit agreement ("Credit
Agreement")  was executed by the  Indemnitor  and Harris Trust and Savings Bank,
individually  and in its  capacity  as agent  under the  Credit  Agreement,  and
SunTrust Bank (all of said banks, including Harris Trust and Savings Bank in its
individual capacity,  being referred to collectively "Banks" and individually as
a "Bank,"  and said Harris  Trust and Savings  Bank as agent for the Banks under
the Credit Agreement being hereinafter referred to in such capacity as "Agent"),
pursuant  to which the Banks  have made term  loans in the  aggregate  principal
amount of  $13,500,000.00  to the  Indemnitor,  which are  evidenced by the term
notes  of  the  Indemnitor  (collectively  "Notes").  All  of  the  Indemnitor's
indebtedness,  obligations  and  liabilities  to  the  Banks  under  the  Credit
Agreement and the other loan documents,  including  without  limitation all such
indebtedness,  obligations  and  liabilities  evidenced  by the Notes and,  with
certain  exceptions,  all  extensions  and renewals of any of the  foregoing are
herein  collectively  referred to as the  "Indebtedness".  All terms used herein
shall  have the  meaning  set forth in the  Credit  Agreement  unless  expressly
defined herein.

      2. Guaranty  Agreement.  In consideration of the credit extended and to be
extended by the Banks to the Indemnitor under the Credit Agreement,  the Company
may agree to guarantee  the full and prompt  payment to the Agent and to each of
the Banks at maturity (whether by acceleration,  lapse of time or otherwise) and
at all times thereafter of principal of all Indebtedness of the Indemnitor under
the Credit Agreement and, with certain exceptions, all extensions or renewals of
all or any part thereof and all other indebtedness,  liabilities and obligations
of the Indemnitor to the Banks and the agent under the Credit Agreement.

      3. Requirement of Indemnity.  It is a condition of the Company's  guaranty
agreement  that the  Indemnitor  indemnify  the  Company in the manner set forth
herein.

      4.  Subrogation  and  Indemnity.  In addition to the rights of subrogation
which the Company may have as a matter of law or equity,  the  Indemnitor  shall
indemnify  Company  from and against all  liabilities  by reason of the guaranty
agreement,  the  Credit  Agreement,  the Note and the other loan  documents  and
against all demands,  claims,  actions,  losses and expenses arising  therefrom,
including reasonable attorney's fees.







      5. Unearned Interest.  The Indemnitor is not permitted to prepay the Notes
and has agreed to pay the full  interest on the Notes even if the Notes are paid
before maturity because of default or acceleration.  However,  the guaranty that
the Company may provide  would  permit the  Company to  discharge  its  guaranty
obligation  by paying the  remaining  Indebtedness  in full  without  paying the
stated but unearned interest ("Full  Payment").  In the event of Full Payment by
the Company,  Indemnitor agrees to pay the remaining interest  obligation to the
Company, rather than the Banks.

      6.  Reports  and other  Covenants.  The  Indemnitor  shall  provide to the
Company a report on the status of the  Indebtedness  at each regular  meeting of
the Board of  Directors  and shall  notify  each member of the Board of material
events or changes in the status of the Indebtedness  between Board meetings.  In
addition,  to the extent that the Indemnitor is required by the Credit Agreement
to  provide  information  to  the  Agent  or  the  Banks,  the  Indemnitor  will
simultaneously provide the same information to the Company.

      7. Binding Effect. The foregoing Indemnity Agreement shall be binding upon
and inure to the benefit of the  parties,  and their  personal  representatives,
successors and assigns.

      IN WITNESS  WHEREOF the parties have executed this  instrument the day and
year first above written.

                                    ESTATE OF JOE FRANKLIN SANDERSON, DECEASED


                                    By:   /s/Joe Franklin Sanderson, Jr.
                                         Joe Franklin Sanderson, Jr.


                                    By:  /s/William Ramon Sanderson
                                         William Ramon Sanderson

                                    SANDERSON FARMS, INC.


                                    By:  /s/D. MichaelCockrell
                                          D. Michael Cockrell, Treasurer and
                                          Chief Financial Officer


ATTEST:


/s/Jimmy Grimes
   Jimmy Grimes, Secretary