EXHIBIT 10.9
AMENDMENT NO. FOUR
TO THE
SANDERSON FARMS, INC.
AND
AFFILIATES
EMPLOYEE STOCK OWNERSHIP PLAN
THIS AGREEMENT, effective as of January 1, 2003, by SANDERSON FARMS,
INC., a Mississippi corporation (the "Company");
WITNESSETH:
WHEREAS, the Employer has adopted and maintains the "Sanderson
Farms, Inc. and Affiliates Employee Stock Ownership Plan" as heretofore amended
and restated as of November 1, 1997 (the "Plan"); and
WHEREAS, the Employer desires to further amend the Plan to comply
with final and temporary regulations under Section 401(a)(9) of the Internal
Revenue Code, relating to required minimum distributions, as herein provided;
NOW, THEREFORE, pursuant to the provisions of Section 17.1 of the
Plan, the Plan is hereby amended as follows:
FIRST: The Plan is hereby amended by adding thereto the following
new Article 20, Minimum Distribution Requirements:
ARTICLE 20
MINIMUM DISTRIBUTION REQUIREMENTS
Section 1. General Rules.
1.1. Effective Date. The provisions of this Article 20 will apply for purposes
of determining required minimum distributions for calendar years beginning with
the 2003 calendar year,
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1.2. Precedence. The requirements of this article will take precedence over any
inconsistent provisions of the Plan.
1.3. Requirements of Treasury Regulations Incorporated. All distributions
required under this article will be determined and made in accordance with the
Treasury regulations under section 40l(a)(9) of the Internal Revenue Code.
1.4. TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of
this article, distributions may be made under a designation made before January
1, 1984, in accordance with section 242(b)(2) of the Tax Equity and Fiscal
Responsibility Act (TEFRA) and the provisions of the Plan that relate to section
242(b)(2) of TEFRA.
Section 2. Time and Manner of Distribution
2.1. Required beginning date. The Participant's entire interest will be
distributed, or begin to be distributed, to the Participant no later than the
Participant's required beginning date which for Plan Years commencing after
October 30, 1999 shall be:
(a) For a Participant who is a 5% owner (as defined in Code
Section 416), the required beginning date is April 1 following
the calendar year in which the Participant attains age 70-1/2.
(b) For a Participant who is not a 5% owner, the required
beginning date is April 1 following the later of (i) the
calendar year in which the Participant attains age 70-1/2, and
(ii) the calendar year in which the Participant retires;
however, such Participant who attains age 70-1/2 before 1999
may elect to commence distributions by April 1 of the calendar
year following the calendar year in which he attains age
70-1/2, or elect to defer payment until April 1 of the
calendar year following the calendar year in which the
Participant retires.
2.2. Death of Participant Before Distributions Begin. If the Participant dies
before distributions begin, the Participant's entire interest will be
distributed, or begin to be distributed, no later than as follows:
(a) If the Participant's surviving spouse is the Participant's
sole designated beneficiary, distributions to the surviving
spouse will begin by December 31 of the calendar year
immediately following the calendar year in which the
Participant died, or by December 31 of the calendar year in
which the Participant would have attained age 70 1/2, if
later.
(b) If the Participant's surviving spouse is not the Participant's
sole designated beneficiary, distributions to the designated
beneficiary will begin by December 31 of the calendar year
immediately following the calendar year in which the
Participant died.
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(c) If there is no designated beneficiary as of September 30 of
the year following the year of the Participant's death, the
Participant's entire interest will be distributed by December
31 of the calendar year containing the fifth anniversary of
the Participant's death.
(d) If the Participant's surviving spouse is the Participant's
sole designated beneficiary and the surviving spouse dies
after the Participant but before distributions to the
surviving spouse begin, this section 2.2, other than section
2.2(a), will apply as if the surviving spouse were the
Participant.
For purposes of this section 2.2 and section 4, unless section 2.2(d)
applies, distributions are considered to begin on the Participant's
required beginning date. If section 2.2(d) applies, distributions are
considered to begin on the date distributions are required to begin to the
surviving spouse under section 2.2(a). If distributions under an annuity
purchased from an insurance company irrevocably commence to the
Participant before the Participant's required beginning date (or to the
Participant's surviving spouse before the date distributions are required
to begin to the surviving spouse under section 2.2(a)), the date
distributions are considered to begin is the date distributions actually
commence.
2.3. Forms of Distribution. Unless the Participant's interest is distributed in
the form of an annuity purchased from an insurance company or in a single sum on
or before the required beginning date, as of the first distribution calendar
year distributions will be made in accordance with sections 3 and 4 of this
article. If the Participant's interest is distributed in the form of an annuity
purchased from an insurance company, distributions thereunder will be made in
accordance with the requirements of section 401(a)(9) of the Code and the
Treasury regulations.
Section 3. Required Minimum Distributions During Participant's Lifetime.
3.1. Amount of Required Minimum Distributions For Each Distribution Calendar
Year. During the Participant's lifetime, the minimum amount that will be
distributed for each distribution calendar year is the lesser of:
(a) the quotient obtained by dividing the Participant's account
balance by the distribution period in the Uniform Lifetime
Table set forth in section 1.401(a)(9)-9 of the Treasury
regulations, using the Participant's age as of the
Participant's birthday in the distribution calendar year; or
(b) if the Participant's sole designated beneficiary for the
distribution calendar year is the Participant's spouse, the
quotient obtained by dividing the Participant's account
balance by the number in the Joint and Last Survivor Table sel
forth in section 1.401(a)(9)-9 of the Treasury regulations,
using the Participant's and spouse's attained ages as of the
Participant's and spouse's birthdays in the distribution
calendar year.
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3.2. Lifetime Required Minimum Distributions Continue Through Year of
Participant's Death. Required minimum distributions will be determined under
this section 3 beginning with the first distribution calendar year and up to
and including the distribution calendar year that includes the Participant's
date of death.
Section 4. Required Minimum Distributions After Participant's Death.
4.1. Death On or After Date Distributions Begin.
(a) Participant Survived by Designated Beneficiary. If the
Participant dies on or after the date distributions begin and
there is a designated beneficiary, the minimum amount that
will be distributed for each distribution calendar year after
the year of the Participant's death is the quotient obtained
by dividing the Participant's account balance by the longer of
the remaining life expectancy of the Participant or the
remaining life expectancy of the Participant's designated
beneficiary, determined as follows:
(1) The Participant's remaining life expectancy is
calculated using the age of the Participant in the year
of death, reduced by one for each subsequent year.
(2) If the Participant's surviving spouse is the
Participant's sole designated beneficiary, the remaining
life expectancy of the surviving spouse is calculated
for each distribution calendar year after the year of
the Participant's death using the surviving spouse's age
as of the spouse's birthday in that year. For
distribution calendar years after the year of the
surviving spouse's death, the remaining life expectancy
of the surviving spouse is calculated using the age of
the surviving spouse as of the spouse's birthday in the
calendar year of the spouse's death, reduced by one for
each subsequent calendar year.
(3) If the Participant's surviving spouse is not the
Participant's sole designated beneficiary, the
designated beneficiary's remaining life expectancy is
calculated using the age of the beneficiary in the year
following the year of the Participant's death, reduced
by one for each subsequent year.
(b) No Designated Beneficiary. If the Participant dies on or after
the date distributions begin and there is no designated
beneficiary as of September 30 of the year after the year of
the Participant's death, the minimum amount that will be
distributed for each distribution calendar year after the year
of the Participant's death is the quotient obtained by
dividing the Participant's account balance by
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the Participant's remaining life expectancy calculated using
the age of the Participant in the year of death, reduced by
one for each subsequent year.
4.2. Death Before Date Distributions Begin.
(a) Participant Survived by Designated Beneficiary. If the
Participant dies before the date distributions begin and there
is a designated beneficiary, the minimum amount that will be
distributed for each distribution calendar year after the year
of the Participant's death is the quotient obtained by
dividing the Participant's account balance by the remaining
life expectancy of the Participant's designated beneficiary,
determined as provided in section 4.1.
(b) No Designated Beneficiary. If the Participant dies before the
date distributions begin and there is no designated
beneficiary as of September 30 of the year following the year
of the Participant's death, distribution of the Participant's
entire interest will be completed by December 31 of the
calendar year containing the fifth anniversary of the
Participant's death.
(c) Death of Surviving Spouse Before Distributions to Surviving
Spouse Are Required to Begin. If the Participant dies before
the date distributions begin, the Participant's surviving
spouse is the Participant's sole designated beneficiary, and
the surviving spouse dies before distributions are required to
begin to the surviving spouse under section 2.2(a), this
section 4.2 will apply as if the surviving spouse were the
Participant.
Section 5. Definitions.
5.1. Designated Beneficiary. The individual who is designated as the beneficiary
under Section 9.3 of the Plan and is the designated beneficiary under section
401(a)(9) of the Internal Revenue Code and section 1.401(a)(9)-l, Q&A-4, of the
Treasury regulations.
5.2. Distribution calendar year. A calendar year for which a minimum
distribution is required. For distributions beginning before the Participant's
death, the first distribution calendar year is the calendar year immediately
preceding the calendar year which contains the Participant's required beginning
date. For distributions beginning after the Participant's death, the first
distribution calendar year is the calendar year in which distributions are
required to begin under section 2.2. The required minimum distribution for the
Participant's first distribution calendar year will be made on or before the
Participant's required beginning date. The required minimum distribution for
other distribution calendar years, including the required minimum distribution
for the distribution calendar year in which the Participant's required beginning
date occurs, will be made on or before December 31 of that distribution calendar
year.
5.3. Life expectancy. Life expectancy as computed by use of the Single Life
Table in section 1.401(a)(9)-9 of the Treasury regulations.
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5.4. Participant's account balance. The account balance as of the last valuation
date in the calendar year immediately preceding the distribution calendar year
(valuation calendar year) increased by the amount of any contributions made and
allocated or forfeitures allocated to the account balance as of dates in the
valuation calendar year after the valuation date and decreased by distributions
made in the valuation calendar year after the valuation date. The account
balance for the valuation calendar year includes any amounts rolled over or
transferred to the Plan either in the valuation calendar year or in the
distribution calendar year if distributed or transferred in the valuation
calendar year.
5.4. Required beginning date. The date specified in section 2.1 of this Article.
SECOND: The amendment made hereby shall not eliminate or reduce any
early retirement benefit or retirement type subsidy (as defined in regulations
promulgated by the Secretary of the Treasury) or eliminate an optional form of
benefit with respect to benefits attributable to service before the date hereof.
THIRD: The Plan as hereby amended shall continue in full force and
effect.
IN WITNESS WHEREOF, Sanderson Farms, Inc. has caused this instrument
to be executed and attested, all by officers thereunto duly authorized.
SANDERSON FARMS, INC.
By /s/ ?????
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ATTEST: ----------------
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