Smithfield Foods, Inc. 2008 Incentive Compensation Plan

Equity Incentive Plan Agreement

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SMITHFIELD FOODS INC

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Title: Smithfield Foods, Inc. 2008 Incentive Compensation Plan
Governing Law: Virginia Date: 7/10/2009
Industry: Food Processing Sector: Consumer/Non-Cyclical

EXHIBIT 10.1

Smithfield Foods, Inc.

2008 Incentive Compensation Plan

Stock Option Award

You have been selected to receive a Stock Option Award under the Smithfield Foods, Inc. 2008 Incentive Compensation Plan (the “Plan”), as specified below:

Participant :_____________________________________________________________

Address : ______________________________________________________________

Number of Shares Subject to Option : _____________________________________

Exercise Price :____________________

Date of Grant :____________________

THIS AGREEMENT, effective on the Date of Grant above, represents the grant of a Stock Option by Smithfield Foods, Inc., a Virginia corporation (the “Company”), to the Participant named above, pursuant to the provisions of the Plan. All capitalized terms shall have the meanings in the Plan. The parties agree as follows:

1. Grant of Option . The Company has granted to Participant as of the Date of Grant above, subject to the terms and conditions of the Plan and this Award, the right and option to purchase from the Company (the “Option”) all or any part of the Number of Shares Subject to Option above at the Exercise Price above. The Exercise Price is not less than 100% of the Fair Market Value per share of the Common Stock on the date of grant. The Option is exercisable as provided below. The Option is intended to be a nonstatutory stock option that does not receive special tax treatment under Section 422 of the Internal Revenue Code.

2. Terms and Conditions . The Option is subject to the following terms and conditions.

(a)	Expiration Date . This Option shall expire seven (7) years from the Date of Grant (the “Expiration Date”). In no event may this Option be exercised after the Expiration Date.

(b)	Nontransferability . This Option shall be nontransferable except by will or by the laws of descent and distribution and, during the lifetime of the Participant, may be exercised only by the Participant, except as provided in Section 3 below.

(c)	Vesting of Option . Subject to the provisions of Section 3 below, this Option shall vest and become exercisable as follows

Vesting DatesPercentage Vested

Vesting Dates	Percentage Vested
[one year from Date of Grant]	33%
[two years from Date of Grant]	67%
[three years from Date of Grant]	100%

If the Participant suffers a Disability or dies, or in the event of the Participant’s Retirement, the requirement that the Participant be employed by the Company through the Vesting Date is waived. In that case, the Participant (or in the event of the Participant’s death, the Participant’s beneficiary) shall be vested in a pro rata portion of the Option equal to the number of full months of employment since the Date of Grant divided by thirty-six (36). The remaining portion of the Option shall be forfeited.

In the event of the termination of the Participant’s employment by the Participant or the Company for any reason other than the Participant’s Disability or death during the Performance Period, the Participant shall forfeit any unvested portion of the Option. The Participant’s transfer of employment to the Company or any Related Company from another Related Company or the Company during the Performance Period shall not constitute a termination of employment.

In the event of a Qualifying Change of Control, the entire Option shall be fully vested as of the Qualifying Change of Control.

The vested portion of the Option shall be fully exercisable until the seventh anniversary of the Date of Grant when the Option will terminate by its terms.

(d)

Method of Exercising and Payment for Shares . The Option may be exercised by giving notice of the exercise under procedures established by the Company and making payment of the Exercise Price as follows. To pay the Exercise Price, the Participant (i), unless prohibited by law, may deliver a properly executed exercise notice together with irrevocable instructions to a broker to deliver promptly to the Company, from the sale or loan proceeds with respect to the sale of Company Stock or a loan secured by Company Stock, the amount necessary to pay the Exercise Price and Applicable Withholding Taxes, (ii) may deliver shares of Company Stock for which the holder thereof has good title, free and clear of all liens and encumbrances (valued at their Fair Market Value on the date of exercise) in satisfaction of all or any part of the Exercise Price, or (iii) may cause to be withheld from the Option shares, shares of Company Stock (valued at their Fair Market Value on the date of exercise) in satisfaction of all or any part of the Exercise Price.

3. Termination of Option Upon Termination of Employment . The right of

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