RESTRICTED STOCK
AGREEMENT
(MANAGEMENT EMPLOYEE)
This RESTRICTED
STOCK AGREEMENT (this “Agreement”), made and entered
into as of the ___ day of
, 20___ (the “Grant Date”), by and between
(the “Participant”) and Sanderson Farms, Inc. (together
with its subsidiaries and affiliates, the “Company”),
sets forth the terms and conditions of a Restricted Stock Award
issued pursuant to the Sanderson Farms, Inc. and Affiliates Stock
Incentive Plan, adopted on February 17, 2005 (the
“Plan”) and this Agreement. Any capitalized term used
but not defined herein shall have the meaning ascribed to such term
in the Plan.
1. Grant and
Vesting of Restricted Stock.
(a) As a
reward for past service or in consideration of and as an incentive
to the Participant’s performance of future services on behalf
of the Company, and for no additional consideration, the Company
hereby grants to the Participant, as of the Grant Date,
shares of the Company’s common stock, par value $1.00
per share (the “Restricted Stock”), subject to the
terms and conditions set forth herein and in the Plan. The
Restricted Stock is subject to forfeiture as provided herein and
may not be sold, exchanged, transferred, pledged, hypothecated or
otherwise disposed of by the Participant, other than by will or by
the laws of descent and distribution of the state in which the
Participant resides on the date of his death. The period during
which the Restricted Stock is not vested and is subject to transfer
restrictions is referred to herein as the “Restriction
Period.”
(b) Except
as otherwise provided in this Agreement or the Plan, the Restricted
Stock shall vest and no longer be subject to forfeiture or any
transfer restrictions hereunder on the tenth anniversary of the
Grant Date, so long as the Participant has remained continuously
employed by the Company from the Grant Date through such
date.
(c) In the
event of (i) the Participant’s termination of employment
with the Company by reason of death or Disability, (ii) the
Participant’s termination of employment with the Company
after his attainment of eligibility for retirement (as determined
by the Board from time to time) or, (iii) a Change in Control,
the Restricted Stock that has not vested shall immediately vest and
no longer be subject to forfeiture or any transfer restrictions
hereunder. If the Participant’s employment with the Company
is terminated for any other reason, voluntarily or involuntarily,
prior to the expiration of the Restriction Period, then the
Restricted Stock that has not vested as of the termination date
shall immediately be forfeited, ownership shall be transferred back
to the Company and the Restricted Stock shall become authorized but
unissued Shares.
(e) If the
Board determines in good faith that the Participant has engaged in
any Detrimental Activity during the period that the Participant is
employed by the Company or during the two-year period following the
Participant’s voluntary termination of employment or his
termination by the Company for Cause, then the Restricted Stock
that has not vested as of the date of the Board determination shall
immediately be forfeited, ownership shall be transferred back to
the Company and the Restricted Stock shall become authorized but
unissued Shares or, if the Restricted Stock has already vested, the
Participant shall repay to the Company the fair market value of the
Shares as of the Grant Date. For purposes of this
Section 1(e), the parties hereto agree that the fair market
value of the Shares as of the Grant Date is $
per share.
Certificates
representing the Restricted Stock shall be registered in the
Participant’s name (or an appropriate book entry shall be
made). Certificates, if issued, may, at the Company’s option,
either be held by the Company in escrow until the Restriction
Period expires or until the restrictions thereon otherwise lapse
and/or be issued to the Participant and registered in the name of
the Participant, bearing an appropriate restrictive legend that
refers to this Agreement and remaining subject to appropriate
stop-transfer orders. The Participant agrees to deliver to the
Board, upon request, one or more stock powers endorsed in blank
relating to the Restricted Stock. If and when the Restricted Stock
vests and is no longer subject to forfeiture or transfer
restrictions, unlegended certificates for such Restricted Stock
shall be delivered to the Participant (subject to Section 6
pertaining to the withholding of taxes and Section 14
pertaining to the Securities Act of 1933, as amended (the
“Securities Act”)); provided, however, that the Board
may cause such legend or legends to be placed on any such
certificates as it may deem advisable under Applicable
Law.
3. Rights as a
Stockholder.
Except as
otherwise provided in this Agreement or the Plan, during the
Restriction Period the Participant shall have, with respect to the
Restricted Stock, all of the rights of a stockholder of the
Company, including the right to vote the Restricted Stock and the
right to receive any dividends or other distributions with respect
thereto.
If any change
in corporate capitalization, such as a stock split, reverse stock
split, stock dividend, or any corporate transaction such as a
reorganization, reclassification, merger or consolidation or
separation, including a spin-off of the Company or sale or other
disposition by the Company of all or a portion of its assets, any
other change in the Company’s corporate structure, or any
distribution t
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