-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HRckQ0wF2fZU0pVtKUbAUyb3+K7+lD6hNhb8assIyqsadLaVPYHOTTQiK31x6TEe a/jf1lqhtj61DnIy5ZftPA== /in/edgar/work/0000950129-00-005376/0000950129-00-005376.txt : 20001114 0000950129-00-005376.hdr.sgml : 20001114 ACCESSION NUMBER: 0000950129-00-005376 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001113 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SYSCO CORP CENTRAL INDEX KEY: 0000096021 STANDARD INDUSTRIAL CLASSIFICATION: [5140 ] IRS NUMBER: 741648137 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-06544 FILM NUMBER: 758121 BUSINESS ADDRESS: STREET 1: 1390 ENCLAVE PKWY CITY: HOUSTON STATE: TX ZIP: 77077 BUSINESS PHONE: 2815841390 10-Q 1 h81699e10-q.txt SYSCO CORPORATION - DATED SEPTEMBER 30, 2000 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ---------- --------- Commission file number 1-6544 SYSCO CORPORATION (Exact name of registrant as specified in its charter) Delaware 74-1648137 (State or other jurisdiction of (IRS employer incorporation or organization) identification number) 1390 Enclave Parkway Houston, Texas 77077-2099 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (281) 584-1390 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] 334,222,489 shares of common stock were outstanding as of October 27, 2000. 2 2 PART I. FINANCIAL INFORMATION Item 1. Financial Statements The following consolidated financial statements have been prepared by the Company, without audit, with the exception of the July 1, 2000 consolidated balance sheet which was taken from the audited financial statements included in the Company's Fiscal 2000 Annual Report on Form 10-K. The financial statements include consolidated balance sheets, consolidated results of operations and consolidated cash flows. In the opinion of management, all adjustments, which consist of normal recurring adjustments, necessary to present fairly the financial position, results of operations and cash flows for all periods presented, have been made. These financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company's Fiscal 2000 Annual Report on Form 10-K. A review of the financial information herein has been made by Arthur Andersen LLP, independent public accountants, in accordance with established professional standards and procedures for such a review. A letter from Arthur Andersen LLP concerning their review is included as Exhibit 15(a). 3 3 SYSCO CORPORATION and its Consolidated Subsidiaries CONSOLIDATED BALANCE SHEETS (In Thousands Except for Share Data)
Sept. 30, 2000 July 1, 2000 Oct. 2, 1999 -------------- ------------ ------------ (Unaudited) (Audited) (Unaudited) ASSETS Current assets Cash $ 117,575 $ 159,128 $ 143,831 Accounts and notes receivable, less allowances of $38,264, $27,628 and $29,567 1,595,725 1,519,038 1,450,881 Inventories 997,143 937,899 910,746 Deferred taxes 77,714 72,041 35,789 Prepaid expenses 45,091 45,109 34,283 ---------- ---------- ---------- Total current assets 2,833,248 2,733,215 2,575,530 Plant and equipment at cost, less depreciation 1,362,632 1,344,693 1,245,926 Other assets Goodwill and intangibles, less amortization 502,997 503,039 402,364 Other 232,633 233,008 175,170 ---------- ---------- ---------- Total other assets 735,630 736,047 577,534 ---------- ---------- ---------- Total assets $4,931,510 $4,813,955 $4,398,990 ========== ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Notes payable $ 57,838 $ 31,109 $ 139,027 Accounts payable 1,248,268 1,186,721 1,090,708 Accrued expenses 519,839 527,233 390,271 Accrued income taxes 90,699 17,914 33,407 Current maturities of long-term debt 19,166 19,958 19,773 ---------- ---------- ---------- Total current liabilities 1,935,810 1,782,935 1,673,186 Long-term debt 874,883 1,023,642 1,055,168 Deferred taxes 246,170 245,810 234,735 Shareholders' equity Preferred stock, par value $1 per share Authorized 1,500,000 shares, issued none -- -- -- Common stock, par value $1 per share Authorized 1,000,000,000 shares, issued 382,587,450 shares 382,587 382,587 382,587 Paid-in capital 88,066 76,967 35,221 Retained earnings 2,436,209 2,332,238 2,096,731 ---------- ---------- ---------- 2,906,862 2,791,792 2,514,539 Less cost of treasury stock, 50,372,203, 51,102,663 and 53,267,646 shares 1,032,215 1,030,224 1,078,638 ---------- ---------- ---------- Total shareholders' equity 1,874,647 1,761,568 1,435,901 ---------- ---------- ---------- Total liabilities and shareholders' equity $4,931,510 $4,813,955 $4,398,990 ========== ========== ==========
Note: The July 1, 2000 balance sheet has been taken from the audited financial statements at that date. 4 4 SYSCO CORPORATION and its Consolidated Subsidiaries CONSOLIDATED RESULTS OF OPERATIONS (Unaudited) (In Thousands Except for Share Data)
13 - Week Period Ended -------------------------------- Sept. 30, 2000 Oct. 2, 1999 -------------- ------------- Sales $ 5,360,174 $ 4,657,034 Costs and expenses Cost of sales 4,322,784 3,793,200 Operating expenses 787,497 674,244 Interest expense 17,401 17,944 Other, net (633) (189) ------------- ------------- Total costs and expenses 5,127,049 4,485,199 ------------- ------------- Earnings before income taxes 233,125 171,835 Income taxes 89,170 66,156 ------------- ------------- Earnings before cumulative effect of accounting change 143,955 105,679 Cumulative effect of accounting change -- (8,041) ------------- ------------- Net earnings $ 143,955 $ 97,638 ============= ============= Earnings before accounting change: Basic earnings per share $ 0.43 $ 0.32 ============= ============= Diluted earnings per share $ 0.43 $ 0.32 ============= ============= Cumulative effect of accounting change: Basic earnings per share $ -- $ (0.02) ============= ============= Diluted earnings per share $ -- $ (0.02) ============= ============= Net earnings: Basic earnings per share $ 0.43 $ 0.30 ============= ============= Diluted earnings per share $ 0.43 $ 0.29 ============= ============= Average shares outstanding 332,025,934 328,925,219 ============= ============= Diluted average shares outstanding 337,092,765 333,487,155 ============= ============= Dividends paid per common share $ 0.12 $ 0.10 ============= =============
5 5 SYSCO CORPORATION and its Consolidated Subsidiaries CONSOLIDATED CASH FLOWS (Unaudited) (In Thousands)
13 - Week Period Ended ---------------------------- Sept. 30, 2000 Oct. 2, 1999 -------------- ------------ Cash flows from operating activities: Net earnings $ 143,955 $ 97,638 Add non-cash items: Cumulative effect of accounting change -- 8,041 Depreciation and amortization 59,712 52,908 Deferred tax benefit (5,313) (1,596) Provision for losses on accounts receivable 8,195 5,979 Additional investment in certain assets and liabilities, net of effect of businesses acquired: (Increase) in receivables (84,882) (94,941) (Increase) in inventories (59,244) (45,907) Decrease (increase) in prepaid expenses 18 (4,169) Increase in accounts payable 61,547 62,435 (Decrease) increase in accrued expenses (7,394) 13,159 Increase in accrued income taxes 72,785 31,747 (Increase) in other assets (3,134) (29,459) --------- --------- Net cash provided by operating activities 186,245 95,835 --------- --------- Cash flows from investing activities: Additions to plant and equipment (70,750) (59,266) Proceeds from sales of plant and equipment 473 5,391 Acquisition of businesses, net of cash acquired (1,423) (60,437) --------- --------- Net cash used for investing activities (71,700) (114,312) --------- --------- Cash flows from financing activities: Bank and commercial paper (repayments) borrowings (121,504) 186,502 Other debt (repayments) (1,318) (4,678) Common stock reissued from treasury 35,545 21,115 Treasury stock purchases (28,837) (156,959) Dividends paid (39,984) (32,975) --------- --------- Net cash provided by (used for) financing activities (156,098) 13,005 --------- --------- Net decrease in cash (41,553) (5,472) Cash at beginning of period 159,128 149,303 --------- --------- Cash at end of period $ 117,575 $ 143,831 ========= ========= Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 12,138 $ 12,586 Income taxes 18,178 22,423
6 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources The liquidity and capital resources discussion included in Management's Discussion and Analysis of Financial Condition and Results of Operations of the Company's Fiscal 2000 Annual Report on Form 10-K remains applicable, other than as described below. In Fiscal 1992, the Company began a common stock repurchase program which continued into the first quarter of Fiscal 2000, resulting in the cumulative repurchase of 80,000,000 shares of common stock. The Board of Directors authorized the repurchase of an additional 8,000,000 shares in July 1999. Under this latest authorization, 4,899,600 shares were purchased through September 30, 2000, including 681,200 shares bought in the first quarter of Fiscal 2001. The increase in treasury stock purchases in the period ended September 30, 2000 primarily reflects shares repurchased for acquisitions. In November 2000, the Board authorized the repurchase of an additional 8,000,000 shares. As of September 30, 2000, SYSCO's borrowings under its commercial paper program were $99,637,000. Such borrowings were $255,248,000 as of October 28, 2000. During the 13-week period ended September 30, 2000, commercial paper and short-term bank borrowings ranged from approximately $157,631,000 to $291,977,000. Long-term debt to capitalization ratio was 31.8% at September 30, 2000, less than the 35% to 40% target ratio, due to strong cash flow from operations and relatively low share repurchases. Results of Operations Sales and cost of sales for the first quarter increased about 15.1% and 14.0%, respectively, over the same quarter of the prior year. Real sales growth for the quarter was 8.2%, after adjusting overall sales growth by 5.25% for acquisitions and 1.69% for food cost inflation primarily due to higher costs for fresh and frozen meat and paper and disposables. Operating expenses for the periods presented remained approximately the same as a percent of sales. 7 7 Interest expense in the current period decreased over the prior period due to decreased borrowings. Income taxes for the periods presented reflect an effective rate of 38.25% this year compared to 38.5% last year. Pretax earnings and net earnings before the accounting change increased 35.7% and 36.2%, respectively, over the prior year. The increases were due to the factors discussed above as well as the Company's success in its continued efforts to increase sales to the Company's territorial street customers and increasing sales of SYSCO brand products, both of which generate higher margins. Basic and diluted earnings per share before the accounting change increased 34.4% over the same period last year due to the factors discussed above. A reconciliation of basic and diluted earnings per share after the accounting change follows. The following table sets forth the computation of basic and diluted earnings per share after the accounting change:
13 - Week Period Ended ------------------------------ Sept. 30, 2000 Oct. 2, 1999 -------------- ------------ Numerator: Numerator for basic earnings per share -- income available to common shareholders $143,955,000 $ 97,638,000 ============ ============ Denominator: Denominator for basic earnings per share -- weighted-average shares 332,025,934 328,925,219 Effect of dilutive securities: Employee and director stock options 5,066,831 4,561,936 ------------ ------------ Denominator for diluted earnings per share -- adjusted weighted-average shares and assumed conversions 337,092,765 333,487,155 ============ ============ Basic earnings per share $ 0.43 $ 0.30 ============ ============ Diluted earnings per share $ 0.43 $ 0.29 ============ ============
8 8 Acquisitions In July 1999, SYSCO acquired Newport Meat Co. Inc., a southern California based distributor of fresh aged beef and other meats, seafood and poultry products. In August 1999, the company acquired Doughtie's Foods, Inc., a food distributor located in Virginia, and bought substantially all of the assets of Buckhead Beef Company, Inc., a Georgia based distributor of custom-cut fresh steaks and other meats, seafood and poultry products. In November 1999, SYSCO acquired Malcolm Meats, an Ohio based distributor of custom-cut fresh steaks and other meat and poultry products. In January 2000, SYSCO acquired Watson Foodservice Inc., a broadline foodservice distributor located in Lubbock, Texas. In March 2000, SYSCO acquired FreshPoint Inc., a North America based distributor of produce. The transactions were accounted for using the purchase method of accounting and the accompanying financial statements for the 13 weeks ended September 30, 2000 include the results of the acquired companies from the respective dates they joined SYSCO. There was no material effect, individually or in the aggregate, on SYSCO's consolidated operating results or financial position from these transactions. The purchase price was allocated to the net assets acquired based on the estimated fair value at the date of acquisition. The balances included in the Consolidated Financial Position related to acquisitions are based upon preliminary information and are subject to change when final asset and liability valuations are obtained. Material changes to the preliminary allocations are not anticipated by management. New Accounting Pronouncements In the first quarter of Fiscal 2001, SYSCO adopted SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." The adoption of SFAS No. 133 did not have a significant effect on SYSCO's consolidated results of operations or financial position. In December 1999, the Securities and Exchange Commission staff released Staff Accounting Bulletin (SAB) No. 101, "Revenue Recognition." The SAB provides guidance on the recognition, presentation and disclosure of revenue in financial statements. SYSCO is required to and will adopt SAB 101 in the fourth quarter of fiscal 2001 and believes that adoption will not have a significant effect on its consolidated results of operations or financial position. 9 9 Item 3. Quantitative and Qualitative Disclosures about Market Risk SYSCO does not utilize financial instruments for trading purposes and holds no derivative financial instruments which could expose the Company to significant market risk. SYSCO's exposure to market risk for changes in interest rates relates primarily to its long-term obligations. At September 30, 2000, the Company had outstanding $99,637,000 of commercial paper at variable rates of interest with maturities through November 9, 2000. The Company's remaining long-term debt obligations of $775,246,000 were primarily at fixed rates of interest. Because a relatively small portion of the Company's long-term debt bears interest at variable rates, SYSCO has no significant cash flow exposure due to interest rate changes for long-term debt obligations. 10 10 Forward-Looking Statements Statements made herein regarding continuation of the share repurchase program and SYSCO's market risks are forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties and are based on current expectations and management's estimates; actual results may differ materially. Share repurchases could be affected by market prices of the Company's stock as well as management's decision to utilize its capital for other purposes. The effect of market risks could be impacted by future borrowing levels and certain economic factors, such as interest rates. Those risks and uncertainties that could impact these statements include the risks relating to the foodservice industry's relatively low profit margins and sensitivity to economic conditions, SYSCO's leverage and debt risks and other risks detailed in the Company's Fiscal 2000 Annual Report on Form 10-K. PART II. OTHER INFORMATION Item 1. Legal Proceedings SYSCO is engaged in various legal proceedings which have arisen but have not been fully adjudicated. These proceedings, in the opinion of management, will not have a material adverse effect upon the consolidated financial position or results of operations of the Company when ultimately concluded. Item 2. Changes in Securities and Use of Proceeds. None Item 3. Defaults upon Senior Securities None Item 4. Submission of Matters to a Vote of Security Holders None Item 5. Other Information None 11 11 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits. 3(a) Restated Certificate of Incorporation, incorporated by reference to Exhibit 3(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 3(b) Bylaws, as amended May 12, 1999, incorporated by reference to Exhibit 3(b) to Form 10-K for the year ended July 3, 1999 (File No. 1-6544). 3(c) Form of Amended Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock, incorporated by reference to Exhibit 3(c) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 3(d) Certificate of Amendment of Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(d) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544). 4(a) Sixth Amendment and Restatement of Competitive Advance and Revolving Credit Facility Agreement dated May 31, 1996, incorporated by reference to Exhibit 4(a) to Form 10-K for the year ended June 27, 1996 (File No. 1-6544). 4(b) Agreement and Seventh Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of June 27, 1997, incorporated by reference to Exhibit 4(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(c) Agreement and Eighth Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of June 22, 1998, incorporated by reference to Exhibit 4(c) to Form 10-K for the year ended July 3, 1999 (File No. 1-6544). 4(d) Senior Debt Indenture, dated as of June 15, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(a) to Registration Statement on Form S-3 filed June 6, 1995 (File No. 33-60023). 12 12 4(e) First Supplemental Indenture, dated June 27, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, as amended, incorporated by reference to Exhibit 4(e) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 4(f) Second Supplemental Indenture, dated as of May 1, 1996, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, as amended, incorporated by reference to Exhibit 4(f) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 4(g) Third Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(g) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(h) Fourth Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(i) Fifth Supplemental Indenture, dated as of July 27, 1998, between Sysco Corporation and First Union National Bank, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 27, 1998 (File No. 1-6554). 4(j) Agreement and Ninth Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of December 1, 1999, incorporated by reference to Exhibit 4(j) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544). *10(a) Second Amendment dated as of May 10, 2000, to the Fifth Amended and Restated SYSCO Corporation Supplemental Executive Retirement Plan. *10(b) Second Amendment dated as of May 10, 2000, to Amended and Restated SYSCO Corporation Executive Deferred Compensation Plan. *10(c) First Amendment dated as of May 10, 2000, to Amended and Restated SYSCO Corporation Board of Directors Deferred Compensation Plan. 13 13 *10(d) First Amendment, dated September 1, 2000, to the Executive Compensation Adjustment Agreement between Sysco and Charles H. Cotros. *15(a) Letter from Arthur Andersen LLP dated November 10, 2000, re: unaudited financial statements. *15(b) Acknowledgement letter from Arthur Andersen LLP. *27 Financial Data Schedule ---------- * Filed herewith. (b) Reports on Form 8-K: On August 3, 2000, the Company filed a Form 8-K to attach a press release dated August 2, 2000 announcing results of operations for the fiscal year ended July 1, 2000 (File No. 1-6544). 14 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. SYSCO CORPORATION (Registrant) By /s/ JOHN K. STUBBLEFIELD, JR. ----------------------------- John K. Stubblefield, Jr. Executive Vice President, Finance & Administration Date: November 10, 2000 15 INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION ------- ----------- 3(a) Restated Certificate of Incorporation, incorporated by reference to Exhibit 3(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 3(b) Bylaws, as amended May 12, 1999, incorporated by reference to Exhibit 3(b) to Form 10-K for the year ended July 3, 1999 (File No. 1-6544). 3(c) Form of Amended Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock, incorporated by reference to Exhibit 3(c) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 3(d) Certificate of Amendment of Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(d) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544). 4(a) Sixth Amendment and Restatement of Competitive Advance and Revolving Credit Facility Agreement dated May 31, 1996, incorporated by reference to Exhibit 4(a) to Form 10-K for the year ended June 27, 1996 (File No. 1-6544). 4(b) Agreement and Seventh Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of June 27, 1997, incorporated by reference to Exhibit 4(a) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(c) Agreement and Eighth Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of June 22, 1998, incorporated by reference to Exhibit 4(c) to Form 10-K for the year ended July 3, 1999 (File No. 1-6544).
16 4(d) Senior Debt Indenture, dated as of June 15, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(a) to Registration Statement on Form S-3 filed June 6, 1995 (File No. 33-60023). 4(e) First Supplemental Indenture, dated June 27, 1995, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, as amended, incorporated by reference to Exhibit 4(e) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 4(f) Second Supplemental Indenture, dated as of May 1, 1996, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, as amended, incorporated by reference to Exhibit 4(f) to Form 10-K for the year ended June 29, 1996 (File No. 1-6544). 4(g) Third Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(g) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(h) Fourth Supplemental Indenture, dated as of April 25, 1997, between Sysco Corporation and First Union National Bank of North Carolina, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 28, 1997 (File No. 1-6544). 4(i) Fifth Supplemental Indenture, dated as of July 27, 1998, between Sysco Corporation and First Union National Bank, Trustee, incorporated by reference to Exhibit 4(h) to Form 10-K for the year ended June 27, 1998 (File No. 1-6554). 4(j) Agreement and Ninth Amendment to Competitive Advance and Revolving Credit Facility Agreement dated as of December 1, 1999, incorporated by reference to Exhibit 4(j) to Form 10-Q for the quarter ended January 1, 2000 (File No. 1-6544).
17 *10(a) Second Amendment dated as of May 10, 2000, to the Fifth Amended and Restated SYSCO Corporation Supplemental Executive Retirement Plan. *10(b) Second Amendment dated as of May 10, 2000, to Amended and Restated SYSCO Corporation Executive Deferred Compensation Plan. *10(c) First Amendment dated as of May 10, 2000, to Amended and Restated SYSCO Corporation Board of Directors Deferred Compensation Plan. *10(d) First Amendment, dated September 1, 2000, to the Executive Compensation Adjustment Agreement between Sysco and Charles H. Cotros. *15(a) Letter from Arthur Andersen LLP dated November 10, 2000, re: unaudited financial statements. *15(b) Acknowledgement letter from Arthur Andersen LLP. *27 Financial Data Schedule
---------- * Filed herewith. EX-10.A 2 h81699ex10-a.txt RESTATED SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN 1 EXHIBIT 10(a) SECOND AMENDMENT TO THE FIFTH AMENDED AND RESTATED SYSCO CORPORATION SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN THIS SECOND AMENDMENT TO THE FIFTH AMENDED AND RESTATED SYSCO CORPORATION SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN (this "Amendment"). WHEREAS, Sysco Corporation has adopted that certain Fifth Amended and Restated Sysco Corporation Supplemental Executive Retirement Plan (the "Plan") pursuant to a plan document executed July 7, 1997, as amended by that certain First Amendment thereto dated as of June 29, 1997; and WHEREAS, the Board of Directors of Sysco has determined to amend the Plan to (i) guarantee the initial monthly benefit payable to a retiring participant for a ten (10) year period, regardless of the death of the Participant, the Participant's spouse, or the death of both the Participant and the Participant's spouse; (ii) allow a Participant to receive full retirement benefits under the Plan at or after age sixty-two (62) if the participant has both (A) at least twenty-five (25) years of "Credited Service" under the Plan with the Company (excluding any Credited Service before the later of the Participant's first date of hire by the Company or the date of acquisition by the Company of the company for which the Participant then worked) and (B) at least fifteen (15) years of participation under the Sysco Corporation Management Incentive Plan; and (iii) provide for the voluntary acceleration of benefits upon a Change of Control of Sysco, all as hereinafter provided. NOW, THEREFORE, the Plan is hereby amended as follows: (Capitalized terms used but not otherwise defined herein shall have the meaning given them in the Plan.) 1. Section 1.2 of the Plan is hereby amended by adding the following at the end thereof: "Notwithstanding the foregoing, for purposes of calculating the Change of Control Payout Benefit the Change of Control Rate as defined in Section 6.10(b)(i) shall be the assumed interest rate, and the mortality assumptions shall be the mortality assumptions used for purposes of calculating lump sum payments made under the Sysco Retirement Plan (or the successor qualified defined benefit plan)." 2 2. Section 1.21 of the Plan is hereby amended in its entirety to read as follows: "1.21 Total Payments. "Total Payments" means all payments or benefits received or to be received by a Participant within the meaning of Section 280G of the Code in connection with a Change of Control of Sysco under the terms of this Agreement or the Sysco Corporation Executive Deferred Compensation Plan, and in connection with a Change of Control of Sysco under the terms of any stock option plan or any other plan, arrangement or agreement with the Company, its successors, any person whose actions result in a Change of Control or any person affiliated with the Company or who as a result of the completion of transactions causing a Change of Control become affiliated with the Company within the meaning of Section 1504 of the Code, taken collectively." 3. Article III of the Plan is hereby amended by adding the following after the end of the first sentence: "If a Change of Control occurs, each Participant will immediately vest 100% in his Accrued Benefit, effective as of the date of the Change of Control, without regard to the required 10 years or more of Credited Service to begin vesting or the vesting schedule. Moreover, each Participant who was a Participant or a frozen Participant on the date of a Change of Control shall be 100% vested in any Accrued Benefit which is accrued after the date of the Change of Control without regard to the Participant's Credited Service or the vesting schedule." 4. Article III of the Plan is hereby amended by adding to the end thereof the following: "In addition, any Participant (i) who is at least sixty-two (62) upon termination of employment with the Company, (ii) who has completed at least twenty-five (25) years of Credited Service (excluding any Credited Service before the later of the Participant's first date of hire by the Company or the acquisition by the Company of the company for which the Participant then worked), and (iii) who has been a participant in the Sysco Corporation Management Incentive Plan for at least fifteen (15) years, shall be 100% vested in his Accrued Benefit." 3 5. Subsections (a) and (b) of Section 4.1 are hereby amended in their entirety to read as follows: "(a) the monthly benefit for the life of the Participant with ten (10) years certain which can be provided on an Actuarially Equivalent Basis with the vested benefit of the Participant in the Sysco Corporation Employees' 401(k) Plan and any other qualified defined contribution plan in the United States and/or registered deferred profit sharing plan in Canada sponsored and funded by the Company or any other company for which a Participant may have worked in the past or will work in the future, (b) the monthly benefit for the life of the Participant with ten (10) years certain which can be provided on an Actuarially Equivalent Basis with the vested accrued benefit of the Participant from the Sysco Retirement Plan and any other qualified defined benefit plan in the United States and/or registered pension plan in Canada sponsored and funded by the Company or any other company for which a Participant may have worked in the past or will work in the future, and" 6. Section 4.2(c) of the Plan is hereby amended in its entirety to read as follows: "(c) For a Participant who is not married at benefit commencement, the form of benefit payment will be a life only monthly annuity with a period of ten (10) years guaranteed, in an amount calculated in accordance with Section 4.1. For a Participant who is married at benefit commencement, (i) the form of benefit payment will be a joint and two-thirds survivor monthly annuity with a ten (10) year certain guarantee, in an amount that is the Actuarial Equivalent of the amount calculated in accordance with Section 4.1 whereby a reduced monthly amount is payable for the joint lives of the Participant and his spouse, and a monthly annuity will continue for the life of the survivor in an amount that equals two-thirds of the monthly amount provided during their joint lives. Notwithstanding the above, during the first ten (10) years there will be no reduction regardless of the death of either or both the Participant and his Spouse. 7. Section 4.4 of the Plan is hereby amended in its entirety to read as follows: "4.4 Beneficiary for the Ten Year Certain Payment. If a Participant who receives a life annuity, with ten (10) years certain, dies prior to completing the ten (10) years certain period, the Beneficiary named by him, under Article V, for any death benefit that may be payable under that Article, will receive the remaining payments to be made under that annuity form after the Participant's death. If both a Participant and 4 the Participant's spouse, who receive the joint and two-thirds survivor annuity, with ten (10) years certain, die prior to completing the ten (10) years certain period, the Beneficiary named under Article V will receive the remaining payments to be made under that annuity form after the Participant's and the Participant's spouse's death. Even though a Participant with a frozen Accrued Benefit cannot receive a death benefit under Article V, a Beneficiary designation completed in accordance with Section 5.6, before or after a Participant's participation is frozen, will be effective for the purpose of awarding the remaining payments under the ten (10) years certain period." 8. Subsections (a) and (b) of Section 5.3 of the Plan are hereby amended in their entirety to read as follows: "(a) If the Participant is married at the time of death, the Participant's designated Beneficiary will be entitled to receive a monthly annuity equal to the annuity such Beneficiary would have received (including the initial ten (10) year certain guarantee) if the Participant had begun receiving a retirement benefit under Article IV as of the date of the Participant's death (as if the Participant could have begun receiving the Participant's benefit as of that date) and then died immediately thereafter. In calculating the Participant's hypothetical retirement benefit for this purpose the Participant's vested percentage as of the Participant's date of termination will be used and the Participant's benefit will be reduced for early commencement by five-ninths of 1% for each full calendar month by which the first payment precedes the month in which the Participant would have attained age sixty-five (65); or (b) If the Participant is single at the time of death, the Participant's designated Beneficiary will be entitled to receive a lump sum payment which is the Actuarial Equivalent of the ten (10) year certain guarantee payment that the Beneficiary would have received if the Participant had begun receiving a retirement benefit under Article IV as of the Participant's date of death (as if the Participant could have begun receiving the Participant's benefit as of that date) and then died immediately thereafter. In calculating the Participant's hypothetical retirement benefit for this purpose the Participant's vested percentage as of the Participant's date of termination will be used and the Participant's benefit will be reduced for early commencement by five ninths of 1% for each full calendar month by which the lump sum payment precedes the month in which the Participant would have attained age sixty-five (65)." 5 9. Section 5.4 of the Plan is hereby amended in its entirety to read as follows: "5.4 Death after Commencement of Retirement Benefits. Upon the death of a Participant after benefit commencement there is no death benefit other than the benefits due under the form of payment applicable to the Participant." 10. Section 5.5(c) of the Plan is hereby amended in its entirety to read as follows: "(c) If a frozen Participant dies after commencement of benefits there shall be no death benefit other than the benefits due under the form of payment applicable to such frozen Participant." 11. Section 5.5 is hereby amended by adding at the end thereof new Subsection (d) to read as follows: "(d) If a frozen Participant dies while actively employed either (x) after age sixty-five (65) or (y) after having met the early retirement criteria of Section 4.2(b), the following death benefits shall apply: (i) If the Participant is married at the time of death, the Participant's designated Beneficiary will be entitled to receive a monthly annuity equal to the annuity the Beneficiary would have received (including the initial ten (10) year certain guarantee) had the Participant retired on the Participant's date of death, begun receiving a retirement benefit under Article IV, and then died immediately thereafter; or (ii) If the Participant is single at the time of death, the Participant's designated Beneficiary will be entitled to receive the ten (10) year certain guarantee payments that such Beneficiary would have received had the Participant retired on the Participant's date of death, begun receiving a retirement benefit under Article IV, and then died immediately thereafter." 12. Section 5.6 of the Plan is hereby amended in its entirety to read as follows: "5.6 Beneficiary Designation. (a) Upon entering the Plan, each Participant shall file with the Committee a designation of one or more Beneficiaries to whom the death benefit provided by this Article V will be payable in the event of the Participant's death. The designation will be effective upon receipt by the Committee of a properly executed form which the Committee has approved for that purpose, and shall remain in force until revoked or changed by the 6 Participant. The Participant may from time to time revoke or change any designation of Beneficiary by filing another approved Beneficiary designation form with the Committee. In the case of a married Participant, any Beneficiary designation which designates any person or entity other than the Participant's spouse must be consented to by the spouse in writing in a form acceptable to the Committee in order to be effective. (b) Upon the commencement of benefits under Article IV, the Participant shall designate one or more Beneficiaries to receive the remaining period certain payments, which designation shall be made and modified in accordance with the procedures set forth in Section 5.6(a). If the Participant does not designate one or more Beneficiaries to receive the remaining period certain payments upon the commencement of benefits, the Beneficiaries designated by the Participant upon entering the Plan shall be the Participant's Beneficiaries for purposes of the remaining period certain payments. A spouse of a Participant may not change the Beneficiaries designated by the Participant, including the Beneficiaries to whom the remaining period certain payments may be paid; provided, however, that a spouse of a Participant who is receiving the survivor annuity provided under Section 4.2(c) may change the Beneficiaries designated by the Participant if all such Beneficiaries have predeceased the Participant or otherwise cease to exist. (c) If there is no valid designation of Beneficiary on file with the Committee at the time of the Participant's death or if all of the Beneficiaries designated in the last Beneficiary designation have predeceased the Participant or otherwise cease to exist, the Beneficiary will be the Participant's spouse, if the spouse survives the Participant, or otherwise the Participant's estate. A Beneficiary must survive the Participant by 60 days in order to be considered to be living on the date of the Participant's death. If any Beneficiary survives the Participant but dies or otherwise ceases to exist before receiving all payments due under Article IV or this Article V, the balance of the payments, which would have been paid to that Beneficiary will, unless the Participant's designation provides otherwise, be distributed to the deceased individual Beneficiary's estate or to the Participant's estate in the case of a Beneficiary which is not an individual. 13. Section 6.8 of the Plan is hereby amended by adding the following after the end of the first sentence thereof: "The reduction in benefits payable under this Plan shall be determined by reducing the percentage in which the Participant is vested in his Accrued Benefit." 7 14. Article VI of the Plan is hereby amended by adding at the end thereof new Section 6.10 to read as follows: "6.10 Acceleration of Payments Upon a Change of Control. If there is a Change of Control of Sysco, then the provisions of this Section 6.10 shall apply notwithstanding anything to the contrary in the Plan: (a) Any Participant, frozen Participant, former Participant receiving benefits under Article IV, or former Participant with a vested Accrued Benefit at the time of the Change of Control, or, if the Participant or former Participant is then deceased, the Participant's or former Participant's Beneficiary, shall be entitled to make an election (a "Change of Control Payout Election") to receive a lump sum payment of such person's accrued vested (taking into account vesting pursuant to the second sentence of Article III) benefits under the Plan as more fully described in Subsections (b) and (c) below. A Change of Control Payout Election shall be made by written notice to the Committee by the electing person at any time after the Change of Control. The payment (the "Change of Control Payout Benefit") shall be made by the latter of ninety (90) days from the date of receipt of the Change of Control Payout Election or as soon as administratively feasible. (b) The Change of Control Payout Benefit shall be determined as follows: (i) If a Participant or a frozen Participant makes a Change of Control Payout Election, then the Change of Control Payout Benefit for such Participant or frozen Participant shall be equal to ninety percent (90%) of the sum of (A) the single sum value of the Participant's or frozen Participant's vested Accrued Benefit as of the date of the Change of Control Payout Election assuming commencement of the accrued vested benefit as of the "Assumed Payment Date" and (B) for a Participant who on such Assumed Payment Date would be eligible for the temporary social security supplement under Section 4.3 of the Plan if the Participant retired from Sysco on that date, the single sum value of the benefit that would be paid to the Participant under such Section 4.3 of the Plan. The interest rate for purposes of the calculations required to made under this Section 6.10(b)(i) shall be one hundred twenty percent (120%) of the applicable federal rate determined under Section 1274(d) of Code as of the date of the Change of Control (the "Change of Control Rate") and the mortality table shall be the table used for purposes of calculating lump sum payments under the Sysco Retirement Plan or the successor qualified defined benefit plan (the "Change of Control Mortality Assumption"). 8 (ii) If either (A) a Beneficiary, or (B) a former Participant is entitled to or is receiving current payments under the Plan other than pursuant to this Section 6.10 of the Plan, then the Change of Control Payout Benefit for such Beneficiary or Participant shall be equal to ninety percent (90%) of the single sum value of the remaining benefit available to such Beneficiary or former Participant determined by the actuarial firm employed by Sysco with any discounting using the Change of Control Rate and the Change of Control Mortality Assumption. (iii) The "Assumed Payment Date" shall be the earliest date on which the Participant could have terminated employment with the Company and commenced receipt of an immediate benefit under the Plan assuming for this purpose that the Participant continued in the employ of the Company indefinitely following the Change of Control. (c) For purposes of determining the Change of Control Payout Benefit under Section 6.10(b)(ii), the Accrued Benefit of a Participant or frozen Participant shall be calculated in accordance with Section 4.1 subject to the following modifications: (i) The amount determined under Section 4.1(a) shall be based on (A) the Participant's or frozen Participant's vested benefit, as of the date of the Change of Control Payout Election, in the plans identified therein, (B) increased by interest on such vested benefit through the Assumed Payment Date. The interest used for purposes of making this calculation shall be the Change of Control Rate. (ii) The amount determined under Section 4.1(b) shall be adjusted to reflect any reduction in benefits that would occur under the plans identified therein as a result of receiving benefits on the Assumed Payment Date. (iii) The amount determined under Section 4.1(c) shall be calculated based on the laws in effect on the date of the Change of Control Payout Election assuming that payment of the Primary Social Security Benefit will be made at the latter of (A) the Assumed Payment Date or (B) the earliest date benefits will be payable to the Participant or frozen Participant under the federal Social Security System or the Canadian Pension Plan, and further assuming that the Participant or frozen Participant will have no additional compensation following the date of the Change of Control Payout Election. (d) Unless a Change of Control Payout Election is made under this Section 6.10, all benefits accrued under the Plan shall be paid in accordance with Articles IV and V following a Change of Control." 9 15. Article VI of the Plan is hereby amended by adding at the end of Section 6.10 thereof new Section 6.11 to read as follows "6.11 Participation in the Plan Following a Change of Control Payout Election. Notwithstanding anything herein to the contrary, a Participant who makes a Change of Control Payout Election shall remain a Participant in the Plan and shall continue to accrue benefits under the Plan for as long as the Participant continues to satisfy the participation requirements of Article II of the Plan. Any benefits accrued following the Change of Control Payout Election shall be paid in accordance with Articles IV and V of the Plan, and any benefits distributed to a Participant or the Beneficiary of a Participant who has received a Change of Control Payout Benefit shall be reduced by the value of the Change of Control Payout Benefit." 16. For purposes of administering the Plan from and after the date hereof, Section 4.2(c) of the Plan, as amended by this Second Amendment, shall be deemed to apply to any former Participant, former Participant's spouse or former Participant's Beneficiary who is receiving benefits or entitled to receive benefits under Article IV as of the date hereof such that the initial benefits payable to such former Participant, former Participant's spouse or former Participant's Beneficiary shall be guaranteed for a period of ten (10) years. Notwithstanding the foregoing, however, the monthly benefits payable to such former Participant, former Participant's spouse or former Participant's Beneficiary shall not be re-calculated to take into account the ten (10) year certain guarantee. Except as specifically amended hereby, the Plan shall remain in full force and effect as prior to this Second Amendment. IN WITNESS WHEREOF, the Company has caused this Second Amendment to be executed as of this 28th day of September, 2000, effective as of May 10, 2000. SYSCO CORPORATION By: /s/ Diane Day Sanders ------------------------------- Title: Vice President and Treasurer ---------------------------- [Corporate Seal] ATTEST: By: Kent Berke ---------------------- Title: Assistant Secretary ------------------- EX-10.B 3 h81699ex10-b.txt RESTATED EXECUTIVE DEFERRED COMPENSATION PLAN 1 EXHIBIT 10(b) SECOND AMENDMENT TO AMENDED AND RESTATED SYSCO CORPORATION EXECUTIVE DEFERRED COMPENSATION PLAN THIS SECOND AMENDMENT TO THE AMENDED AND RESTATED SYSCO CORPORATION EXECUTIVE DEFERRED COMPENSATION PLAN (this "Amendment"). WHEREAS, Sysco Corporation (the "Company") has adopted that certain Amended and Restated Sysco Corporation Executive Deferred Compensation Plan (the "Plan") pursuant to a plan document executed August 16, 1995 as amended by a First Amendment thereto dated as of June 29, 1997; and WHEREAS, the Board of Directors of the Company has determined to amend the Plan to provide for the voluntary acceleration of benefits upon a change of control of the Company, all as hereinafter provided. NOW, THEREFORE, the Plan is hereby amended as follows: (Capitalized terms used but not otherwise defined herein shall have the meaning given them in the Plan.) 1. Article VI of the Plan is hereby amended by adding at the end thereof new Section 6.12 to read as follows: "6.12 Acceleration of Payments Upon a Change of Control. (a) If there is a Change of Control of Sysco, then any Participant or, if the Participant is deceased, the Participant's Beneficiary, shall be entitled to make an election (a "Change of Control Payout Election") to receive a lump sum payment in full satisfaction of all benefits to which the Participant or Beneficiary would otherwise be entitled under the Plan. A Change of Control Payout Election shall be made by written notice to the Committee by the electing person at any time after the Change of Control of Sysco. The payment (the "Change of Control Payout Benefit") shall be made by the latter of ninety (90) days from the date of receipt of the Change of Control Payout Election or as soon as administratively feasible. If a Participant or Beneficiary makes a Change of Control Payout Election, the Change of Control Payout Benefit shall be the exclusive payment to which the Participant, the Participant's spouse and/or the Beneficiary will be eligible under the Plan and no benefit payments shall be made to a Participant or the Participant's Beneficiary pursuant to any other provision of this Plan following a Change of Control Payout Election, provided that a Participant who remains employed by the Company after making the Change of Control Payout Election shall not be precluded from further participation in the Plan with respect to future deferrals pursuant to Section 3.1 of the Plan to the extent such Participant otherwise continues to be eligible to make such election. 2 (b) Subject to reduction pursuant to Sections 6.6, 6.7 and/or 6.10 hereof, a Participant's Change of Control Payout Benefit shall be determined as follows: (i) If the Participant or the Participant's Beneficiary has not received any payments pursuant to the Plan on or prior to the Change of Control Payout Election, the Change of Control Payout Benefit shall equal ninety percent (90%) the balance of the Participant's Account as of the date of the Change of Control Payout Election. (ii) If the Participant or the Participant's Beneficiary has received payments pursuant to the Plan on or prior to the Change of Control Payout Election, the "Change of Control Payout Benefit" shall equal the sum of (A) ninety percent (90%) of the remaining principal balance of the installment payments due the Participant or the Participant's Beneficiary as of the date of the Change of Control Payout Election, and (B) interest on such remaining principal balance, determined pursuant to Section 4.5 hereof from the date of the last installment paid pursuant to the Plan with respect to the such Participant or Beneficiary through the date of payment of the Change of Control Payment Benefit. Except as specifically amended hereby, the Plan shall remain in full force and effect as prior to this Second Amendment. IN WITNESS WHEREOF, the Company has caused this Second Amendment to be executed as of this 28th day of September, 2000, effective as of May 10, 2000. SYSCO CORPORATION By: /s/ Diane Day Sanders ------------------------------- Title: Vice President and Treasurer ---------------------------- [Corporate Seal] ATTEST: By: Kent Berke ------------------- Title: Assistant Secretary ------------------- EX-10.C 4 h81699ex10-c.txt RESTATED BOARD OF DIRECTORS DEFERRED COMPENSATION 1 EXHIBIT 10(c) FIRST AMENDMENT TO AMENDED AND RESTATED SYSCO CORPORATION BOARD OF DIRECTORS DEFERRED COMPENSATION PLAN THIS FIRST AMENDMENT TO THE AMENDED AND RESTATED SYSCO CORPORATION BOARD OF DIRECTORS DEFERRED COMPENSATION PLAN (this "Amendment"). WHEREAS, Sysco Corporation (the "Company") has adopted that certain Amended and Restated Sysco Corporation Board of Directors Deferred Compensation Plan (the "Plan") pursuant to a plan document executed December 7, 1995; and WHEREAS, the Board of Directors of the Company has determined to amend the Plan to provide for the voluntary acceleration of benefits upon a change of control of the Company, all as hereinafter provided. NOW, THEREFORE, the Plan is hereby amended as follows: (Capitalized terms used but not otherwise defined herein shall have the meaning given them in the Plan.) 1. Article VI of the Plan is hereby amended by adding at the end thereof new Section 6.9 to read as follows: "6.9 Acceleration of Payments Upon a Change of Control. (a) If there is a Change of Control of Sysco, then any Participant or, if the Participant is deceased, the Participant's Beneficiary, shall be entitled to make an election (a "Change of Control Payout Election") to receive a lump sum payment in full satisfaction of all benefits to which the Participant or Beneficiary would otherwise be entitled under the Plan. A Change of Control Payout Election shall be made by written notice to the Committee by the electing person at any time after the Change of Control of Sysco. Notwithstanding anything herein to the contrary, the payment (the "Change of Control Payout Benefit") shall be made by the latter of ninety (90) days from the date of receipt of the Change of Control Payout Election or as soon as administratively feasible. If a Participant or Beneficiary makes a Change of Control Payout Election, the Change of Control Payout Benefit shall be the exclusive payment to which the Participant, the Participant's spouse and/or the Beneficiary will be eligible under the Plan and no benefit payments shall be made to a Participant or the Participant's Beneficiary pursuant to any other provision of this Plan following a Change of Control Payout Election, provided that a Participant who remains a member of the Board of Directors of the Company after making the Change of Control Payout Election shall not be precluded from further participation in the Plan with respect to future deferrals pursuant to Section 3.1 of the Plan to the extent such Participant otherwise continues to be eligible to make such election. 2 (b) A Participant's Change of Control Payout Benefit shall be determined as follows: (i) If the Participant or the Participant's Beneficiary has not received any payments pursuant to the Plan on or prior to the Change of Control Payout Election, the Change of Control Payout Benefit shall equal ninety percent (90%) the balance of the Participant's Account as of the date of the Change of Control Payout Election. (ii) If the Participant or the Participant's Beneficiary has received payments pursuant to the Plan on or prior to the Change of Control Payout Election, the Change of Control Payout Benefit shall equal the sum of (A) ninety percent (90%) of the remaining principal balance of the installment payments due the Participant or the Participant's Beneficiary as of the date of the Change of Control Payout Election, and (B) interest on such remaining principal balance determined pursuant to Section 4.5 hereof from the date of the last installment paid pursuant to the Plan with respect to the such Participant or Beneficiary through the date of payment of the Change of Control Payment Benefit. Except as specifically amended hereby, the Plan shall remain in full force and effect as prior to this First Amendment. IN WITNESS WHEREOF, the Company has caused this First Amendment to be executed as of this 28th day of September, 2000, effective as of May 10, 2000. SYSCO CORPORATION By: /s/ Diane Day Sanders -------------------------------- Title: Vice President and Treasurer ---------------------------- [Corporate Seal] ATTEST: By: Kent Berke ---------------------- Title: Assistant Secretary ------------------- EX-10.D 5 h81699ex10-d.txt 1ST AMENDMENT - EXECUTIVE COMPENSATION ADJUSTMENT 1 EXHIBIT 10(d) FIRST AMENDMENT TO THE EXECUTIVE COMPENSATION ADJUSTMENT AGREEMENT (Charles H. Cotros) THIS AMENDMENT by Sysco Corporation ("Sysco") and Charles H. Cotros ("Officer") WITNESSETH: WHEREAS, Sysco and the Officer have executed an agreement entitled "Executive Compensation Adjustment Agreement" ("Agreement") on October 21, 1999; and WHEREAS, pursuant to paragraph 13 of the Agreement, Sysco and the Officer may amend the terms of the Agreement by an instrument in writing signed by them; and WHEREAS, Sysco and the Officer desire to amend the Agreement to correct the actuarial error and to make other changes; NOW, THEREFORE, pursuant to the provisions of paragraph 13 of the Agreement, Sysco and the Officer hereby completely amend and restate paragraph 3 of the Agreement effective October 21, 1999, as follows: "3. Partial Waiver of SERP Benefits. Subject to the conditions of paragraph 4, as a requirement for participation in the Split Dollar Plan, Officer hereby irrevocably waives, renounces, and forfeits $19,374.30 of the monthly SERP retirement benefit for the Officer in the form of an age 65, ten-year certain and life annuity as calculated under Article 4.1 of the SERP. This forfeited amount will be adjusted for the form and time of payment as specified under Article 4.2 of the SERP. In the event benefits commence prior to age 65, the offset for this forfeited benefit will not occur until age 65 and appropriate adjustments would be made to the forfeited amount to reflect the remaining certain period. In calculating the death benefit under Article 5 of the SERP, the commuted lump sum values referenced in Article 5 will be reduced by the commuted lump sum value of the monthly retirement benefit forfeited above." 2 IN WITNESS WHEREOF, Sysco and the Officer have executed this Amendment this 1st day of September, 2000. SYSCO CORPORATION By: /s/ Michael C. Nichols ---------------------------------- Michael C. Nichols Vice President and General Counsel By: /s/ Charles H. Cotros ---------------------------------- Charles H. Cotros, Officer The Officer's wife is fully aware, understands, and fully consents and agrees to the provisions of this Amendment including its binding effect upon any community property interest she may have in the SERP benefits irrevocably waived, renounced, and forfeited by the Officer and any economic benefits realized under the Split Dollar Agreement. Such awareness, understanding, consent and agreement is evidenced by signing this Amendment. By: /s/ Constance Cotros ---------------------------------- Constance Cotros EX-15.A 6 h81699ex15-a.txt LETTER FROM ARTHUR ANDERSEN LLP - DATED 11/10/2000 1 EXHIBIT 15(a) REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Board of Directors and Shareholders of Sysco Corporation: We have reviewed the consolidated balance sheets of Sysco Corporation (a Delaware corporation) and subsidiaries as of September 30, 2000 and October 2, 1999 and the related statements of consolidated results of operations and cash flows for the thirteen week periods then ended included in the Company's Quarterly Report on Form 10-Q. These financial statements are the responsibility of the Company's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to the financial statements referred to above for them to be in conformity with accounting principles generally accepted in the United States. /s/ Arthur Andersen LLP Houston, Texas November 10, 2000 EX-15.B 7 h81699ex15-b.txt ACKNOWLEDGEMENT LETTER FROM ARTHUR ANDERSEN LLP 1 EXHIBIT 15(b) Arthur Andersen LLP Houston, Texas November 10, 2000 Sysco Corporation: We are aware that Sysco Corporation has incorporated by reference in its Registration Statement on Form S-3 (333-52897 and 333-48686), Form S-4 (333-30050) and Form S-8 (33-10906, 2-76096, 33-45804, 33-45820, 333-1259, 333-1255, 333-1257, 333-27405 and 333-66987) its Form 10-Q for the quarter ended September 30, 2000, which includes our report dated November 10, 2000 covering the unaudited interim financial information contained therein. Pursuant to Regulation C of the Securities Act of 1933, that report is not considered a part of the registration statement prepared or certified by our Firm or a report prepared or certified by our Firm within the meaning of Sections 7 and 11 of the Act. Very truly yours, /s/ Arthur Andersen LLP EX-27 8 h81699ex27.txt FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from Item 1. Financial Statements and is qualified in its entirety by reference to such financial statements. 1,000 3-MOS DEC-31-2000 SEP-30-2000 117,575 0 1,633,989 38,264 997,143 2,833,248 2,624,752 1,262,120 4,931,510 1,935,810 874,883 0 0 382,587 1,492,060 4,931,510 5,360,174 5,360,174 4,322,784 5,127,049 (633) 8,195 17,401 233,125 89,170 143,955 0 0 0 143,955 0.43 0.43
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