Delaware
|
74-1648137
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(State or other jurisdiction of
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(IRS employer
|
incorporation or organization)
|
identification number)
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1390 Enclave Parkway
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77077-2099
|
Houston, Texas
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(Zip Code)
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(Address of principal executive offices)
|
|
Large Accelerated Filer ☑
|
Accelerated Filer ☐
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Non-accelerated Filer ☐ (Do not check if a smaller reporting company)
|
Smaller Reporting Company ☐
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|
|
Page No.
|
|
PART I – FINANCIAL INFORMATION
|
|
|
|
|
|
PART II – OTHER INFORMATION
|
|
|
|
|
|
|
Oct. 1, 2016
|
|
Jul. 2, 2016
|
|
Sep. 26, 2015
|
||||||
|
(unaudited)
|
|
|
|
|
(unaudited)
|
|||||
ASSETS
|
|||||||||||
Current assets
|
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents
|
$
|
759,898
|
|
|
$
|
3,919,300
|
|
|
$
|
388,256
|
|
Accounts and notes receivable, less allowances of
$41,246, $37,880, and $46,470 |
4,191,460
|
|
|
3,380,971
|
|
|
3,531,105
|
|
|||
Inventories
|
3,025,811
|
|
|
2,639,174
|
|
|
2,841,361
|
|
|||
Deferred income taxes
|
—
|
|
|
—
|
|
|
85,416
|
|
|||
Prepaid expenses and other current assets
|
158,301
|
|
|
114,454
|
|
|
93,015
|
|
|||
Prepaid income taxes
|
—
|
|
|
—
|
|
|
88,807
|
|
|||
Total current assets
|
8,135,470
|
|
|
10,053,899
|
|
|
7,027,960
|
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|||
Plant and equipment at cost, less depreciation
|
4,418,524
|
|
|
3,880,442
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|
|
3,961,299
|
|
|||
Other long-term assets
|
|
|
|
|
|
|
|
|
|||
Goodwill
|
3,815,674
|
|
|
2,121,661
|
|
|
1,981,390
|
|
|||
Intangibles, less amortization
|
1,203,888
|
|
|
207,461
|
|
|
168,541
|
|
|||
Deferred income taxes
|
198,867
|
|
|
207,320
|
|
|
—
|
|
|||
Other assets
|
252,387
|
|
|
251,021
|
|
|
232,361
|
|
|||
Total other long-term assets
|
5,470,816
|
|
|
2,787,463
|
|
|
2,382,292
|
|
|||
Total assets
|
$
|
18,024,810
|
|
|
$
|
16,721,804
|
|
|
$
|
13,371,551
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|||||||||||
Current liabilities
|
|
|
|
|
|
|
|
|
|||
Notes payable
|
$
|
6,834
|
|
|
$
|
89,563
|
|
|
$
|
51,806
|
|
Accounts payable
|
3,716,517
|
|
|
2,935,982
|
|
|
2,887,863
|
|
|||
Accrued expenses
|
1,381,300
|
|
|
1,289,312
|
|
|
999,337
|
|
|||
Accrued income taxes
|
252,681
|
|
|
110,690
|
|
|
—
|
|
|||
Current maturities of long-term debt
|
9,218
|
|
|
8,909
|
|
|
31,810
|
|
|||
Total current liabilities
|
5,366,550
|
|
|
4,434,456
|
|
|
3,970,816
|
|
|||
Long-term liabilities
|
|
|
|
|
|
|
|
|
|||
Long-term debt
|
7,843,517
|
|
|
7,336,930
|
|
|
3,004,618
|
|
|||
Deferred income taxes
|
218,414
|
|
|
26,942
|
|
|
160,688
|
|
|||
Other long-term liabilities
|
1,498,680
|
|
|
1,368,482
|
|
|
885,501
|
|
|||
Total long-term liabilities
|
9,560,611
|
|
|
8,732,354
|
|
|
4,050,807
|
|
|||
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|||
Noncontrolling interest
|
76,863
|
|
|
75,386
|
|
|
44,243
|
|
|||
Shareholders' equity
|
|
|
|
|
|
|
|
|
|||
Preferred stock, par value $1 per share
Authorized 1,500,000 shares, issued none
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common stock, par value $1 per share
Authorized 2,000,000,000 shares, issued 765,174,900 shares
|
765,175
|
|
|
765,175
|
|
|
765,175
|
|
|||
Paid-in capital
|
1,313,245
|
|
|
1,281,140
|
|
|
1,231,506
|
|
|||
Retained earnings
|
9,159,866
|
|
|
9,006,138
|
|
|
8,816,245
|
|
|||
Accumulated other comprehensive loss
|
(1,434,940
|
)
|
|
(1,358,118
|
)
|
|
(1,007,539
|
)
|
|||
Treasury stock at cost, 216,182,601,
205,577,484 and 169,052,528 shares |
(6,782,560
|
)
|
|
(6,214,727
|
)
|
|
(4,499,702
|
)
|
|||
Total shareholders' equity
|
3,020,786
|
|
|
3,479,608
|
|
|
5,305,685
|
|
|||
Total liabilities and shareholders' equity
|
$
|
18,024,810
|
|
|
$
|
16,721,804
|
|
|
$
|
13,371,551
|
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Sales
|
$
|
13,968,654
|
|
|
$
|
12,562,611
|
|
Cost of sales
|
11,276,735
|
|
|
10,324,616
|
|
||
Gross profit
|
2,691,919
|
|
|
2,237,995
|
|
||
Operating expenses
|
2,125,086
|
|
|
1,744,521
|
|
||
Operating income
|
566,833
|
|
|
493,474
|
|
||
Interest expense
|
73,623
|
|
|
126,907
|
|
||
Other expense (income), net
|
(7,216
|
)
|
|
(15,240
|
)
|
||
Earnings before income taxes
|
500,426
|
|
|
381,807
|
|
||
Income taxes
|
176,539
|
|
|
137,387
|
|
||
Net earnings
|
$
|
323,887
|
|
|
$
|
244,420
|
|
|
|
|
|
||||
Net earnings:
|
|
|
|
|
|
||
Basic earnings per share
|
$
|
0.58
|
|
|
$
|
0.41
|
|
Diluted earnings per share
|
0.58
|
|
|
0.41
|
|
||
|
|
|
|
||||
Average shares outstanding
|
555,437,764
|
|
|
596,698,935
|
|
||
Diluted shares outstanding
|
560,954,068
|
|
|
600,789,913
|
|
||
|
|
|
|
||||
Dividends declared per common share
|
$
|
0.31
|
|
|
$
|
0.30
|
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Net earnings
|
$
|
323,887
|
|
|
$
|
244,420
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||
Foreign currency translation adjustment
|
(89,553
|
)
|
|
(87,229
|
)
|
||
Items presented net of tax:
|
|
|
|
|
|
||
Gains and losses on cash flow hedges
|
1,770
|
|
|
1,676
|
|
||
Change in fair value of cash flow hedges
|
(319
|
)
|
|
(3,778
|
)
|
||
Amortization of prior service cost
|
1,752
|
|
|
1,715
|
|
||
Amortization of actuarial loss, net
|
8,790
|
|
|
3,275
|
|
||
Prior service cost arising in current year
|
738
|
|
|
—
|
|
||
Total other comprehensive income (loss)
|
(76,822
|
)
|
|
(84,341
|
)
|
||
Comprehensive income
|
$
|
247,065
|
|
|
$
|
160,079
|
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
||
Net earnings
|
$
|
323,887
|
|
|
$
|
244,420
|
|
Adjustments to reconcile net earnings to cash provided by operating activities:
|
|
|
|
|
|
||
Share-based compensation expense
|
25,127
|
|
|
11,636
|
|
||
Depreciation and amortization
|
211,685
|
|
|
135,961
|
|
||
Amortization of debt issuance and other debt-related costs
|
6,560
|
|
|
6,161
|
|
||
Loss on extinguishment of debt
|
—
|
|
|
86,460
|
|
||
Deferred income taxes
|
11,374
|
|
|
124,631
|
|
||
Provision for losses on receivables
|
(440
|
)
|
|
1,546
|
|
||
Other non-cash items
|
(6,829
|
)
|
|
(4,511
|
)
|
||
Additional changes in certain assets and liabilities, net of effect of businesses acquired:
|
|
|
|
|
|
||
(Increase) in receivables
|
(136,097
|
)
|
|
(211,035
|
)
|
||
(Increase) in inventories
|
(149,759
|
)
|
|
(162,867
|
)
|
||
(Increase) decrease in prepaid expenses and other current assets
|
(12,657
|
)
|
|
165
|
|
||
Increase in accounts payable
|
110,914
|
|
|
23,580
|
|
||
(Decrease) in accrued expenses
|
(259,698
|
)
|
|
(470,409
|
)
|
||
Increase in accrued income taxes
|
145,601
|
|
|
5,833
|
|
||
(Increase) in other assets
|
(17,066
|
)
|
|
(10,354
|
)
|
||
Increase (decrease) in other long-term liabilities
|
1,340
|
|
|
(38,419
|
)
|
||
Excess tax benefits from share-based compensation arrangements
|
(5,268
|
)
|
|
(4,280
|
)
|
||
Net cash provided by (used for) operating activities
|
248,674
|
|
|
(261,482
|
)
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Additions to plant and equipment
|
(142,255
|
)
|
|
(121,243
|
)
|
||
Proceeds from sales of plant and equipment
|
4,261
|
|
|
1,506
|
|
||
Acquisition of businesses, net of cash acquired
|
(2,910,461
|
)
|
|
(83,598
|
)
|
||
Decrease in restricted cash
|
—
|
|
|
168,274
|
|
||
Net cash used for investing activities
|
(3,048,455
|
)
|
|
(35,061
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Bank and commercial paper borrowings (repayments), net
|
442,777
|
|
|
717,600
|
|
||
Other debt borrowings
|
1,201
|
|
|
4,148
|
|
||
Other debt repayments
|
(94,935
|
)
|
|
(3,659
|
)
|
||
Redemption of senior notes
|
—
|
|
|
(5,050,000
|
)
|
||
Debt issuance costs
|
(2,846
|
)
|
|
—
|
|
||
Cash received from termination of interest rate swap agreements
|
—
|
|
|
14,496
|
|
||
Proceeds from stock option exercises
|
32,307
|
|
|
54,768
|
|
||
Treasury stock purchases
|
(600,139
|
)
|
|
—
|
|
||
Dividends paid
|
(173,292
|
)
|
|
(179,037
|
)
|
||
Excess tax benefits from share-based compensation arrangements
|
5,268
|
|
|
4,280
|
|
||
Net cash used for financing activities
|
(389,659
|
)
|
|
(4,437,404
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
30,038
|
|
|
(7,841
|
)
|
||
Net decrease in cash and cash equivalents
|
(3,159,402
|
)
|
|
(4,741,788
|
)
|
||
Cash and cash equivalents at beginning of period
|
3,919,300
|
|
|
5,130,044
|
|
||
Cash and cash equivalents at end of period
|
$
|
759,898
|
|
|
$
|
388,256
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||
Cash paid during the period for:
|
|
|
|
|
|
||
Interest
|
$
|
118,426
|
|
|
$
|
93,976
|
|
Income taxes
|
24,406
|
|
|
13,298
|
|
Cash consideration paid, net of cash acquired
|
$
|
626,442
|
|
Payment for Brakes outstanding financial debt
|
2,284,100
|
|
|
Total consideration paid, net of cash acquired
|
$
|
2,910,542
|
|
|
Preliminary Purchase Price
Allocation
|
||
Accounts receivable
|
$
|
720,053
|
|
Inventory
|
248,031
|
|
|
Plant and equipment
|
540,928
|
|
|
Other assets
|
9,842
|
|
|
Goodwill and other intangibles
(1)
|
2,860,179
|
|
|
Total assets
|
4,379,033
|
|
|
Accounts payable
|
(736,881
|
)
|
|
Accrued expenses
|
(240,436
|
)
|
|
Deferred tax liabilities
|
(213,614
|
)
|
|
Other liabilities
|
(277,560
|
)
|
|
Total consideration, net of cash acquired
|
$
|
2,910,542
|
|
(1)
|
The excess purchase price of
$1.7 billion
was assigned to goodwill,
none
of which is deductible for income tax purposes.
This goodwill has been assigned to the International Foodservice Operations reportable segment. Intangible assets added include customer relationships of
$917.6 million
with a weighted average life of
12
years and trademarks and trade names of
$140.6 million
that are indefinite lives assets. Amortization expense is being recognized on a straight line basis and for the first quarter of fiscal 2017 was
$19.1 million
.
|
|
13-Week Period Ended
|
||
|
Sep. 26, 2015
|
||
|
|
||
Sales
|
$
|
13,992,188
|
|
Income before Taxes
|
$
|
369,579
|
|
Net Earnings
|
$
|
236,091
|
|
|
|
||
Net earnings:
|
|
|
|
Basic earnings per common share
|
$
|
0.40
|
|
Diluted earnings per common share
|
$
|
0.39
|
|
(i)
|
Additional amortization expense related to the fair value of intangible assets acquired.
|
(ii)
|
Additional depreciation expense related to the fair value of property and equipment acquired.
|
(iii)
|
The elimination of interest expense assuming the long-term debt paid off on behalf of the Brakes Group as of the Acquisition date had been retired as of June 28, 2015.
|
(iv)
|
The addition of interest expense incurred by Sysco due to the Acquisition of the Brakes Group.
|
(v)
|
The elimination of interest income from related party debt instruments issued to the Brakes Group prior to the Acquisition.
|
(vi)
|
The elimination of Brakes' minority interests, as the majority of the interests were repurchased before the Acquisition.
|
•
|
Level 1 – Unadjusted quoted prices for identical assets or liabilities in active markets;
|
•
|
Level 2 – Inputs other than quoted prices in active markets for identical assets and liabilities that are observable either directly or indirectly for substantially the full term of the asset or liability; and
|
•
|
Level 3 – Unobservable inputs for the asset or liability, which include management’s own assumption about the assumptions market participants would use in pricing the asset or liability, including assumptions about risk.
|
•
|
Time deposits and commercial paper included in cash equivalents are valued at amortized cost, which approximates fair value. These are included within cash equivalents as a Level 2 measurement in the tables below.
|
•
|
Money market funds are valued at the closing price reported by the fund sponsor from an actively traded exchange. These are included within cash equivalents and restricted cash as Level 1 measurements in the tables below.
|
•
|
The interest rate swap agreements are valued using a swap valuation model that utilizes an income approach using observable market inputs including interest rates, LIBOR swap rates and credit default swap rates. These are included as Level 2 measurements in the tables below.
|
•
|
The foreign currency swap agreements are valued using a swap valuation model that utilizes an income approach applying observable market inputs including interest rates, LIBOR swap rates for U.S. dollars, pound sterling and Euro currencies, and credit default swap rates. These are included as Level 2 measurements in the tables below.
|
•
|
Foreign currency forwards are valued based on exchange rates quoted by domestic and foreign banks for similar instruments. These are included as Level 2 measurements in the tables below.
|
•
|
Fuel hedges are valued based on observable market transactions of forward commodity prices. These are included as Level 2 measurements in the tables below.
|
•
|
Contingent consideration in the form of earnout agreements relating to acquisitions is determined utilizing a discounted cash flow approach using various probability-weighted scenarios. The significant unobservable inputs used in calculating the fair value of the contingent consideration includes financial performance scenarios, the probability of achieving those scenarios and the discount rate. These are included in contingent consideration liabilities as Level 3 measurements in the table below. For additional information, see
Note 4
,
"Acquisitions"
.
|
|
Assets and Liabilities Measured at Fair Value as of Oct. 1, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
9,176
|
|
|
$
|
43,270
|
|
|
$
|
—
|
|
|
$
|
52,446
|
|
Other assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap agreements
|
—
|
|
|
18,935
|
|
|
—
|
|
|
18,935
|
|
||||
Foreign currency swaps
|
—
|
|
|
3,979
|
|
|
—
|
|
|
3,979
|
|
||||
Foreign currency forwards
|
—
|
|
|
873
|
|
|
—
|
|
|
873
|
|
||||
Total assets at fair value
|
$
|
9,176
|
|
|
$
|
67,057
|
|
|
$
|
—
|
|
|
$
|
76,233
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6,659
|
|
|
$
|
6,659
|
|
Other long-term liabilities
|
|
|
|
|
|
|
|
||||||||
Cross-currency swaps
|
—
|
|
|
3,184
|
|
|
—
|
|
|
3,184
|
|
||||
Foreign currency swaps
|
—
|
|
|
10,695
|
|
|
—
|
|
|
10,695
|
|
||||
Fuel hedges
|
—
|
|
|
618
|
|
|
—
|
|
|
618
|
|
||||
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
14,497
|
|
|
$
|
6,659
|
|
|
$
|
21,156
|
|
|
Assets and Liabilities Measured at Fair Value as of Jul. 2, 2016
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
634,230
|
|
|
$
|
43,270
|
|
|
$
|
—
|
|
|
$
|
677,500
|
|
Other assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap agreements
|
—
|
|
|
36,805
|
|
|
—
|
|
|
36,805
|
|
||||
Total assets at fair value
|
$
|
634,230
|
|
|
$
|
80,075
|
|
|
$
|
—
|
|
|
$
|
714,305
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16,439
|
|
|
$
|
16,439
|
|
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
16,439
|
|
|
$
|
16,439
|
|
|
Assets and Liabilities Measured at Fair Value as of Sep. 26, 2015
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash equivalents
|
$
|
102,508
|
|
|
$
|
62,131
|
|
|
$
|
—
|
|
|
$
|
164,639
|
|
Other assets
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap agreement
|
—
|
|
|
8,219
|
|
|
—
|
|
|
8,219
|
|
||||
Total assets at fair value
|
$
|
102,508
|
|
|
$
|
70,350
|
|
|
$
|
—
|
|
|
$
|
172,858
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,722
|
|
|
$
|
28,722
|
|
Total liabilities at fair value
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28,722
|
|
|
$
|
28,722
|
|
|
13-Week Period Ended
|
||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||
Unobservable Inputs:
|
(Weighted Average)
|
||||
Probability of achieving payout targets
|
92.1
|
%
|
|
93.2
|
%
|
Discount Rate
|
8.3
|
%
|
|
11.5
|
%
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Balance at the beginning of year
|
$
|
16,439
|
|
|
$
|
28,644
|
|
Contingent consideration liabilities recorded for business acquisitions
|
(142
|
)
|
|
(125
|
)
|
||
Payments
|
(9,537
|
)
|
|
(75
|
)
|
||
Currency translation
|
(101
|
)
|
|
278
|
|
||
Balance as of the end of the quarter
|
$
|
6,659
|
|
|
$
|
28,722
|
|
Maturity Date of Swap
|
|
Notional Value
(in millions)
|
|
Fixed Coupon Rate on Hedged Debt
|
|
Floating Interest Rate on Swap
|
|
Floating Rate Reset Terms
|
|||
February 12, 2018
|
|
$
|
500
|
|
|
5.25
|
%
|
|
Six-month LIBOR
|
|
Every six months in arrears
|
April 1, 2019
|
|
$
|
500
|
|
|
1.90
|
%
|
|
Three-month LIBOR
|
|
Every three months in advance
|
October 1, 2020
|
|
$
|
750
|
|
|
2.60
|
%
|
|
Three-month LIBOR
|
|
Every three months in advance
|
July 15, 2021
|
|
$
|
500
|
|
|
2.50
|
%
|
|
Three-month LIBOR
|
|
Every three months in advance
|
|
|
|
Derivative Fair Value
|
||||||||||
|
Balance Sheet location
|
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
|
Jul. 2, 2016
|
||||||
|
|
|
(In thousands)
|
||||||||||
Fair value hedges:
|
|
|
|
|
|
|
|
||||||
Interest rate swap agreements
|
Other assets
|
|
$
|
18,935
|
|
|
$
|
8,219
|
|
|
$
|
36,805
|
|
|
|
|
|
|
|
|
|
||||||
Cash Flow Hedges:
|
|
|
|
|
|
|
|
||||||
Foreign currency forwards
|
Other assets
|
|
$
|
873
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Fuel hedges
|
Other long-term liabilities
|
|
618
|
|
|
—
|
|
|
—
|
|
|||
Cross currency swaps
|
Other long-term liabilities
|
|
3,184
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
||||||
Net Investment Hedges:
|
|
|
|
|
|
|
|
||||||
Foreign currency swaps
|
Other assets
|
|
$
|
3,979
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency swaps
|
Other long-term liabilities
|
|
10,695
|
|
|
—
|
|
|
—
|
|
|
Location of (Gain)
or Loss Recognized
|
|
Amount of (Gain)
or Loss Recognized
|
||||||
|
|
|
13-Week Period Ended
|
||||||
|
|
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
|
|
|
(In thousands)
|
||||||
Fair Value Hedge Relationships:
|
|
|
|
|
|
||||
Interest rate swap agreements
|
Interest expense
|
|
$
|
(3,400
|
)
|
|
$
|
(1,997
|
)
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
|
(In thousands, except for share
and per share data)
|
||||||
Numerator:
|
|
|
|
||||
Net earnings
|
$
|
323,887
|
|
|
$
|
244,420
|
|
Denominator:
|
|
|
|
|
|
||
Weighted-average basic shares outstanding
|
555,437,764
|
|
|
596,698,935
|
|
||
Dilutive effect of share-based awards
|
5,516,304
|
|
|
4,090,978
|
|
||
Weighted-average diluted shares outstanding
|
560,954,068
|
|
|
600,789,913
|
|
||
Basic earnings per share
|
$
|
0.58
|
|
|
$
|
0.41
|
|
Diluted earnings per share
|
$
|
0.58
|
|
|
$
|
0.41
|
|
|
|
|
13-Week Period Ended Oct. 1, 2016
|
||||||||||
|
Location of Expense
(Income) Recognized
in Net Earnings
|
|
Before Tax
Amount
|
|
Tax
|
|
Net of Tax
Amount
|
||||||
|
|
|
(In thousands)
|
||||||||||
Pension and other postretirement benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|||
Reclassification adjustments:
|
|
|
|
|
|
|
|
|
|
|
|||
Amortization of prior service cost
|
Operating expenses
|
|
$
|
2,844
|
|
|
$
|
1,092
|
|
|
$
|
1,752
|
|
Amortization of actuarial loss (gain), net
|
Operating expenses
|
|
12,721
|
|
|
3,931
|
|
|
8,790
|
|
|||
Prior service cost arising in current year
|
Operating expenses
|
|
738
|
|
|
—
|
|
|
738
|
|
|||
Total reclassification adjustments
|
|
|
16,303
|
|
|
5,023
|
|
|
11,280
|
|
|||
Foreign currency translation:
|
|
|
|
|
|
|
|
||||||
Other comprehensive income before
reclassification adjustments:
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
N/A
|
|
(89,553
|
)
|
|
—
|
|
|
(89,553
|
)
|
|||
Interest rate swaps:
|
|
|
|
|
|
|
|
||||||
Reclassification adjustments:
|
|
|
|
|
|
|
|
||||||
Gains and losses on cash flow hedges
|
Interest expense
|
|
2,873
|
|
|
1,103
|
|
|
1,770
|
|
|||
Change in fair value of cash flow hedge
|
N/A
|
|
(319
|
)
|
|
—
|
|
|
(319
|
)
|
|||
Total other comprehensive (loss) income
|
|
|
$
|
(70,696
|
)
|
|
$
|
6,126
|
|
|
$
|
(76,822
|
)
|
|
|
|
13-Week Period Ended Sep. 26, 2015
|
||||||||||
|
Location of Expense
(Income) Recognized
in Net Earnings
|
|
Before Tax
Amount
|
|
Tax
|
|
Net of Tax
Amount
|
||||||
|
|
|
(In thousands)
|
||||||||||
Pension and other postretirement benefit plans:
|
|
|
|
|
|
|
|
|
|
|
|||
Reclassification adjustments:
|
|
|
|
|
|
|
|
|
|
|
|||
Amortization of prior service cost
|
Operating expenses
|
|
$
|
2,784
|
|
|
$
|
1,069
|
|
|
$
|
1,715
|
|
Amortization of actuarial loss (gain), net
|
Operating expenses
|
|
5,317
|
|
|
2,042
|
|
|
3,275
|
|
|||
Total reclassification adjustments
|
|
|
8,101
|
|
|
3,111
|
|
|
4,990
|
|
|||
Foreign currency translation:
|
|
|
|
|
|
|
|
||||||
Other comprehensive income before
reclassification adjustments:
|
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
N/A
|
|
(87,229
|
)
|
|
—
|
|
|
(87,229
|
)
|
|||
Interest rate swaps:
|
|
|
|
|
|
|
|
||||||
Reclassification adjustments:
|
|
|
|
|
|
|
|
||||||
Gains and losses on cash flow hedges
|
Interest expense
|
|
2,720
|
|
|
1,044
|
|
|
1,676
|
|
|||
Change in fair value of cash flow hedges
|
N/A
|
|
(6,134
|
)
|
|
(2,356
|
)
|
|
(3,778
|
)
|
|||
Total other comprehensive (loss) income
|
|
|
$
|
(82,542
|
)
|
|
$
|
1,799
|
|
|
$
|
(84,341
|
)
|
|
13-Week Period Ended Oct. 1, 2016
|
||||||||||||||
|
Pension and Other Postretirement Benefit Plans,
net of tax
|
|
Foreign Currency Translation
|
|
Interest Rate Swaps,
net of tax
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance as of Jul. 2, 2016
|
$
|
(1,104,484
|
)
|
|
$
|
(136,813
|
)
|
|
$
|
(116,821
|
)
|
|
$
|
(1,358,118
|
)
|
Equity adjustment from foreign currency translation
|
—
|
|
|
(89,553
|
)
|
|
—
|
|
|
(89,553
|
)
|
||||
Other comprehensive income before
reclassification adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Gains and losses on cash flow hedges
|
—
|
|
|
—
|
|
|
1,770
|
|
|
1,770
|
|
||||
Change in fair value of cash flow hedges
|
—
|
|
|
—
|
|
|
(319
|
)
|
|
(319
|
)
|
||||
Prior service cost arising in current year
|
738
|
|
|
—
|
|
|
—
|
|
|
738
|
|
||||
Amortization of unrecognized prior service cost
|
1,752
|
|
|
—
|
|
|
—
|
|
|
1,752
|
|
||||
Amortization of unrecognized net actuarial losses
|
8,790
|
|
|
—
|
|
|
—
|
|
|
8,790
|
|
||||
Balance as of Oct. 1, 2016
|
$
|
(1,093,204
|
)
|
|
$
|
(226,366
|
)
|
|
$
|
(115,370
|
)
|
|
$
|
(1,434,940
|
)
|
|
13-Week Period Ended Sep. 26, 2015
|
||||||||||||||
|
Pension and Other Postretirement Benefit Plans,
net of tax
|
|
Foreign Currency Translation
|
|
Interest Rate Swaps,
net of tax
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance as of Jun. 27, 2015
|
$
|
(705,311
|
)
|
|
$
|
(97,733
|
)
|
|
$
|
(120,153
|
)
|
|
$
|
(923,197
|
)
|
Other comprehensive income before
reclassification adjustments
|
—
|
|
|
(87,229
|
)
|
|
—
|
|
|
(87,229
|
)
|
||||
Gains and losses on cash flow hedges
|
—
|
|
|
—
|
|
|
1,676
|
|
|
1,676
|
|
||||
Change in fair value of cash flow hedges
|
—
|
|
|
—
|
|
|
(3,778
|
)
|
|
(3,778
|
)
|
||||
Amortization of unrecognized prior service cost
|
1,715
|
|
|
—
|
|
|
—
|
|
|
1,715
|
|
||||
Amortization of unrecognized net actuarial losses
|
3,274
|
|
|
—
|
|
|
—
|
|
|
3,274
|
|
||||
Balance as of Sep. 26, 2015
|
$
|
(700,322
|
)
|
|
$
|
(184,962
|
)
|
|
$
|
(122,255
|
)
|
|
$
|
(1,007,539
|
)
|
•
|
U.S. Foodservice Operations - primarily includes U.S. broadline operations, custom-cut meat companies, FreshPoint (our specialty produce companies) and European Imports (a specialty import company);
|
•
|
International Foodservice Operations - includes broadline operations in Canada and Europe, including the Brakes Group, Bahamas, Mexico, Costa Rica and Panama, as well as a company that distributes to international customers;
|
•
|
SYGMA - our chain restaurant distribution subsidiary; and
|
•
|
Other - primarily our hotel supply operations and our Sysco Ventures platform, which includes our suite of technology solutions that help support the business needs of our customers.
|
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Sales:
|
(In thousands)
|
||||||
U.S. Foodservice Operations
|
$
|
9,481,115
|
|
|
$
|
9,407,923
|
|
International Foodservice Operations
|
2,728,360
|
|
|
1,390,259
|
|
||
SYGMA
|
1,504,692
|
|
|
1,445,904
|
|
||
Other
|
254,487
|
|
|
318,525
|
|
||
Total
|
$
|
13,968,654
|
|
|
$
|
12,562,611
|
|
|
|
|
|
||||
|
13-Week Period Ended
|
||||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||||
Operating income:
|
(In thousands)
|
||||||
U.S. Foodservice Operations
|
$
|
745,231
|
|
|
$
|
686,669
|
|
International Foodservice Operations
|
79,435
|
|
|
51,920
|
|
||
SYGMA
|
4,908
|
|
|
5,123
|
|
||
Other
|
8,001
|
|
|
10,770
|
|
||
Total segments
|
837,575
|
|
|
754,482
|
|
||
Corporate expenses
|
(270,742
|
)
|
|
(261,008
|
)
|
||
Total operating income
|
566,833
|
|
|
493,474
|
|
||
Interest expense
|
73,623
|
|
|
126,907
|
|
||
Other expense (income), net
|
(7,216
|
)
|
|
(15,240
|
)
|
||
Earnings before income taxes
|
$
|
500,426
|
|
|
$
|
381,807
|
|
|
Oct. 1, 2016
|
|
July 2, 2016
|
|
Sep. 26, 2015
|
||||||
Assets:
|
(In thousands)
|
||||||||||
U.S. Foodservice Operations
|
$
|
6,988,148
|
|
|
$
|
6,870,159
|
|
|
$
|
7,263,246
|
|
International Foodservice Operations
|
6,410,354
|
|
|
2,030,917
|
|
|
1,812,094
|
|
|||
SYGMA
|
583,106
|
|
|
541,796
|
|
|
508,403
|
|
|||
Other
|
433,895
|
|
|
469,830
|
|
|
429,226
|
|
|||
Total segments
|
14,415,503
|
|
|
9,912,702
|
|
|
10,012,969
|
|
|||
Corporate
|
3,609,307
|
|
|
6,809,102
|
|
|
3,358,582
|
|
|||
Total
|
$
|
18,024,810
|
|
|
$
|
16,721,804
|
|
|
$
|
13,371,551
|
|
|
Condensed Consolidating Balance Sheet
|
||||||||||||||||||
|
Oct. 1, 2016
|
||||||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
Totals
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Current assets
|
$
|
227,329
|
|
|
$
|
4,043,517
|
|
|
$
|
3,864,624
|
|
|
$
|
—
|
|
|
$
|
8,135,470
|
|
Investment in subsidiaries
|
7,324,607
|
|
|
260,252
|
|
|
758,353
|
|
|
(8,343,212
|
)
|
|
—
|
|
|||||
Plant and equipment, net
|
394,254
|
|
|
1,566,905
|
|
|
2,457,365
|
|
|
—
|
|
|
4,418,524
|
|
|||||
Other assets
|
199,918
|
|
|
566,954
|
|
|
4,703,944
|
|
|
—
|
|
|
5,470,816
|
|
|||||
Total assets
|
$
|
8,146,108
|
|
|
$
|
6,437,628
|
|
|
$
|
11,784,286
|
|
|
$
|
(8,343,212
|
)
|
|
$
|
18,024,810
|
|
Current liabilities
|
$
|
433,751
|
|
|
$
|
2,138,099
|
|
|
$
|
2,794,700
|
|
|
$
|
—
|
|
|
$
|
5,366,550
|
|
Intercompany payables (receivables)
|
(4,182,835
|
)
|
|
(474,685
|
)
|
|
4,657,520
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
|
7,607,826
|
|
|
61,663
|
|
|
174,028
|
|
|
—
|
|
|
7,843,517
|
|
|||||
Other liabilities
|
1,032,296
|
|
|
156,272
|
|
|
528,526
|
|
|
—
|
|
|
1,717,094
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
76,863
|
|
|
—
|
|
|
76,863
|
|
|||||
Shareholders’ equity
|
3,255,070
|
|
|
4,556,279
|
|
|
3,552,649
|
|
|
(8,343,212
|
)
|
|
3,020,786
|
|
|||||
Total liabilities and shareholders’ equity
|
$
|
8,146,108
|
|
|
$
|
6,437,628
|
|
|
$
|
11,784,286
|
|
|
$
|
(8,343,212
|
)
|
|
$
|
18,024,810
|
|
|
Condensed Consolidating Balance Sheet
|
||||||||||||||||||
|
July 2, 2016
|
||||||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
Totals
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Current assets
|
$
|
3,440,206
|
|
|
$
|
3,813,524
|
|
|
$
|
2,800,169
|
|
|
$
|
—
|
|
|
$
|
10,053,899
|
|
Investment in subsidiaries
|
6,484,258
|
|
|
224,138
|
|
|
(306,219
|
)
|
|
(6,402,177
|
)
|
|
—
|
|
|||||
Plant and equipment, net
|
429,890
|
|
|
1,587,702
|
|
|
1,862,850
|
|
|
—
|
|
|
3,880,442
|
|
|||||
Other assets
|
213,186
|
|
|
642,525
|
|
|
1,931,752
|
|
|
—
|
|
|
2,787,463
|
|
|||||
Total assets
|
$
|
10,567,540
|
|
|
$
|
6,267,889
|
|
|
$
|
6,288,552
|
|
|
$
|
(6,402,177
|
)
|
|
$
|
16,721,804
|
|
Current liabilities
|
$
|
621,925
|
|
|
$
|
111,728
|
|
|
$
|
3,700,803
|
|
|
$
|
—
|
|
|
$
|
4,434,456
|
|
Intercompany payables (receivables)
|
(1,348,425
|
)
|
|
2,097,508
|
|
|
(749,083
|
)
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
|
7,145,955
|
|
|
62,387
|
|
|
128,588
|
|
|
—
|
|
|
7,336,930
|
|
|||||
Other liabilities
|
878,834
|
|
|
248,493
|
|
|
268,097
|
|
|
—
|
|
|
1,395,424
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
75,386
|
|
|
—
|
|
|
75,386
|
|
|||||
Shareholders’ equity
|
3,269,251
|
|
|
3,747,773
|
|
|
2,864,761
|
|
|
(6,402,177
|
)
|
|
3,479,608
|
|
|||||
Total liabilities and shareholders’ equity
|
$
|
10,567,540
|
|
|
$
|
6,267,889
|
|
|
$
|
6,288,552
|
|
|
$
|
(6,402,177
|
)
|
|
$
|
16,721,804
|
|
|
Condensed Consolidating Balance Sheet
|
||||||||||||||||||
|
Sep. 26, 2015
|
||||||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
Totals
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Current assets
|
$
|
237,758
|
|
|
$
|
4,252,595
|
|
|
$
|
2,537,607
|
|
|
$
|
—
|
|
|
$
|
7,027,960
|
|
Investment in subsidiaries
|
9,473,425
|
|
|
—
|
|
|
—
|
|
|
(9,473,425
|
)
|
|
—
|
|
|||||
Plant and equipment, net
|
512,397
|
|
|
1,662,227
|
|
|
1,786,675
|
|
|
—
|
|
|
3,961,299
|
|
|||||
Other assets
|
203,535
|
|
|
525,372
|
|
|
1,653,385
|
|
|
—
|
|
|
2,382,292
|
|
|||||
Total assets
|
$
|
10,427,115
|
|
|
$
|
6,440,194
|
|
|
$
|
5,977,667
|
|
|
$
|
(9,473,425
|
)
|
|
$
|
13,371,551
|
|
Current liabilities
|
$
|
478,158
|
|
|
$
|
1,105,347
|
|
|
$
|
2,387,311
|
|
|
$
|
—
|
|
|
$
|
3,970,816
|
|
Intercompany payables (receivables)
|
1,041,230
|
|
|
(1,670,713
|
)
|
|
629,483
|
|
|
—
|
|
|
—
|
|
|||||
Long-term debt
|
2,884,581
|
|
|
9,337
|
|
|
110,700
|
|
|
—
|
|
|
3,004,618
|
|
|||||
Other liabilities
|
715,169
|
|
|
271,194
|
|
|
59,826
|
|
|
—
|
|
|
1,046,189
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
44,243
|
|
|
—
|
|
|
44,243
|
|
|||||
Shareholders’ equity
|
5,307,977
|
|
|
6,725,029
|
|
|
2,746,104
|
|
|
(9,473,425
|
)
|
|
5,305,685
|
|
|||||
Total liabilities and shareholders’ equity
|
$
|
10,427,115
|
|
|
$
|
6,440,194
|
|
|
$
|
5,977,667
|
|
|
$
|
(9,473,425
|
)
|
|
$
|
13,371,551
|
|
|
Condensed Consolidating Statement of Comprehensive Income
|
||||||||||||||||||
|
For the 13-Week Period Ended Oct. 1, 2016
|
||||||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
Totals
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Sales
|
$
|
—
|
|
|
$
|
8,532,859
|
|
|
$
|
5,880,712
|
|
|
$
|
(444,917
|
)
|
|
$
|
13,968,654
|
|
Cost of sales
|
—
|
|
|
6,874,182
|
|
|
4,847,470
|
|
|
(444,917
|
)
|
|
11,276,735
|
|
|||||
Gross profit
|
—
|
|
|
1,658,677
|
|
|
1,033,242
|
|
|
—
|
|
|
2,691,919
|
|
|||||
Operating expenses
|
217,903
|
|
|
957,964
|
|
|
949,219
|
|
|
—
|
|
|
2,125,086
|
|
|||||
Operating income (loss)
|
(217,903
|
)
|
|
700,713
|
|
|
84,023
|
|
|
—
|
|
|
566,833
|
|
|||||
Interest expense (income)
|
68,889
|
|
|
(25,034
|
)
|
|
29,768
|
|
|
—
|
|
|
73,623
|
|
|||||
Other expense (income), net
|
(14,891
|
)
|
|
(224
|
)
|
|
7,899
|
|
|
—
|
|
|
(7,216
|
)
|
|||||
Earnings (losses) before income taxes
|
(271,901
|
)
|
|
725,971
|
|
|
46,356
|
|
|
—
|
|
|
500,426
|
|
|||||
Income tax (benefit) provision
|
(95,921
|
)
|
|
256,107
|
|
|
16,353
|
|
|
—
|
|
|
176,539
|
|
|||||
Equity in earnings of subsidiaries
|
499,868
|
|
|
—
|
|
|
—
|
|
|
(499,868
|
)
|
|
—
|
|
|||||
Net earnings
|
323,888
|
|
|
469,864
|
|
|
30,003
|
|
|
(499,868
|
)
|
|
323,887
|
|
|||||
Other comprehensive income (loss)
|
(76,822
|
)
|
|
—
|
|
|
(214,625
|
)
|
|
214,625
|
|
|
(76,822
|
)
|
|||||
Comprehensive income
|
$
|
247,066
|
|
|
$
|
469,864
|
|
|
$
|
(184,622
|
)
|
|
$
|
(285,243
|
)
|
|
$
|
247,065
|
|
|
Condensed Consolidating Statement of Comprehensive Income
|
||||||||||||||||||
|
For the 13-Week Period Ended Sep. 26, 2015
|
||||||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Eliminations
|
|
Consolidated
Totals
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Sales
|
$
|
—
|
|
|
$
|
8,524,550
|
|
|
$
|
4,426,998
|
|
|
$
|
(388,937
|
)
|
|
$
|
12,562,611
|
|
Cost of sales
|
—
|
|
|
6,912,169
|
|
|
3,801,384
|
|
|
(388,937
|
)
|
|
10,324,616
|
|
|||||
Gross profit
|
—
|
|
|
1,612,381
|
|
|
625,614
|
|
|
—
|
|
|
2,237,995
|
|
|||||
Operating expenses
|
199,375
|
|
|
956,915
|
|
|
588,231
|
|
|
—
|
|
|
1,744,521
|
|
|||||
Operating income (loss)
|
(199,375
|
)
|
|
655,466
|
|
|
37,383
|
|
|
—
|
|
|
493,474
|
|
|||||
Interest expense (income)
|
146,097
|
|
|
(39,983
|
)
|
|
20,793
|
|
|
—
|
|
|
126,907
|
|
|||||
Other expense (income), net
|
(5,077
|
)
|
|
(477
|
)
|
|
(9,686
|
)
|
|
—
|
|
|
(15,240
|
)
|
|||||
Earnings (losses) before income taxes
|
(340,395
|
)
|
|
695,926
|
|
|
26,276
|
|
|
—
|
|
|
381,807
|
|
|||||
Income tax (benefit) provision
|
(122,484
|
)
|
|
250,417
|
|
|
9,454
|
|
|
—
|
|
|
137,387
|
|
|||||
Equity in earnings of subsidiaries
|
462,331
|
|
|
—
|
|
|
—
|
|
|
(462,331
|
)
|
|
—
|
|
|||||
Net earnings
|
244,420
|
|
|
445,509
|
|
|
16,822
|
|
|
(462,331
|
)
|
|
244,420
|
|
|||||
Other comprehensive income (loss)
|
(84,341
|
)
|
|
—
|
|
|
(183,185
|
)
|
|
183,185
|
|
|
(84,341
|
)
|
|||||
Comprehensive income
|
$
|
160,079
|
|
|
$
|
445,509
|
|
|
$
|
(166,363
|
)
|
|
$
|
(279,146
|
)
|
|
$
|
160,079
|
|
|
Condensed Consolidating Cash Flows
|
||||||||||||||
|
For the 13-Week Period Ended Oct. 1, 2016
|
||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Consolidated
Totals
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows provided by (used for):
|
|
|
|
|
|
|
|
||||||||
Operating activities
|
$
|
(163,444
|
)
|
|
$
|
2,236,758
|
|
|
$
|
(1,824,640
|
)
|
|
$
|
248,674
|
|
Investing activities
|
(22,729
|
)
|
|
(19,426
|
)
|
|
(3,006,300
|
)
|
|
(3,048,455
|
)
|
||||
Financing activities
|
(225,668
|
)
|
|
(7,492
|
)
|
|
(156,499
|
)
|
|
(389,659
|
)
|
||||
Effect of exchange rates on cash
|
—
|
|
|
—
|
|
|
30,038
|
|
|
30,038
|
|
||||
Intercompany activity
|
(2,833,759
|
)
|
|
(2,206,407
|
)
|
|
5,040,166
|
|
|
—
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
(3,245,600
|
)
|
|
3,433
|
|
|
82,765
|
|
|
(3,159,402
|
)
|
||||
Cash and cash equivalents at the beginning of period
|
3,376,412
|
|
|
34,072
|
|
|
508,816
|
|
|
3,919,300
|
|
||||
Cash and cash equivalents at the end of period
|
$
|
130,812
|
|
|
$
|
37,505
|
|
|
$
|
591,581
|
|
|
$
|
759,898
|
|
|
Condensed Consolidating Cash Flows
|
||||||||||||||
|
For the 13-Week Period Ended Sep. 26, 2015
|
||||||||||||||
|
Sysco
|
|
Certain U.S.
Broadline
Subsidiaries
|
|
Other
Non-Guarantor
Subsidiaries
|
|
Consolidated
Totals
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash flows provided by (used for):
|
|
|
|
|
|
|
|
||||||||
Operating activities
|
$
|
(525,626
|
)
|
|
$
|
(317,193
|
)
|
|
$
|
581,337
|
|
|
$
|
(261,482
|
)
|
Investing activities
|
138,186
|
|
|
(13,083
|
)
|
|
(160,164
|
)
|
|
(35,061
|
)
|
||||
Financing activities
|
(4,445,507
|
)
|
|
(800
|
)
|
|
8,903
|
|
|
(4,437,404
|
)
|
||||
Effect of exchange rates on cash
|
—
|
|
|
—
|
|
|
(7,841
|
)
|
|
(7,841
|
)
|
||||
Intercompany activity
|
59,403
|
|
|
329,064
|
|
|
(388,467
|
)
|
|
—
|
|
||||
Net increase (decrease) in cash and cash equivalents
|
(4,773,544
|
)
|
|
(2,012
|
)
|
|
33,768
|
|
|
(4,741,788
|
)
|
||||
Cash and cash equivalents at the beginning of period
|
4,851,074
|
|
|
26,377
|
|
|
252,593
|
|
|
5,130,044
|
|
||||
Cash and cash equivalents at the end of period
|
$
|
77,530
|
|
|
$
|
24,365
|
|
|
$
|
286,361
|
|
|
$
|
388,256
|
|
•
|
U.S. Foodservice Operations - primarily includes U.S. Broadline, custom-cut meat companies, FreshPoint (our specialty produce companies) and European Imports (a specialty import company);
|
•
|
International Foodservice Operations - includes broadline operations in Canada and Europe, including the Brakes Group, Bahamas, Mexico, Costa Rica and Panama, as well as a company that distributes to international customers;
|
•
|
SYGMA - our chain restaurant distribution subsidiary; and
|
•
|
Other - primarily our hotel supply operations and our Sysco Ventures platform, which includes our suite of technology solutions that help support the business needs of our customers.
|
•
|
Sales:
|
◦
|
increased
11.2%
, or $
1.4 billion
, to
$14.0 billion
;
|
◦
|
adjusted sales increased
1.0%
, or
$122.5 million
to
$12.7 billion
excluding Brakes;
|
•
|
Operating income:
|
◦
|
increased
14.9%
, or $
73.4 million
, to $
566.8 million
;
|
◦
|
adjusted operating income increased
23.8%
, or $
120.3 million
, to $
626.8 million
;
|
◦
|
adjusted operating income increased
15.3%
, or
$77.6 million
to
$584.0 million
excluding Brakes;
|
•
|
Net earnings:
|
◦
|
increased
32.5%
, or $
79.5 million
, to
$323.9 million
;
|
◦
|
adjusted net earnings increased
20.7%
, or
$64.4 million
, to
$376.1 million
;
|
◦
|
adjusted net earnings increased
12.8%
, or
$39.8 million
to
$351.6 million
excluding Brakes;
|
•
|
Basic earnings per share and diluted earnings per share in the first quarter of fiscal
2017
were:
|
◦
|
both
$0.58
, a
41.5%
increase from the comparable prior year amount of
$0.41
per share;
|
◦
|
adjusted diluted earnings per share were
$0.67
in the first quarter of fiscal
2017
, a
28.8%
increase from the comparable prior year amount of
$0.52
per share; and
|
◦
|
adjusted diluted earnings per share were
$0.63
, a
21.2%
increase from the comparable prior year amount of
$0.52
per share excluding Brakes.
|
|
13-Week Period Ended
|
||||
|
Oct. 1, 2016
|
|
Sep. 26, 2015
|
||
Sales
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
80.7
|
|
|
82.2
|
|
Gross profit
|
19.3
|
|
|
17.8
|
|
Operating expenses
|
15.2
|
|
|
13.9
|
|
Operating income
|
4.1
|
|
|
3.9
|
|
Interest expense
|
0.5
|
|
|
1.0
|
|
Other expense (income), net
|
(0.1
|
)
|
|
(0.1
|
)
|
Earnings before income taxes
|
3.6
|
|
|
3.0
|
|
Income taxes
|
1.3
|
|
|
1.1
|
|
Net earnings
|
2.3
|
%
|
|
1.9
|
%
|
|
13-Week Period Ended
|
|
Sales
|
11.2
|
%
|
Cost of sales
|
9.2
|
|
Gross profit
|
20.3
|
|
Operating expenses
|
(21.8
|
)
|
Operating income
|
14.9
|
|
Interest expense
|
42.0
|
|
Other expense (income), net
(1)
|
(52.7
|
)
|
Earnings before income taxes
|
31.1
|
|
Income taxes
|
28.5
|
|
Net earnings
|
32.5
|
%
|
Basic earnings per share
|
41.5
|
%
|
Diluted earnings per share
|
41.5
|
|
Average shares outstanding
|
(6.9
|
)
|
Diluted shares outstanding
|
(6.6
|
)
|
|
13-Week Period Ended Oct. 1, 2016
|
||||||||||||||||||||||||||||||
|
U.S. Foodservice Operations
|
|
International Foodservice Operations
|
|
Brakes
|
|
International Foodservice Operations Excluding Brakes (Non-GAAP)
|
|
SYGMA
|
|
Other
|
|
Corporate
|
|
Consolidated
Totals
|
||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||||||
Sales
|
$
|
9,481,115
|
|
|
$
|
2,728,360
|
|
|
$
|
1,283,524
|
|
|
$
|
1,444,836
|
|
|
$
|
1,504,692
|
|
|
$
|
254,487
|
|
|
$
|
—
|
|
|
$
|
13,968,654
|
|
Sales increase (decrease)
|
0.8
|
%
|
|
96.2
|
%
|
|
NM
|
|
|
3.9
|
%
|
|
4.1
|
%
|
|
(20.1
|
)%
|
|
|
|
11.2
|
%
|
|||||||||
Percentage of total
|
67.9
|
%
|
|
19.5
|
%
|
|
9.2
|
%
|
|
10.3
|
%
|
|
10.8
|
%
|
|
1.8
|
%
|
|
|
|
100.0
|
%
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Operating income
|
$
|
745,231
|
|
|
$
|
79,435
|
|
|
$
|
20,208
|
|
|
$
|
59,227
|
|
|
$
|
4,908
|
|
|
$
|
8,001
|
|
|
$
|
(270,742
|
)
|
|
$
|
566,833
|
|
Operating income increase (decrease)
|
8.5
|
%
|
|
53.0
|
%
|
|
NM
|
|
|
16.8
|
%
|
|
(4.2
|
)%
|
|
(25.7
|
)%
|
|
|
|
—
|
|
|||||||||
Percentage of total
|
89.0
|
%
|
|
9.5
|
%
|
|
2.4
|
%
|
|
7.1
|
%
|
|
0.6
|
%
|
|
1.0
|
%
|
|
|
|
100.0
|
%
|
|||||||||
Operating income as a percentage of sales
|
7.9
|
%
|
|
2.9
|
%
|
|
1.6
|
%
|
|
4.1
|
%
|
|
0.3
|
%
|
|
3.1
|
%
|
|
|
|
4.1
|
%
|
|
13-Week Period Ended Sep. 26, 2015
|
||||||||||||||||||||||
|
U.S. Foodservice Operations
|
|
International Foodservice Operations
|
|
SYGMA
|
|
Other
|
|
Corporate
|
|
Consolidated
Totals
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Sales
|
$
|
9,407,923
|
|
|
$
|
1,390,259
|
|
|
$
|
1,445,904
|
|
|
$
|
318,525
|
|
|
$
|
—
|
|
|
$
|
12,562,611
|
|
Percentage of total
|
74.9
|
%
|
|
11.1
|
%
|
|
11.5
|
%
|
|
2.5
|
%
|
|
|
|
100.0
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating income
|
$
|
686,669
|
|
|
$
|
51,920
|
|
|
$
|
5,123
|
|
|
$
|
10,770
|
|
|
$
|
(261,008
|
)
|
|
$
|
493,474
|
|
Percentage of total
|
91.0
|
%
|
|
6.9
|
%
|
|
0.7
|
%
|
|
1.4
|
%
|
|
|
|
100.0
|
%
|
|||||||
Operating income as a percentage of sales
|
7.3
|
%
|
|
3.7
|
%
|
|
0.4
|
%
|
|
3.4
|
%
|
|
|
|
3.9
|
%
|
|
13-Week Period Ended Oct. 1, 2016
|
|
13-Week Period Ended Sep. 26, 2015
|
|
13-Week Period Ended Change in Dollars
|
|
13-Week Period
% Change |
|||||||
|
(In thousands)
|
|||||||||||||
Sales
|
$
|
9,481,115
|
|
|
$
|
9,407,923
|
|
|
$
|
73,192
|
|
|
0.8
|
%
|
Gross profit
|
1,913,115
|
|
|
1,834,354
|
|
|
78,761
|
|
|
4.3
|
|
|||
Operating expenses
|
1,167,884
|
|
|
1,147,685
|
|
|
20,199
|
|
|
1.8
|
|
|||
Operating income
|
$
|
745,231
|
|
|
$
|
686,669
|
|
|
$
|
58,562
|
|
|
8.5
|
%
|
|
|
|
|
|
|
|
|
|||||||
Gross profit
|
$
|
1,913,115
|
|
|
$
|
1,834,354
|
|
|
$
|
78,761
|
|
|
4.3
|
%
|
Adjusted operating expenses (Non-GAAP)
|
1,167,884
|
|
|
1,146,813
|
|
|
21,071
|
|
|
1.8
|
|
|||
Adjusted operating income (Non-GAAP)
|
$
|
745,231
|
|
|
$
|
687,541
|
|
|
$
|
57,690
|
|
|
8.4
|
%
|
|
Increase (Decrease)
|
|||||
|
13-Week Period
|
|||||
|
(Dollars in millions)
|
|||||
Cause of change
|
Percentage
|
|
Dollars
|
|||
Case volume
(1)
|
1.8
|
%
|
|
$
|
166.0
|
|
Acquisitions
|
0.4
|
|
|
35.2
|
|
|
Other
|
(1.6
|
)
|
|
(150.3
|
)
|
|
Total sales increase
|
0.6
|
%
|
|
$
|
50.9
|
|
|
13-Week Period Ended Oct. 1, 2016
|
|
13-Week Period Ended Sep. 26, 2015
|
|
13-Week Period Ended Change in Dollars
|
|
13-Week Period
% Change |
|||||||
|
(In thousands)
|
|||||||||||||
Sales
|
$
|
2,728,360
|
|
|
$
|
1,390,259
|
|
|
$
|
1,338,101
|
|
|
96.2
|
%
|
Gross profit
|
598,406
|
|
|
245,462
|
|
|
352,944
|
|
|
143.8
|
|
|||
Operating expenses
|
518,971
|
|
|
193,542
|
|
|
325,429
|
|
|
168.1
|
|
|||
Operating income
|
$
|
79,435
|
|
|
$
|
51,920
|
|
|
$
|
27,515
|
|
|
53.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||
Gross profit
|
$
|
598,406
|
|
|
$
|
245,462
|
|
|
$
|
352,944
|
|
|
143.8
|
%
|
Adjusted operating expenses (Non-GAAP)
|
494,793
|
|
|
192,299
|
|
|
302,494
|
|
|
157.3
|
|
|||
Adjusted operating income (Non-GAAP)
|
$
|
103,613
|
|
|
$
|
53,163
|
|
|
$
|
50,450
|
|
|
94.9
|
%
|
|
Increase (Decrease)
|
|||||
|
13-Week Period
|
|||||
|
(Dollars in millions)
|
|||||
Cause of change
|
Percentage
|
|
Dollars
|
|||
Case volume
(1)
|
1.3
|
%
|
|
$
|
18.8
|
|
Acquisitions
|
94.9
|
|
|
1,340.1
|
|
|
Foreign currency
|
—
|
|
|
(0.3
|
)
|
|
Other
|
(1.4
|
)
|
|
(20.0
|
)
|
|
Total sales increase
|
94.8
|
%
|
|
$
|
1,338.6
|
|
|
13-Week Period Ended Oct. 1, 2016
|
|
13-Week Period Ended Sep. 26, 2015
|
|
13-Week Period Change in Dollars
|
|
13-Week Period
% Change
(3)
|
|||||||
|
(In thousands, except for share and per share data)
|
|||||||||||||
Sales
|
$
|
13,968,654
|
|
|
$
|
12,562,611
|
|
|
$
|
1,406,043
|
|
|
11.2
|
%
|
Impact of Brakes
|
(1,283,524
|
)
|
|
—
|
|
|
(1,283,524
|
)
|
|
NM
|
|
|||
Sales excluding the impact of Brakes (Non-GAAP)
|
$
|
12,685,130
|
|
|
$
|
12,562,611
|
|
|
$
|
122,519
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|||||||
Operating expenses (GAAP)
|
$
|
2,125,086
|
|
|
$
|
1,744,521
|
|
|
$
|
380,565
|
|
|
21.8
|
%
|
Impact of restructuring costs (1)
|
(38,285
|
)
|
|
(3,189
|
)
|
|
(35,096
|
)
|
|
NM
|
|
|||
Impact of acquisition-related costs (2)
|
(21,710
|
)
|
|
(9,816
|
)
|
|
(11,894
|
)
|
|
121.2
|
%
|
|||
Operating expenses adjusted for certain items (Non-GAAP)
|
$
|
2,065,091
|
|
|
$
|
1,731,516
|
|
|
$
|
333,575
|
|
|
19.3
|
%
|
Impact of Brakes
|
$
|
(322,843
|
)
|
|
$
|
—
|
|
|
$
|
(322,843
|
)
|
|
NM
|
|
Impact of Brakes restructuring costs (3)
|
3,074
|
|
|
—
|
|
|
3,074
|
|
|
NM
|
|
|||
Impact of Brakes acquisition-related costs (2)
|
19,498
|
|
|
—
|
|
|
19,498
|
|
|
NM
|
|
|||
Operating expenses adjusted for certain items and excluding the impact of Brakes (Non-GAAP)
|
$
|
1,764,820
|
|
|
$
|
1,731,516
|
|
|
$
|
33,304
|
|
|
1.9
|
%
|
|
|
|
|
|
|
|
|
|||||||
Operating income (GAAP)
|
$
|
566,833
|
|
|
$
|
493,474
|
|
|
$
|
73,359
|
|
|
14.9
|
%
|
Impact of restructuring costs (1)
|
38,285
|
|
|
3,189
|
|
|
35,096
|
|
|
NM
|
|
|||
Impact of acquisition-related costs (2)
|
21,710
|
|
|
9,816
|
|
|
11,894
|
|
|
121.2
|
%
|
|||
Operating income adjusted for certain items (Non-GAAP)
|
$
|
626,828
|
|
|
$
|
506,479
|
|
|
$
|
120,349
|
|
|
23.8
|
%
|
Impact of Brakes
|
$
|
(20,208
|
)
|
|
$
|
—
|
|
|
$
|
(20,208
|
)
|
|
NM
|
|
Impact of Brakes restructuring costs (3)
|
(3,074
|
)
|
|
—
|
|
|
(3,074
|
)
|
|
NM
|
|
|||
Impact of Brakes acquisition-related costs (2)
|
(19,498
|
)
|
|
—
|
|
|
(19,498
|
)
|
|
NM
|
|
|||
Operating income adjusted for certain items and excluding the impact of Brakes (Non-GAAP)
|
$
|
584,048
|
|
|
$
|
506,479
|
|
|
$
|
77,569
|
|
|
15.3
|
%
|
|
|
|
|
|
|
|
|
Operating margin (GAAP)
|
4.06
|
%
|
|
3.93
|
%
|
|
0.13
|
%
|
|
3.3
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Operating margin (Non-GAAP)
|
4.49
|
%
|
|
4.03
|
%
|
|
0.46
|
%
|
|
11.3
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Operating margin excluding Certain Items and Brakes (Non-GAAP)
|
4.60
|
%
|
|
4.03
|
%
|
|
0.57
|
%
|
|
14.2
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Interest expense (GAAP)
|
$
|
73,623
|
|
|
$
|
126,907
|
|
|
$
|
(53,284
|
)
|
|
(42.0
|
)%
|
Impact of acquisition financing costs (4)
|
—
|
|
|
(94,835
|
)
|
|
94,835
|
|
|
(100.0
|
)%
|
|||
Interest expense adjusted for certain items (Non-GAAP)
|
$
|
73,623
|
|
|
$
|
32,072
|
|
|
$
|
41,551
|
|
|
129.6
|
%
|
|
|
|
|
|
|
|
|
|||||||
Net earnings (GAAP)
|
$
|
323,887
|
|
|
$
|
244,420
|
|
|
$
|
79,467
|
|
|
32.5
|
%
|
Impact of restructuring costs (1)
|
38,285
|
|
|
3,189
|
|
|
35,096
|
|
|
NM
|
|
|||
Impact of acquisition-related costs (2)
|
21,710
|
|
|
9,816
|
|
|
11,894
|
|
|
121.2
|
%
|
|||
Impact of acquisition financing costs (4)
|
—
|
|
|
94,835
|
|
|
(94,835
|
)
|
|
(100.0
|
)%
|
|||
Tax impact of restructuring costs (5)
|
(3,593
|
)
|
|
(1,198
|
)
|
|
(2,395
|
)
|
|
199.9
|
%
|
|||
Tax impact of acquisition-related costs (5)
|
(4,169
|
)
|
|
(3,688
|
)
|
|
(481
|
)
|
|
13.0
|
%
|
|||
Tax impact of acquisition financing costs (5)
|
—
|
|
|
(35,632
|
)
|
|
35,632
|
|
|
(100.0
|
)%
|
|||
Net earnings adjusted for certain items (4)
|
$
|
376,120
|
|
|
$
|
311,742
|
|
|
$
|
64,378
|
|
|
20.7
|
%
|
Impact of Brakes
|
$
|
(18,852
|
)
|
|
$
|
—
|
|
|
$
|
(18,852
|
)
|
|
NM
|
|
Impact of Brakes restructuring costs (3)
|
(2,446
|
)
|
|
—
|
|
|
(2,446
|
)
|
|
NM
|
|
|||
Impact of Brakes acquisition-related costs (2)
|
(15,514
|
)
|
|
—
|
|
|
(15,514
|
)
|
|
NM
|
|
|||
Impact of interest expense on debt issued for the Brakes acquisition (6)
|
19,735
|
|
|
—
|
|
|
19,735
|
|
|
NM
|
|
|||
Tax impact of interest expense on debt issued for the Brakes acquisition (5)
|
(7,460
|
)
|
|
—
|
|
|
(7,460
|
)
|
|
NM
|
|
|||
Net earnings adjusted for certain items and excluding the impact of Brakes (Non-GAAP)
|
$
|
351,583
|
|
|
$
|
311,742
|
|
|
$
|
39,841
|
|
|
12.8
|
%
|
|
|
|
|
|
|
|
|
|||||||
Diluted earnings per share (GAAP)
|
$
|
0.58
|
|
|
$
|
0.41
|
|
|
$
|
0.17
|
|
|
41.5
|
%
|
Impact of restructuring costs (1)
|
0.07
|
|
|
—
|
|
|
0.07
|
|
|
NM
|
|
|||
Impact of acquisition-related costs (2)
|
0.04
|
|
|
0.02
|
|
|
0.02
|
|
|
144.8
|
%
|
|||
Impact of acquisition financing costs (4)
|
—
|
|
|
0.16
|
|
|
(0.16
|
)
|
|
(100.0
|
)%
|
|||
Tax impact of restructuring costs (5)
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
NM
|
|
|||
Tax impact of acquisition-related costs (5)
|
(0.01
|
)
|
|
(0.01
|
)
|
|
—
|
|
|
62.9
|
%
|
|||
Tax impact of acquisition financing costs (5)
|
—
|
|
|
(0.06
|
)
|
|
0.06
|
|
|
(100.0
|
)%
|
|||
Diluted EPS adjusted for certain items (Non-GAAP) (7)
|
$
|
0.67
|
|
|
$
|
0.52
|
|
|
$
|
0.15
|
|
|
28.8
|
%
|
Impact of Brakes
|
$
|
(0.03
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
NM
|
|
Impact of Brakes restructuring costs (3)
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
NM
|
|
|||
Impact of Brakes acquisition-related costs (2)
|
(0.02
|
)
|
|
—
|
|
|
—
|
|
|
NM
|
|
|||
Impact of interest expense on debt issued for the Brakes acquisition (6)
|
0.03
|
|
|
—
|
|
|
—
|
|
|
NM
|
|
|||
Tax impact of interest expense on debt issued for the Brakes acquisition (5)
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
NM
|
|
|||
Net earnings adjusted for certain items and excluding the impact of Brakes (Non-GAAP) (7)
|
$
|
0.63
|
|
|
$
|
0.52
|
|
|
$
|
0.11
|
|
|
21.2
|
%
|
|
13-Week Period Ended Oct. 1, 2016
|
|
13-Week Period Ended Sep. 26, 2015
|
|
13-Week Period Ended Change in Dollars
|
|
13-Week Period % Change
|
|||||||
U.S. FOODSERVICE OPERATIONS
|
|
|
|
|
|
|
|
|||||||
Sales (GAAP)
|
$
|
9,481,115
|
|
|
$
|
9,407,923
|
|
|
$
|
73,192
|
|
|
0.8
|
%
|
Gross Profit (GAAP)
|
1,913,115
|
|
|
1,834,354
|
|
|
78,761
|
|
|
4.3
|
%
|
|||
Gross Margin (GAAP)
|
20.2
|
%
|
|
19.5
|
%
|
|
0.7
|
%
|
|
3.5
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Operating expenses (GAAP)
|
$
|
1,167,884
|
|
|
$
|
1,147,685
|
|
|
$
|
20,199
|
|
|
1.8
|
%
|
Impact of restructuring costs
|
—
|
|
|
(873
|
)
|
|
873
|
|
|
NM
|
|
|||
Operating expenses adjusted for certain items (Non-GAAP)
|
$
|
1,167,884
|
|
|
$
|
1,146,813
|
|
|
$
|
21,071
|
|
|
1.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Operating income (GAAP)
|
$
|
745,231
|
|
|
$
|
686,669
|
|
|
$
|
58,562
|
|
|
8.5
|
%
|
Impact of restructuring costs
|
—
|
|
|
873
|
|
|
(873
|
)
|
|
NM
|
|
|||
Operating income adjusted for certain items (Non-GAAP)
|
$
|
745,231
|
|
|
$
|
687,542
|
|
|
$
|
57,689
|
|
|
8.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
INTERNATIONAL FOODSERVICE OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|||
Sales (GAAP)
|
$
|
2,728,360
|
|
|
$
|
1,390,259
|
|
|
$
|
1,338,101
|
|
|
96.2
|
%
|
Gross Profit (GAAP)
|
598,406
|
|
|
245,462
|
|
|
352,944
|
|
|
143.8
|
%
|
|||
Gross Margin (GAAP)
|
21.9
|
%
|
|
17.7
|
%
|
|
4.2
|
%
|
|
23.7
|
%
|
|||
|
|
|
|
|
|
|
|
|||||||
Operating expenses (GAAP)
|
$
|
518,971
|
|
|
$
|
193,542
|
|
|
$
|
325,429
|
|
|
168.1
|
%
|
Impact of restructuring costs (1)
|
(4,680
|
)
|
|
(1,243
|
)
|
|
(3,437
|
)
|
|
276.5
|
%
|
|||
Impact of acquisition-related costs (2)
|
(19,498
|
)
|
|
—
|
|
|
(19,498
|
)
|
|
NM
|
|
|||
Operating expenses adjusted for certain items (Non-GAAP)
|
$
|
494,793
|
|
|
$
|
192,299
|
|
|
$
|
302,494
|
|
|
157.30
|
%
|
Impact of Brakes
|
$
|
(322,843
|
)
|
|
$
|
—
|
|
|
$
|
(322,843
|
)
|
|
NM
|
|
Impact of Brakes restructuring costs
|
3,074
|
|
|
$
|
—
|
|
|
$
|
3,074
|
|
|
NM
|
|
|
Impact of Brakes acquisition-related costs
|
19,498
|
|
|
$
|
—
|
|
|
$
|
19,498
|
|
|
NM
|
|
|
Operating expenses adjusted for certain items and excluding the impact of Brakes (Non-GAAP)
|
$
|
194,522
|
|
|
$
|
192,299
|
|
|
$
|
2,223
|
|
|
1.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Operating income (GAAP)
|
$
|
79,435
|
|
|
$
|
51,920
|
|
|
$
|
27,515
|
|
|
53.0
|
%
|
Impact of restructuring costs (1)
|
4,680
|
|
|
1,243
|
|
|
3,437
|
|
|
276.5
|
%
|
|||
Impact of acquisition related costs (2)
|
19,498
|
|
|
—
|
|
|
19,498
|
|
|
NM
|
|
|||
Operating income adjusted for certain items (Non-GAAP)
|
$
|
103,613
|
|
|
$
|
53,163
|
|
|
$
|
50,450
|
|
|
94.9
|
%
|
Impact of Brakes
|
$
|
(20,208
|
)
|
|
$
|
—
|
|
|
$
|
(20,208
|
)
|
|
NM
|
|
Impact of Brakes restructuring costs
|
(3,074
|
)
|
|
—
|
|
|
(3,074
|
)
|
|
NM
|
|
|||
Impact of Brakes acquisition-related costs
|
(19,498
|
)
|
|
—
|
|
|
(19,498
|
)
|
|
NM
|
|
|||
Operating income adjusted for certain items and excluding the impact of Brakes (Non-GAAP)
|
$
|
60,833
|
|
|
$
|
53,163
|
|
|
$
|
7,670
|
|
|
14.4
|
%
|
•
|
Cash flows from operations were $
248.7 million
in 2017, compared to a negative cash flow of $
261.5 million
in 2016;
|
•
|
Capital expenditures totaled $
142.3 million
in 2017, compared to $
121.2 million
in 2016;
|
•
|
Free cash flow was
$110.7 million
in 2017, compared to a negative free cash flow of
$381.2 million
in 2016, and were negatively impacted by cash payments associated with Certain Items to a greater extent in the first quarter of fiscal 2016 (see "Non-GAAP reconciliation" below under the heading “Free Cash Flow”);
|
•
|
Cash used for acquisition of businesses, net of cash received, was $
2.9 billion
in 2017, compared to $
83.6 million
in 2016;
|
•
|
Net bank borrowings were $
442.8 million
in 2017, compared to borrowings of $
717.6 million
in 2016; and
|
•
|
Dividends paid were $
173.3 million
in 2017, compared to $
179.0 million
in 2016.
|
•
|
working capital requirements;
|
•
|
investments in facilities, systems, fleet, other equipment and technology;
|
•
|
return of capital to shareholders, including cash dividends and share repurchases;
|
•
|
acquisitions compatible with our overall growth strategy;
|
•
|
contributions to our various retirement plans; and
|
•
|
debt repayments.
|
•
|
our cash flows from operations;
|
•
|
the availability of additional capital under our existing commercial paper programs, supported by our revolving credit facility and bank line of credit; and
|
•
|
our ability to access capital from financial markets, including issuances of debt securities, either privately or under our shelf registration statement filed with the Securities and Exchange Commission (SEC).
|
|
13-Week Period Ended Oct. 1, 2016
|
|
13-Week Period Ended Sep. 26, 2015
|
||||
|
(In thousands)
|
||||||
Net cash provided by operating activities (GAAP)
|
$
|
248,674
|
|
|
$
|
(261,482
|
)
|
Additions to plant and equipment
|
(142,255
|
)
|
|
(121,243
|
)
|
||
Proceeds from sales of plant and equipment
|
4,261
|
|
|
1,506
|
|
||
Free Cash Flow (Non-GAAP)
|
$
|
110,680
|
|
|
$
|
(381,219
|
)
|
•
|
$788.5 million
amounts outstanding from our commercial paper program
|
•
|
No amounts outstanding from the credit facility supporting the company’s U.S. and Canadian commercial paper programs.
|
•
|
expectations regarding long-term consumer demand;
|
•
|
expectations regarding the earnings per share impact of the Brakes Acquisition, including estimated intangible amortization expense;
|
•
|
expectations regarding future fuel costs;
|
•
|
SYGMA’s progress against key business initiatives;
|
•
|
anticipated fuel needs for the remainder of fiscal 2017;
|
•
|
the impact of general economic conditions on our business and our industry;
|
•
|
expectations and goals related to cost per case for our U.S. Broadline companies;
|
•
|
expectations regarding the allocation of cash generated from operations;
|
•
|
Sysco’s expectations regarding cash held by international subsidiaries;
|
•
|
the sufficiency of our mechanisms for managing working capital and competitive pressures, and our beliefs regarding the impact of these mechanisms;
|
•
|
Sysco’s ability to meet future cash requirements, including the ability to access debt markets effectively, and maintain sufficient liquidity;
|
•
|
Sysco’s ability to effectively access the commercial paper market and long-term capital markets;
|
•
|
our expectations regarding the impact of seasonal trends on cash flow from operations and free cash flow;
|
•
|
our strategy and expectations regarding share repurchases; and
|
•
|
expectations related to our forward diesel fuel commitments.
|
•
|
periods of significant or prolonged inflation or deflation and their impact on our product costs and profitability;
|
•
|
risks related to unfavorable conditions in the U.S. economy and local markets and the impact on our results of operations and financial condition;
|
•
|
the risks related to our efforts to meet our long-term strategic objectives, including the risk that these efforts may not provide the expected benefits in our anticipated time frame, if at all, and may prove costlier than expected; the risk that the actual costs of any initiatives may be greater or less than currently expected; and the risk of adverse
|
•
|
the impact of unexpected future changes to our business initiatives based on management’s subjective evaluation of our overall business needs;
|
•
|
the risk that competition in our industry may adversely impact our margins and our ability to retain customers and make it difficult for us to maintain our market share, growth rate and profitability;
|
•
|
the risk that we may not be able to fully compensate for increases in fuel costs, and forward purchase commitments intended to contain fuel costs could result in above market fuel costs;
|
•
|
the risk of interruption of supplies and increase in product costs as a result of conditions beyond our control;
|
•
|
the potential impact on our reputation and earnings of adverse publicity or lack of confidence in our products;
|
•
|
risks related to unfavorable changes to the mix of locally managed customers versus corporate-managed customers;
|
•
|
the risk that we may not realize anticipated benefits from our operating cost reduction efforts;
|
•
|
difficulties in successfully expanding into international markets and complimentary lines of business;
|
•
|
the potential impact of product liability claims;
|
•
|
the risk that we fail to comply with requirements imposed by applicable law or government regulations;
|
•
|
risks related to our ability to effectively finance and integrate acquired businesses;
|
•
|
our access to borrowed funds in order to grow and any default by us under our indebtedness that could have a material adverse impact on cash flow and liquidity;
|
•
|
our level of indebtedness and the terms of our indebtedness could adversely affect our business and liquidity position;
|
•
|
the risk that the implementation of various initiatives, the timing and successful completion of acquisitions, construction schedules and the possibility that other cash requirements could result in delays or cancellations of capital spending;
|
•
|
the risk that the results of the referendum on June 23, 2016 in the United Kingdom to exit the European Union, commonly referred to as Brexit, may adversely impact our operations in the United Kingdom, including those of Brakes;
|
•
|
the risk that factors beyond management’s control, including fluctuations in the stock market, as well as management’s future subjective evaluation of the company’s needs, would impact the timing of share repurchases;
|
•
|
due to our reliance on technology, any technology disruption or delay in implementing new technology could have a material negative impact on our business;
|
•
|
the risk that a cybersecurity incident and other technology disruptions could negatively impact our business and our relationships with customers;
|
•
|
the potential requirement to pay material amounts under our multiemployer defined benefit pension plans;
|
•
|
our funding requirements for our company-sponsored qualified pension plan may increase should financial markets experience future declines;
|
•
|
labor issues, including the renegotiation of union contracts and shortage of qualified labor; and
|
•
|
the risk that the anti-takeover benefits provided by our preferred stock may not be viewed as beneficial to stockholders.
|
ISSUER PURCHASES OF EQUITY SECURITIES
|
|||||||||
Period
|
(a) Total Number of Shares Purchased
(1)
|
(b) Average Price Paid per Share
|
(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
(d) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
|
|||||
Month #1
|
|
|
|
|
|||||
July 3 - July 30
|
3,092,496
|
|
$
|
51.72
|
|
3,092,496
|
|
6,907,504
|
|
Month #2
|
|
|
|
|
|
||||
July 31 - August 27
|
3,850,454
|
|
51.95
|
|
3,848,689
|
|
4,392,997
|
|
|
Month #3
|
|
|
|
|
|
||||
August 28 - October 1
|
4,113,661
|
|
51.09
|
|
4,112,417
|
|
4,392,997
|
|
|
|
|
|
|
|
|||||
Total
|
11,056,611
|
|
$
|
51.58
|
|
11,053,602
|
|
4,392,997
|
|
|
Sysco Corporation
|
|
(Registrant)
|
|
By
|
/s/ WILLIAM J. DELANEY
|
|
|
William J. DeLaney
|
|
|
Chief Executive Officer
|
|
|
|
Date: November 7, 2016
|
|
|
|
By
|
/s/ JOEL T. GRADE
|
|
|
Joel T. Grade
|
|
|
Executive Vice President and
|
|
|
Chief Financial Officer
|
|
|
|
Date: November 7, 2016
|
|
|
|
|
|
3.1
|
—
|
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).
|
|
|
|
3.2
|
—
|
Certificate of Amendment to Restated Certificate of Incorporation increasing authorized shares, incorporated by reference to Exhibit 3(e) to Form 10-Q for the quarter ended December 27, 2003 (File No. 1-6544).
|
|
|
|
3.3
|
—
|
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).
|
|
|
|
10.1#†
|
—
|
Sysco Corporation Fiscal 2017 Management Incentive Program (MIP) For Corporate MIP Bonus-eligible Positions adopted effective August 25, 2016.
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10.2#†
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Form of Performance Share Unit Grant Agreement (Fiscal Year 2017) for executive officers under the Sysco Corporation 2013 Long-Term Incentive Plan.
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10.3#†
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—
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Form of Stock Option Grant Agreement (Fiscal Year 2017) for executive officers under the Sysco Corporation 2013 Long-Term Incentive Plan.
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10.4#†
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Form of Sysco Protective Covenants Agreement applicable to executive officers in connection with Stock Options and Performance Share Units issued under the 2013 Long-Term Incentive Plan.
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12.1#
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Statement regarding Computation of Ratio of Earnings to Fixed Charges.
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15.1#
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Review Report from Ernst & Young LLP dated November 7, 2016, re: unaudited financial statements.
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15.2#
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Acknowledgment letter from Ernst & Young LLP.
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31.1#
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CEO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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31.2#
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CFO Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
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32.1#
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—
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CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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32.2#
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—
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CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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101.1#
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The following financial information from Sysco Corporation’s Quarterly Report on Form 10-Q for the quarter ended October 1, 2016 filed with the SEC on November 7, 2016, formatted in XBRL includes: (i) Consolidated Balance Sheets as of October 1, 2016, July 2, 2016 and September 26, 2015, (ii) Consolidated Results of Operations for the thirteen week period ended October 1, 2016 and September 26, 2015, (iii) Consolidated Statements of Comprehensive Income for the thirteen week period ended October 1, 2016 and September 26, 2015, (iv) Consolidated Cash Flows for the thirteen week period ended October 1, 2016 and September 26, 2015, and (v) the Notes to Consolidated Financial Statements.
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Participant’s Bonus Target Amount
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X
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Operating Income Bonus Percentage
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X
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50%
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=
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Operating Income Bonus
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(BB)
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Gross Profit Dollars Growth and NABL Total Cases Growth Bonus
–
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Participant’s Bonus Target Amount
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X
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Gross Profit Dollars Growth and NABL Total Cases Growth Bonus Percentage
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X
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25%
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=
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Gross Profit Dollars Growth and NABL Total Cases Growth Bonus
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Participant’s Bonus Target Amount
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X
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SBO Bonus Percentage
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X
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25%
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=
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SBO Bonus
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(1)
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General Conditions
. This Award is in the form of PSUs that settle in Stock on the Payment Date, except as otherwise provided in Section 3 below in the event of the Grantee’s death. If the conditions set forth in this Agreement are satisfied, the number of shares of Stock earned based on actual performance achieved will be calculated as of the Certification Date and issued to the Grantee on the Payment Date. If these conditions are
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(4)
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Acceptance of Agreement.
The Grantee shall indicate his or her acceptance of this Agreement, in the method directed by the Company.
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(5)
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Notices.
Each notice relating to this Award shall be in writing. All notices to the Company shall be addressed to the Corporate Secretary, Sysco Corporation, 1390 Enclave Parkway, Houston, Texas 77077. All notices to the Grantee shall be addressed to the address of the Grantee on file with the Company or the Employer. Either the Company or the Grantee may designate a different address by written notice to the other. Written notice to said addresses shall be effective to bind the Company, the Grantee and the Grantee’s representatives and beneficiaries.
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(1)
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withholding from the Grantees’ wages or other cash compensation paid to the Grantee by the Company and/or the Employer, or any other payment of any kind otherwise due to the Grantee by the Company and/or the Employer; or
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(2)
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withholding from proceeds of the sale of Stock acquired upon settlement of the Award, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Grantee’s behalf pursuant to this authorization without further consent); or
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(7)
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Compensation Committee
. The Grantee hereby agrees that (a) any change, interpretation, determination or modification of this Agreement by the Committee shall be final and conclusive for all purposes and on all persons including the Company and the Grantee; provided, however, that with respect to any amendment or modification of the Plan which affects the Award made hereby, the Committee shall have determined that such amendment or modification is in the best interests of the Grantee of such Award; and (b) this Agreement and the Award shall not affect in any way the right of the Company or the Employer to terminate or change the employment of the Grantee. The right of the Company or Employer to terminate at will the Grantee’s employment at any time for any reason is specifically reserved.
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(8)
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Prohibited Activities; Post-Employment Covenants; Additional Remedies of Clawback and Recoupment.
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(i)
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to the extent the Grantee has received any Stock in satisfaction of this Award and the Grantee continues to hold those shares of Stock, the shares of Stock so acquired;
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(ii)
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to the extent the Grantee has received any Stock in satisfaction of this Award and no longer owns the shares of Stock so acquired, cash in an amount equal to the Fair Market Value of such shares of Stock on the date such payment is demanded by the Company (which, unless otherwise determined by the Committee, shall be equal to the closing sale price during regular trading hours of the shares of Stock as reported by the New York Stock Exchange on such date); and
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(iii)
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to the extent the Grantee has not received any Stock in satisfaction of this Award, all of the Grantee’s remaining rights, title or interest in the Award.
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(9)
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Modification of Agreement.
If any of the terms of this Agreement may, in the opinion of the Company, conflict or be inconsistent with any applicable law or regulation of any governmental agency having jurisdiction, the Company reserves the right to modify this Agreement to be consistent with applicable laws or regulations. No change or modification of this Agreement shall be valid unless it is in writing and signed by the party against which enforcement is sought, except where specifically provided to the contrary herein.
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(10)
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Data Privacy.
To the extent that consent is required, the Grantee hereby consents to the collection, use and transfer, in electronic or other form, of the Grantee’s personal data as described in this Agreement and any other Award materials by and among, as applicable, the Employer, the Company and its
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(12)
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No Advice Regarding Grant.
Neither the Company nor any Affiliated Company is providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Grantee’s participation in the Plan, or the Grantee’s acquisition or sale of the underlying Stock. The Grantee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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(13)
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Entire Agreement; Severability
. The Plan and this Agreement set forth the entire understanding between the Grantee, the Employer, the Company, and any Affiliated Company regarding the acquisition of the Stock and supersedes all prior oral and written agreements pertaining to this Award. If all or any part or application of the provisions of this Agreement are held or determined to be invalid or unenforceable for any reason whatsoever by a court of competent jurisdiction in an action between Grantee and the Company, each and all of the other provisions of this Agreement shall remain in full force and effect.
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i.
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in the United States, that Optionee has been determined by the Social Security Administration to be totally disabled; and
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ii.
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in all other jurisdictions, as set forth in the applicable section of Appendix A.
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(15)
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Compliance with Law
. Notwithstanding any other provision of the Plan or this Agreement, unless there is an available exemption from any registration, qualification or other legal requirement applicable to the Stock, the Company shall not be required to deliver any Stock issuable upon settlement of the Award prior to the completion of any registration or qualification of the Stock under any local, state, federal or foreign securities or exchange control law or under rulings or regulations of the U.S. Securities and Exchange Commission (“SEC”) or of any other governmental regulatory body, or prior to obtaining any approval or other clearance from any local, state, federal or foreign governmental agency, which registration, qualification or approval the Company shall, in its absolute discretion, deem necessary or advisable. The Grantee understands that the Company is under no obligation to register or qualify the Stock with the SEC or any state or foreign securities commission or to seek approval or clearance from any governmental authority for the issuance or sale of the Stock. Further, the Grantee agrees that the Company shall have unilateral authority to amend the Plan and the Agreement without the Grantee’s consent to the extent necessary to comply with securities or other laws applicable to issuance of Stock.
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(16)
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Language.
If the Grantee has received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
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(17)
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Electronic Delivery and Acceptance
. The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. The Grantee hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
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(18)
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Appendix A
. The Award shall be subject to any special terms and conditions for the Grantee’s country set forth in Appendix A. Moreover, if the Grantee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Grantee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. Appendix A constitutes part of this Agreement.
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(19)
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Imposition of Other Requirements.
The Company reserves the right to impose other requirements on the Grantee’s participation in the Plan, on the Award and on any Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Grantee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
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(21)
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Insider Trading Restrictions/Market Abuse Laws.
The Grantee acknowledges that, depending on the Grantee’s country of residence, the Grantee may be subject to insider trading restrictions and/or market abuse laws, which may affect the Grantee’s ability to acquire or sell shares of Stock or rights to shares of Stock (e.g., Awards) under the Plan during such times as the Grantee is considered to have “inside information” regarding the Company (as defined by the laws in the Grantee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under the Company’s insider trading policy. The Grantee acknowledges that it is his or her responsibility to comply with any applicable restrictions, and the Grantee is advised to speak to his or her personal advisor on this matter.
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(22)
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Mobility
. If during the course of Grantee’s employment with the Company or any Affiliated Companies or during the provision of services to the Company or any of its Affiliated Companies, Grantee becomes a tax resident in a jurisdiction other than his or her home country at the award date, the Company reserves the right to modify the terms of this agreement to comply with local laws in another jurisdiction.
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(23)
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Governing Law and Venue
. This Award and this Agreement has been made in and shall be governed by, construed under and in accordance with the laws of the State of Texas, without regard to the conflict of law provisions, as provided in the Plan. Any and all disputes relating to, concerning or arising from this Agreement, or relating to, concerning or arising from the relationship between the parties evidenced by the Award or this Agreement, shall be brought and heard exclusively in the United States District Court for the Southern District of Texas or Harris County, Texas. Each of the parties hereby represents and agrees that such party is subject to the personal jurisdiction of said courts; hereby irrevocably consents to the jurisdiction of such courts in any legal or equitable proceedings related to, concerning or arising from such dispute, and waives, to the fullest extent permitted by law, any objection which such party may now or hereafter have that the laying of the venue of any legal or equitable proceedings related to, concerning or arising from such dispute which is brought in such courts is improper or that such proceedings have been brought in an inconvenient forum.
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1.
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General Conditions
. Please carefully review all of the provisions of the Plan. In addition to the conditions set forth in the Plan, the Option is contingent upon satisfying the terms and conditions set forth in this Agreement. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned to such terms in the Plan.
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2.
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Vesting
. The Option will vest in three equal tranches over a period of three years (one-third on each of the first, second, and third anniversaries of the Grant Date), subject to any acceleration provisions contained in the Plan or otherwise set forth in this Agreement and the Optionee’s continuous employment or service with the Company or any of its Subsidiaries from the Grant Date through the applicable vesting date (each date on which a portion of the Option will vest pursuant to this Agreement, a “Vesting Date”).
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3.
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Maximum Term
. Unless terminated earlier in accordance with the terms of this Agreement, this Option will expire at the close of business on the final trading day immediately prior to the tenth anniversary of the Grant Date.
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4.
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Exercise Restrictions
.
Subject to any country-specific variations, the vested portion of the Option may be exercised at any time after its applicable Vesting Date and prior to the expiration of the Option, provided that at the time of the exercise all of the conditions set forth in the Plan and in this Agreement have been met. No portion of the Option may be exercised prior to the first anniversary of the Grant Date or after the expiration of the maximum term set forth in Section 3, above.
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5.
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Accelerated Vesting Events
. The Option awarded pursuant to this Agreement will vest according to the schedule set forth in Section 2 of this Agreement, subject to the Optionee’s continuous service with the Company or one of its Subsidiaries through each applicable Vesting Date. Notwithstanding the foregoing, provided that the Optionee has been in continuous service with the Company or one of its Subsidiaries since the Grant Date through the date of termination of his or her employment or service, (a) the Option shall remain in effect and continue to vest according to the vesting schedule set forth in Section 2 of this Agreement, irrespective of the continuous service limitations set forth in the first sentence of this Section 5, upon the occurrence of (i) the Optionee’s termination of employment by reason of Retirement in Good Standing (as defined in Section 19, below) or (ii) the Optionee’s termination of employment or service by reason of Disability (as defined in Section 19, below), and (b) the Option shall immediately vest upon the occurrence of (i) a “Change in Control Termination” (as defined in Section 19, below) in accordance with Section 4.2(h)(ii) of the Plan or (ii) the Optionee’s termination of employment or service by reason of death.
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6.
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Exercise Period
. The Option will normally terminate on the earlier of (i) the date of the expiration of the Option set forth in Section 3 of this Agreement or (ii) the 90th day after severance of the Optionee’s employment relationship with the Company or any Subsidiary, for any reason, for or without Cause. Whether an authorized leave of absence, or an absence for military or government service, constitutes severance of the Optionee’s employment or service relationship with the Company or a Subsidiary will be determined by the Committee administering the Plan at the time of the event. However, if before the expiration of the Option, the Optionee’s employment relationship with the Company or a Subsidiary terminates as a result of Retirement in Good Standing, Change in Control Termination, or Disability, the Option will remain exercisable in accordance with its terms as if Optionee remained in the employment or service of the Company or a Subsidiary, and in the event of the Optionee’s death while employed by or providing service to the Company or any Subsidiary, the Option may be exercised by the executors or administrators of the Optionee’s estate for up to three years following the date of the Optionee’s death, but in no event later than the last day of the maximum term of the Option set forth in Section 3.
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7.
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Method of Exercise.
At the time or times when the Optionee wishes to exercise the Option, the Optionee shall be required to follow the procedures established for doing so, which the Committee may revise from time to time. Notice of exercise of the Option must be accompanied by a payment equal to the applicable Option exercise price plus all Tax-Related items (as defined below) required to be withheld, collected or accounted for, if any, such amount to be paid in cash or by tendering, either by actual delivery of shares of Stock or by attestation, shares of Stock that are acceptable to the Committee, such shares to be valued at Fair Market Value as of the day the shares are tendered, or paid in any combination of cash and shares, as determined by the Committee. To the extent permitted by applicable law and the policies adopted from time to time by the Committee, the Optionee may elect to pay the exercise price through the contemporaneous sale by a third party broker of shares of Stock acquired upon exercise yielding net sales proceeds equal to the exercise price and any withholding Tax-Related Items required to be withheld, collected or account for and the remission of those sale proceeds to the Company.
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8.
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No Assignment
.
No right or interest of the Optionee in the Option may be pledged, encumbered, or hypothecated or be made subject to any lien, obligation or liability of the Optionee other than as provided in this Section 8. The Option may not be sold, assigned, transferred or otherwise disposed of by the Optionee other than by will or the laws of descent and distribution.
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9.
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Nature of Option
.
In accepting the Option, the Optionee acknowledges, understands and agrees that:
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a.
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the Plan is established voluntarily by the Company, it is discretionary in nature and the Company can amend, modify, suspend, cancel or terminate it at any time, to the extent permitted under the Plan;
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b.
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this Option and any other awards under the Plan are voluntary and occasional and do not create any contractual or other right to receive future options, awards or benefits in lieu of any options or awards, even if similar options or awards have been granted repeatedly in the past;
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c.
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all determinations with respect to any future options or awards, including, but not limited to, the times when options or awards are made, the amount of the options or awards and other conditions attached to the options or awards, will be at the sole discretion of the Company and/or the Committee;
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d.
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participation in this Plan or program is voluntary;
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e.
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the Option and any shares of Stock acquired under the Plan upon exercise of the Option are extraordinary items and do not constitute compensation of any kind (and do not give a right of claim of any kind) for services of any kind rendered to the Company or any of its Subsidiaries (including, as applicable, the entity employing the Optionee or to which the Optionee provides services, (the “Employer”) and which are outside the scope of the Optionee’s employment or service contract, if any;
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f.
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this Option, and any income derived therefrom, are not paid in lieu of, and are not intended to replace, any pension rights or compensation and are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any termination, severance, resignation, redundancy, dismissal, end of service payments, bonuses, long-service awards, life or accident insurance benefits, pension or retirement or welfare benefits or similar payments;
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g.
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for the purposes of the Option, the Optionee’s employment or service will be considered terminated as of the date the Optionee is no longer actively providing services to the Company or any Subsidiary (regardless of the reason for such termination and whether or not later to be found invalid or in breach of employment laws in the jurisdiction where the Optionee is employed or the terms of the Optionee’s employment agreement, if any), and unless otherwise expressly provided in this Agreement or determined by the Company, the Optionee’s right to vest in the Option under the Plan, if any, will terminate as of such date and will not be extended by any notice period or period during with the Optionee is in receipt of pay in lieu of such notice or severance pay (e.g., the Optionee’s period of service would not include any contractual, statutory or common law notice period or period during which the Optionee is in the receipt of pay in lieu of such notice or severance pay or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where the Optionee is employed or the terms of the Optionee’s employment agreement, if any); the Committee shall have the exclusive discretion to determine when the Optionee is no longer actively providing services for the purposes of the Option (including whether the Optionee may still be considered to be providing services while on a leave of absence);
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h.
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the future value of the underlying Stock is unknown, indeterminable and cannot be predicted with certainty. If the shares of Stock subject to the Option do not increase in value following the Grant Date, the Option will have no value. If the Optionee exercises the Option and obtains the shares of Stock, the value of those shares acquired upon exercise may increase or decrease in value, even below the Option exercise price;
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i.
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no claim or entitlement to compensation or damages shall arise from forfeiture of the Option resulting from the termination of the Optionee’s employment or other service relationship (for any reason whatsoever whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the Optionee is employed or the terms of the Optionee’s employment agreement, if any), and in consideration of the grant of the Option to which the Optionee is otherwise not entitled, the Optionee irrevocably agrees never to institute any claim against the Company, the Employer, any Subsidiary or any Affiliated Company; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, the Optionee shall be deemed irrevocably to have agreed not to pursue such claim and agrees to execute any and all documents necessary to request dismissal or withdrawal of such claim;
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j.
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the Option and the Optionee’s participation in the Plan shall not create a right to employment or be interpreted as forming an employment or services contract with the Company, the Employer, any Subsidiary or any Affiliated Company and shall not interfere with the ability of the Company, the Employer, any Subsidiary or any Affiliated Company, as applicable, to terminate the Optionee’s employment or service relationship (if any). The right of the Company or Employer to terminate at will the Optionee’s employment or service at any time for any reason is specifically reserved;
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k.
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if the Optionee is providing services outside the United States, the Optionee acknowledges and agrees that neither the Company, the Employer, any Subsidiary nor any Affiliate shall be liable for any foreign exchange rate fluctuation between the Optionee’s local currency and the United States Dollar that may affect the value of the Option or of any amounts due to the Optionee pursuant to the exercise of the Option or the subsequent sale of any Stock acquired upon exercise; and
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l.
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in the event of any conflict between communications to the Optionee by the Company of the terms of this Agreement or the records of any third party administrator and the Plan, the Plan will prevail.
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10.
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Responsibility for Taxes.
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a.
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Irrespective of any action taken by the Company or the Employer, the Optionee hereby acknowledges and agrees that the ultimate liability for all income tax, social insurance, social security, payroll tax, fringe benefits tax, payment on account or other tax-related items related to the Optionee’s participation in the Plan and legally applicable to the Optionee (“Tax-Related Items”), is and remains the responsibility of the Optionee or the Optionee’s estate (as applicable) and may exceed the amount actually withheld by the Company or the Employer. The Optionee acknowledges and understands that the requirements with respect to the Tax-Related Items may change from time to time as applicable laws or interpretations change.
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b.
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Prior to any relevant taxable or tax withholding event, as applicable, the Optionee agrees to make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related Items. In this regard, the Optionee authorizes the Company, the Employer, and their respective agents, at their discretion, to satisfy the obligations with regard to all Tax-Related Items withholding obligations by one or a combination of the following:
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i.
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withholding from the Optionee’s wages or other cash compensation paid to the Optionee by the Company and/or the Employer, or any other payment of any kind otherwise due to the Optionee by the Company and/or the Employer; or
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ii.
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withholding from proceeds of the sale of Stock acquired upon exercise of the Option, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Optionee’s behalf pursuant to this authorization without further consent); or
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iii.
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retention of or withholding in Stock to be issued upon exercise of the Option having a Fair Market Value not in excess of the minimum withholding amount.
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c.
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If the obligation for Tax-Related Items is satisfied by withholding in Stock, for tax purposes, the Optionee is deemed to have been issued the full amount of Stock subject to the Option, notwithstanding that an amount of Stock was retained solely for the purpose of paying the Tax-Related Items.
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d.
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In addition, the Optionee shall pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of the Optionee’s participation in the Plan that cannot be satisfied by the means previously described. The Company may refuse to issue or deliver the Stock or the proceeds of the sale of Stock, if the Optionee fails to comply with the Optionee’s obligations in connection with the Tax-Related Items.
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e.
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The Optionee further acknowledges that the Company and/or the Employer (1) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Option, including, but not limited to, the grant, vesting or exercise of the Option, the issuance of Stock upon exercise of the Option, the subsequent sale of Stock acquired pursuant to such exercise and the receipt of any dividends and/or dividend equivalents following the issuance of Stock upon the exercise of the Option; and (2) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the Option to reduce or eliminate the Optionee’s liability for Tax-Related Items or achieve any particular tax result. Further, if the Optionee is subject to tax in more than one jurisdiction, the Optionee acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
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11.
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Prohibited Activities; Post-Employment Covenants; Additional Remedies of Clawback and Recoupment
.
|
a.
|
Notwithstanding any other term of the Agreement or any prior agreement to the contrary, in order to be eligible to benefit from any portion of the Option, the Optionee must have entered into an agreement containing restrictive covenants concerning limitations of the Optionee’s behavior both during employment or service and following termination of employment or service that is satisfactory to the Company or one of its Subsidiaries. In the event the Optionee engages in any action that violates any such restrictive covenants at any time during the term of the Agreement, the Option shall be forfeited. The Optionee further agrees that to the extent permitted by applicable law, upon demand by the Company or one of its Subsidiaries, the Optionee will forfeit, return or repay the “Benefits and Proceeds” (as defined below) in the event the Optionee breaches any post-employment or post-service covenant with the Company and/or any of its Subsidiaries.
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b.
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For the purposes of this Agreement, “Benefits and Proceeds” means:
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i.
|
to the extent the Optionee has received any Stock in satisfaction of this Option and the Optionee continues to hold those shares of Stock, the shares of Stock so acquired;
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ii.
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to the extent the Optionee has received any Stock in satisfaction of this Option and no longer owns the shares of Stock so acquired, cash in an amount equal to the Fair Market Value of such shares of Stock on the date such payment is demanded by the Company (which, unless otherwise determined by the Committee, shall be equal to the closing sale price during regular trading hours of the shares of Stock as reported by the New York Stock Exchange on such date); and
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iii.
|
to the extent the Optionee has not received any Stock in satisfaction of this Option, all of the Optionee’s remaining rights, title or interest in the Option.
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12.
|
Electronic Delivery and Acceptance
. The Optionee consents and agrees to electronic delivery of any Plan documents, proxy materials, annual reports or other related documents, and to the electronic review, confirmation and acceptance procedures governing this Option. The Optionee consents and agrees that any such electronic procedures may be effected by a third party engaged by the Company to provide administrative services related to the Plan, including any program adopted under the Plan. The Optionee further agrees that his or her electronic signature is the same as, and shall have the same force and effect as, his or her manual signature. The Optionee acknowledges and agrees that the Company may provide personal information regarding the Optionee and any award of Options under the Plan, included but not limited to this Option, to any third party engaged by the Company to provide administrative or brokerage services related to the Plan.
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13.
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Data Privacy
.
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a.
|
To the extent consent is required, the Optionee hereby consents to the collection, use and transfer, in electronic or other form, of the Optionee’s personal data as described in this Agreement and any other Option materials by and among, as applicable, the Employer, the Company any Subsidiary and its Affiliated Companies for the purpose of implementing, administering and managing the Optionee’s participation in the Plan. The Employer and the Company will be joint data controllers in relation to the Optionee’s personal data.
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b.
|
The Optionee understands that the Employer, the Company, any Subsidiary and any Affiliated Company may hold certain personal information about the Optionee, including but not limited to his or her name, home address, telephone number, date of birth, social security number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company and details of all Options or any other entitlements to shares of stock awarded, cancelled, vested, unvested, or outstanding in the Optionee’s favor (“Data”), for the purpose of implementing, administering or managing the Plan. Certain Data may also constitute “sensitive personal data” within the meaning of applicable local law. Such Data include, but are not limited to, the information provided above and any changes thereto and other appropriate personal and financial data about the Optionee. The Optionee hereby provides explicit consent to the Company, the Employer, any Subsidiary and any Affiliated Company to process any such Data to the extent it is necessary for the purposes of implementing, administering and managing the Optionee’s participation in the Plan.
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c.
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The Optionee understands that Data will be transferred, for the purposes of implementing, administering and managing the Optionee’s participation in the Plan, to such equity plan service provider as may be selected by the Company in the future, which is assisting the Company with the implementation, administration and management of the Plan. The Optionee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country (e.g., the United States) may have data privacy laws and protections which provide standards of protection that are different to or lower than the standards provided by the data privacy laws in the Optionee’s country. The Optionee understands that if he or she resides outside the United States, he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative. The Optionee authorizes the Company, the Company’s equity service plan provider and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing his or her participation in the Plan. The Optionee understands that Data will be held only as long as is necessary to implement, administer and manage the Optionee’s participation in the Plan. The Optionee understands if he or she resides outside the United States, he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to or deletion of Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative. Further, the Optionee understands that he or she is providing the consents herein on a purely voluntary basis. If the Optionee does not consent, or if the Optionee later seeks to revoke his or her consent, his or her employment status or service and career with the Employer will not be adversely affected; the only adverse consequence of refusing or withdrawing the Optionee’s consent is that the Company would not be able to grant the Optionee Options or other equity awards or administer or maintain such awards. Therefore, the Optionee understands that refusing or withdrawing his or her consent may affect the Optionee’s ability to participate in the Plan. For more information on the consequences of the Optionee’s refusal to consent or withdrawal of consent, the Optionee understands that he or she may contact his or her local human resources representative.
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14.
|
Notices
.
Each notice relating to this Option shall be in writing. All notices to the Company shall be addressed to the Corporate Secretary, Sysco Corporation, 1390 Enclave Parkway, Houston, Texas 77077. All notices to the Optionee shall be addressed to the address of the Optionee on file with the Company or the Employer. Either the Company or the Optionee may designate a different address by written notice to the other. Written notice to said addresses shall be effective to bind the Company, the Optionee and the Optionee’s representatives and beneficiaries.
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15.
|
Committee
.
The Optionee hereby agrees that (a) any change, interpretation, determination or modification of this Agreement by the Committee shall be final and conclusive for all purposes and on all persons including the Company and the Optionee; provided, however, that with respect to any amendment or modification of the Plan which affects the Option of Stock made hereby, the Committee shall have determined that such amendment or modification is in the best interests of the Optionee of such Option; and (b) this Agreement and the Option shall not affect in any way the right of the Company or the Employer to terminate or change the employment of the Optionee.
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16.
|
Modification of Agreement
.
If any of the terms of this Agreement may, in the opinion of the Company, conflict or be inconsistent with any applicable law or regulation of any governmental agency having jurisdiction, the Company reserves the right to modify this Agreement to be consistent with applicable laws or regulations. If all or any part or application of the provisions of this Agreement are held or determined to be invalid or unenforceable for any reason whatsoever by a court of competent jurisdiction in an action between Optionee and the Company, each and all of the other provisions of this Agreement shall remain in full force and effect. No change or modification of this Agreement shall be valid unless it is in writing and signed by the party against with enforcement is sought, except where specifically provided to the contrary herein.
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17.
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No Advice Regarding Grant
. None of the Company, any Subsidiary or any Affiliated Company is providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Optionee’s participation in the Plan, or the Optionee’s acquisition or sale of the underlying Stock. The Optionee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.
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18.
|
Entire Agreement; Severability
.
The Plan and this Agreement set forth the entire understanding between the Optionee, the Employer, the Company and any Subsidiary regarding the acquisition of the Stock and supersedes all prior oral and written agreements pertaining to this Option. If all or any part of the provisions of this Agreement are held or determined to be invalid or unenforceable for any reason whatsoever by a court of competent jurisdiction in an action between the Optionee and the Company, each and all of the other provisions of the Agreement shall remain in full force and effect.
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19.
|
Definitions
. For purposes of this Agreement:
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a.
|
“Retirement in Good Standing” means:
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i.
|
in the United States and Canada, Belgium and Spain termination of employment after the date the Optionee reaches (i) age 55 and the Optionee has 10 or more years of service with the Company and its Subsidiaries, or (ii) age 65, regardless of years of service with the Company and it Subsidiaries; and
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ii.
|
In all other jurisdictions, retirement (as determined by the Committee).
|
b.
|
“Disability” means:
|
i.
|
in the United States, that the Optionee has been determined by the Social Security Administration to be totally disabled; and
|
ii.
|
in all other jurisdictions, as set forth in the applicable section of Appendix A.
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c.
|
“Change in Control Termination” means the occurrence of both: (A) a Change in Control and (B) during the period commencing 12 months prior to the first occurrence of the Change in Control and ending 24 months after such Change in Control, the Company or one of its Subsidiaries involuntarily terminates the Optionee’s employment or Service without Cause or the Optionee terminates employment for Good Reason.
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20.
|
Compliance with Law
. Notwithstanding any other provision of the Plan or this Agreement, unless there is an available exemption from any registration, qualification or other legal requirement applicable to the Stock, the Company shall not be required to deliver any Stock issuable upon exercise of the Option prior to the completion of any registration or qualification of the Stock under any local, state, federal or foreign securities or exchange control law or under rulings or regulations of the U.S. Securities and Exchange Commission (“SEC”) or of any other governmental regulatory body, or prior to obtaining any approval or other clearance from any local, state, federal or foreign governmental agency, which registration, qualification or approval the Company shall, in its absolute discretion, deem necessary or advisable. The Optionee understands that the Company is under no obligation to register or qualify the Stock with the SEC or any state or foreign securities commission or to seek approval or clearance from any governmental authority for the issuance or sale of the Stock. Further, the Optionee agrees that the Company shall have unilateral authority to amend the Plan and the Agreement without the Optionee’s consent to the extent necessary to comply with securities or other laws applicable to issuance of Stock.
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21.
|
Language
. If the Optionee has received this Agreement or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
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22.
|
Appendix A
. The Option shall be subject to any special terms and conditions for the Optionee’s country set forth in Appendix A. Moreover, if the Optionee relocates to one of the countries included in Appendix A, the special terms and conditions for such country will apply to the Optionee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. Appendix A constitutes part of this Agreement.
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23.
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Imposition of Other Requirements.
The Company reserves the right to impose other requirements on the Optionee’s participation in the Plan, on the Option and on any Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the Optionee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
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24.
|
Insider Trading Restrictions/Market Abuse Laws
. The Optionee acknowledges that, depending on the Optionee’s country of residence, the Optionee may be subject to insider trading restrictions and/or market abuse laws, which may affect the Optionee’s ability to acquire or sell shares of Stock or rights to shares of Stock (e.g., Options) under the Plan during such times as the Optionee is considered to have “inside information” regarding the Company (as defined by the laws in the Optionee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under the Company’s insider trading policy. The Optionee acknowledges that it is his or her responsibility to comply with any applicable restrictions, and the Optionee is advised to speak to his or her personal advisor on this matter.
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25.
|
Waiver.
The Optionee acknowledges that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or acceptance of any subsequent breach by the Optionee or any other person claiming rights with respect to the Option.
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26.
|
Governing Law and Venue
. This Option has been granted and this Agreement has been made in and shall be governed by, construed under and in accordance with the laws of the State of Texas, without regard to the conflict of law provisions, as provided in the Plan. Any and all disputes relating to, concerning or arising from
this
Agreement, or relating to, concerning or arising from the relationship between the parties evidenced by the Option or this Agreement, shall be brought and heard exclusively in the United States District Court for the Southern District of Texas or Harris County, Texas. Each of the parties hereby represents and agrees that such party is subject to the personal jurisdiction of said courts; irrevocably consents to the jurisdiction of such courts in any legal or equitable proceedings related to, concerning or arising from such dispute, and waives, to the fullest extent permitted by law, any objection which such party may now or hereafter have that the laying of the venue of any legal or equitable proceedings related to, concerning or arising from such dispute which is brought in such courts is improper or that such proceedings have been brought in an inconvenient forum.
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27.
|
Mobility.
If, during the course of the Optionee’s employment with the Company or any of its Subsidiaries or during the provision of services to the Company or any of its Subsidiaries, the Optionee becomes a tax resident in a jurisdiction other than his or her home country as of the Grant Date, the Company reserves the right to modify the terms of this Agreement to comply with local laws in another jurisdiction.
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a.
|
that such form is established in application of Article 80 bis of the French Tax Code;
|
b.
|
the corporate name and the registered office of the Company or Subsidiary;
|
c.
|
his/ her name and address;
|
d.
|
the date of grant and exercise date of the Options;
|
e.
|
the number of Options acquired upon the exercise of the Options, the exercise price per value of the shares as at the exercise date, and, if relevant, the “discount” on the share which is greater than 5 per cent. For the purpose of this clause, “discount” means the difference between the average middle market quotation for a share over the twenty Dealing Days preceding the Grant Date and the exercise price; and
|
f.
|
the French-source portion of the gain realised on the exercise date.’
|
a.
|
in relation to Options to subscribe for new shares issued by the Company, 80 per cent. of the average middle market quotation for a Share on the New York Stock Exchange
for the 20 Dealing Days preceding the Grant Date; and
|
b.
|
in relation to Options to acquire existing shares of the Company:
|
i.
|
80 per cent. of the average middle market quotation for a Share on the New York Stock Exchange
for the 20 Dealing Days preceding the Grant Date; and
|
ii.
|
in any case, not less than 80 per cent. of the average middle acquisition price of Shares acquired by the Company for the purpose of granting Options and held by the Company for the same purpose as at the Grant Date.
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1.
|
I have reviewed this quarterly report on Form 10-Q of Sysco Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Sysco Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
1.
|
The company’s Quarterly Report on Form 10-Q for the fiscal quarter ended October 1, 2016 (“Quarterly Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
2.
|
All of the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the company.
|
1.
|
The company’s Quarterly Report on Form 10-Q for the fiscal quarter ended October 1, 2016 (“Quarterly Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
|
2.
|
All of the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the company.
|