exv10w4



 





Exhibit 10.4




Form of Grant Agreement Letter to

Corporate Participants1

Under the SYSCO Corporation 2004 Mid-Term Incentive Plan




September 28, 2007



PERSONAL AND CONFIDENTIAL




[Name]

[Street Address]

[City, State, Zip]



Dear [Grantee]:



In recognition of your long-term commitment to SYSCO and its customers and of your expected future
contributions to our corporate financial objectives, you have been granted [                    ] “performance
units” under the SYSCO Corporation 2004 Mid-Term Incentive Plan (the “Plan”). The value assigned
to each of your performance units is $35.00.




Subject to the terms and conditions of the Plan, these performance units represent your right to
receive a cash bonus of up to 150% of the total value of your units, consisting of two components.
Any bonus payable will equal the sum of:




(A) up to 75% of the total value of your units, if and to the extent that SYSCO
attains certain increases in net earnings per share during the “performance period”
(July 1, 2007 through July 3, 2010), set by the Compensation Committee of SYSCO’s
Board of Directors; plus




(B) up to 75% of the total value of your units, if and to the extent that SYSCO
attains certain increases in sales during the performance period, set by the
Compensation Committee.


Enclosed for your review are copies of the Plan document, a beneficiary designation form,
instructions for completing the beneficiary designation form and other explanatory materials. All
of the enclosed documents are important legal documents that should be reviewed carefully and kept
in a safe place. If you are a new participant or would like to change your designated beneficiary
under the Plan, please complete the enclosed beneficiary designation form as soon as possible, and
return it to Connie Brooks. If you completed the beneficiary designation form last year, you do
not have to complete it again this year unless you want to change your designated beneficiary.



Thank you for your hard work and service. Your efforts, which are an integral part of SYSCO’s
growth and progress, are deeply appreciated. If you should have any questions about your
performance unit grant or the Plan, please contact Mike Nichols.




Sincerely,




William Delaney

Executive Vice President, Finance

and Chief Financial Officer






 




			
	1	 	All Named Executive Officers are Corporate Participants
under the Plan.




 









 










FISCAL YEAR 2008




MID-TERM INCENTIVE PROGRAM




[Performance Period Fiscal 2008-2010]




Adopted Effective September 18, 2007




     This Fiscal Year 2008 Mid-Term Incentive Program (the “Program”) was adopted pursuant to the
Sysco Corporation 2004 Mid-Term Incentive Plan (the “Plan”) by the Committee (as defined in the
Plan) of Sysco Corporation (the “Company”) effective September 18, 2007. This Program is for the
Performance Period commencing July 1, 2007 and ending July 3, 2010 (the “Performance Period”).
Capitalized terms used but not otherwise defined herein shall have the meanings given them in the
Plan.



     1. Participants. The participants (“Participants”) in the Program are as follows:



          Subsidiary Participants. Persons determined by the Chairman, Chief Executive Officer
or Chief Operating Officer (individually, a “Senior Officer”) who also serve as an officer of an
operating division or subsidiary of the Company (individually, a “Subsidiary”) regardless of
whether such Participant is employed by a Subsidiary of the Company. The Payment Amount for a
Subsidiary Participant shall be determined using Table A, as is more fully described in
Section 3 hereof.




          Corporate Participants. Those persons on the attached list and other persons
designated by a Senior Officer who (i) serve as an officer of the Company and (ii) are also
employees of the Company or a Subsidiary. The Payment Amount for a Corporate Participant shall be
determined using Table B, as is more fully described in Section 3 hereof.




          Designated Participants. Persons other than Subsidiary Participants or Corporate
Participants who are employed by a Subsidiary or by the corporate office of the Company who are
designated by the Committee. The Payment Amount for a Designated Participant shall be determined
using Table A if the Committee determines that such Designated Participant’s Performance
Goals are to be measured by the performance of one or more Subsidiaries, or Table B if the
Committee determines that such Designated Participant’s Performance Goals are to be measured by the
performance of the Company, in each case as is more fully described in Section 3 hereof.




     2. Definitions.



          (a) For Calculations Regarding Table A attached hereto:




               (i) Increase in Operating Pretax Earnings. Except as provided in Section 2(a)(ii), the
Increase in Operating Pretax Earnings (“OPTE”) for the Performance Period is equal to the average
of the percentage change in OPTE calculated for each Fiscal Year ending during the Performance
Period. The percentage change in OPTE for each Fiscal Year is computed by comparing the
Subsidiary’s OPTE for the relevant Fiscal Year (the calculation of which does not include gain on
the sale of fixed assets and is subject to other adjustments determined by the Committee) to the
Subsidiary’s OPTE for the prior Fiscal Year; provided, however, that no more than a thirty-percent
(30%) increase in the OPTE for any Fiscal Year



 









 





during a Performance Period shall be taken into account in determining the Increase in OPTE for
such Performance Period.




               (ii) Increase in OPTE for Performance Periods with Negative Growth Year.
Notwithstanding Section 2(a)(i), in the event that a Subsidiary’s OPTE for any Fiscal Year during
the Performance Period is less than the Subsidiary’s OPTE for the immediately preceeding Fiscal
Year (such Fiscal Year with the lower OPTE is hereneafter referred to as (a “Negative Growth
Year”)), the Increase in the OPTE for the Performance Period containing the Negative Growth Year
shall be calculated as the ratio of (A) divided by (B), where (A) is the average of the sum of the
actual amount of the increase(s) or decrease(s) in the OPTE for the Fiscal Years in such
Performance Period and (B) is the OPTE for the Fiscal Year immediately prior to the first Fiscal
Year of the applicable Performance Period. The calculation of the OPTE for any Fiscal Year does not
include gain on the sale of fixed assets and is subject to other adjustments determined by the
Committee.



               (iii) Foldout Companies. For purposes of calculating the increase in OPTE with respect
to a foldout company (“Foldout”) under 2(a)(i) and 2(a)(ii) above, the OPTE of the Foldout for its
first Fiscal Year shall be ignored, and the Performance Period shall be deemed to contain two
Fiscal Years.



               (iv) Specialty Company Adjustment. Operating pretax earnings for Specialty Companies
will be adjusted to consolidate the pro forma earnings generated on sales by Traditional Broadline
Companies of such Specialty Company’s products.



               (v) Specialty Company. A Subsidiary that is not a Traditional Broadline Company.
Specialty Companies include Guest Supply, Specialty Meat Companies and Specialty Produce Companies.



               (vi) Specialty Meat Company. A Subsidiary that specializes in specialty meat
operations.



               (vii) Specialty Produce Company. A Subsidiary that specializes in specialty produce
operations.



               (viii) Traditional Broadline Company. A Subsidiary that is not a Specialty Company.



               (ix) Percentage Change in Sales. Shall equal the average of the percentage change in
sales (whether positive or negative for any Fiscal Year of the Subsidiary) calculated for each
Fiscal Year ending during the Performance Period. The percentage change in sales for each Fiscal
Year is computed by comparing the Subsidiary’s sales for the relevant Fiscal Year to the
Subsidiary’s sales for the prior Fiscal Year. Sales shall be determined in accordance with U.S.
generally accepted accounting principles (GAAP).



2









 





          (b) For Calculations Regarding Table B attached hereto:




               (i) Increase in Net Earnings Per Share. The Increase in Net Earnings Per Share
(“EPS”) for the Performance Period is equal to the average change in EPS calculated for each Fiscal
Year ending during the Performance Period. The change in EPS for each Fiscal Year is computed by
comparing EPS for the relevant Fiscal Year to the Company’s EPS for the prior Fiscal Year.



               (ii) Percentage Change in Sales. Shall equal the average of the percentage change in
sales (whether positive or negative for any Fiscal Year of the Company) calculated for each Fiscal
Year ending during the Performance Period. The percentage change in sales for each Fiscal Year is
computed by comparing the Company’s sales for the relevant Fiscal Year to the Company’s sales for
the prior Fiscal Year. Sales shall be determined in accordance with U.S. generally accepted
accounting principles (GAAP).



          (c) Fiscal Years. For purposes of this Performance Period, Fiscal Years shall mean
the fiscal years of the Company.




     3. Method of Operation.



          (a) In General. Subject to the discretion of the Committee to formulate different
Performance Goals as to any Participant other than Covered Employees, the Payment Amount which a
Participant can earn with respect to Performance Units under the Plan is based on (i) the
performance of the Company as a whole, (ii) the performance of the Subsidiary which employs such
Participant, (iii) the performance of the Subsidiary designated by the Committee as the Subsidiary
by reference to which the bonus is to be determined (as to Subsidiary Participants and Designated
Participants), or (iv) the performance of a select group of Subsidiaries (as to Corporate
Participants and possibly Designated Participants). Except as otherwise provided in the Plan, the
Payment Amount is calculated with respect to the entire Performance Period. If earned, the Payment
Amount shall be paid in accordance with the Plan.




          (b) Payment Amount.




               (i) Subsidiary Participant. Subject to Section 3(i), for each Subsidiary Participant,
the Payment Amount is the sum of (A) the Earnings Growth Payment Amount and (B) the Sales Growth
Payment Amount, determined as follows:



Earnings Growth Payment Amount 




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Number of 

Performance 

Units Granted 

to Participant
	 	X
	 	Unit

 Value
	 	X
	 	Applicable

Percentage

Determined

Under Part I of

Table A
	 	X
	 	50%
	 	=
	 	Earnings Growth

Payment Amount






3









 






Sales Growth Payment Amount 




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Number of 

Performance

Units Granted 

to Participant
	 	X
	 	Unit

 Value
	 	X
	 	Applicable

Percentage

Determined

Under Part II of 
Table A
	 	X
	 	50%
	 	=
	 	Sales Growth

Payment Amount






               (ii) Corporate Participant. For each Corporate Participant, the Payment Amount is the
sum of (A) the Earnings Growth Payment Amount and (B) the Sales Growth Payment Amount, determined
as follows:



Earnings Growth Payment Amount 




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Number of 

Performance

Units Granted 

to Participant
	 	X
	 	Unit

 Value
	 	X
	 	Applicable

Percentage

Determined

Under Part I of 
Table B
	 	X
	 	50%
	 	=
	 	Earnings Growth

Payment Amount






Sales Growth Payment Amount 




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Number of 

Performance

Units Granted 

to Participant
	 	X
	 	Unit

 Value
	 	X
	 	Applicable

Percentage

Determined

Under Part II of 
Table B
	 	X
	 	50%
	 	=
	 	Sales Growth

Payment Amount






          (c) Performance Goals Measured by Performance of Subsidiaries. With respect to each
Participant whose Performance Goals are measured by the performance of a Subsidiary, the Applicable
Percentage shall be determined on the basis of the results of the operations of that Subsidiary
during the Performance Period as shown on Table A attached hereto and made a part hereof.




          (d) Performance Goals Measured by Performance of the Company. With respect to each
Participant whose Performance Goals are measured by the performance of the Company, the Applicable
Percentage shall be determined on basis of the results of operations of the Company during the
Performance Period as shown on Table B attached hereto and made a part hereof.




          (e) Performance Goals for Transferred Participants. If a Participant transfers
employment between the Company and a Subsidiary or a Subsidiary and another Subsidiary (a
“Transferred Participant”), the Transferred Participant’s Performance Goals shall be measured by
the performance of the Company or Subsidiary, as applicable, for which the Transferred Participant
that has been employed for the greatest number of business days during the Performance Period.




          (f) Unit Value. The Unit Value for the Performance Period is $35.00.




          (g) General Rules Regarding Bonus Calculation. In determining whether or not the
results of operations of a Subsidiary (or group of Subsidiaries) or the Company for the




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Performance Period satisfy the Performance Goals, except as otherwise provided herein Company
accounting practices and generally accepted accounting principles shall be applied on a basis
consistent with prior periods, and such determination shall be based on the calculations made by
the Company, approved (in the case of Covered Employees) by the Committee and binding on each
Participant.




          (h) Tax Law Changes. If the Code is amended during a Fiscal Year and, as a result of
such amendment(s), the effective tax rate applicable to the earnings of the Company (as described
in the “Summary of Accounting Policies” section of the Company’s annual report to the Securities
and Exchange Commission on Form 10-K) changes during a Fiscal Year, the calculation of the EPS of
the Company for the Fiscal Year in which such rate change becomes effective (the “Rate Change
Year”) shall be made as if such rate change had not occurred during the Rate Change Year. For the
Fiscal Year following the Rate Change Year, the calculation of the EPS of the Company shall be made
after taking into account such rate change, and shall be compared, for purposes of computing the
appropriate change in EPS for such Fiscal Year, with the EPS of the Company for the Rate Change
Year, computed after taking into account such rate change.




          (i) No Payment Amount for Certain Subsidiary Participants. In the event that during
any Fiscal Year a Subsidiary has an operating loss (a “Loss Year”), then neither the President nor
the Executive President(s) who are Subsidiary Participants with respect to such Subsidiary shall be
entitled to a Payment Amount for the Performance Period containing such Loss Year.




     4. Payment. Within 90 days after the end of the Performance Period, the Company shall
determine, and, in the case of Covered Employees, the Committee shall approve, the Payment Amount
to be made for Performance Units awarded under the Plan and earned by each Participant pursuant to
the provisions of Section 3 above. Such bonus shall be payable in cash as provided in the Plan,
and shall be paid no later than the last day of the fourth month following the end of the
Performance Period (the “Payment Date”).



     5. Overall Limitation Applicable to Covered Employees. Notwithstanding any other
provision in this Program to the contrary, in no event shall any Covered Employee be entitled to a
Payment Amount for any Performance Period in excess of one percent (1%) of the Company’s earnings
before income taxes as publicly disclosed in the “Consolidated Results of Operations” section of
the Company’s annual report to the Securities and Exchange Commission on Form 10-K for the Fiscal
Year ending in 2010.



     6. Delegation of Authority. Pursuant to Section 8.1 of the Plan, the Committee hereby
delegates discretionary authority granted to the Committee under this Program as well as under the
Plan to the Senior Officers and each of them individually, except as to Covered Employees.



5









 





Exhibit 1




TABLE A




FISCAL YEAR 2008




MID-TERM INCENTIVE PLAN




(Performance Period Fiscal 2008-2010)




OPERATIONS OF THE SUBSIDIARY




PART I: GROWTH IN OPERATING PRE-TAX EARNINGS




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Threshold	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Target	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maximum
	Percentage	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Increase	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	in Operating	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pre-Tax 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Earnings	 	6-6.49	 	6.5-6.99	 	7-7.49	 	7.5-7.99	 	8-8.49	 	8.5-8.99	 	9-9.49	 	9.5-9.99	 	10-10.49	 	10.5-10.99	 	11-11.49	 	11.5-11.99	 	12-12.49	 	12.5-12.99	 	13-13.49	 	13.5-13.99	 	14+
	Applicable
Percentage
	 	 	50	%	 	 	56.3	%	 	 	62.5	%	 	 	68.8	%	 	 	75.0	%	 	 	81.3	%	 	 	87.5	%	 	 	93.8	%	 	 	100.0	%	 	 	106.3	%	 	 	112.5	%	 	 	118.8	%	 	 	125.0	%	 	 	131.3	%	 	 	137.5	%	 	 	143.8	%	 	 	150.0	%






PART II: GROWTH IN SALES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Threshold	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Target	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maximum
	Percentage	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Change in	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Sales	 	6-6.24	 	6.25-6.49	 	6.5-6.74	 	6.75-6.99	 	7.00-7.24	 	7.25-7.49	 	7.50-7.74	 	7.75-7.99	 	8.00-8.24	 	8.25.8.49	 	8.50-8.84	 	8.85-8.99	 	9.00-9.24	 	9.25-9.49	 	9.50-9.94	 	9.95-9.99	 	10+
	Applicable
Percentage
	 	 	50	%	 	 	56.3	%	 	 	62.5	%	 	 	68.8	%	 	 	75.0	%	 	 	81.3	%	 	 	87.5	%	 	 	93.8	%	 	 	100.0	%	 	 	106.3	%	 	 	112.5	%	 	 	118.8	%	 	 	125.0	%	 	 	131.3	%	 	 	137.5	%	 	 	143.8	%	 	 	150.0	%






6









 






Exhibit 2




TABLE B




FISCAL YEAR 2008




MID-TERM INCENTIVE PLAN




(Performance Period Fiscal 2008-2010)




OPERATIONS OF THE COMPANY




PART I: GROWTH IN NET EARNINGS PER SHARE




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Threshold	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Target	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maximum
	Percentage	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Increase in	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Net Earnings	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	per Share	 	6-6.49	 	6.5-6.99	 	7-7.49	 	7.5-7.99	 	8-8.49	 	8.5-8.99	 	9-9.49	 	9.5-9.99	 	10-10.49	 	10.5-10.99	 	11-11.49	 	11.5-11.99	 	12-12.49	 	12.5-12.99	 	13-13.49	 	13.5-13.99	 	14+
	Applicable
Percentage
	 	 	50	%	 	 	56.3	%	 	 	62.5	%	 	 	68.8	%	 	 	75.0	%	 	 	81.3	%	 	 	87.5	%	 	 	93.8	%	 	 	100.0	%	 	 	106.3	%	 	 	112.5	%	 	 	118.8	%	 	 	125.0	%	 	 	131.3	%	 	 	137.5	%	 	 	143.8	%	 	 	150.0	%






PART II: GROWTH IN SALES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Threshold	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Target	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Maximum
	Percentage	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Change in	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Sales 	 	6-6.24	 	6.25-6.49	 	6.5-6.74	 	6.75-6.99	 	7.00-7.24	 	7.25-7.49	 	7.50-7.74	 	7.75-7.99	 	8.00-8.24	 	8.25.8.49	 	8.50-8.84	 	8.85-8.99	 	9.00-9.24	 	9.25-9.49	 	9.50-9.94	 	9.95-9.99	 	10+
	Applicable
Percentage
	 	 	50	%	 	 	56.3	%	 	 	62.5	%	 	 	68.8	%	 	 	75.0	%	 	 	81.3	%	 	 	87.5	%	 	 	93.8	%	 	 	100.0	%	 	 	106.3	%	 	 	112.5	%	 	 	118.8	%	 	 	125.0	%	 	 	131.3	%	 	 	137.5	%	 	 	143.8	%	 	 	150.0	%







7