SYSCO CORP

Recent Accounting Guidance Not Yet Adopted

Income Taxes

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740), Improvements to Income Tax

Disclosures to enhance income tax information primarily through changes in the rate reconciliation and income taxes paid

information. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, (our fiscal 2026), and may be

applied prospectively or retrospectively. Early adoption is permitted. We are currently evaluating the effect of adopting ASU

2023-09 on our disclosures.

Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense

Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. The standard update requires

more detailed disclosures related to the types of expenses included within commonly presented income statement captions. The

amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, (our fiscal 2028),

and interim reporting periods for our fiscal years beginning after December 15, 2027, (our first quarter of fiscal 2029). Early

adoption is permitted. The standard updates are to be applied prospectively with the option for retrospective application. We are

currently evaluating the effect of adopting ASU 2024-03 on our disclosures.

Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software

(Subtopic 350-40), which amends certain aspects of the accounting and disclosure of software costs under ASU 350-40. This

ASU updates the cost capitalization threshold for internal-use software development costs by removing all references to

software project development stages and providing new guidance on how to evaluate whether the probable-to-complete

recognition threshold has been met. ASU 2025-06 is effective for annual reporting periods beginning after December 15, 2027,

(our fiscal 2029), and interim reporting periods within those annual reporting periods, (our first quarter of fiscal 2029). Early

adoption is permitted. The standard updates may be applied prospectively, retrospectively, or via a modified prospective

transition method. We are currently evaluating the effect of adopting ASU 2025-06 on our consolidated financial statements

and disclosures.

3. REVENUE

We recognize revenues when our performance obligations are satisfied in an amount that reflects the consideration

Sysco expects to be entitled to receive in exchange for those goods and services. Customer receivables, which are included in

accounts receivable, less allowances in the consolidated balance sheet, were$5.4 billion and$5.1 billion as of March 28, 2026

and June 28, 2025, respectively.

The following tables present our sales disaggregated by reportable segment and sales mix for the company’s principal

product categories for the periods presented:

4. ACQUISITIONS

During the first 39 weeks of fiscal 2026, the company paid$189 million primarily for the acquisitions of Fairfax

Meadow and Ginsberg’s Foods.

In certain circumstances, purchase price allocations may be based upon preliminary estimates and assumptions.

Accordingly, allocations are subject to revision until Sysco receives final information and completes its analysis during the

measurement period. This includes finalizing the valuation of acquired tangible and intangible assets and related tax attributes.

Sysco’s operations within the United Kingdom will undergo a rebranding initiative, rebranding the Brakes® brand and

other smaller brands, as “Sysco GB.” This rebranding initiative will take approximatelytwo years and will result in Sysco

amortizing previously indefinite-lived intangible assets on a straight-line basis over thistwo-year period. Amortization expense

related to these intangible assets is expected to be$29 million in fiscal 2026,$49 million in fiscal 2027 and$25 million in fiscal

2029. FAIR VALUE MEASUREMENTS

Sysco’s policy is to invest only in high-quality investments. The fair values of our cash deposits and money market

funds included in cash equivalents are valued using inputs that are considered a Level 1 measurement. Other cash equivalents,

such as time deposits and highly liquid instruments with original maturities of three months or less, are valued using inputs that

are considered a Level 2 measurement. The fair value of our marketable securities is measured using inputs that are considered

a Level 2 measurement, as they rely on quoted prices in markets that are not actively traded or observable inputs over the full

term of the asset. The location and the fair value of the company’s marketable securities in the consolidated balance sheet are

disclosed in Note 6,“Marketable Securities.” The fair value of our derivative instruments is measured using inputs that are

considered a Level 2 measurement, as they are not actively traded and are valued using pricing models that use observable

market quotations. The location and the fair values of derivative assets and liabilities designated as hedges in the consolidated

balance sheet are disclosed in Note 7,“Derivative Financial Instruments.”

The following tables present our assets measured at fair value on a recurring basis as of March 28, 2026 and June 28,

2025:

The carrying values of accounts receivable and accounts payable approximated their respective fair values due to their

short-term maturities. The fair value of our total debt is estimated based on the quoted market prices for the same or similar

issues or on the current rates offered to the company for new debt with the same maturities as existing debt and is considered a

Level 2 measurement. The fair value of total debt was approximately$13.4 billion as of March 28, 2026 and$12.8 billion as of

June 28, 2025, while the carrying value was$14.0 billion as of March 28, 2026 and$13.3 billion as of June 28, 2025.

6. MARKETABLE SECURITIES

Sysco invests a portion of the assets held by its wholly owned captive insurance subsidiary in a restricted investment

portfolio of marketable fixed income securities, which have been classified and accounted for as available-for-sale. We include

fixed income securities maturing in less than 12 months within prepaid expenses and other current assets. Fixed income

securities maturing in more than 12 months are included within other assets in the accompanying consolidated balance sheets.

We record the amounts at fair market value, which is determined using quoted market prices at the end of the reporting period.

Unrealized gains and any portion of a security’s unrealized loss attributable to non-credit losses are recorded in

accumulated other comprehensive loss. There were no significant credit losses recognized in the first 39 weeks of fiscal 2026.

The following table presents our available-for-sale marketable securities as of March 28, 2026 and June 28, 2025:

As of March 28, 2026, the balance of available-for-sale securities by contractual maturity is shown in the following

table. Within the table, maturities of fixed income securities have been allocated based upon timing of estimated cash flows.

Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay

obligations without prepayment penalties.

There wereno significant realized gains or losses in marketable securities in the first 39 weeks of fiscal 2026.

7. DERIVATIVE FINANCIAL INSTRUMENTS

Sysco uses derivative financial instruments to enact hedging strategies for risk mitigation purposes; however, we do

not use derivative financial instruments for trading or speculative purposes. Hedging strategies are used to manage interest rate

risk, foreign currency risk and fuel price risk.

Hedging of interest rate risk

Sysco manages its debt portfolio with interest rate swaps from time to time to achieve an overall desired position of

fixed and floating rates. In thethird quarter of fiscal 2026, we entered into receive-fixed, pay-floating swap agreements to trade

the fixed interest rate on$600 million of 4.40% senior notes and$650 million of 4.95% senior notes with variable rates,

respectively. The interest rate swaps are designated as fair value hedges and gains or losses on the hedges impact interest

expense within the consolidated statements of income.

Hedging of foreign currency risk

Sysco has cross-currency swaps that hedge the foreign currency exposure of our net investment in certain foreign

operations. These cross-currency swaps are designated as net investment hedges with gains and losses recognized within

accumulated other comprehensive income (loss), including changes in fair value attributed to the spot-forward rate differential

which are excluded from the assessment of hedge effectiveness. The initial value of the excluded component is recognized in

earnings over the life of the hedging instrument. In thethird quarter of fiscal 2026, we entered into$814 million Canadian

dollar cross-currency swaps which will mature on June 25, 2031 to hedge the foreign currency exposure of the net investment

in our Canadian operations.

Sysco routinely manages foreign currency risk with spot and forward-rate cross-currency swaps on foreign-

denominated balances. The swaps are designated as fair value hedges and for swaps hedging the change in foreign currency

spot rates, we have elected to exclude the changes in fair value of the forward points from the assessments of hedge

effectiveness. Gains or losses from fair value hedges impact the same category on the consolidated statements of income as the

item being hedged, including the value of the excluded components which is recognized in earnings over the life of the hedging

instrument. Subsequent to March 28, 2026, Sysco entered an intercompany loan with an affiliate that is denominated in euro

that will mature July 10, 2026. To hedge our foreign currency risk, we entered into a cross currency swap for€450 million and

designated it as a fair value hedge.

Sysco’s operations in Europe have inventory purchases denominated in currencies other than their functional currency,

such as the Euro, U.S. dollar, Polish zloty and Danish krone. Accounts payable associated with these inventory purchases give

rise to foreign currency exposure between the functional currency of each entity and these currencies. We periodically enter into

foreign currency forward swap contracts to sell the applicable entity’s functional currency and buy currencies matching the

inventory purchase, which operate as cash flow hedges of the company’s foreign currency-denominated inventory purchases.

Hedging of fuel price risk

Sysco uses fuel commodity swap contracts to hedge against the risk of the change in the price of diesel fuel on

anticipated future purchases. These swaps are designated as cash flow hedges.

None of our hedging instruments contain credit-risk-related contingent features. Details of outstanding hedging

instruments as of March 28, 2026 are presented below:

The location and the fair value of derivative instruments designated as hedges in the consolidated balance sheets as of

March 28, 2026 and June 28, 2025 are as follows:

Gains or losses recognized in the consolidated results of operations for cash flow hedging relationships are not

significant for each of the periods presented. The location and amount of gains or losses recognized in the consolidated results

of operations for fair value hedging relationships for each of the periods, presented on a pretax basis, are as follows:

The gains and losses on the fair value hedging relationships associated with the hedged items as disclosed in the table

above consist of the following components for each of the periods presented:

The location and effect of cash flow, net investment, and excluded components of fair value hedges on the

consolidated statements of comprehensive income for the 13-week periods ended March 28, 2026 and March 29, 2025,

presented on a pretax basis, are as follows:

The location and effect of cash flow, net investment, and excluded components of fair value hedges on the

consolidated statements of comprehensive income for the 39-week periods ended March 28, 2026 and March 29, 2025,

presented on a pretax basis, are as follows:

The location and carrying amount of hedged liabilities in the consolidated balance sheet as of March 28, 2026 are as

follows:

The carrying amount of hedged liabilities in the consolidated balance sheet as of June 28, 2025 is$1.1 billion.

8. DEBT

On September 5, 2025, Sysco entered into a new long-term revolving credit facility, which replaces the$3.0 billion

senior revolving credit facility that was originally entered into on April 29, 2022. The aggregate commitments of the lenders

under the new long-term credit agreement are$3.0 billion, with an option to increase such commitments to$4.0 billion. The

new facility includes a covenant requiring Sysco to maintain a ratio of consolidated EBITDA to consolidated interest expense

of 3.0 to 1.0 over four consecutive fiscal quarters, which is consistent with our previous revolving credit facility. The new

revolving credit facility expires on September 5, 2030. As of March 28, 2026, there wereno borrowings outstanding under this

facility. In April 2026, Sysco replaced the 2025 credit facility described above. See more information in Note 15, Subsequent

Events.

We have a commercial paper program allowing the company to issue short-term unsecured notes in an aggregate

amount not to exceed$3.0 billion. Any outstanding amounts are classified within long-term debt, as the program is supported

by the long-term revolving credit facility noted above. As of March 28, 2026, there wereno U.S. commercial paper issuances

outstanding under this program. We have commercial paper issuances outstanding under this program in Europe. In December

2025, Sysco entered into an agreement to increase the maximum allowable principal amount of the commercial paper issuances

in Europe, with borrowings not to exceed€750 million. As of March 28, 2026, there were€410 million (the equivalent of

$473 million) in commercial paper issuances outstanding in Europe.

On February 13, 2026, Sysco issued senior notes (the Notes) totaling$1.25 billion. Details of the Notes are as follows:

The Notes initially are fully and unconditionally guaranteed by Sysco’s direct and indirect wholly owned subsidiaries

that guarantee Sysco’s other senior notes issued under the indenture governing the Notes or any of Sysco’s other indebtedness.

Subsidiaries acquired or created in the future may or may not become guarantors, but any domestic subsidiary that guarantees

our other senior notes or our other indebtedness must also guarantee the Notes. Interest on the 2031 Notes will be paid semi-

annually in arrears on January 25 and July 25, beginning on July 25, 2026. Interest on the 2036 Notes will be paid semi-

annually in arrears on March 25 and September 25, beginning on September 25, 2026. The 2031 Notes will mature on July 25,

2031, and the 2036 Notes will mature on March 25, 2036. At Sysco’s option, any or all of the Notes may be redeemed, in whole

or in part, at any time prior to maturity. If we elect to redeem (i) the 2031 Notes before the date that isone month prior to the

maturity date, or (ii) the 2036 Notes before the date that isthree months prior to the maturity date, Sysco will pay a redemption

price equal to the greater of (1)100% of the principal amount of the Notes of the applicable series to be redeemed plus, in either

case, accrued and unpaid interest thereon to, but excluding, the date of redemption and (2) a “make-whole” amount calculated

by reference to the sum of the present values of the remaining scheduled payments of principal and interest on the Notes of the

applicable series to be redeemed discounted to the date of redemption . If we elect to redeem a series of Notes on or after the

applicable date described in the preceding sentence, Sysco will pay a redemption price equal to 100% of the principal amount of

the Notes being redeemed plus accrued and unpaid interest thereon to the date of redemption.

The total carrying value of our debt was$14.0 billion as of March 28, 2026 and$13.3 billion as of June 28, 2025. The

increase in the carrying value of our debt during the 39-week period ended March 28, 2026 was due to the issuance of the Notes

and borrowings under our European commercial paper program, partially offset by a senior note that matured in October 2025.

Information regarding the guarantors of our registered debt securities is contained in the section captioned Guarantor

Summarized Financial Information in “Management’s Discussion and Analysis of Financial Condition and Results of

Operations” in Item 2 of Part I of this Form 10-Q.

9. EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share:

The number of securities that were not included in the diluted earnings per share calculation because the effect would

have been anti-dilutive was approximately 1,600,000 and 4,667,000 for thethird quarter of fiscal 2026 and 2025, respectively,

andapproximately 2,274,000 and 3,722,000 for the first 39 weeks of fiscal 2026 and fiscal 2025, respectively.

10. OTHER COMPREHENSIVE INCOME

Comprehensive income is net earnings plus certain other items that are recorded directly to shareholders’ equity, such

as foreign currency translation adjustment, amounts related to certain hedging arrangements, amounts related to pension and

other postretirement plans and changes in marketable securities. Comprehensive income was$373 million and$542 million for

thethird quarter of fiscal 2026 and fiscal 2025, respectively. Comprehensive income was$1.2 billion and$1.4 billion for the

first 39 weeks of fiscal 2026 and 2025, respectively.

A summary of the components of other comprehensive income (loss) and the related tax effects for each of the periods

presented is as follows:

The following tables provide a summary of the changes in accumulated other comprehensive (loss) income for the

periods presented:

11. SHARE-BASED COMPENSATION

Sysco provides compensation benefits to employees under several share-based payment arrangements, including

various long-term employee stock incentive plans and the 2015 Employee Stock Purchase Plan (ESPP).

Stock Incentive Plans

In the first 39 weeks of fiscal 2026, options to purchase 726,016 shares were granted to employees. The fair value of

each option award is estimated as of the date of grant using a Black-Scholes option pricing model. The weighted average grant-

date fair value per option granted during the first 39 weeks of fiscal 2026 was$19.52.

In the first 39 weeks of fiscal 2026, employees were granted 460,258 performance share units (PSUs). Based on the

jurisdiction in which the employee resides, some of these PSUs were granted with forfeitable dividend equivalents. The fair

value of each PSU award granted with a dividend equivalent is based on the company’s stock price as of the date of grant. For

PSUs granted without dividend equivalents, the fair value is reduced by the present value of expected dividends during the

vesting period. The weighted average grant-date fair value per PSU granted during the first 39 weeks of fiscal 2026 was$86.22.

The PSUs will convert into shares of Sysco’s common stock at the end of the three-year performance period based on actual

performance targets achieved, as well as the market-based return of Sysco’s common stock relative to that of each company

within the S&P 500 index.

In the first 39 weeks of fiscal 2026, employees were granted 1,353,984 restricted stock units. The weighted average

grant-date fair value per restricted stock unit granted during the first 39 weeks of fiscal 2026 was$77.46.

Employee Stock Purchase Plan

Plan participants purchased 838,005 shares of common stock under the ESPP during the first 39 weeks of fiscal 2026.

The weighted average fair value per employee stock purchase right issued pursuant to the ESPP was$11.37 during the first 39

weeks of fiscal 2026. The fair value of each stock purchase right is estimated as the difference between the stock price at the

date of issuance and the employee purchase price.

All Share-Based Payment Arrangements

The total share-based compensation cost that has been recognized in results of operations was$95 million and$74

million for the first 39 weeks of fiscal 2026 and fiscal 2025, respectively.

As of March 28, 2026, there was a total of$162 million of unrecognized compensation cost related to share-based

compensation arrangements. This cost is expected to be recognized over a weighted-average period of 1.88 years.

12. INCOME TAXES

Effective Tax Rate

The effective tax rates for thethird quarter and first 39 weeks of fiscal 2026 were 23.6% and 22.5%, respectively.

These rates were higher than the company’s 21.0% statutory tax rate primarily due to the impact of state income taxes, partially

offset by a foreign income tax benefit and equity-based compensation excess tax benefits.

The effective tax rates for thethird quarter and first 39 weeks of fiscal 2025 were 23.3% and 23.6%, respectively.

These rates were higher than the company’s 21.0% statutory tax rate primarily as a result of state income taxes, partially offset

by a foreign income tax benefit and equity-based compensation excess tax benefits.

Uncertain Tax Positions

As of March 28, 2026, the gross amount of unrecognized tax benefit and related accrued interest was$68 million and

$20 million, respectively. It is reasonably possible the amount of the unrecognized tax benefit with respect to certain

unrecognized tax positions of the company will increase or decrease in the next 12 months. At this time, an estimate of the

range of the reasonably possible change cannot be made.

During the third quarter of fiscal 2023, Sysco received a Statutory Notice of Deficiency from the Internal Revenue

Service, mainly related to foreign tax credits generated in fiscal 2018 from repatriated earnings primarily from our Canadian

operations. In the fourth quarter of fiscal 2023, the company filed suit in the U.S. Tax Court challenging the validity of certain

tax regulations related to the one-time transition tax on unrepatriated foreign earnings, which were enacted as part of the Tax

Cuts and Jobs Act of 2017 (TCJA). The lawsuit seeks to have the court invalidate these regulations, which would affirm the

company’s position regarding its foreign tax credits. Sysco has previously recorded a benefit of$131 million attributable to its

interpretation of the TCJA and the Internal Revenue Code. If we are ultimately unsuccessful in defending our position, we may

be required to reverse all, or some portion, of the benefit previously recorded.

Other

The Inflation Reduction Act includes provisions that allow for the transfer of certain federal clean energy tax credits

(Transferable Tax Credits). In September 2025, we entered into a contract to purchase Transferable Tax Credits which will be

applied against our fiscal 2026 federal income tax liability. Through March 28, 2026, we have purchased$241 million of

Transferable Tax Credits.

The determination of our provision for income taxes requires judgment, the use of estimates and the interpretation and

application of complex tax laws. Our provision for income taxes reflects income earned and taxed in the various U.S. federal

and state, as well as foreign jurisdictions. Tax law changes, increases or decreases in permanent book versus tax basis

differences, accruals or adjustments of accruals for unrecognized tax benefits or valuation allowances, and our change in the

mix of earnings from these taxing jurisdictions all affect the overall effective tax rate.

13. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

Sysco is engaged in various legal proceedings that have arisen but have not been fully adjudicated. The likelihood of

loss for these legal proceedings, based on definitions within contingency accounting literature, ranges from remote to

reasonably possible to probable. When probable and reasonably estimable, the losses have been accrued. Although the final

results of legal proceedings cannot be predicted with certainty, based on estimates of the range of potential losses associated

with these matters, management does not believe the ultimate resolution of these proceedings, either individually or in the

aggregate, will have a material adverse effect upon the consolidated financial position or results of operations of the company.

14. BUSINESS SEGMENT INFORMATION

Sysco distributes food and related products to restaurants, healthcare and educational facilities, lodging establishments

and other foodservice customers. Our primary operations are located in North America and Europe. Under the accounting

provisions related to disclosures about segments of an enterprise, we have aggregated certain operating segments into three

reportable segments. “Other” financial information is attributable to our other operating segments that do not meet the

quantitative disclosure thresholds.

•U.S. Foodservice Operations – primarily includes (a) our U.S. Broadline operations, which distribute a full line

of food products, including custom-cut meat, seafood, produce, specialty Italian, specialty imports and a wide

variety of non-food products and (b) our U.S. Specialty operations, which include our FreshPoint fresh produce

distribution business, our Buckhead | Newport Meat & Seafood specialty protein operations, our growing Italian

Specialty platform anchored by Greco & Sons, Inc., our Edward Don restaurant equipment and supplies

distribution business, our Asian specialty distribution company and a number of other small specialty businesses

that are not material to the operations of Sysco;

•International Foodservice Operations – includes operations outside of the United States (U.S.), which distribute

a full line of food products and a wide variety of non-food products. The Americas primarily consists of

operations in Canada, Bahamas, Costa Rica and Panama, as well as our export operations that distribute to

international customers. Our European operations primarily consist of operations in the United Kingdom (U.K.),

France, Ireland and Sweden;

•SYGMA – our U.S. customized distribution operations serving quick-service chain restaurant customer locations;

and

•Other – primarily our hotel supply operations, Guest Worldwide.

The accounting policies for the segments are the same as those disclosed by Sysco for its consolidated financial

statements. Our Global Support Center expenses generally include all expenses of the corporate office and Sysco’s shared

service operations. Collectively, our Global Support Center provides numerous centralized services to our operating sites and

performs support activities for employees, suppliers and customers. These services include customer and vendor contract

administration, finance, legal, information technology, risk management and insurance, sales and marketing, merchandising,

inbound logistics, human resources, and strategy. Expenses for the Global Support Center primarily consist of payroll costs for

employees assigned to these operations, including severance, if any, all U.S. share-based compensation costs, and certain

information technology, self-insurance, and depreciation expenses.

Our chief operating decision maker (CODM) is our chief executive officer, who is responsible for setting the

company's strategic direction, managing overall operations, and is the main point of communication between the board of

directors and key operational personnel within the organization. The CODM regularly reviews financial results, operating

performance, and capital expenditures of our reportable segments. Our CODM uses operating income as a primary measure of

segment performance and as a comparison between each of our segments. Operating income is defined as income before

interest expense, other expense (income), net, and income taxes. The significant expense categories and amounts presented

below align with the segment-level information that is regularly provided to the CODM. The following tables set forth certain

financial information for Sysco’s business segments.

15. SUBSEQUENT EVENTS

On March 30, 2026, Sysco Corporation entered into an agreement (the Merger Agreement) to acquire Jetro Restaurant

Depot (JRD), a leading U.S. wholesale cash-and-carry foodservice provider serving smaller, independent restaurants and

businesses. JRD operates 167 large-format warehouse stores across 35 states that serve more than 725,000 independent

restaurants and foodservice operators with a broad assortment of fresh and low-priced products.

Sysco has agreed to pay approximately$29.1 billion to JRD shareholders, comprising of approximately$21.6 billion

in cash, subject to customary adjustments, and 91.5 million shares of Sysco common stock. Following the transaction, JRD’s

equity holders are expected to hold approximately 16% of the outstanding common stock of Sysco in the aggregate.

The cash portion of the purchase price is expected to be financed with a combination ofnew senior unsecured notes,

hybrid debt, cash on hand and equity or equity-linked securities. Sysco has executed a commitment letter for a$22 billion

senior unsecured 364-day bridge loan facility that could be used to fund the cash portion of the purchase price and pay related

fees and expenses. Subsequent to the execution of the commitment letter for the bridge loan facility, Sysco entered into a

$3 billion senior unsecured delayed draw term loan facility, comprising a$1.25 billion 364-day tranche and a$1.75 billion 2-

year tranche, reducing the bridge loan facility commitments from$22 billion to$19 billion. Fees paid upfront for this facility as

of April 10, 2026 total$88 million and will be amortized to interest expense within our statement of consolidated results of

operations over the expected life of the bridge facility unless it is terminated at an earlier date. Additional fees will apply at later

stages.

We have executed cash-settled deal contingent rate lock transactions to mitigate interest rate risk on$6.3 billion of

future permanent debt that could potentially be issued to finance the purchase of JRD. As these interest rate lock transactions

are contingent upon whether the transaction is successfully consummated, we have not elected to apply hedge accounting at this

time and any unrealized gains or losses will be recognized in Other income and expense within our statement of consolidated

results of operations.

On April 16, 2026, Sysco entered into a new long-term revolving credit facility, which replaces Sysco’s existing

$3.0 billion senior revolving credit facility that was originally entered into on September 5, 2025. The aggregate commitments

of the lenders under the new revolving credit agreement are$3.0 billion, and such commitments will increase to$4.0 billion

after the acquisition of JRD is complete. The new revolving credit agreement has an option to increase such commitments to

$5.0 billion. The new facility includes a covenant requiring Sysco to maintain a ratio of consolidated EBITDA to consolidated

interest expense of 3.0 to 1.0 over four consecutive fiscal quarters, which is consistent with our previous revolving credit

facility. The new revolving credit facility expires on April 16, 2031.

This transaction is expected to close by the third quarter of Sysco’s fiscal 2027, subject to the satisfaction of customary

closing conditions, including regulatory clearance under the Hart-Scott-Rodino Act. If the Merger Agreement is terminated due

to a failure to obtain required regulatory clearances, Sysco has agreed to pay JRD a termination fee of $1.164 billion.