Form of 2006 Management Incentive Bonus Agreement

Exhibit 10(yy)

[date]

PERSONAL AND CONFIDENTIAL

[Name]
[Street Address]
[City, State Zip]

RE:  Fiscal 2006 Bonus

Dear [Grantee]:

     In recognition of your long-term commitment to Sysco Corporation (“SYSCO”) and its customers and of your expected future contributions to our corporate financial objectives, you have been granted an opportunity to earn a performance bonus for fiscal year 2006 under the SYSCO Corporation 2000 Management Incentive Plan (the “Plan”).

     You will not receive any bonus unless SYSCO achieves an Increase in Earnings Per Share of at least ___% (“Target A”) and achieves a Return on Stockholders’ Equity of at least ___% (“Target B”). If Target A and Target B have been met, then subject to the further adjustments and additions provided for elsewhere in the Plan and this Agreement, a portion of your bonus (“Part A”) will depend upon the results of the Operations of SYSCO as shown on Table A attached hereto, and the balance of your bonus (“Part B”) will depend on the aggregate performance of the Subsidiaries that you supervise (the “Supervised Operations”).

Part A Bonus Calculation

Part A of any bonus you may earn will be equal to the product of:

(i) 35% of your annual base salary in effect at the fiscal year end (“Base Salary”); and

(ii) the appropriate percentage shown on Table A which coincides with the appropriate Increase in Earnings per Share and Return on Stockholder’s Equity for SYSCO as a whole.

Part B Bonus Calculation

     In calculating Part B of your bonus, the financial results of the Supervised Operations will be aggregated, and the Supervised Operations will be considered a single Subsidiary which has achieved such aggregated financial results. Part B of any bonus you may earn will be equal to the product of:

(i) the sum of:

a.

70% of the appropriate percentage shown on Table B which coincides for the Supervised Operations with the appropriate level of Return on Capital and Increase in Operating Pretax Earnings; and

[date]
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b.

30% of the appropriate percentage shown on Table B which coincides for the Supervised Operations with the appropriate level of Return on Capital and Increase in Pretax Earnings; and

(ii) 70% of your Base Salary.

Maximum Bonus Amounts

     Although Tables A and B have only been calculated to 370% and 172%, respectively, the “grids” shall be deemed to continue to increase in the same ratios as set forth. However, notwithstanding the foregoing and any other provision in this Agreement to the contrary, your bonus amount for fiscal 2006 (including, if applicable, the value of any Additional Shares and Additional Cash Bonus) cannot exceed 1% of SYSCO’s earnings before income taxes as publicly disclosed in the “Consolidated Results of Operations” section of SYSCO’s annual report to the Securities and Exchange Commission on Form 10-K for fiscal year 2006.

General Rules Regarding Bonus Calculation

     In determining whether or not the results of operations of the Supervised Operations or SYSCO result in a bonus, SYSCO’s accounting practice 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 SYSCO, approved by the Compensation and Stock Option Committee of SYSCO’s Board of Directors (“Plan Compensation Committee”) and binding on you.

Tax Law Changes

     If the Internal Revenue Code is amended during the fiscal year and, as a result of such amendment(s), the effective tax rate applicable to the earnings of SYSCO (as described in the “Summary of Accounting Policies” section of SYSCO’s annual report to the Securities and Exchange Commission on Form 10-K) changes during the year, the calculation of the net after-tax earnings per share of SYSCO for fiscal 2006 shall be made as if such rate change had not occurred during 2006.

Payment

     Within 90 days following the end of each fiscal year, SYSCO shall determine and the Plan Compensation Committee shall approve the amount of any bonus earned by you under this Agreement. Such bonus shall be payable in the manner, at the times and in the amounts provided in the Plan.

Definitions

     The capitalized terms in this document have the meaning ascribed to them in the Glossary attached hereto. Any capitalized terms not included in the Glossary have the meanings ascribed to them in the Plan.

Additional Documents

     Enclosed for your review are copies of the Plan document and other explanatory materials. All of the enclosed documents are important legal documents that should be reviewed carefully and kept in a safe place. Please complete the enclosed forms as soon as possible, and return them to Connie Brooks.

[date]
Page 3
 

     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 bonus opportunity or the Plan, please contact Mike Nichols.

Sincerely,

 
Richard J. Schnieders
Chairman, CEO and President

Enclosures
cc: [                                ]

Accepted and Agreed:

Name

Date

GLOSSARY

     1. Total Capital — for any Subsidiary, the sum of the following components:

(a) Stockholders’ equity — the average of the amounts outstanding for such Subsidiary at the end of each quarter for which the computation is being made (quarterly average basis).

(b) Long-term debt — the average of the long-term portion of debt of such Subsidiary outstanding at the end of each quarter for which the computation is being made (quarterly average basis).

(c) Intercompany borrowings — the average of the amount outstanding at the end of each day during the period for which the computation is being made (daily average basis).

(d) Average patronage dividend receivable — the average of the amount outstanding at the end of each period for which the computation is being made (monthly average basis).

(e) Adjustments — amounts allocated to capital with respect to (i) fixed rate intercompany loans, (ii) capitalized leases, and (iii) below market plant and equipment costs.

     2. Return on Capital — the Return on Capital for any Subsidiary is expressed as a percentage and is computed by dividing the Subsidiary’s pretax earnings (the calculation of which does not include gain on the sale of fixed assets and intercompany interest income and is subject to adjustment to include taxes that would have been included but for the timing of any tax deferrals so that results are consistent with fiscal 2005) by the Subsidiary’s Total Capital.

     3. Return on Stockholders’ Equity — expressed as a percentage and computed by dividing the Company’s net after-tax earnings for fiscal 2006 by the Company’s average stockholders’ equity at the end of each quarter during the year.

     4. Increase in Earnings Per Share — expressed as a percentage increase of the net after-tax earnings per share for fiscal 2006 over the net after-tax earnings per share for fiscal 2005.

     5. Increase in Pretax Earnings — the Increase in Pretax Earnings is expressed as a percentage increase of the Supervised Operations’ pretax earnings for fiscal 2006 (the calculation of which does not include gain on the sale of fixed assets [discretionary provision removed]) compared to the greater of (a) the Supervised Operations’ actual pretax earnings for fiscal 2005 or (b) those pretax earnings which would have been required to have been earned by the Supervised Operations in fiscal 2005 in order to have obtained Target C.

     6. Increase in Operating Pretax Earnings — the Increase in Operating Pretax Earnings is expressed as a percentage increase of the Supervised Operations’ operating pretax earnings for fiscal 2006 (the calculation of which does not include gain on the sale of fixed assets [discretionary provision removed]) compared to the Supervised Operations’ operating pretax earnings for fiscal 2005.

     7. Quarterly Averages — In determining the average amount outstanding of stockholders’ equity, long-term debt and adjustments above, and the quarterly average stockholders’ equity, such averages shall be determined by dividing five (5) into the sum of the amounts outstanding of the relevant category at the end of each of the four quarters of the fiscal year plus the amount outstanding of the relevant category at the beginning of the fiscal year.

Capitalized terms used but not otherwise defined herein shall have the meaning ascribed to them in the Plan.

TABLE A

PERFORMANCE OF SYSCO AS A WHOLE
 

Return
on		PERCENTAGE INCREASE IN EARNINGS PER SHARE:
Equity:
		__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%				__%
___%			20				24				28				45				50				55				60				65				70				75				80				85				90				100				110				120				130				140				150				160				170				180				190				200
___%			27				31				35				55				60				65				70				75				80				85				90				95				100				110				120				130				140				150				160				170				180				190				200				210
___%			34				38				42				65				70				75				80				85				90				95				100				105				110				120				130				140				150				160				170				180				190				200				210				220
___%			41				45				49				75				80				85				90				95				100				105				110				115				120				130				140				150				160				170				180				190				200				210				220				230
___%			48				52				56				85				90				95				100				105				110				115				120				125				130				140				150				160				170				180				190				200				210				220				230				240
___%			55				59				63				95				100				105				110				115				120				125				130				135				140				150				160				170				180				190				200				210				220				230				240				250
___%			62				66				70				105				110				115				120				125				130				135				140				145				150				160				170				180				190				200				210				220				230				240				250				260
___%			69				73				77				115				120				125				130				135				140				145				150				155				160				170				180				190				200				210				220				230				240				250				260				270
___%			76				80				84				125				130				135				140				145				150				155				160				165				170				180				190				200				210				220				230				240				250				260				270				280
___%			83				87				91				135				140				145				150				155				160				165				170				175				180				190				200				210				220				230				240				250				260				270				280				290
___%			90				94				98				145				150				155				160				165				170				175				180				185				190				200				210				220				230				240				250				260				270				280				290				300
___%			97				101				105				155				160				165				170				175				180				185				190				195				200				210				220				230				240				250				260				270				280				290				300				310
___%			104				108				112				165				170				175				180				185				190				195				200				205				210				220				230				240				250				260				270				280				290				300				310				320
___%			111				115				119				175				180				185				190				195				200				205				210				215				220				230				240				250				260				270				280				290				300				310				320				330
___%			118				122				126				185				190				195				200				205				210				215				220				225				230				240				250				260				270				280				290				300				310				320				330				340
___%			125				129				133				195				200				205				210				215				220				225				230				235				240				250				260				270				280				290				300				310				320				330				340				350
___%			132				136				140				205				210				215				220				225				230				235				240				245				250				260				270				280				290				300				310				320				330				340				350				360
___%			139				143				147				215				220				225				230				235				240				245				250				255				260				270				280				290				300				310				320				330				340				350				360				370

TABLE B

PERFORMANCE OF SUPERVISED OPERATIONS
 

PERCENT
RETURN		PERCENTAGE INCREASE IN OPERATING PRETAX EARNINGS AND PRETAX EARNINGS
ON
CAPITAL		___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%
___%			10				12				15				20				30				32				35				37				40				42				45				47				50				52				55				57				60				61				63				65				67				70
___%			15				17				20				25				40				42				45				47				50				52				55				57				60				62				65				67				70				71				73				75				77				80
___%			20				22				25				30				50				52				55				57				60				62				65				67				70				72				75				77				80				81				83				85				87				90
___%			25				27				30				35				60				62				65				67				70				72				75				77				80				82				85				87				90				91				93				95				97				100
___%			30				32				35				45				70				72				75				77				80				82				85				87				90				92				95				97				100				101				102				103				104				105
___%			35				37				40				50				80				82				85				87				90				92				95				97				100				101				102				103				105				106				107				108				109				110
___%			40				42				45				55				90				92				95				97				100				101				102				103				105				106				107				108				110				111				112				113				114				115
___%			45				47				50				65				100				101				102				103				105				106				107				108				110				111				112				113				115				116				117				118				119				120
___%			50				52				55				70				105				106				107				108				110				111				112				113				115				116				117				118				120				121				122				123				124				125
___%			52				55				60				75				110				111				112				113				115				116				117				118				120				121				122				123				125				126				127				128				129				130
___%			52				60				65				80				115				116				117				118				120				121				122				123				125				126				127				128				130				131				132				133				134				135
___%			54				62				70				85				120				121				122				123				125				126				127				128				130				131				132				133				135				136				137				138				139				140
___%			54				62				70				85				125				126				127				128				130				131				132				133				135				136				137				138				140				141				142				143				144				145
___%			56				64				75				90				130				131				132				133				135				136				137				138				140				141				142				143				145				146				147				148				149				150

TABLE B, Continued
 

PERCENT
RETURN		PERCENTAGE INCREASE IN OPERATING PRETAX EARNINGS AND PRETAX EARNINGS
ON
CAPITAL		___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%				___%
___%			71				73				75				77				80				81				83				85				87				90				91				93				95				97				100				101				102				103				104				105				106				107
___%			81				83				85				87				90				91				93				95				97				100				101				102				103				104				105				106				107				108				109				110				111				112
___%			91				93				95				97				100				101				102				103				104				105				106				107				108				109				110				111				112				113				114				115				116				117
___%			101				102				103				104				105				106				107				108				109				110				111				112				113				114				115				116				117				118				119				120				121				122
___%			106				107				108				109				110				111				112				113				114				115				116				117				118				119				120				121				122				123				124				125				126				127
___%			111				112				113				114				115				116				117				118				119				120				121				122				123				124				125				126				127				128				129				130				131				132
___%			116				117				118				119				120				121				122				123				124				125				126				127				128				129				130				131				132				133				134				135				136				137
___%			121				122				123				124				125				126				127				128				129				130				131				132				133				134				135				136				137				138				139				140				141				142
___%			126				127				128				129				130				131				132				133				134				135				136				137				138				139				140				141				142				143				144				145				146				147
___%			131				132				133				134				135				136				137				138				139				140				141				142				143				144				145				146				147				148				149				150				151				152
___%			136				137				138				139				140				141				142				143				144				145				146				147				148				149				150				151				152				153				154				155				156				157
___%			141				142				143				144				145				146				147				148				149				150				151				152				153				154				155				156				157				158				159				160				161				162
___%			146				147				148				149				150				151				152				153				154				155				156				157				158				159				160				161				162				163				164				165				166				167
___%			151				152				153				154				155				156				157				158				159				160				161				162				163				164				165				166				167				168				169				170				171				172