Corporate Safety Services and Treasury Department

M E M O R A N D U M

TO: ALL PRESIDENTS CONTROLLERS HUMAN RESOURCES LEADS SAFETY CONTACTS VPs FINANCE VPs OPERATIONS FROM: AL DIBENS BILL ENGLAND MARK WOOTEN MARTY TIMPANO DATE: May 19, 2009 SUBJECT: ELIGIBILITY FOR FY 10 CASUALTY INSURANCE POOL

The internal pooling threshold and the eligibility requirements to participate in the pool for FY 10 are outlined as follows: Pooling Point: The operating company is responsible for the first $250,000 of each casualty claim (workers’ compensation, auto, general, including products, liability) and then 25% of the next $750,000 equating to $437,500 of the first $1,000,000. After $1,000,000, the pool will pick up 100% of the cost until the excess insurance company becomes responsible. For the Operating Company to be eligible for the pool, the following needs to be in place:

A 3rd party audit of your safety program completed within the past 18 months by an approved vendor.

A DOT compliance review completed by Corporate Transportation Safety Services, an approved vendor or a regulatory/enforcement agency having federal jurisdiction within the past 18 months.

Exclusions - All claims are eligible for pooling except as follows:

Any serious accident, injury or fatality not reported to the Third Party Administrator (TPA) and to Sysco Corporate’s Safety Services Department immediately, no later than 24 hours after notice. (View Definition of serious accidents, injuries and fatalities)

Any accident, incident, or injury that is not reported to the TPA (Gallagher Bassett or Providence) within two business days after the company receives knowledge.

Any injury which results in an OSHA citation.

Any WC or liability claim involving a fall from a piece of warehouse equipment, rack, etc., where the operating company and the associate were not following the current corporate-approved Fall Protection Standard posted on the Corporate Safety Services intranet site.

Any claim involving a supplier, contract employee or outside contractor for which the company does not have in its files a valid certificate of insurance (COI) and a valid hold harmless agreement (HHA). Corporate approved HHAs and sample COIs are available on the Corporate Risk Management intranet site.

Any AL claim involving a marketing associate or any other employee who travels on company business six or more times a year where the employee does not maintain minimum limits of $100,000 per person, $300,000 per accident and $100,000 in property damage on their personal auto insurance.

Any claim involving a Sysco employee who was not wearing a seatbelt. (This includes claims where the Sysco employee is a passenger but was not wearing a seatbelt.)

Any claim involving an associate operating a vehicle with a Gross Vehicle Weight Rating of over 26,000 pounds where the driver was:

Driving a vehicle prior to receiving negative pre-employment controlled substances/alcohol test results.

Any claim involving an associate operating a vehicle with a Gross Vehicle Weight Rating (GVWR) or actual gross weight of over 10,000 pounds where the driver was:

not in compliance with the Federal Motor Carrier Safety Regulations (FMCSR) hours of service rules.

hired with less than 1 full year commercial vehicle driving experience and is not participating in or has not successfully completed a corporate approved driver training program. (An approved warehouse to driver training program fulfills this requirement)

Any claim involving a vehicle driven by, or on behalf of, any associate conducting business on behalf of Sysco (delivery, marketing, etc) who drives on company business six or more times per year who:

was hired after July 1, 2008 was convicted of DUI/DWI within the past 3 years or multiple times within the past 10 years. (Note: Any associate who has left a driving position for any reason and returns to a driving position must be requalified under the same qualification requirements as a new hire.)

is convicted of a DUI/DWI after July 1, 2008.

has an accident, Out Of Service violation or moving violation where related retraining, corrective action or progressive discipline had not been documented.

has not had their MVR reviewed within the prior 12 months against a written operating company standard.

has not completed an accredited defensive driving course (NSC Defensive Driving, Smith System or other Corporate approved program)with a completion certificate on file before beginning to drive, at time of hire or more than two years prior to the incident.

(New for next year, FY11: is found to be using an electronic device including cell phones, laptops, etc.)

Notes:

In case of a fatality or serious accident, reserves of $25,000 for bodily injury and $25,000 for claim expense will be established immediately.

A full safety audit will be conducted at the discretion of Corporate Safety Services on workers’ compensation, auto liability or general liability claims involving fatalities or serious accidents.

Please let us know if you have any questions. Attachment cc: Michael Green Mike Nichols Ken Spitler Chuck Staes Gary Cullen Kent Humphries Larry Pulliam Cliff Stanley Jim Danahy Al Kelso Vanessa Rossi Corporate Safety Services

Bill Delaney Tom Kurz Brian Sturgeon Corporate Risk Management Kirk Drummond Jim Lankford Steve Smith Kathy Gish Andy Malcolm Scott Sonnemaker