DEBT AND OTHER FINANCING ARRANGEMENTS

Sysco’s debt consists of the following:



	June 27, 2015			June 28, 2014
	(In thousands)
Commercial paper, interest averaging 0.2% as of June 28, 2014	$	—		$	129,999
Senior notes, interest at 0.55%, maturing in fiscal 2015	—			299,015
Senior notes, interest at 5.25%, maturing in fiscal 2018 ⁽¹⁾	502,608			502,521
Senior notes, interest at 5.375%, maturing in fiscal 2019 ⁽¹⁾	248,824			248,509
Senior notes, interest at 2.6%, maturing in fiscal 2022 ⁽¹⁾	444,212			443,384
Debentures, interest at 7.16%, maturing in fiscal 2027 ⁽²⁾	50,000			50,000
Debentures, interest at 6.5%, maturing in fiscal 2029 ⁽¹⁾	223,610			223,505
Senior notes, interest at 5.375%, maturing in fiscal 2036 ⁽¹⁾	496,775			495,636
Senior notes, interest at 6.625%, maturing in fiscal 2039 ⁽¹⁾	244,415			244,180
Senior notes, interest at 1.45%, maturing in fiscal 2018 ^{(1), (3)}	500,801			—
Senior notes, interest at 2.35% maturing in fiscal 2020 ^{(1), (3)}	752,070			—
Senior notes, interest at 3.00% , maturing in fiscal 2022 ^{(1), (3)}	745,136			—
Senior notes, interest at 3.50% , maturing in fiscal 2025 ^{(1), (3)}	1,239,116			—
Senior notes, interest at 4.35%, maturing in fiscal 2035 ^{(1), (3)}	742,664			—
Senior notes, interest at 4.50%, maturing in fiscal 2045 ^{(1), (3)}	981,813			—
Notes payable, capital leases, and other debt, interest averaging 2.81% and maturing at various dates to fiscal 2026 as of June 27, 2015 and 2.59% and maturing at various dates to fiscal 2029 as of June 28, 2014	149,833			96,333
Total debt	7,321,877			2,733,082
Less current maturities of long-term debt	(4,979,301		)	(304,777		)
Less notes payable	(70,751		)	(70,975		)
Net long-term debt	$	2,271,825		$	2,357,330

⁽¹⁾ Represents senior notes that are unsecured, are not subject to any sinking fund requirement and include a redemption provision that allows Sysco to retire the debentures and notes at any time prior to maturity at the greater of par plus accrued interest or an amount designed to ensure that the debenture and note holders are not penalized by the early redemption.

⁽²⁾ This debenture is not subject to any sinking fund requirement and is no longer redeemable prior to maturity.

⁽³⁾ Represents senior notes that were redeemed in July 2015 under a mandatory redemption feature.

As of June 27, 2015, the principal payments required to be made during the next five fiscal years on long-term debt, excluding notes payable and commercial paper, are shown below:



	Amount
	(In thousands)
2016	$	5,007,943
2017	29,140
2018	506,694
2019	269,532
2020	3,387

Commercial Paper and Revolving Credit Facility

Sysco has a commercial paper program allowing the company to issue short-term unsecured notes in an aggregate amount not to exceed $1.5 billion.

Sysco and one of its subsidiaries, Sysco International, ULC, have a revolving credit facility supporting the company’s U.S. and Canadian commercial paper programs. The facility provides for borrowings in both U.S. and Canadian dollars. Borrowings by Sysco International, ULC under the agreement are guaranteed by Sysco, and borrowings by Sysco and Sysco International, ULC under the credit agreement are guaranteed by the wholly-owned subsidiaries of Sysco that are guarantors of the company’s senior notes and debentures. The facility, in the amount of $1.5 billion, expires on December 29, 2018, but is subject to extension. As of June 27, 2015, there were no commercial paper issuances outstanding. In periods where Sysco has commercial paper borrowings, the amounts are classified within long-term debt, as the program is supported by long-term revolving credit facility described above.

During fiscal 2015, 2014, and 2013, aggregate outstanding commercial paper issuances ranged from approximately zero to $659.4 million, zero to $770.5 million, and zero to $330.0 million, respectively.

Fixed Rate Debt

In February 2013, Sysco repaid 4.2% senior notes totaling $250.0 million at maturity utilizing a combination of cash flow from operations and cash on hand.

In March 2014, Sysco repaid 4.6% senior notes totaling $200.0 million at maturity utilizing a combination of cash flow from operations and commercial paper issuances.

In June 2015, Sysco repaid 0.55% senior notes totaling $300.0 million at maturity utilizing a combination of cash flow from operations and cash on hand.

In October 2014, Sysco issued senior notes and terminated a previously outstanding unsecured bridge facility that was established in December 2013 as a potential financing mechanism for funding the proposed US Foods merger until longer-term funding could be obtained. The senior notes, issued under the company’s previous February 2012 registration statement, were unsecured, were not subject to any sinking fund requirement and included a redemption provision that allowed Sysco to retire the notes at any time prior to maturity at the greater of par plus accrued interest or an amount designed to ensure that the note holders are not penalized by early redemption. These senior notes contained mandatory redemption features providing that, on the earlier of the merger agreement termination date or October 8, 2015, Sysco was required to redeem all of the senior notes at a redemption price equal to 101% of the principal of the senior notes plus accrued interest. In June 2015, we terminated the merger agreement, and we redeemed the senior notes in July 2015 using cash on hand and the proceeds from borrowings under our commercial paper program. The senior notes were classified as current maturities of long-term debt as of June 27, 2015. Details of the senior notes are below:



Maturity Date	Par Value (in millions)		Coupon Rate		Pricing (percentage of par)
October 2, 2017	$	500	1.45	%	99.962	%
October 2, 2019		750	2.35		99.864
October 2, 2021		750	3.00		99.781
October 2, 2024		1,250	3.50		99.616
October 2, 2034		750	4.35		99.841
October 2, 2044		1,000	4.50		98.992

Total Debt

Total debt as of June 27, 2015 was $7.3 billion, of which approximately 74% was at fixed rates with a weighted average of 4.3% and an average life of 4.37 years, and the remainder was at floating rates with a weighted average of 2.9% and an average life of 0.84 years. Certain loan agreements contain typical debt covenants to protect note holders, including provisions to maintain the company’s long-term debt to total capital ratio below a specified level. Sysco is currently in compliance with all debt covenants.

Other

As of June 27, 2015 and June 28, 2014, letters of credit outstanding were $101.0 million and $45.7 million, respectively.