McCORMICK & COMPANY
 2008 ANNUAL REPORT
 
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FOREIGN CURRENCY EXCHANGE CONTRACTS AT NOVEMBER 30, 2008

We have a number of smaller contracts with an aggregate notional value of $4.4 million to purchase or sell various other currencies, such as the Australian dollar and the Swiss franc as of November 30, 2008. The aggregate fair value of these contracts was $0.2 million at November 30, 2008.
      At November 30, 2007, we had foreign currency exchange contracts for the Euro, British pound sterling, Canadian dollar, Australian dollar and Singapore dollar with a notional value of $63.1 million, all of which matured in 2008. The aggregate fair value of these contracts was $(2.7) million at November 30, 2007.
       Contracts with durations which are less than 5 days and used for short-term cash flow funding are not included in the notes or table above.
 

Interest Rate Risk – Our policy is to manage interest rate risk by entering into both fixed and variable rate debt arrangements. We also use interest rate swaps to minimize worldwide financing costs and to achieve a desired mix of fixed and variable rate debt. The table that follows provides principal cash flows and related interest rates, excluding the effect of interest rate swaps and

  

the amortization of any discounts or fees, by fiscal year of maturity at November 30, 2008 and 2007. For foreign currency-denominated debt, the information is presented in U.S. dollar equivalents. Variable interest rates are based on the weighted-average rates of the portfolio at the end of the year presented.


YEAR OF MATURITY AT NOVEMBER 30, 2008


YEAR OF MATURITY AT NOVEMBER 30, 2007

The table above displays the debt by the terms of the original debt instrument without consideration of fair value, interest rate swaps and any loan discounts or origination fees. Interest rate swaps have the following effects. The fixed interest rate on $50 million of 3.35% medium-term notes due in 2009 is effectively converted to a variable rate by interest rate swaps through 2009. Net interest payments are based on LIBOR minus 0.21% during this period. The fixed interest rate on $100 million of the 5.20% medium-term note due in 2015 is effectively converted to a variable rate by interest rate swaps through 2015. Net interest payments are based on LIBOR minus 0.05% during this period. We issued $250 million of 5.75% medium-term notes due in 2017 in December 2007. Forward treasury lock agreements of $150 million were settled upon the issuance of these medium-term notes and effectively fixed the interest rate on the full $250 million of notes at a weighted-average fixed rate of 6.25%. We issued $250 million of 5.25% medium-term notes due in 2013 in September 2008. Forward treasury lock agreements of $100 million were settled upon the issuance of these medium-term notes and effectively fixed the interest rate on the full $250 million of notes at a weighted-average fixed rate of 5.54%.
 
 
 
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