1.0- INTRODUCTION

PepsiCo, Inc. is currently one of the most successful consumer products company in the world with annual

revenues exceeding $30 billion and has more than 480,000 employees. PepsiCo, Inc. began as a successor to a

company incorporated in 1931, known as Loft Inc. Once known as Pepsi-Cola, the company expanded its

business and adopted its current name, PepsiCo, after a merger with Frito-Lay in 1965.This merger

dramatically increased PepsiCo's market potential and set the foundation for the company's tremendous

growth.

PepsiCo's products are recognized and are most respected all around the globe. Currently, PepsiCo divisions

operates in three major US and international businesses: beverages, snack foods, and restaurants. In each of

these businesses, PepsiCo has attained a leadership position as being the world leader in soft drink bottling, the

world largest snack chip producer, and the world largest franchised and company operated restaurant system.

The corporations increasing success has been based on high standards of performance, marketing strategies,

competitiveness, determination, commitment, and the personal and professional integrity of their people,

products and business practices.

PepsiCo's overall mission is to increase the value of our shareholders' investments through sales growth,

investments and financial activities. PepsiCo believes their success depends upon the quality and value of their

products by providing a safe, whole some, economically efficient and a healthy environment for their

customers; and by providing a fair return to their investors while maintaining the highest standards of integrity.

2.0-PEPSI LEGACY

Adding to the star wattage this spring was Mariah Carey, who took center stage with a national Pepsi

commercial in a unique partnership. The Grammy Award-winning artist wrote and recorded original ringtones,

available exclusively through the Pepsi Cool Tones & Motorola Phones promotion. For the first time ever in a

large-scale national promotion, music fans could download new ringtones written and recorded by today's top

artists specifically for the ringtone format, a length of 40 seconds or less.

The Pepsi Cool Tones & Motorola Phones promotion offered access to an unprecedented 150 original music

and voice ringtones by Grammy Award-winning artists, including Mary J. Blige and The All-American

Rejects

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as well as renowned producers Scott Storch and Luny Tunes. With that combination, ringtones will never be the same.

As America awaited the return of the Man of Steel in Warner Bros. Pictures’ highly anticipated summer release

of Superman Returns, PepsiCo, the film’s official food and beverage partner, launched exclusive promotions,

packaging and products tied to the movie’s release. Through several interactive sweepstakes, participants from

all over the country were crowned winners. One lucky consumer hit it big with a $1 million cash prize! 2006

also saw several new additions to the beverage aisle.

January marked the introduction of FlavorSplash Grape, the latest addition in the popular FlavorSplash line of

waters from the makers of Aquafina. FlavorSplash Grape joined three existing flavors: Citrus Blend, Wild

Berry and Raspberry. FlavorSplash by the makers of Aquafina is flavored with natural fruit flavors and

sweetened with Splenda brand sweetener, making it free of calories, free of carbs, free of sugar and low in

sodium.

In March, the Pepsi-Lipton Tea Partnership unveiled five new varieties within its ready-to-drink tea portfolio

on both the Lipton Original and Lipton Iced Tea lines. Lipton Original Iced Tea

added two great flavors: White Tea with Tangerine and Green Tea with Orange & Passion Fruit. Lipton Iced Tea welcomed three new flavor varieties: Peach Iced Tea, Diet Peach Iced Tea and Diet Green Tea with Mixed Berry. Both lineups deliver great taste with the health benefits of antioxidants. Also in March, for the first time in its fifteen year history, Diet Mountain Dew was revamped with a new taste featuring a blend of sweeteners including Aspartame, Sucralose and ASK (Acesulfame Potassium). The reformulation was met with much fanfare, particularly in Times Square, where a 100- foot snowboarding rail jam was constructed, featuring an exhibition by some of the

best young snowboarders braving a

snowy slope in the center of Manhattan. Snowboarding champs Shaun White and Hannah Teter, who have

been sponsored by Mountain Dew since 2003, were on-hand to help spread the word and celebrate the brand

that’s synonymous with action sports.

This year, taking vitamins just got a whole lot tastier when SoBe Beverages announced the launch of new

SoBe Life Water, a line of refreshing vitamin-enhanced water beverages that contain the powerful antioxidant

vitamins C & E as well as members of the vitamin B complex. Available in five delicious flavors-

Pomegranate Cherry, Blackberry Grape, Passionfruit Citrus, Orange Tangerine and Strawberry Kiwi- the

lineup is the newest addition to SoBe’s family of great-tasting “healthy refreshment” beverages.

In April, just in time for the warm weather, Starbucks® Iced Coffee came in to cool things off. The new

premium line of ready-to-drink coffee drinks features Starbucks® Italian Roast coffee with just a hint of milk

and sweetness in a slim 11-

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ounce can. Available in both regular and light versions, the product is available in Starbucks retail stores as well as convenience and grocery stores nationwide.

In addition to the launch of Starbucks Iced Coffee, we also saw the introduction of two line extensions within

the bottled Starbucks Frappuccino® and Starbucks DoubleShot® brands. Starbucks Strawberries and Crème

Frappuccino® crème drink, a smooth blend of real strawberries and low-fat milk, is the first coffee-free bottled

Starbucks Frappuccino crème drink, inspired by the most popular non-coffee blended beverage in Starbucks

retail stores. Starbucks DoubleShot® Light espresso drink has the same high-quality, great tasting blend of rich

espresso and a touch of cream as the original Starbucks DoubleShot, but with lower fat, calories and sugar.

Over the summer, Pepsi challenged consumers to think differently about indulgence with the introduction of

Jazz, a new line of zero-calorie colas available in rich flavors like Black Cherry French Vanilla and

Strawberries & Cream. Consumer research leading up to the product’s launch revealed that the smooth nature

of the cola coupled with these aromatic flavors added up to a more indulgent experience than typical zero-

calorie sodas.

2006 also marked the beginning of a beautiful friendship when Ben & Jerry’s Ice Cream, the funky & chunky

ice cream company from Vermont, announced a multi- year licensing agreement with PepsiCo. This summer,

the two companies worked together to bring milkshakes to the masses with the launch Ben & Jerry’s

MilkShakes- a rich, creamy drinkable treat in three classic flavors from the Vermont ice cream maker. The

euphoric milk beverages are currently available in Cherry Garcia, Chunky Monkey and Chocolate Fudge

Brownie.

3.0-PRODUCT 3.1-PRODUCT LINE Pepsi (8 fl. oz)

Contains: CARBONATED WATER, HIGH FRUCTOSE CORN SYRUP, CARAMEL COLOR, SUGAR,

PHOSPHORIC ACID, CAFFEINE, CITRIC ACID, NATURAL FLAVORS

Calories 100 Total Fat (g) 0 Sodium (mg) 20 Potassium (mg)

10 Total Carbohydrates (g) 28 Sugars (g)

28 Protein (g) 0 Caffeine (mg) 25 Page 3 of 21 Mind Breaker