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This excerpt taken from the PBG DEF 14A filed Mar 31, 2006. Beverage Agreements and Purchases of
Concentrates and Finished Products.
PBG purchases concentrates from PepsiCo and manufactures,
packages, distributes and sells carbonated and non-carbonated
beverages under license agreements with PepsiCo. These
agreements give PBG the right to manufacture, sell and
distribute beverage products of PepsiCo in both bottles and cans
and fountain syrup in specified territories. The agreements also
provide PepsiCo with the ability to set prices of such
concentrates, as well as the terms of payment and other terms
and conditions under which PBG purchases such concentrates. In
addition, PBG bottles water under the Aquafina trademark
pursuant to an agreement with PepsiCo, which provides for the
payment of a royalty fee to PepsiCo. In certain instances, PBG
purchases finished beverage products from PepsiCo. During 2005,
total payments by PBG to PepsiCo for concentrates, royalties and
finished beverage products were approximately $2.6 billion.
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