|SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-Q

/x/   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 28, 2002


/ /   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number 001-15019


PEPSIAMERICAS, INC.(Exact name of registrant as specified in its charter)
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Delaware                                                                       |  | 13-6167838                                             
|------------------------------------------------------------------------------ |  | -------------------------------------------------------
|(State or other jurisdiction of
                incorporation or organization) |  | (I.R.S. Employer
                Identification Number)

|3880 Dain Rauscher Plaza,
                60 South Sixth Street
                Minneapolis, Minnesota |  | 55402     
|------------------------------------------------------------------------------------------------------ |  | ----------
|(Address of principal executive offices)                                                               |  | (Zip Code)

|Registrant's telephone number, including area code (612) 661-3883


Indicate by check mark
whether the registrant: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|YES | /x/ | NO | / / | 
|--- | --- | -- | --- | 

|As of  November 1, 2002,  the  Registrant
had  150,295,017  outstanding  shares of common  stock,  par value  $0.01 per  share,  the
Registrant's only class of common stock.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

|PEPSIAMERICAS, INC.FORM 10-QTHIRD QUARTER 2002
|----------------------------------------------

|CONTENTS
|--------

|               |  |                       |                                                                                            |     
|-------------- |  | --------------------- | ------------------------------------------------------------------------------------------ | ----
|               |  |                       |                                                                                            | Page
|               |  |                       |                                                                                            |     
|PART I         |  | FINANCIAL INFORMATION
|              
|               |  | Item 1.               | Financial Statements                                                                       |     
|               |  |                       | Condensed Consolidated Statements of Income                                                | 2   
|               |  |                       | Condensed Consolidated Balance Sheets                                                      | 3   
|               |  |                       | Condensed Consolidated Statements of Cash Flows                                            | 4   
|               |  |                       | Notes to Condensed Consolidated Financial Statements                                       | 5   
|              
|               |  | Item 2.               | Managements Discussion and Analysis of Financial Condition
     and Results of Operations | 12  
|              
|               |  | Item 3.               | Quantitative and Qualitative Disclosures About Market Risk                                 | 19  
|              
|               |  | Item 4.               | Controls and Procedures                                                                    | 20  
|              
|PART II        |  | OTHER INFORMATION    
|              
|               |  | Item 1.               | Legal Proceedings                                                                          | 21  
|              
|SIGNATURE      |  |                       |                                                                                            | 22  
|              
|CERTIFICATIONS |  |                       |                                                                                            | 23  

---

|CONDENSED CONSOLIDATED STATEMENTS OF INCOME(unaudited
and in millions, except per share data)
|---------------------------------------------------------------------------------------------

|                                               | Third Quarter |        | First Nine Months |  
|---------------------------------------------- | ------------- | ------ | ----------------- | -
|                                               |               |        |                   |  
|                                               | 2002          |        | 2001              |  
|                                               |               |        |                   |  
|                                               |               |        |                   |  
|Net sales                                      | $             | 882.5  |                   | $
|Cost of goods sold                             |               | 524.6  |                   |  
|                                               |               |        |                   |  
|Gross Profit                                   |               | 357.9  |                   |  
|Selling, delivery and administrative expenses  |               | 255.9  |                   |  
|Amortization expense                           |               |       |                   |  
|Special charges                                |               | ( 1.1  | )                 |  
|Gain on pension curtailment                    |               |       |                   |  
|                                               |               |        |                   |  
|Operating income                               |               | 103.1  |                   |  
|Interest expense, net                          |               | ( 19.2 | )                 |  
|Other expense, net                             |               | ( 1.6  | )                 |  
|                                               |               |        |                   |  
|Income before income taxes                     |               | 82.3   |                   |  
|Income taxes                                   |               | 32.1   |                   |  
|                                               |               |        |                   |  
|Income from continuing operations              |               | 50.2   |                   |  
|Loss from discontinued operations, net of tax  |               |       |                   |  
|                                               |               |        |                   |  
|Net income                                     | $             | 50.2   |                   | $
|                                               |               |        |                   |  
|                                               |               |        |                   |  
|Weighted average common shares:                |               |        |                   |  
|Basic                                          |               | 152.2  |                   |  
|Incremental effect of stock options and awards |               | 0.5    |                   |  
|                                               |               |        |                   |  
|Diluted                                        |               | 152.7  |                   |  
|                                               |               |        |                   |  
|                                               |               |        |                   |  
|Income (loss) per share - basic:               |               |        |                   |  
|Continuing operations                          | $             | 0.33   |                   | $
|Discontinued operations                        |               |       |                   |  
|                                               |               |        |                   |  
|Net income                                     | $             | 0.33   |                   | $
|                                               |               |        |                   |  
|                                               |               |        |                   |  
|Income (loss) per share - diluted:             |               |        |                   |  
|Continuing operations                          | $             | 0.33   |                   | $
|Discontinued operations                        |               |       |                   |  
|                                               |               |        |                   |  
|Net income                                     | $             | 0.33   |                   | $
|                                               |               |        |                   |  
|                                               |               |        |                   |  
|Cash dividends per share                       | $             |       |                   | $
|                                               |               |        |                   |  

|See accompanying notes to
condensed consolidated financial statements.
|----------------------------------------------------------------------

|2
|-

---

|CONDENSED CONSOLIDATED BALANCE SHEETS
            (in millions, except per share data)
|--------------------------------------------------------------------------------------

|                                                                  |   | End ofThird Quarter2002 |   |   | End ofFiscal Year2001 |  
|----------------------------------------------------------------- | - | ----------------------- | - | - | --------------------- | -
|                                                                  |   |                         |   |  
|                                                                  |   | (unaudited)             |   |   |                       |  
|ASSETS:                                                           |   |                         |   |   |                       |  
|Current assets:                                                   |   |                         |   |   |                       |  
|Cash and equivalents                                              | $ | 115.4                   |   | $ | 64.4                  |  
|Receivables                                                       |   | 230.0                   |   |   | 197.1                 |  
|Inventories                                                       |   | 179.9                   |   |   | 173.4                 |  
|Other current assets                                              |   | 50.5                    |   |   | 45.9                  |  
|                                                                  |   |                         |   |  
|Total current assets                                              |   | 575.8                   |   |   | 480.8                 |  
|Property (at cost)                                                |   | 1,922.1                 |   |   | 1,821.0               |  
|Accumulated depreciation                                          |   | ( 815.7                 | ) |   | ( 753.9               | )
|                                                                  |   |                         |   |  
|Net property                                                      |   | 1,106.4                 |   |   | 1,067.1               |  
|                                                                  |   |                         |   |  
|Intangible assets, net                                            |   | 1,751.1                 |   |   | 1,749.3               |  
|Investments and other assets                                      |   | 143.5                   |   |   | 122.1                 |  
|                                                                  |   |                         |   |  
|Total assets                                                      | $ | 3,576.8                 |   | $ | 3,419.3               |  
|                                                                  |   |                         |   |  
|                                                                  |   |                         |   |   |                       |  
|LIABILITIES AND SHAREHOLDERS' EQUITY:                             |   |                         |   |   |                       |  
|Current liabilities:                                              |   |                         |   |   |                       |  
|Short-term debt, including current maturities of long-term debt   | $ | 298.6                   |   | $ | 255.2                 |  
|Payables                                                          |   | 208.5                   |   |   | 216.5                 |  
|Other current liabilities                                         |   | 187.0                   |   |   | 181.0                 |  
|                                                                  |   |                         |   |  
|Total current liabilities                                         |   | 694.1                   |   |   | 652.7                 |  
|                                                                  |   |                         |   |  
|Long-term debt                                                    |   | 1,080.1                 |   |   | 1,083.4               |  
|Deferred income taxes                                             |   | 110.1                   |   |   | 68.9                  |  
|Other liabilities                                                 |   | 199.7                   |   |   | 184.0                 |  
|Shareholder' equity:                                              |   |                         |   |   |                       |  
|Preferred stock ($0.01 par value, 12.5 million shares authorized; |   |                         |   |   |                       |  
|no shares issued)                                                 |   |                        |   |   |                      |  
|Common stock ($0.01 par value, 350 million shares authorized;     |   |                         |   |   |                       |  
|167.5 million shares issued-2002 and 167.6 million shares         |   |                         |   |   |                       |  
|issued-2001)                                                      |   | 1,539.1                 |   |   | 1,546.7               |  
|Retained income                                                   |   | 280.7                   |   |   | 164.4                 |  
|Unearned stock-based compensation                                 |   | ( 9.6                   | ) |   | ( 1.1                 | )
|Accumulated other comprehensive loss:                             |   |                         |   |   |                       |  
|Cumulative translation adjustment                                 |   | ( 21.0                  | ) |   | ( 25.1                | )
|Net unrealized investment and hedging losses                      |   | ( 14.0                  | ) |   | ( 4.7                 | )
|Minimum pension liability                                         |   | ( 4.1                   | ) |   | ( 4.1                 | )
|                                                                  |   |                         |   |  
|Accumulated other comprehensive loss                              |   | ( 39.1                  | ) |   | ( 33.9                | )
|Treasury stock (17.4 million shares - 2002 and 14 million         |   |                         |   |   |                       |  
|shares - 2001)                                                    |   | ( 278.3                 | ) |   | ( 245.8               | )
|                                                                  |   |                         |   |  
|Total shareholders' equity                                        |   | 1,492.8                 |   |   | 1,430.3               |  
|                                                                  |   |                         |   |  
|Total liabilities and shareholders' equity                        | $ | 3,576.8                 |   | $ | 3,419.3               |  
|                                                                  |   |                         |   |  

|See accompanying notes to condensed
consolidated financial statements.
|----------------------------------------------------------------------

|3
|-

---

|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited and in millions)
|---------------------------------------------------------------------------

|                                                                              | First Nine Months |        
|----------------------------------------------------------------------------- | ----------------- | -------
|                                                                              |                   |        
|                                                                              |                   | 2002   
|                                                                              |                   |        
|                                                                              |                   |        
|CASH FLOW FROM OPERATING ACTIVITIES:                                          |                   |        
|Income from continuing operations                                             | $                 | 128.4  
|Adjustments to reconcile to net cash provided by operating activities:        |                   |        
|Depreciation and amortization                                                 |                   | 120.2  
|Deferred income taxes                                                         |                   | 39.4   
|Gain on pension curtailment                                                   |                   |       
|Gain on sale of investment                                                    |                   | ( 3.5  
|Special charges                                                               |                   | ( 1.1  
|Cash outlays related to special charges                                       |                   | ( 5.0  
|Other                                                                         |                   | ( 1.0  
|Change in assets and liabilities, exclusive of acquisitions and divestitures: |                   |        
|Increase in receivables                                                       |                   | ( 32.9 
|Increase in inventories                                                       |                   | ( 6.3  
|(Decrease) increase in payables                                               |                   | ( 13.7 
|Net change in other assets and liabilities                                    |                   | 6.0    
|                                                                              |                   |        
|Net cash provided by operating activities                                     |                   | 230.5  
|                                                                              |                   |        
|                                                                              |                   |        
|CASH FLOWS FROM INVESTING ACTIVITIES:                                         |                   |        
|Franchises and companies acquired,
                net of cash required       |                   | ( 2.9  
|Capital investments, net of
                proceeds from asset sales         |                   | ( 152.5
|Proceeds from sales of investments                                            |                   | 26.5   
|                                                                              |                   |        
|Net cash used in investing activities                                         |                   | ( 128.9
|                                                                              |                   |        
|                                                                              |                   |        
|CASH FLOWS FROM FINANCING ACTIVITIES:                                         |                   |        
|Net repayments of
                short-term debt                             |                   | ( 228.4
|Proceeds from issuance of long-term debt                                      |                   | 250.0  
|Repayment of long-term debt                                                   |                   |       
|Dividends                                                                     |                   | ( 6.1  
|Treasury stock purchases                                                      |                   | ( 56.1 
|Issuance of common stock                                                      |                   | 4.8    
|                                                                              |                   |        
|Net cash used in financing activities                                         |                   | ( 35.8 
|                                                                              |                   |        
|                                                                              |                   |        
|Net cash used in discontinued
                operations                      |                   | ( 14.6 
|Effects of exchange rate changes
                on cash and equivalents      |                   | ( 0.2  
|                                                                              |                   |        
|Change in cash and equivalents                                                |                   | 51.0   
|Cash and equivalents at
                beginning of year                     |                   | 64.4   
|                                                                              |                   |        
|Cash and equivalents at end
                of first nine months              | $                 | 115.4  
|                                                                              |                   |        

|See accompanying notes
to condensed consolidated financial statements.
|----------------------------------------------------------------------

|4
|-

---

|NOTES TO
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS(unaudited)
|---------------------------------------------------------------

|1. | The condensed consolidated
financial statements included herein have been
prepared by PepsiAmericas, Inc. (the Company) without audit. Certain
information and note disclosures normally included in financial statements
prepared in accordance with accounting principles generally accepted in the
United States have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission, although the Company
believes that the disclosures made are adequate to make the information
presented not misleading. It is suggested that these condensed consolidated
financial statements be read in conjunction with the condensed financial statements and
notes thereto included in the Companys Annual Report on Form 10-K for the
fiscal year 2001. In the opinion of management, the information furnished herein
reflects all adjustments (consisting only of normal, recurring adjustments)
necessary for a fair statement of results for the interim periods presented.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | The Company manufactures, packages, sells and distributes carbonated and
non-carbonated Pepsi-Cola beverages and a variety of other beverages in the
United States, Central Europe and the Caribbean. The Company is the number-two
anchor bottler in the Pepsi system and accounts for approximately 19 percent of
all Pepsi-Cola products sold in the United States. The Company operates in a
significant portion of an 18 state region, primarily in the Central and
Midwestern United States.  Outside the United States, the Company operates in
the Central European markets in Poland, Hungary, the Czech Republic and the
Republic of Slovakia and in the Caribbean markets in Puerto Rico, Jamaica, the
Bahamas, Trinidad and Tobago, and Barbados. The Company serves areas with a total
population of more than 117 million people, and its business is highly seasonal.
PepsiCo, Inc. holds a 37.9 percent equity interest in the Company.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Beginning in the second quarter of 2002, the Company began providing a further
breakdown of information related to its international markets.  This change was
made to provide more insight into the results of both the Central European and
Caribbean operations.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The following presents selected financial information related to the Company's geographic
segments (in millions):
| | -----------------------------------------------------------------------------------------------------------------

| |                          | Third Quarter |       | First Nine Months
| | ------------------------ | ------------- | ----- | -----------------
| |                          |               |       |                  
| |                          | 2002          |       | 2001             
| |                          |               |       |                  
| |                          |               |       |                  
| | Net sales:               |               |       |                  
| | Domestic                 | $             | 746.8 |                  
| | Central Europe           |               | 87.3  |                  
| | Caribbean                |               | 48.4  |                  
| |                          |               |       |                  
| | Total                    | $             | 882.5 |                  
| |                          |               |       |                  
| | Operating income (loss): |               |       |                  
| | Domestic                 | $             | 98.4  |                  
| | Central Europe           |               | 5.0   |                  
| | Caribbean                |               | ( 0.3 | )                
| |                          |               |       |                  
| | Total                    | $             | 103.1 |                  
| |                          |               |       |                  

|5
|-

---

| |                 | End ofThird Quarter2002 |         | End ofFiscal Year2001 |  
| | --------------- | ----------------------- | ------- | --------------------- | -
| |                 |                         |         |                      
| |                 |                         |         |                       |  
| | Total assets:   |                         |         |                       |  
| | Domestic        | $                       | 3,046.1 |                       | $
| | Central Europe  |                         | 257.6   |                       |  
| | Caribbean       |                         | 138.0   |                       |  
| |                 |                         |         |                       |  
| | Total operating |                         | 3,441.7 |                       |  
| | Non-operating   |                         | 135.1   |                       |  
| |                 |                         |         |                       |  
| | Total           | $                       | 3,576.8 |                       | $
| |                 |                         |         |                       |  

|3. | The Companys fiscal year consists of 52 or 53 weeks ending on the Saturday
closest to December 31; fiscal 2001 ended on December 29, 2001. The
Companys third quarters of 2002 and 2001 were based on the thirteen weeks
ended September 28, 2002 and September 29, 2001, respectively.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | Interest expense, net, is comprised of the following (in millions):
|-- | -------------------------------------------------------------------

| |                       | Third Quarter |        | First Nine Months
| | --------------------- | ------------- | ------ | -----------------
| |                       |               |        |                  
| |                       | 2002          |        | 2001             
| |                       |               |        |                  
| |                       |               |        |                  
| | Interest expense      | $             | ( 19.4 | )                
| | Interest income       |               | 0.2    |                  
| |                       |               |        |                  
| | Interest expense, net | $             | ( 19.2 | )                
| |                       |               |        |                  

|5. | Net cash provided by operating activities reflected cash payments and receipts for interest and income taxes
as follows (in millions):
|-- | --------------------------------------------------------------------------------------------------------------------------------------

| |                                   | First Nine Months |      |     
| | --------------------------------- | ----------------- | ---- | ----
| |                                   |                   |     
| |                                   | 2002              |      | 2001
| |                                   |                   |      |     
| |                                   |                   |      |     
| | Interest paid                     | $                 | 63.3 |     
| | Interest received                 |                   | 0.4  |     
| | Income taxes paid, net of refunds |                   | 22.6 |     

|6. | The Company's comprehensive income is as follows (in millions):
|-- | ---------------------------------------------------------------

| |                                              | Third Quarter |       | First Nine Months
| | -------------------------------------------- | ------------- | ----- | -----------------
| |                                              |               |       |                  
| |                                              | 2002          |       | 2001             
| |                                              |               |       |                  
| |                                              |               |       |                  
| | Net income                                   | $             | 50.2  |                  
| | Foreign currency translation adjustment      |               | ( 4.9 | )                
| | Net unrealized investment and hedging losses |               | ( 6.8 | )                
| |                                              |               |       |                  
| | Comprehensive income                         | $             | 38.5  |                  
| |                                              |               |       |                  

| | Net unrealized investment and cash flow hedging losses are presented net of tax benefit
of $2.8 million in the third quarter of 2002 and $4.0 million in the first nine months of 2002,
compared to $4.1 million and $1.8 million tax benefits in the comparable periods of 2001, respectively.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|6
|-

---

|7. | In connection with the integration of former Whitman Corporation and former PepsiAmericas
domestic benefit plans during the first quarter of 2001, the Company amended its pension
plans to freeze pension benefit accruals for all salaried and non-union employees
effective December 31, 2001.  Employees age 50 or older with 10 or more years of vesting
service were grandfathered such that they will continue to accrue benefits after
December 31, 2001 based on their final average pay as of December 31, 2001.  As a result of
the curtailment, the Company recognized a one-time curtailment gain of $8.9 million
($5.4 million after taxes).  Beginning January 1, 2002, the existing domestic salaried
and non-union pension plans were replaced by an additional Company contribution to the 401(K) plan.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | In the second  quarter of 2002,  the Company  recorded a $3.5  million  gain related to the sale
of its interest in a parcel of land in downtown  Chicago.  The gain is reflected in Other expense,
net. The Company  received  $26.5 million in cash and a $12 million  promissory  note
collateralized  by a  subordinated  mortgage  related to the sale.  An  additional  $1.4 million,
otherwise  payable to the  Company,  was held back in escrow,  a portion  of which is  expected  to
be recovered  when certain conditions are met related to existing  environmental  matters.
The  promissory  note and escrow balance were recorded at their estimated  realizable value, net
of reserves of  approximately  $6.2 million.  In addition,  the Company recorded $2.5 million of
liabilities, net, for certain indemnifications made pursuant to the sale agreement.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|9. | During
the first quarter of 2001, the Company reached an agreement with Crescent
Distributing, LLC (Crescent), a wholly-owned subsidiary of Poydras
Street Investors LLC (Poydras). Under the agreement, the joint
venture between the Company and Poydras was terminated with Crescent retaining
sole ownership of the rights to the beer operations and related assets and the
Company assuming sole ownership of the rights to the soft drink operations and
related assets. The results derived from the beer operations were not material
to the Companys overall business.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|10. | As of the end of the third quarter of 2002, the components of inventory were  approximately
44 percent  comprised of raw materials and supplies  and 56 percent  comprised of finished
goods and were  materially  consistent  with the mix of inventory at the end of fiscal year 2001.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|11. | In July 2001, the Financial Accounting Standards Board issued Statement of Financial Accounting
Standards (SFAS) No. 142, Goodwill and Other Intangible Assets, which changes the accounting
for goodwill from an amortization method to an impairment-only approach. This change applies to goodwill
and other intangible assets with indefinite lives.  The Company adopted SFAS No. 142 effective the
beginning of 2002 and has ceased amortization of substantially all intangible assets beginning
in the first quarter of 2002.  Had SFAS No. 142 been in effect at the beginning of fiscal year 2001,
the Company estimates that net income would have been approximately $46.4 million ($0.30 per
diluted share) and $118.2 million ($0.75 per diluted share), for the third quarter and first nine months of
2001, respectively.  The Company has completed the initial impairment review required by
SFAS No. 142 and determined that goodwill was not impaired.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | As of the end of the third quarter of 2002, goodwill by reportable segment was as follows (in million):
| | -------------------------------------------------------------------------------------------------------

| | Domestic       | $ | 1,702.0 | 
| | -------------- | - | ------- | 
| | Central Europe |   | 27.3    | 
| | Caribbean      |   | 16.9    | 
| |                |   |        
| | Total goodwill | $ | 1,746.2 | 
| |                |   |        

| | There were no material changes in the carrying amount of goodwill during the
first nine months of 2002.  Intangible assets include various distribution and
non-compete agreements, and the pension intangible asset.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12. | In the fourth quarter of 2001, the Company recorded special charges totaling $9.2 million
primarily for severance costs and other costs related to changing the Companys marketing
and distribution strategy in Hungary, as well as for the write-down of marketing
equipment in the U.S.  The write-down of marketing equipment was recorded in conjunction
with the start-up of the Ft. Wayne, Indiana refurbishment operations.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7
|-

---

| | In the first quarter of 2001, the Company recorded a special charge of $4.6 million related to
further organization changes resulting from the transaction with the former PepsiAmericas,
which was principally composed of severance and related benefits.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In the fourth quarter of 2000, the Company recorded a special charge of $21.7 million ($13.2 million
after tax).  The charge, related to the merger with the former PepsiAmericas, included severance, related
benefits and other payments to executives and employees of the Company totaling $17.1 million.  Further,
in connection with the closure of its production facility in Ft. Wayne, Indiana, the Company recorded a
charge of $4.2 million, which included a write-down of building and equipment and $0.5 million for
severance payments and other benefits.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The following table summarizes activity associated with the special charges (in millions):
| | ------------------------------------------------------------------------------------------

| |                                                             | 2001Charges |       | 2000Charges |   | Total |  
| | ----------------------------------------------------------- | ----------- | ----- | ----------- | - | ----- | -
| |                                                             |             |       |             |   |       |  
| |                                                             |             |       |             |   |       |  
| | Accrued liabilities as of fiscal year end 2001              | $           | 6.4   |             | $ | 1.7   |  
| | Expenditures primarily for employee-related costs           |             | ( 3.3 | )           |   | ( 1.7 | )
| |                                                             |             |       |             |   |       |  
| | Accrued liabilities at the end of the third quarter of 2002 | $           | 3.1   |             | $ |      |  
| |                                                             |             |       |             |   |       |  

| | The 2001 and 2000 charges affected approximately 525 employees, of which 153 remain
as of the end of the third quarter of 2002.  The accrued liabilities remaining as of
the end of the third quarter of 2002 are primarily comprised of deferred severance
payments and certain employee benefits.   The Company expects to pay a significant
portion of the $3.1 million of employee related costs, using cash from operations,
during the next 12 months; accordingly, such amounts are classified as other current
liabilities.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In addition, the Company identified approximately $1.1 million of excess severance and related
exit costs in Central Europe related to a special charge recorded in fiscal year 1999 that were
credited to income and reflected in Special charges.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|13. | In the third quarter of 2002, the Company issued $250 million of notes with a coupon
rate of 3.875 percent due 2007.  These notes are included in long-term debt in the
Condensed Consolidated Balance Sheet.  Proceeds from these notes were used to repay
outstanding commercial paper or are included in the cash and equivalents balance at the end
of the third quarter.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14. | The Company uses financial instruments to hedge against volatility in future cash flows
on anticipated aluminum can purchases, the prices of which are indexed to aluminum market prices.
Realized gains and losses on aluminum hedge contracts are deferred until the related finished
products are sold.  See Quantitative and Qualitative Disclosures About Market Risk - Commodity
Prices.   Effective at the beginning of fiscal 2001, the Company adopted SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities, as amended by SFAS
Nos. 137 and 138.  In connection with the adoption, the Company recognized an asset for the fair
value of aluminum hedges of $1.4 million and reclassified $0.4 million of previously deferred
hedging losses to accumulated other comprehensive loss.  Accordingly, the impact of adopting
SFAS No. 133, as amended, was an increase of $1 million in accumulated other comprehensive income,
which was reclassified into cost of goods sold during fiscal 2001.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the fourth quarter of 2001, the Company also began using financial instruments to
hedge against volatility in future cash flows on anticipated fuel purchases, the prices
of which are indexed to fuel market prices.  Realized gains and losses on fuel hedge contracts
are deferred until the fuel is purchased.  See Quantitative and Qualitative Disclosures About
Market Risk - Commodity Prices.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company has hedged a portion of its anticipated aluminum can and fuel purchases through
the fourth quarters of 2004 and 2002, respectively.  As of the end of the third quarter of 2002,
the Company had deferred $6.9 million of losses related to these hedging programs in Accumulated
other comprehensive loss, a majority of which will be reclassified into earnings during the next 18 months.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8
|-

---

| | During the third quarter of 2001, the Company entered into interest rate swap contracts
with an aggregate notional amount of $200 million to convert a portion of its fixed rate
debt to floating rate debt, with the objective of reducing overall borrowing costs.  These
swaps are accounted for as fair value hedges, since they hedge against the change in fair
value of fixed rate debt resulting from fluctuations in interest rates.  The fair value
of the interest rate swaps at the end of the third quarter of 2002 was $22.4 million,
which is reflected in Other assets on the Condensed Consolidated Balance Sheet, with a
corresponding increase in Long-term debt representing the change in fair value of the
fixed rate debt.  The fair value adjustment had no earnings impact since the swaps are
considered highly effective in eliminating the interest rate risk of the fixed rate debt
they are hedging.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In anticipation of the long-term debt issuance in the third quarter of 2002, the Company entered
into a series of treasury rate locks with an aggregate notional amount of $250 million.  These
treasury rate locks are accounted for as cash-flow hedges, as the treasury rate locks are hedging
against the variability of interest payments on the forecasted issuance of fixed-rate debt attributable to
changes in the interest rates.  The treasury rate locks were settled for $2.5 million, concurrent
with the debt
issuance in the third quarter of 2002 (see Note 13).  As of the end of the third quarter of 2002,
the Company had deferred approximately $2.5 million of losses in Accumulated other
comprehensive loss in the Condensed Consolidated Balance Sheet, as the treasury rate
locks were considered highly effective in eliminating the interest rate risk on the
forecasted debt issuance.  Amounts accumulated in other comprehensive loss will be reclassified
into earnings commensurate with the recognition of the interest expense on the newly issued debt.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15. | The Company continues to be subject to certain indemnification obligations, net of
insurance, under agreements related to previously sold subsidiaries, including
indemnification expenses for potential environmental and tort liabilities of these
prior subsidiaries. There is significant uncertainty in assessing the Companys potential
expenses for complying with its indemnification obligations. The assessment and determination
of expenses for cleanup at the various sites involved are inherently speculative during the early
stages, as is the projection of future claims. The amount of the expense also is subject to
various factors, including possible insurance recoveries and the allocation of liabilities
among many other potentially responsible and financially viable parties.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In the fourth quarter of fiscal year 2001, the Company engaged outside consultants to
assist in estimating the amount of expense the Company may incur due to the environmental
liabilities arising from sites owned or operated by the prior subsidiaries.  The outside
consultants provided the Company with an estimate of the most likely costs of remediating
the sites.  Their estimates were based on their evaluations of the characteristics
and parameters of the sites, including results from field inspections, test borings and
water flows.  Their estimates are based upon the use of current technology and remediation
techniques, and do not take into consideration any inflationary trends upon such claims
or expense.  Based upon these estimates, the Company recorded a charge to
discontinued operations in the fourth quarter of 2001 of $111 million ($71 million after taxes).
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | During the second quarter of 2000, proceeds of a settlement of insurance policies issued
to a prior subsidiary were placed in a trust (the Trust).  The Trust documents specify
that funds in the Trust would be used to pay future liabilities of the prior subsidiaries.
Monies paid by the Trust thereby would reduce the indemnification obligations of the Company.
As of fiscal year end 2001, the Company had $131.2 million accrued to cover potential
indemnification obligations, which amount excluded expenses for which the Trust was
expected to be responsive.  The amount also excluded any possible insurance recoveries
under policies that were in place prior to recently purchased insurance policies
described below.  The accrual included estimated expenses for the remediation of
identified sites, payments to third parties for claims and expenses, and the expenses of on-going
evaluations and litigation.  The Company expects a significant portion of the accrued
liabilities will be disbursed during the next 10 years.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The significant sites included in the aggregate accrued liabilities the Company has
recorded are described more fully in the Companys Annual Report on Form 10-K
for the fiscal year 2001.  No significant changes in the status of those sites occurred and no
significant new sites were discovered during the first nine months of 2002.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|9
|-

---

| | During the second quarter of 2002, as part of a comprehensive program concerning environmental
liabilities related to the former Whitman Corporation subsidiaries, the Company purchased
new insurance coverage related to the known sites previously owned and operated by Pneumo
Abex and its subsidiaries, along with other sites which Pneumo Abex or one of its subsidiaries
may have owned or operated.  In addition, the Trust purchased insurance coverage and funded
coverage for remedial and other costs ("finite funding") related to the sites previously
owned and operated by Pneumo Abex and its subsidiaries.   These actions have been taken to fund costs
associated with the sites previously owned and operated by Pneumo Abex and its subsidiaries and
to protect against additional future costs in excess of a self-insured retention of the Company.
The amount of self-insured retention (the amount the Company must pay before the insurance
carrier is obligated to commence payments) is $114 million.  The Company had accrued
$90 million, which is its estimate of the contingent liabilities related to such environmental
matters.  The finite funding of $26 million may be used to pay a portion of the $90 million
which the Company had accrued, along with previously incurred expenses of the Company.
Essentially all of the assets of the Trust were expended by the Trust in connection with
the purchase of the insurance coverage and the finite funding and related expenses.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | In  conjunction  with the purchase of the  insurance  policies in the second quarter of 2002,
the Company  recorded a charge to  discontinued  operations of $9.8 million,  or $6 million
after tax.  This charge  represented  amounts  expended by the Company and a reduction  of funds in the
Trust available to pay expenses related to sites for which the Company has indemnification
obligations.  Because payments by the Trust  reduce cash  required to be paid by the
Company  for the  environmental  sites for which the Company has  indemnification
obligations, the Company recorded the finite funding in Investments and other assets.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company has contingent liabilities from various pending claims and litigation on a
number of matters, including indemnification claims under agreements with previously
sold subsidiaries for product liability and toxic torts.  The ultimate liability for
these claims cannot be determined.  In the opinion of management, based upon information
currently available, the ultimate resolution of these claims and litigation, including
potential environmental exposures, and considering amounts already accrued, should not
have a material effect on the Companys financial condition, although amounts recorded
in a given period could be material to the results of operations or cash flows for that period.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Existing environmental liabilities associated with the Companys continuing operations
are not material.
| | --------------------------------------------------------------------------------------------------------

|16. | The Company purchases concentrate from PepsiCo to be used in the production of Pepsi carbonated
soft drinks and other non-alcoholic beverages.  PepsiCo also provides the Company with various
forms of marketing supports to promote Pepsis brands.  This support covers a variety of initiatives,
including market place support, marketing programs, marketing equipment and related program support
and shared media expense.  PepsiCo and the Company each record their share of the cost of marketing
programs in their financial statements.  Based on the objectives of the programs and initiatives,
domestic marketing support is recorded as an adjustment to net sales or as a reduction of selling,
delivery and administrative expense.  There are no conditions or requirements, which could result
in the repayment of any support payments received by the Company.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | The Company manufacturers and distributes fountain products and provides fountain equipment
service to PepsiCo customers in certain territories in accordance with various agreements.
There are other products which the Company produces and/or distributes through
various arrangements with PepsiCo or partners of PepsiCo.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | See the Annual Report on Form 10-K for fiscal year 2001 for further discussion of related party transactions.
| | -------------------------------------------------------------------------------------------------------------

|10
|--

---

|17. | Basic income per share is based upon the weighted-average number of common shares
outstanding.  Diluted income per share assumes the exercise of all options which are
dilutive, whether exercisable or not.  The dilutive effects of stock options and non-vested
restricted stock awards are measured under the treasury stock method.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Options to purchase the following shares were not included in the computation of diluted
income per share because the exercise price was greater than the average market price of the common
shares during the related period:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |                                  | Third Quarter |           | First Nine Months
| | -------------------------------- | ------------- | --------- | -----------------
| |                                  |               |           |                  
| |                                  | 2002          |           | 2001             
| |                                  |               |           |                  
| |                                  |               |           |                  
| | Shares under options outstanding |               | 8,969,473 |                  
| | Weighted-average exercise price  |               |           |                  
| | per share                        | $             | 17.89     |                  

|11
|--

---

|Item 2.      Management's Discussion and Analysis of
Financial Condition and Results of Operations.
|---------------------------------------------------------------------------------------------------

|CRITICAL ACCOUNTING POLICIES
|----------------------------

|The preparation of the Consolidated Financial Statements in conformity with accounting
principles generally accepted in the United States requires management to use estimates.
These estimates are made using managements best judgment and the information available
at the time these estimates are made, including the advice of outside experts.  For a
better understanding of the Companys significant accounting policies used in preparation
of the Consolidated Financial Statements, please refer to the Company's Annual
Report on Form 10-K for the fiscal year 2001.  We focus your attention on the following:
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Goodwill Impairment - Beginning in 2002, the Company adopted SFAS No. 142, Goodwill
and Other Intangible Assets, which changed the accounting for goodwill from an
amortization method to an impairment-only approach.  The Company completed its initial
impairment review and determined that goodwill was not impaired.  This review included
estimating fair market value using discounted future cash flows, which requires
considerable management judgment.  A review of the carrying value of goodwill will
be performed on an annual basis, as required by SFAS No. 142.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Commitments and Contingencies - The Company continues to be subject to certain
indemnification obligations under agreements related to previously sold subsidiaries,
including potential environmental liabilities (see Note 15).  The Company has estimated
its contingent liability under its indemnification obligations, which is inherently
difficult to estimate.  Management has utilized outside consultants and other
professionals to assist with the estimation of its liability.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Income Taxes - The Company's effective tax rate and the tax bases of its assets and
liabilities reflect management's best estimate of the outcome of future tax audits.  The
Company has established valuation allowances using managements best judgment where
expected results do not support the realization of deferred tax assets.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|RESULTS OF OPERATIONS
        2002 THIRD QUARTER COMPARED WITH 2001 THIRD QUARTER
|---------------------------------------------------------------------------------

|Due to special charges and other non-recurring items
recorded in 2001 and 2002, the Company believes that pro forma results provide a better indication
of current operating trends than reported results.  Therefore, included within the following
discussions are explanations of both reported results and pro forma results.  The Companys
business is highly seasonal; accordingly, the operating results of any individual quarter may
not be indicative of a full years operating results.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Net sales for the third quarter of 2002 and 2001 were
as follows (in millions):
|-------------------------------------------------------------------------------

| |                 | Reported |       |         |   |       
| | --------------- | -------- | ----- | ------- | - | ------
| |                 |          |       | Percent |   |       
| |                 | 2002     |       | 2001    |   | Change
| |                 |          |       |         |   |       
| | Domestic        | $        | 746.8 |         | $ | 719.5 
| | Central Europe  |          | 87.3  |         |   | 80.8  
| | Caribbean       |          | 48.4  |         |   | 46.8  
| |                 |          |       |         |   |       
| | Total net sales | $        | 882.5 |         | $ | 847.1 
| |                 |          |       |         |   |       

|On a reported basis, net sales increased $35.4 million,
or 4.2 percent, in the third quarter of 2002 compared to the third quarter of 2001, primarily
reflecting increased volume in both the domestic and Central European markets and improved pricing
in the domestic markets, certain Central European markets and the Caribbean markets.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|12
|--

---

|The growth in domestic net sales of $27.3 million
resulted from improved pricing, up 1.3 percent, as well as increased volume, up 3.5 percent.
The improved pricing included a 0.6 percent improvement attributed to rate increases and a 0.7 percent
improvement associated with favorable changes in package mix.  Offsetting the improvements attributed to
the increased volume and higher pricing were declines in contract (sales to other bottlers), commissary and
other sales, which decreased 9.2 percent in the current quarter compared to the third quarter of last
year.  The domestic volume growth in the third quarter benefited from strong growth in Trademark
Pepsi of 1.6 percent, due in part to innovation.  Aquafina continued strong growth of 50.9 percent,
and Trademark Mountain Dew grew 0.5 percent as the Company  lapped the strong introduction of Code
Red in the third quarter of 2001.   Other Pepsi branded flavored soft drinks experienced growth of
17.9 percent, led by Sierra Mist and Lipton Brisk.  Dr Pepper continued to have strong single-digit
growth.  The volume growth in the third quarter was driven by growth in cans of 2 percent and strong
growth in 24-ounce non-returnable packages of 18.2 percent. The domestic results reflected continued
growth in the large format channel, led by supermarkets, offset by slight declines in the small
format channels while on-premise channels remained relatively flat.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The growth in Central Europe net sales of $6.5 million, or 8.0
percent, resulted from volume growth of 8.4 percent, as well as favorable foreign exchange rates, offset,
in part, by decreased pricing in Poland.  Excluding the favorable exchange rate impact, all four markets
in Central Europe experienced strong growth in net sales attributed to both volume growth and pricing
improvements, except for Poland.   Competitive pricing pressures continued to adversely affect Polands
sales growth and pricing in the quarter.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The growth in Caribbean net sales of $1.6 million, or 3.4 percent,
resulted mainly from improved pricing, as volume remained relatively flat.
|---------------------------------------------------------------------------------------------------------------------------------------------

|The consolidated gross profit margin on a reported basis
increased 50 basis points to 40.6 percent of net sales in the third quarter of 2002 compared with the
third quarter of 2001.  The improvement was primarily attributed to improved margins in the domestic
markets, as pricing improved and ingredient and packaging costs on a per unit basis remained relatively
flat. In Central Europe, the gross profit margin improved 50 basis points, mainly due
to the favorable foreign exchange impact, while the overall gross profit margin
declined in the Caribbean markets.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Selling, delivery and administrative (SD&A)
expenses represented 29.0 percent of sales in the third quarter of 2002 compared with
28.4 percent in the third quarter of 2001.  The increase in the percentage of SD&A expenses was
due primarily to the increase in the domestic markets, offset, in part, by a decrease in Central
Europe.   SD&A as a percent of net sales increased 120 basis points in the domestic markets to 28.2
percent, reflecting an increase in wages and benefits in the domestic markets due, in part, to aligning the
compensation and benefit programs of legacy Whitman and legacy PepsiAmericas, as well as increased
insurance costs.  The increase also reflected expenses associated with the next generation selling
system implementation and the roll-out of additional components of the enterprise-wide resource
planning system, primarily inventory and demand planning applications, as well as higher depreciation
associated with investments in technology and cold drink equipment.  Excluding the impact
of foreign exchange rates, SD&A costs as a percent of net sales in Central Europe declined 4.0 percent,
while SD&A costs in the Caribbean markets were essentially flat as a percent of sales.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Operating income (loss) for the third quarters of 2002 and
2001 was as follows (in millions):
|---------------------------------------------------------------------------------------------

| |                        | Reported |       |         |   | Pro Forma |   |        
| | ---------------------- | -------- | ----- | ------- | - | --------- | - | -------
| |                        |          |       | Percent |   |           |   | Percent
| |                        | 2002     |       | 2001    |   | Change    |   | 2002   
| |                        |          |       |         |   |           |   |        
| | Domestic               | $        | 98.4  |         | $ | 87.1      |   | 13.0   
| | Central Europe         |          | 5.0   |         |   | ( 0.2     | ) |       
| | Caribbean              |          | ( 0.3 | )       |   | ( 0.1     | ) |       
| |                        |          |       |         |   |           |   |        
| | Total operating income | $        | 103.1 |         | $ | 86.8      |   | 18.8   
| |                        |          |       |         |   |           |   |        

|13
|--

---

|In the third quarter of 2002, the $1.1 million reversal
of previously recognized special charges in Central Europe was excluded from pro forma operating income.
Reconciliation of reported results to pro forma results for the third quarter of 2001 is as follows
(in millions):
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |                            | Third Quarter 2001 |     
| | -------------------------- | ------------------ | ----
| |                            |                    |     
| |                            |                    |     
| |                            | Domestic           |     
| |                            |                    |     
| |                            |                    |     
| | Reported operating income  | $                  | 87.1
| | Exclude amortization       |                    | 11.9
| |                            |                    |     
| | Pro forma operating income | $                  | 99.0
| |                            |                    |     

|Pro forma operating results assume amortization
of goodwill and other intangible assets with indefinite lives ceased as of the beginning of 2001.
|-------------------------------------------------------------------------------------------------------------------------------------------------

|In the third quarter of 2002, reported operating income
increased $16.3 million, or 18.8 percent.  The improvement in reported operating income included
the benefit of the change in accounting for goodwill from an amortization method to an impairment-only
approach.  The Company ceased amortizing goodwill and other intangible assets with indefinite lives at
the beginning of fiscal year 2002, while the operating income in the third quarter of 2001
included amortization expense of $12.2 million.  On a pro forma basis, assuming the change in
accounting for goodwill occurred at the beginning of 2001, operating income for the third quarter
increased $3.0 million, or 3.0 percent.  On a pro forma basis, operating income in the domestic
markets decreased slightly by $0.6 million, or 0.6 percent, impacted by increased SD&A costs,
which offset the improvement in gross profit.  Central Europe recorded operating income of
$3.9 million, or $4.0 million better than the previous year. The favorable impact of
foreign exchange rates improved operating results by approximately $1.3 million in the current quarter.
In the Caribbean markets, pro forma operating losses increased by $0.4 million reflecting the
modest increase in SD&A costs and ingredient and packaging costs.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Net interest expense decreased $3.5 million in the
third quarter of 2002 to $19.2 million.  This decrease was principally due to lower rates on
short-term borrowings, and the fixed rate debt, which was converted to floating rate debt
through interest rate swap agreements in fiscal year 2001.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The Company reported other expense of $1.6 million
in the third quarter of 2002 compared to expense of $1.3 million reported in the third quarter of 2001.
|----------------------------------------------------------------------------------------------------------------------------------------------------------

|The Companys effective tax rate in the third quarter
of 2002 was 39 percent compared to 47.9 percent in the third quarter of 2001. The decrease in
the effective tax rate in 2002 was primarily due to the Company ceasing amortization of goodwill
and other intangible assets with indefinite lives.  A majority of this amortization expense was
not deductible for tax purposes.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|14
|--

---

|RESULTS OF OPERATIONS
        2002 FIRST NINE MONTHS COMPARED WITH 2001 FIRST NINE MONTHS
|-----------------------------------------------------------------------------------------

|Due to the disposition of the beer business, as
well as special charges and other non-recurring items recorded in 2002 and 2001, the Company
believes that pro forma results provide a better indication of current operating trends
than reported results.  Therefore, included within the following discussion are explanations
of both reported results and pro forma results.  The Companys business is highly seasonal;
accordingly, the operating results for the first nine months may not be indicative of a full years
operating results.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Net sales for the first nine months of 2002 and
2001 were as follows (in millions):
|-----------------------------------------------------------------------------------

| |                 | Reported |         |         |   |        
| | --------------- | -------- | ------- | ------- | - | -------
| |                 |          |         | Percent |   |        
| |                 | 2002     |         | 2001    |   | Change 
| |                 |          |         |         |   |        
| | Domestic        | $        | 2,141.4 |         | $ | 2,071.7
| | Central Europe  |          | 231.8   |         |   | 209.2  
| | Caribbean       |          | 130.9   |         |   | 128.4  
| |                 |          |         |         |   |        
| | Total net sales | $        | 2,504.1 |         | $ | 2,409.3
| |                 |          |         |         |   |        

|Net sales increased $94.8 million, or 3.9 percent, in the
first nine months of 2002 compared to the first nine months of 2001, primarily due to continued
volume growth in both the domestic and Central European markets, improved pricing in the domestic markets,
and favorable foreign exchange rates.  Excluding net sales of $11 million associated with the beer business
divested in the first quarter of 2001, net sales increased $105.8 million, or 4.4 percent.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Excluding sales associated with the divested beer business,
domestic net sales increased $80.7 million, or 3.9 percent, resulting from improved pricing, up
1.8 percent, as well as increased volume of 3.0 percent.  The improved pricing included a 1.4 percent
improvement attributed to rate increases and a 0.4 percent improvement associated with favorable changes in package
mix.  Offsetting the increase in net sales attributable to increased volume and pricing were declines
in contract, commissary and other net sales, which declined 9.0 percent in the first nine months compared
to last year.  The domestic volume growth in the first nine months benefited from continued growth in
Trademark Mountain Dew of 3 percent, due to incremental growth contributed by Code Red, together
with the continued strong growth in Aquafina of 48.6 percent. Trademark Pepsi volume was essentially
flat compared to the prior year.   Other Pepsi branded flavored soft drinks experienced growth of 14.1
percent, led by Sierra Mist.  Dr Pepper continued to have strong single-digit growth.  The volume growth
in the first nine months was driven by growth in cans of 2.2 percent and strong growth in 24-ounce
non-returnable packages of 19.7 percent, offset, in part, by a decline in 2 liter volume.  Volume from
single serve soft drinks remained relatively flat compared to the prior year.  The domestic results
reflected continued growth in the large format channel, led by supermarkets, offset by continued softness
in the on-premise channel while small format volume remained relatively flat compared to the prior year.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The growth in Central Europe net sales of $22.6 million, or
10.8 percent, resulted from volume growth of 12.9 percent, as well as favorable foreign exchange rates,
offset, in part, by continued declines in pricing in Poland.  Excluding the favorable exchange rate
impact, all markets in Central Europe experienced strong growth in net sales attributed to both volume
growth and pricing improvements, except for Poland.   Competitive pricing pressures continued to
adversely affect Polands net sales growth and pricing in the first nine months compared to the previous year.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The growth in Caribbean net sales of $2.5 million, or 1.9
percent, resulted from improved pricing offset, in part, by a decline in volume of 3.1 percent.
The decline in volume was principally attributed to the adverse impact of the labor dispute in Puerto Rico in
the first quarter of 2002, as well as the impact of a continued decline in tourism in the Caribbean
markets since September 2001.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15
|--

---

|The consolidated gross profit margin, excluding results
of the divested beer operations, increased 50 basis points to 40.4 percent of sales in the first
nine months of 2002 compared with the first nine months of 2001.  The improvement was primarily
attributed to improved margins in the domestic markets, which resulted from improved pricing and
overall moderate growth in ingredient and packaging costs.  In Central Europe, the gross profit
margin improved 170 basis points, mainly due to the favorable impact of foreign exchange rates, while the
overall gross profit margin decreased in the Caribbean markets.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|SD&A expenses in the first nine months of 2002 increased
$44.0 million, or 6.3 percent, compared to the previous year.  Excluding results from the divested
beer business, SD&A represented 29.7 percent of net sales in the first nine months of 2002 compared with 29.1
percent in the first nine months of 2001.  The increase in SD&A as a percent of net sales was mainly
attributable to the domestic markets, offset, in part, by a decline in SD&A costs in Central Europe.
SD&A as a percent of net sales increased 80 basis points in the domestic markets to 28.4 percent.
Costs of $2.8 million associated with the labor strike in Chicago in the second quarter of
2002 negatively impacted the domestic SD&A. Other factors contributing to the increase in SD&A
costs included increases in wages and benefits in the domestic markets due, in part, to aligning
the compensation and benefit programs of legacy Whitman and legacy PepsiAmericas, as well as
expenses associated with the next generation selling system implementation and the roll-out of
additional components of the enterprise-wide resource planning system, primarily inventory and
demand planning applications.  The increase also reflected higher depreciation associated with
investments in technology and cold drink equipment.  SD&A costs as a percent of net sales in Central
Europe declined in the first nine months of 2002, while costs in the Caribbean markets increased
moderately as a percent of net sales.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Operating income (loss) for the first nine months of 2002 and
2001 was as follows (in millions):
|------------------------------------------------------------------------------------------------

| |                        | Reported |       |         |   | Pro Forma |   |        
| | ---------------------- | -------- | ----- | ------- | - | --------- | - | -------
| |                        |          |       | Percent |   |           |   | Percent
| |                        | 2002     |       | 2001    |   | Change    |   | 2002   
| |                        |          |       |         |   |           |   |        
| | Domestic               | $        | 276.2 |         | $ | 241.3     |   | 14.5   
| | Central Europe         |          | ( 2.4 | )       |   | ( 12.0    | ) | 80.0   
| | Caribbean              |          | ( 4.4 | )       |   | ( 2.1     | ) | ( 109.5
| |                        |          |       |         |   |           |   |        
| | Total operating income | $        | 269.4 |         | $ | 227.2     |   | 18.6   
| |                        |          |       |         |   |           |   |        

|In the first nine months of 2002, the $1.1 million reversal of
previously recognized special charges in Central Europe was excluded from pro forma operating income.
Reconciliation of reported results to pro forma results for the first nine months of 2001 is as follows
(in millions):
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |                                                     | First Nine Months 2001 |      
| | --------------------------------------------------- | ---------------------- | -----
| |                                                     |                        |      
| |                                                     |                        |      
| |                                                     | Domestic               |      
| |                                                     |                        |      
| |                                                     |                        |      
| | Reported operating income                           | $                      | 241.3
| | Exclude amortization                                |                        | 35.7 
| | Exclude special charges                             |                        | 4.6  
| | Exclude gain on pension
                curtailment |                        | ( 8.9
| |                                                     |                        |      
| | Pro forma operating income                          | $                      | 272.7
| |                                                     |                        |      

|Pro forma operating results exclude the impact of
special charges and other non-recurring items from the first nine months of 2001 and 2002. In addition,
pro forma results assume amortization of goodwill and other intangible
assets with indefinite lives ceased as of the beginning of 2001.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|16
|--

---

|In the first nine months of 2002, reported operating
income increased $42.2 million, or 18.6 percent.  The improvement in reported operating income
included the benefit of the change in accounting for goodwill from an amortization method to an
impairment-only approach.  The Company ceased amortizing goodwill and other intangible assets with
indefinite lives at the beginning of fiscal year 2002, while the previous year operating income
included amortization expense of $36.7 million.  On a pro forma basis, operating income increased
$8.7 million, or 3.4 percent, which included the costs associated with the Chicago
strike of $2.8 million.  On a pro forma basis, domestic markets increased operating income by $3.5
million, or 1.3 percent, mainly due to increased volume and pricing, offset, in part, by increased
SD&A costs including costs associated with the Chicago strike.  Central Europe reduced operating
losses by $8.0 million, or 69.6 percent, due in part to improved operating performance, led by double-digit
growth in volume, as well as the favorable impact of foreign exchange rates.
In the Caribbean markets, pro forma operating losses increased by $2.8 million reflecting the decline
in volume and increased SD&A costs.  As noted previously, the Caribbean results were adversely
affected by the labor disputes in Puerto Rico and the decline in tourism that has continued since
September 2001.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Net interest expense decreased $15.2 million in the
first nine months of 2002 to $56.6 million.  This decrease was principally due to lower rates
on short-term borrowings.  The Company also adjusted the mix of fixed rate versus floating rate
debt using interest rate swap agreements, which were favorable in the first nine months of 2002.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The Company reported other expense of $2.4 million in the
first nine months of 2002 compared to $0.9 million reported in the first nine months of 2001.
Included in the results for the first nine months of 2002 was a pretax gain of $3.5 million
resulting from the sale of a parcel of land in downtown Chicago.  Results for the first nine
months of 2001 included the benefit of real estate tax refunds associated with the Companys
non-operating real estate entities.  The Company sold certain non-operating real estate assets in 2002.
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The Companys effective tax rate in the first nine months
of 2002 was 39 percent compared to 47.6 percent in the first nine months of 2001.  The decrease in
the effective tax rate in 2002 was primarily due to the Company ceasing amortization of goodwill and other
intangible assets with indefinite lives.  A majority of this amortization expense was not deductible
for tax purposes.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|LIQUIDITY AND CAPITAL RESOURCES
|-------------------------------

|Net cash provided by continuing operations decreased by
$17.4 million to $230.5 million in the first nine months of 2002.  This decrease was primarily due
to the impact of the change in primary working capital, in particular receivables and payables.  The
increase in receivables in the first nine months of 2002 was attributed to an increase in trade
receivables in Central Europe associated with the strong single-digit increase in net sales in the third
quarter of 2002.  In addition, the increase in receivables reflected balances remaining from the
pre-bankruptcy sales to Kmart, as well as increased funding receivable balances from PepsiCo.  The
increase in cash used in accounts payable was primarily related to the timing of payments
made in the third quarter of 2002.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Investing activities in the first nine months of 2002
included $2.9 million of cash paid to acquire full line vending businesses. Investing activities
in the first nine months of 2001 included $5.5 million paid to acquire the minority partners
interest in the soft drink operations in New Orleans, as well as payments related to the acquisition
of Trinidad and Tobago.  The Company made capital investments of $152.5 million, net of proceeds
from asset sales, in the first nine months of 2002 compared with $151.0 million
in the first nine months of 2001.  The increase primarily resulted from investments in manufacturing
capacity, both in the domestic and international operations, as well as investments in cold drink
equipment and the development of a next generation selling system.  The Company expects to spend
approximately $210 to $215 million in 2002 for its capital projects.  Proceeds from the sale of investments
in the first nine months of 2002 related to the sale of a parcel of land in downtown Chicago and in the
first nine months of 2001 related to other miscellaneous land sales associated with the Companys
non-operating real estate subsidiaries.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|17
|--

---

|The Companys total debt increased $40.1 million to $1,378.7
million at the end of the third quarter of 2002, from $1,338.6 million at the end of fiscal 2001.
In September 2002, the Company issued $250 million of notes with a coupon rate of 3.875 percent due in
2007.  These notes are included in long-term debt on the Condensed Consolidated Balance Sheet.
Proceeds from these notes were used to repay outstanding commercial paper or are included in the cash
and equivalents balance at the end of the third quarter.  During February and
March 2001, the Company issued $200 million and $150 million of notes with coupon rates of 5.95
percent due 2006 and 5.79 percent due 2013, respectively.  The notes issued in March 2001 will be
remarketed in March 2003, at which time the notes will either be mandatorily purchased and reissued
by the underwriter or mandatorily redeemed by the Company.  These notes are included in current
maturities of long-term debt in the Condensed Consolidated Balance Sheet at the end of the third quarter of 2002.
Proceeds from these notes were used to repay outstanding commercial paper.  Dividends paid during
the first nine months of 2002 were essentially unchanged from the previous year at $6.1 million
compared to $6.2 million in 2001.  The dividend rate of $0.04 per share in 2002 was unchanged from
the previous year.  During the first nine months of 2002, the Company repurchased 3.9 million shares
for $56.1 million, while purchases of 0.5 million shares for $6.6 million were made in the first
nine months of 2001. The issuance of common stock from treasury shares for the exercise of stock options resulted in cash inflows of
$4.8 million in the first nine months of 2002, compared to $9.1 million in the first nine months of 2001.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The Company has a revolving credit agreement with maximum
borrowings of $500 million, which acts as a back-up for the Companys $500 million commercial paper
program; accordingly, the Company has a total of $500 million available under the commercial paper program
and revolving credit facility combined.  There were no borrowings outstanding at the end of the third
quarter of 2002 as a result of the repayment of such debt from the proceeds from the issuance of
long-term debt in the third quarter.  The Company believes that with its existing operating cash flows, available lines of credit, and the
potential for additional debt and equity offerings, it will have sufficient resources to fund its
future growth and expansion.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|TRANSACTIONS WITH PEPSICO
|-------------------------

|The Company purchases concentrate from PepsiCo to be used in
the production of Pepsi carbonated soft drinks and other non-alcoholic beverages.  PepsiCo also
provides the Company with various forms of marketing supports to promote Pepsis brands.  This support
covers a variety of initiatives, including market place support, marketing programs, marketing equipment
and related program support and shared media expense.  PepsiCo and the Company each record their
share of the cost of marketing programs in their financial statements.  Based on the objectives of
the programs and initiatives, domestic marketing support is recorded as an adjustment to net
sales or as a reduction of selling, delivery and administrative expense.  There are no conditions or
requirements, which could result in the repayment of any support payments received by the Company.
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|The Company manufacturers and distributes fountain
products and provides fountain equipment service to PepsiCo customers in certain territories
in accordance with various agreements.  There are other products which the Company produces
and/or distributes through various arrangements with PepsiCo or partners of PepsiCo.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|See the Annual Report on Form 10-K for fiscal year 2001
for further discussion of related party transactions.
|-------------------------------------------------------------------------------------------------------------

|18
|--

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|FORWARD-LOOKING STATEMENTS
|--------------------------

|This quarterly report on Form 10-Q contains certain
forward-looking statements of expected future developments, as defined in the Private Securities
Litigation Reform Act of 1995.  The forward-looking statements in this Form 10-Q refer to the expectations
regarding continuing operating improvement and other matters.  These forward-looking statements reflect
managements expectations and are based on currently available data; however, actual results are
subject to future risks and uncertainties, which could materially affect actual performance.
Risks and uncertainties that could adversely affect such future performance include, but are not limited
to, the following:  competition, including product and pricing pressures; changing trends in consumer
tastes; changes in the Companys relationship and/or support programs with PepsiCo and other brand
owners; market acceptance of new product offerings; weather conditions; cost and availability of
raw materials; availability of capital; labor and employee benefit costs; unfavorable interest rate
and currency fluctuations; costs of legal proceedings; outcomes of environmental claims and litigation;
and general economic, business and political conditions in the countries and territories where the
Company operates.  These events and uncertainties are difficult or impossible to predict accurately
and many are beyond the Companys control.  The Company assumes no obligation to publicly release
the result of any revisions that may be made to any forward-looking statements to reflect events or
circumstances after the date of such statements or to reflect the occurrence of anticipated or
unanticipated events.
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Item 3.      Quantitative and Qualitative Disclosures
About Market Risk.
|------------------------------------------------------------------------

|The Company is subject to various market risks, including risks
from changes in commodity prices, interest rates and currency
exchange rates.
|---------------------------------------------------------------------------------------------------------------------------------------------

|Commodity Prices
|----------------

|The risk from commodity price changes relates to the
Companys ability to recover higher product costs through price increases to customers, which
may be limited due to the competitive pricing environment that exists in the soft drink business.
The Company uses swap contracts to hedge price fluctuations for a portion of its aluminum and
fuel requirements over a specified period of time. Because of the high correlation between
commodity prices and the Companys contractual cost of these products, the Company considers
these hedges to be highly effective.  As of the end of the third quarter of 2002, the Company
had hedged a portion of its future aluminum and fuel requirements through the fourth quarters
of 2004 and 2002, respectively.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Interest Rates
|--------------

|In the third quarter of 2002, the risk from changes
in interest rates was not material to the Companys operations because a significant portion
of the Companys debt issues were fixed rate obligations.  The Company has entered into interest
rate swaps to convert a portion of its fixed rate debt to floating rate debt.  The Companys
floating rate exposure relates to changes in the six-month LIBOR rate and the overnight Federal
Funds rate.  Assuming consistent levels of floating rate debt with those held at the end of the
third quarter of 2002, a 50 basis point (0.5 percent) change in each of these rates would have
had a $0.5 million impact on the Companys third quarter 2002 interest expense.  The Company
had cash equivalents throughout the third quarter of 2002, principally invested in money market
funds and commercial paper, which were most closely tied to overnight Federal Funds rates.
Assuming a change of 50 basis points in the rate of interest associated with the Companys cash
equivalents at the end of the third quarter of 2002, interest income would not have changed
by a significant amount.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|19
|--

---

|Currency Exchange Rates
|-----------------------

|Because the Company operates in international franchise
territories, it is subject to exposure resulting from changes in currency exchange rates.
Currency exchange rates are influenced by a variety of economic factors including local inflation,
growth, interest rates and governmental actions, as well as other factors.  The Company currently
does not hedge the translation risks of investments in its international operations.  Any positive
cash flows generated by international operations have been reinvested in the operations, or used
to repay intercompany loans.
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|International operations, based on net sales, represented
approximately 15 percent of the Companys total operations in the third quarter of 2002.  A
significant portion of the sales in the Caribbean markets, specifically Puerto Rico, are denominated
in U.S. dollars, which is its functional currency.  Changes in currency exchange rates impact
the translation of the results of certain international operations from their local currencies
into U.S. dollars.  If the currency exchange rates had changed by five percent in the third
quarter of 2002, the Company estimates the impact on reported operating income would not have
been significant.  The Companys estimate reflects the fact that a portion of the international
operations costs are denominated in U.S. dollars, including concentrate.  This estimate does not
take into account the possibility that rates can move in opposite directions and that gains in
one category may or may not be offset by losses from another category.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Item 4.      Controls and Procedures.
|-------------------------------------

|We maintain a system of disclosure controls and
procedures that is designed to provide reasonable assurance that information, which is required
to be disclosed, is accumulated and communicated to management timely.  Within the 90 days
prior to the date of this report, the Company carried out an evaluation, under the supervision
and with the participation of the Company's management, including the Company's Chief Executive
Officer and Chief Financial Officer, of the effectiveness of the design and operation of the
Company's disclosure controls and procedures pursuant to Exchange Act Rule 13a-15. Based upon
that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the
Company's disclosure controls and procedures are effective in timely alerting them to material
information required to be included in the Company's periodic SEC filings relating to the
Company.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|There were no significant changes in the
Company's internal controls or in other factors that could significantly affect these internal
controls subsequent to the date of our most recent evaluation.
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20
|--

---

|PART II-OTHER INFORMATION
|-------------------------

|Item 1.      Legal Proceedings.
|-------------------------------

|No changes to be reported this quarter.
|---------------------------------------

|21
|--

---

|SIGNATURE
|---------

|Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | PEPSIAMERICAS, INC.
| |  | -------------------

|Dated: | November 12, 2002 | By: | /s/ G. MICHAEL DURKIN JR.                                        
|------ | ----------------- | --- | -----------------------------------------------------------------
|       |                   |     |                                                                  
|       |                   |     | G. Michael Durkin Jr.                                            
|       |                   |     | Senior Vice President
                and Chief Financial Officer
|       |                   |     | (As Chief Accounting
                Officer and Duly            
|       |                   |     | Authorized Officer
                of PepsiAmericas, Inc.)       

|22
|--

---

|CERTIFICATIONS
|--------------

|CHIEF EXECUTIVE OFFICER CERTIFICATION
        PURSUANT TO RULE 13a-14
|---------------------------------------------------------------------

I, Robert C. Pohlad, Chairman of the Board and Chief Executive Officer of PepsiAmericas, Inc., certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of
        PepsiAmericas, Inc. for the quarter ended September 28, 2002;
| | -- | ---------------------------------------------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly report
does not contain any untrue statements of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the period covered by this quarterly report;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial
statements, and other financial information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying
officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | designed such disclosure controls
and procedures to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which
this quarterly report is being prepared;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | evaluated the effectiveness of the
registrants disclosure controls and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the Evaluation Date); and
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c) | presented in this quarterly report
our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying
officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and
the audit committee of registrants board of directors (or persons performing the equivalent functions):
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | all significant deficiencies in the
design or operation of internal controls which could adversely affect the registrants ability to record,
process, summarize and report financial data and have identified for the registrants auditors any
material weaknesses in internal controls; and
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | any fraud, whether or not material, that involves
management or other employees who have a significant role in the registrants internal controls;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this quarterly report whether or not
there were significant changes in internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: | November 12, 2002 | By: | /s/ ROBERT C. POHLAD                                             
|------ | ----------------- | --- | -----------------------------------------------------------------
|       |                   |     |                                                                  
|       |                   |     | Robert C. Pohlad                                                 
|       |                   |     | Chairman of the Board and
                Chief Executive Officer

|23
|--

---

|CHIEF FINANCIAL OFFICER CERTIFICATION
        PURSUANT TO RULE 13a-14
|---------------------------------------------------------------------

I, G. Michael Durkin Jr., Senior Vice President and Chief Financial Officer of PepsiAmericas, Inc.,
certify that:

| | 1. | I have reviewed this quarterly report on Form 10-Q of
        PepsiAmericas, Inc. for the quarter ended September 28, 2002;
| | -- | ---------------------------------------------------------------------------------------------------------------------------

| | 2. | Based on my knowledge, this quarterly report
does not contain any untrue statements of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the period covered by this quarterly report;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 3. | Based on my knowledge, the financial
statements, and other financial information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 4. | The registrants other certifying
officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | designed such disclosure controls
and procedures to ensure that material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which
this quarterly report is being prepared;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | evaluated the effectiveness of the
registrants disclosure controls and procedures as of a date within 90 days prior to the filing date
of this quarterly report (the Evaluation Date); and
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c) | presented in this quarterly report
our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 5. | The registrants other certifying
officers and I have disclosed, based on our most recent evaluation, to the registrants auditors and
the audit committee of registrants board of directors (or persons performing the equivalent functions):
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | all significant deficiencies in the
design or operation of internal controls which could adversely affect the registrants ability to record,
process, summarize and report financial data and have identified for the registrants auditors any
material weaknesses in internal controls; and
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | any fraud, whether or not material, that involves
management or other employees who have a significant role in the registrants internal controls;
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------

| | 6. | The registrants other certifying officers and I have indicated in this quarterly report whether or not
there were significant changes in internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: | November 12, 2002 | By: | /s/ G. MICHAEL DURKIN JR.                                        
|------ | ----------------- | --- | -----------------------------------------------------------------
|       |                   |     |                                                                  
|       |                   |     | G. Michael Durkin Jr.                                            
|       |                   |     | Senior Vice President
                and Chief Financial Officer

|24
|--

---

|CHIEF EXECUTIVE OFFICER CERTIFICATION
        PURSUANT TO 18 U.S.C. SECTION 1350
|--------------------------------------------------------------------------------

|In connection with the
Quarterly Report of PepsiAmericas, Inc. (the Company) on Form 10-Q for the quarterly period
ended September 28, 2002, as filed with the Securities and Exchange Commission on the date hereof (the
Report), I, Robert C. Pohlad, Chairman of the Board and Chief Executive Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, that:
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1. | the Report fully complies with the
requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
| | -- | ---------------------------------------------------------------------------------------------------------------------

| | 2. | the information contained in the Report
fairly presents, in all material respects, the financial condition and results of operations of the Company.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: | November 12, 2002 | By: | /s/ ROBERT C. POHLAD                                             
|------ | ----------------- | --- | -----------------------------------------------------------------
|       |                   |     |                                                                  
|       |                   |     | Robert C. Pohlad                                                 
|       |                   |     | Chairman of the Board and
                Chief Executive Officer

|25
|--

---

|CHIEF FINANCIAL OFFICER CERTIFICATION
        PURSUANT TO 18 U.S.C. SECTION 1350
|--------------------------------------------------------------------------------

|In connection with the
Quarterly Report of PepsiAmericas, Inc. (the Company) on Form 10-Q for the quarterly period
ended September 28, 2002, as filed with the Securities and Exchange Commission on the date hereof (the
Report), I, G. Michael Durkin Jr., Senior Vice President and Chief Financial Officer of the Company,
certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002, that:
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 1. | the Report fully complies with the
requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
| | -- | ---------------------------------------------------------------------------------------------------------------------

| | 2. | the information contained in the Report
fairly presents, in all material respects, the financial condition and results of operations of the Company.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------

|Dated: | November 12, 2002 | By: | /s/ G. MICHAEL DURKIN JR.                                        
|------ | ----------------- | --- | -----------------------------------------------------------------
|       |                   |     |                                                                  
|       |                   |     | G. Michael Durkin Jr.                                            
|       |                   |     | Senior Vice President
                and Chief Financial Officer

|26
|--

---