Document:

Deed of Covenant dated July 21, 2006 made by PepsiCo, Inc.

 Exhibit 4.2 
  
 21 July 2006 
 PEPSICO, INC.

  

					
		  	 	  	
		  	  
 DEED OF COVENANT
 in respect of a U.S.$2,500,000,000
 EURO MEDIUM TERM NOTE PROGRAMME
  
  
	  	
		  	 	  	

 DEED OF COVENANT 
 THIS DEED OF COVENANT is made on 21 July, 2006 by PepsiCo, Inc. (the Issuer) in favour of the account holders specified below of Clearstream Banking, société anonyme and Euroclear Bank
S.A./N.V., as operator of the Euroclear System and/or any other additional clearing system or systems as are specified in the Final Terms relating to any Note (as defined below) (each a Clearing System). 
 WHEREAS: 
  

	 (A)
	 The Issuer has entered into a Programme Agreement (the Programme Agreement, which expression includes the same as it may be amended or supplemented
from time to time) dated 21 July, 2006 with the Dealers named therein under which the Issuer proposes from time to time to issue Euro Medium Term Notes (the Notes). 

  

	 (B)
	 The Notes will initially be represented by, and comprised in, Temporary Global Notes (the Temporary Global Notes) or Permanent Global Notes (the
Permanent Global Notes, the Temporary Global Notes and the Permanent Global Notes being herein together called the Global Notes) representing a certain number of underlying Notes (the Underlying Notes). Each
Underlying Note initially represented by, and comprised in, a Temporary Global Note may be thereafter represented by a Permanent Global Note. 

  

	 (C)
	 Each Global Note may, after issue, be deposited with a depositary or, as the case may be, the common safekeeper, for one or more Clearing Systems (each such
Clearing System or all such Clearing Systems together, the Relevant Clearing System). Upon such deposit of a Global Note the Underlying Notes represented by such Global Note will be credited to a securities account or securities
accounts with the Relevant Clearing System. Any account holder with the Relevant Clearing System which has underlying Notes credited to its securities account from time to time (each a Relevant Account Holder) will, subject to and in
accordance with the terms and conditions and operating procedures or management regulations of the Relevant Clearing System, be entitled to transfer such Underlying Notes and (subject to and upon payment being made by the Issuer to the bearer in
accordance with the terms of the relevant Global Note) will be entitled to receive payments from the Relevant Clearing System, as the case may be, calculated by reference to the Underlying Notes credited to its securities account.

  

	 (D)
	 In certain circumstances specified in each Global Note, a Global Note will become void. The time at which a Global Note becomes void is hereinafter referred to
as the Relevant Time. In such circumstances each Relevant Account Holder will, subject to and in accordance with the terms of this Deed, acquire against the Issuer all those rights which such Relevant Account Holder would have had if,
prior to the Global Note becoming void, duly executed and authenticated Definitive Note(s) (as defined in the Agency Agreement) and, if the Notes are repayable in instalments, receipts in respect thereof (the Receipts) and interest
coupons (the Coupons) appertaining to the Definitive Note(s) (if appropriate) had been issued in respect of its Underlying Note(s) and such Definitive Note(s), Receipts (if appropriate) and Coupons (if 

  

 Page 2 

	     
	 appropriate) were held and beneficially owned by such Relevant Account Holder. 

 NOW THIS DEED WITNESSES AS
FOLLOWS: 
  

	 1.
	 If any Global Note becomes void in accordance with the terms thereof the Issuer hereby undertakes and covenants with each Relevant Account Holder (other than
when any Relevant Clearing System is an account holder of any other Relevant Clearing System) that each Relevant Account Holder shall automatically acquire at the Relevant Time, without the need for any further action on behalf of any person,
against the Issuer all those rights which such Relevant Account Holder has credited to its securities account with the Relevant Clearing System at the Relevant Time. The Issuer’s obligation pursuant to this clause shall be a separate and
independent obligation by reference to each Underlying Note which a Relevant Account Holder has credited to its securities account with the Relevant Clearing System and the Issuer agrees that a Relevant Account Holder may assign its rights hereunder
in whole or in part. 

  

	 2.
	 The records of the Relevant Clearing System shall be conclusive evidence of the identity of the Relevant Account Holders and the number of Underlying Notes
credited to the securities account of each Relevant Account Holder. For the purposes hereof a statement issued by the Relevant Clearing System stating: 

  

	 	 (i)
	 the name of the Relevant Account Holder to which such statement is issued; and 

  

	 	 (ii)
	 the aggregate nominal amount of Underlying Notes credited to the securities account of such Relevant Account Holder as at the opening of business on the first
day following the Relevant Time on which the Relevant Clearing System is open for business, shall be conclusive evidence of the records of the Relevant Clearing System at the Relevant Time. 

  

	 3.
	 In the event of a dispute, the determination of the Relevant Time by the Relevant Clearing System (in the absence of manifest error) shall be final and
conclusive for all purposes in connection with the Relevant Account Holders with securities accounts with the Relevant Clearing System. 

  

	 4.
	 The Issuer will, subject to the exceptions and limitations set forth below, pay such Additional Amounts as are necessary in order that the net payment by the
Issuer or any Paying Agent of the principal of and interest (including any discount) on a Note or Coupon to a holder who is a United States Alien (as such term is defined below), after deduction or withholding for or on account of any present or
future tax, assessment or governmental charge of the United States (as such term is defined below), or a political subdivision or authority thereof or therein, imposed by withholding with respect to the payment, will not be less than the amount
provided for in such Note or such Coupon to be then due and payable; provided, however, that the foregoing obligation to pay Additional Amounts shall not apply to: 

  

 Page 3 

	 	 (i)
	 any tax, assessment or governmental charge that would not have been so imposed but for the existence of any present or former connection between such holder (or
between a fiduciary, settlor, beneficiary, member or shareholder of, or holder of power over, such holder, if such holder is an estate, trust, partnership or corporation) and the United States, including, without limitation, such holder (or
fiduciary, settlor, beneficiary, member, shareholder or holder of a power): 

  

	 	 (A)
	 being or having been present or engaged in a trade or business in the United States or having or having had a permanent establishment therein; or

  

	 	 (B)
	 having a current or former relationship with the United States, including a relationship as a citizen or resident or being treated as a resident thereof; or

  

	 	 (C)
	 being or having been a personal holding company, a controlled foreign corporation, a passive foreign investment company, a foreign personal holding company with
respect to the United States, a corporation that has accumulated earnings to avoid United States federal income tax or a private foundation or other tax-exempt organisation; or 

  

	 	 (D)
	 being or having been an actual or a constructive “10-per cent. shareholder” of the Issuer as defined in Section 871(h)(3) of the Code, or a bank
receiving interest described under Section 881(c)(3)(A) of the Code or a direct or indirect subsidiary of the Issuer; or 

  

	 	 (ii)
	 any holder who is a fiduciary or partnership or other than the sole beneficial owner of the Note or Coupon, but only to the extent that a beneficiary or settlor
with respect to such fiduciary or member of such partnership or a beneficial owner of the Note or Coupon would not have been entitled to the payment of an additional amount had such beneficiary, settlor, member or beneficial owner been the holder of
such Note or Coupon; or 

  

	 	 (iii)
	 any tax, assessment or governmental charge that would not have been imposed or withheld but for the failure of the holder, if required, to comply with
certification, identification information reporting requirements under United States income tax laws, without regard to any tax treaty, with respect to the payment, concerning the nationality, residence, identity or connection with the United States
of the holder or a beneficial owner of such Note or Coupon, if such compliance is required by United States income tax laws, without regard to any tax treaty, as a precondition to relief or exemption from such tax, assessment or governmental charge;
or 

  

	 	 (iv)
	 any tax, assessment or governmental charge that would not have been so imposed or withheld but for the presentation by the holder of such

  

 Page 4 

	 	     
	 Note or Coupon for payment on a date more than 30 days after the Relevant Date; or 

  

	 	 (v)
	 any estate, inheritance, gift, sales, transfer, excise, wealth or personal property tax or any similar tax, assessment or governmental charge; or

  

	 	 (vi)
	 any tax, assessment or governmental charge that is (a) payable otherwise than by withholding by the Issuer or a Paying Agent from the payment of the
principal of or interest on such Note or Coupon or (b) is required to be withheld by any Paying Agent from any such payment if such payment can be made without such withholding by any other Paying Agent; or 

  

	 	 (vii)
	 any withholding or deduction that is imposed on a payment to an individual and is required to be made pursuant to European Council Directive 2003/48/EC on the
taxation of savings income or any law implementing or complying with, or introduced in order to conform to, such Directive; or 

  

	 	 (viii)
	 any Note or Coupon presented for payment by or on behalf of a holder who would have been able to avoid such withholding or deduction by presenting the relevant
Note or Coupon to another Paying Agent in a Member State of the EU; or 

  

	 	 (ix)
	 any combination of items (i), (ii), (iii), (iv), (v), (vi), (vii) or (viii). 

  

	     
	 As used with this paragraph, United States means the United States of America (including the States and the District of Columbia), the Commonwealth
of Puerto Rico and each possession of the United States of America and place subject to its jurisdiction and United States Alien means any person that is for United States federal income tax purposes (A) a foreign corporation,
(B) a foreign partnership one or more of the members of which is, for United States federal income tax purposes, a foreign corporation, a non-resident alien fiduciary of a foreign estate or trust, (C) a non-resident alien individual or
(D) a non-resident alien fiduciary of a foreign estate or trust. 

  

	     
	 As used herein, the Relevant Date means the date on which such payment fist becomes due, except that, if the full amount of the moneys payable has
not been duly received by the Agent on or prior to such due date, it means the date on which, the full amount of such moneys having been so received, notice to that effect is duly given to the Noteholders. 

  

	 5.
	 The Issuer will pay any stamp and other duties and similar taxes, including interest and penalties, payable on or in connection with the execution of this Deed
and any action taken by any Relevant Account Holder to enforce the provisions of this Deed. 

  

	 6.
	 The Issuer hereby warrants, represents and covenants with each Relevant Account Holder that it has all corporate power, and has taken all necessary corporate or
other steps, to enable it to execute, deliver and perform this Deed, and that this Deed constitutes a legal, valid and binding obligation of the 

  

 Page 5 

	     
	 Issuer enforceable in accordance with its terms subject to the laws of bankruptcy and other laws affecting the rights of creditors generally.

  

	 7.
	 This Deed shall take effect as a Deed Poll for the benefit of the Relevant Account Holders from time to time and for the time being. This Deed shall be deposited
with and held by the depositary or, as the case may be, the common safekeeper for the Relevant Clearing System until all the obligations of the Issuer hereunder have been discharged in full. 

  

	 8.
	 The Issuer hereby acknowledges the right of every Relevant Account Holder to the production of, and the right of every Relevant Account Holder to obtain (upon
payment of a reasonable charge) a copy of, this Deed, and further acknowledges any covenants that the obligations binding upon it contained herein are owed to, and shall be for the account of, each and every Relevant Account Holder, and that each
Relevant Account Holder shall be entitled severally to enforce the said obligations against the Issuer. 

  

	 9.
	 This Deed is governed by, and shall be construed in accordance with, the law of England. 

  

	     
	 The Issuer hereby irrevocably agrees, for the exclusive benefit of the Paying Agents, that the courts of England are to have jurisdiction to settle any disputes
which may arise out of or in connection with this Deed and that accordingly any suit, action or proceedings (together referred to as Proceedings) arising out of or in connection with this Deed may be brought in such courts. The Issuer
hereby irrevocably waives any objection which it may have now or hereafter to the laying of the venue of any such Proceedings in any such court and any claim that any such Proceedings have been brought in an inconvenient forum and hereby further
irrevocably agrees that a judgment in any such Proceedings brought in the English courts shall be conclusive and binding upon it and may be enforced in the courts of any other jurisdiction. Nothing contained in this Clause shall limit any right to
take Proceedings against the Issuer in any other court of competent jurisdiction, nor shall the taking of Proceedings in one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction, whether concurrently or not. The Issuer
hereby appoints PepsiCo International Limited at its registered office at 63 Kew Road, Richmond, Surrey, England TW9 2QL (Attention: Division Counsel) as its agent for service of process, and undertakes that, in the event of PepsiCo International
Limited ceasing so to act or ceasing to be registered in England, it will appoint another person, as the Agent may approve, as its agent for service of process in England in respect of any Proceedings. Nothing herein shall affect the right to serve
process in any manner permitted by law. 

  

	 10.
	 No person shall have any right to enforce any term or condition of the Notes under the Contracts (Rights of Third Parties) Act 1999.

  

 Page 6 

 IN WITNESS whereof the Issuer has caused this Deed to be duly
executed the day and year first above mentioned. 
  

			
	 EXECUTED as a DEED under seal
	  	     )

	 by PEPSICO, INC.
	  	     )

	 and signed and delivered as a deed on
	  	     )

	 its behalf by
	  	     )

	 in the presence of:
	  	     )

  

			
	 Witness:  /s/ Cynthia Nastanski

	
	 Name: /s/ Lionel L. Nowell

	             Lionel L. Nowell

  

			
	 Address:
	  	         PepsiCo, Inc.

		  	         700 Anderson Hill Road

		  	         Purchase, NY 10577

  

			
	 EXECUTED as a DEED under seal
	  	     )

	 by PEPSICO, INC.
	  	     )

	 and signed and delivered as a deed on
	  	     )

	 its behalf by
	  	     )

	 in the presence of:
	  	     )

  

			
	 Witness:  /s/ Cynthia Nastanski

	
	 Name: /s/ J. Darrell Thomas

	             J. Darrell Thomas

  

			
	 Address:
	  	         PepsiCo, Inc.

		  	         700 Anderson Hill Road

		  	         Purchase, NY 10577

  

 Page 7PepsiCo, Inc. Long-Term Incentive Plan

 Exhibit 10.1 
 PepsiCo, Inc. 
 2003 Long-Term Incentive Plan 
 (as amended and restated effective October 1, 2006) 
  

	 1.
	 Purposes. 

 The purposes of this Plan are to provide long-term incentives to those persons with significant responsibility for the success and growth of PepsiCo, Inc. (“PepsiCo”) and its subsidiaries, divisions and affiliated businesses, to
associate the interests of such persons with those of PepsiCo’s shareholders, to assist PepsiCo in recruiting, retaining and motivating a diverse group of employees and outside directors on a competitive basis, and to ensure a pay for
performance linkage for such employees and outside directors. If approved by PepsiCo’s shareholders, this Plan would replace the PepsiCo, Inc. 1994 Long-Term Incentive Plan, the PepsiCo, Inc. 1995 Stock Option Incentive Plan, the PepsiCo
SharePower Stock Option Plan, the Director Stock Plan and the PepsiCo Share Award Plan, and no further awards would be made under any of the foregoing plans. 
  

	 2.
	 Definitions. 

 For purposes of the Plan: 
 (a)    “Award” means a grant of Options, Stock
Appreciation Rights, Restricted Shares, Restricted Share Units, Performance Awards, vested shares of Common Stock, or any or all of them (but vested shares of Common Stock may not be granted to employees or officers). 
 (b)    “Board” means the Board of Directors of PepsiCo, Inc. 
 (c)    “Change in Control” is defined in Section 11(f). 
 (d)    “Code” means the Internal Revenue Code of 1986, as amended. 
 (e)    “Committee” means, with respect to any matter relating to Section 8 of the Plan, the Board, and
with respect to all other matters under the Plan, the Compensation Committee of the Board of Directors of PepsiCo, Inc. The Compensation Committee shall be appointed by the Board and shall consist of two or more outside, disinterested members of the
Board. The Compensation Committee, in the judgment of the Board, shall be qualified to administer the Plan as contemplated by (a) Rule 16b-3 of the Securities and Exchange Act of 1934 (or any successor rule), (b) Section 162(m) of the
Code, as amended, and the regulations thereunder (or any successor Section and regulations), and (c) any rules and regulations of a stock exchange on which Common Stock is traded. Any member of the Compensation Committee who does not satisfy
the qualifications set out in the preceding sentence may recuse himself or herself from any vote or other action taken by the Committee. The Board may, at any time and in its complete discretion, remove any member of the Compensation Committee and
may fill any vacancy in the Compensation Committee. 
 (f)    “Common Stock” means the common
stock, par value 1 2/3 cents per share, of PepsiCo, Inc. 
 (g)    “Company” means PepsiCo, its
subsidiaries, divisions and affiliated businesses. 
 (h)    “Eligible Participants” means any
of the following individuals who is designated by the Committee as eligible to receive Awards, subject to the conditions set forth in this Plan: any officer, employee, consultant or advisor of the Company. The term employee does not include any
individual who is not, as of the grant date of an Award, classified by the Company as an employee on its corporate books and records even if that individual is later reclassified (by the Company, any court or any governmental or 

 regulatory agency) as an employee as of the grant date. Non-Employee Directors are not Eligible
Participants. 
 (i)    “Employee Directors” means the members of the Board who are also
employees of the Company. 
 (j)    “Fair Market Value” on any date means the average of the
high and low market prices at which a share of Common Stock shall have been sold on such date, or the immediately preceding trading day if such date was not a trading day, as reported on the New York Stock Exchange Composite Transactions Listing
and, in the case of an ISO, means fair market value as determined by the Committee in accordance with Section 422 of the Code. 
 (k)    “ISO” means an Option satisfying the requirements of Section 422 of the Code and designated by the Committee as an ISO. 
 (l)    “Named Executive Officer” means PepsiCo’s Chief Executive Officer and PepsiCo’s next four highest paid executive officers, as reported in
PepsiCo’s proxy statement pursuant to Regulation S-K, Item 402(a)(3) for a given year. 
 (m)    “Non-Employee Director” means a member of the Board who is not an employee of the Company. 
 (n)    “NQSO” or “Non-Qualified Stock Option” means an Option that does not satisfy the requirements of Section 422 of the Code and that is not designated as an ISO by the
Committee. 
 (o)    “Options” means the right to purchase shares of Common Stock at a
specified price for a specified period of time. 
 (p)    “Option Exercise Price” means the
purchase price per share of Common Stock covered by an Option granted pursuant to this Plan. 
 (q)    “Participant” means an individual who has received an Award under this Plan. 
 (r)    “PepsiCo” means PepsiCo, Inc., a North Carolina corporation. 
 (s)    “Performance Awards” means an Award of Performance Shares or Performance Units based on the achievement of Performance Goals during a Performance Period. 
 (t)    “Performance Based Exception” means the performance-based exception set forth in Code
Section 162(m)(4)(C) from the deductibility limitations of Code Section 162(m). 
 (u)    “Performance Goals” means the goals established by the Committee under Section 7(d). 
 (v)    “Performance Measures” means the criteria set out in Section 7(d) that may be used by the Committee as the basis for a Performance Goal. 
 (w)    “Performance Period” means the period established by the Committee during which the achievement of
Performance Goals is assessed in order to determine whether and to what extent a Performance Award has been earned. 
 (x)    “Performance Shares” means shares of Common Stock awarded to a Participant based on the achievement of Performance Goals during a Performance Period. 
 (y)    “Performance Units” means an Award denominated in shares of Common Stock, cash or a combination
thereof, as determined by the Committee, awarded to a Participant based on the achievement of Performance Goals during a Performance Period. 
  

 2 

 (z)    “Plan” means the PepsiCo, Inc. 2003 Long-Term
Incentive Plan, as amended and restated from time to time. 
 (aa)    “Prior Plans” means the
PepsiCo, Inc. 1994 Long-Term Incentive Plan, the PepsiCo, Inc. 1995 Stock Option Incentive Plan, the PepsiCo SharePower Stock Option Plan, the Director Stock Plan, the PepsiCo Share Award Plan, the PepsiCo 1987 Incentive Plan, the Quaker Long Term
Incentive Plan of 1990, the Quaker Long Term Incentive Plan of 1999 and the Quaker Stock Compensation Plan for Outside Directors. 
 (bb)    “Restriction Period” means, with respect to Restricted Shares or Restricted Share Units, the period during which any restrictions set by the Committee remain in place. Restrictions remain in place until
such time as they have lapsed under the terms and conditions of the Restricted Shares or as otherwise determined by the Committee. 
 (cc)    “Restricted Shares” means shares of Common Stock, which may not be traded or sold until the date that the restrictions on transferability imposed by the Committee with respect to such shares have
lapsed. 
 (dd)    “Restricted Share Units” means the right, as described in Section 7(c),
to receive an amount, payable in either cash or shares of Common Stock, equal to the value of a specified number of shares of Common Stock. 
 (ee)    “Retirement” with respect to a Non-Employee Director shall mean termination from the Board after such Non-Employee Director shall have attained at least age 55 or after such
Non-Employee Director shall have satisfied the criteria for Retirement established by the Employee Directors from time to time. 
 (ff)    “Stock Appreciation Rights” or “SAR” means the right to receive the difference between the Fair Market Value of a share of Common Stock on the grant date and the Fair Market Value of a share
of Common Stock on the date the Stock Appreciation Right is exercised. 
 (gg)    “Total
Disability” shall have the meaning set forth in the long-term disability program of PepsiCo. 
  

	 3.
	 Administration of the Plan. 

 (a)    Authority of Committee.  The Plan shall be administered by the Committee, which shall have all the powers vested in it by the terms of the Plan, such powers to include the
authority (within the limitations described herein): 
  

	 	 •
	 	 to select the persons to be granted Awards under the Plan, 

	 	 •
	 	 to determine the type, size and terms of Awards to be made to each person selected, 

	 	 •
	 	 to determine the time when Awards are to be made and any conditions which must be satisfied before an Award is made, 

	 	 •
	 	 to establish objectives and conditions for earning Awards, 

	 	 •
	 	 to determine whether an Award shall be evidenced by an agreement and, if so, to determine the terms of such agreement (which shall not be inconsistent with the
Plan) and who must sign such agreement, 

	 	 •
	 	 to determine whether the conditions for earning an Award have been met and whether an Award will be paid at the end of the Performance Period,

	 	 •
	 	 to determine if and when an Award may be deferred, 

	 	 •
	 	 to determine whether the amount or payment of an Award should be reduced or eliminated, 

	 	 •
	 	 to determine the guidelines and/or procedures for the payment or exercise of Awards, and 

  

 3 

	 	 •
	 	 to determine whether an Award should qualify, regardless of its amount, as deductible in its entirety for federal income tax purposes, including whether any
Awards granted to Named Executive Officers comply with the Performance Based Exception under Code Section 162(m). 

 (b)    Interpretation of Plan.  The Committee shall have full power and authority to administer and interpret the Plan and to adopt or establish such rules, regulations,
agreements, guidelines, procedures and instruments, which are not contrary to the terms of the Plan and which, in its opinion, may be necessary or advisable for the administration and operation of the Plan. The Committee’s interpretations of
the Plan, and all actions taken and determinations made by the Committee pursuant to the powers vested in it hereunder, shall be conclusive and binding on all parties concerned, including PepsiCo, its shareholders and any person receiving an Award
under the Plan. 
 (c)    Delegation of Authority.  To the extent not prohibited by law,
the Committee may delegate its authority hereunder and may grant authority to employees or designate employees of the Company to execute documents on behalf of the Committee or to otherwise assist the Committee in the administration and operation of
the Plan. 
  

	 4.
	 Eligibility. 

 (a)    General.  Subject to the provisions of the Plan, the Committee may, from time to time, select from all Eligible Participants those to whom Awards shall be granted under Section 7 and shall
determine the nature and amount of each Award. Only Non-Employee Directors shall be eligible to receive Awards under Section 8. 
 (b)    International Participants.  Notwithstanding any provision of the Plan to the contrary, in order to foster and promote achievement of the purposes of the Plan or to comply
with provisions of laws in other countries in which the Company operates or has employees, the Committee, in its sole discretion, shall have the power and authority to (i) determine which Eligible Participants (if any) employed by the Company
outside the United States are eligible to participate in the Plan, (ii) modify the terms and conditions of any Awards made to such Eligible Participants, and (iii) establish subplans and modified Option exercise procedures and other Award
terms and procedures to the extent such actions may be necessary or advisable. 
  

	 5.
	 Shares of Common Stock Subject to the Plan. 

 (a)    Authorized Number of Shares.  Unless otherwise authorized by PepsiCo’s shareholders and subject to the provisions of this Section 5 and
Section 10, the maximum aggregate number of shares of Common Stock available for issuance under the Plan shall be (i) 70 million, plus (ii) the number of shares underlying awards under the Prior Plans, which are cancelled or
expire after the effective date of this Plan. Any of the authorized shares may be used for any of the types of Awards described in the Plan, except: 
 (i)    at least 20 million of the authorized shares will be available for issuance in connection with broad-based grants under PepsiCo’s SharePower program, 
 (ii)    no more than 30 million of the authorized shares may be issued pursuant to Awards other than Options
granted with an Option Exercise Price equal to Fair Market Value on the date of grant, and 
 (iii)    no
more than 50 million shares may be issued in the form of ISOs. 
 (b)    Share
Counting.  The following shall apply in determining the number of shares remaining available for grant under this Plan: 
 (i)    In connection with the granting of an Option or other Award (other than a Performance Unit denominated in dollars), the number of shares of Common Stock available for issuance under this
Plan shall be reduced by the number of shares in respect of which the Option or Award is granted 
  

 4 

 or denominated; provided, however, that where a SAR is settled in shares of Common Stock, the number of
shares of Common Stock available for issuance under this Plan shall be reduced only by the number of shares issued in such settlement. 
 (ii)    If any Option is exercised by tendering shares of Common Stock to PepsiCo as full or partial payment of the exercise price, the number of shares available for issuance under this Plan shall
be increased by the number of shares so tendered. 
 (iii)    Whenever any outstanding Option or other
Award (or portion thereof) expires, is cancelled, is settled in cash or is otherwise terminated for any reason without having been exercised or payment having been made in respect of the entire Option or Award, the shares allocable to the expired,
cancelled, settled or otherwise terminated portion of the Option or Award may again be the subject of Options or Awards granted under this Plan. 
 (iv)    Awards granted through the assumption of, or in substitution for, outstanding awards previously granted to individuals who become employees as a result of a merger, consolidation,
acquisition or other corporate transaction involving the Company as a result of an acquisition will not count against the reserve of available shares under this Plan. 
 (c)    Shares to be Delivered.  Shares of Common Stock to be delivered by the Company under this Plan shall be determined by the Committee and may consist in
whole or in part of authorized but unissued shares, treasury shares or shares acquired on the open market. 
  

	 6.
	 Award Limitations. 

 The maximum number of Options or SARs that can be granted to any Eligible Participant during a single calendar year cannot exceed 2,000,000. The maximum per Eligible Participant, per calendar year amount of Awards other than Options and
SARs shall not exceed $15,000,000 or 500,000 shares of Common Stock. The maximum Award that may be granted to any Eligible Participant for a Performance Period greater than one year shall not exceed the foregoing annual maximum multiplied by the
number of full years in the Performance Period. 
  

	 7.
	 Awards to Eligible Participants. 

 (a)    Options. 
 (i)    Grants.  Subject to the terms and provisions of this Plan, Options may be granted to Eligible Participants. Options may consist of ISOs or NQSOs, as the Committee shall determine. Options may be
granted alone or in tandem with SARs. With respect to Options granted in tandem with SARs, the exercise of either such Options or such SARs will result in the simultaneous cancellation of the same number of tandem SARs or Options, as the case may
be. 
 (ii)    Option Exercise Price.  The Option Exercise Price shall be equal to or
greater than the Fair Market Value on the date the Option is granted, unless the Option was granted through the assumption of, or in substitution for, outstanding awards previously granted to individuals who became employees of the Company as a
result of a merger, consolidation, acquisition or other corporate transaction involving the Company. 
 (iii)    Term.  The term of Options shall be determined by the Committee in its sole discretion, but in no event shall the term exceed ten (10) years from the date of grant; provided, however, that
Awards covering up to five (5) million shares of Common Stock may be issued with a term of up to fifteen (15) years. 
 (iv)    ISO Limits.  ISOs may only be granted to employees of PepsiCo, its divisions and subsidiaries and may only be granted to an employee who, at the time the Option is granted, does not own

  

 5 

 stock possessing more than ten percent (10%) of the total combined voting power of all classes of
stock of PepsiCo. The aggregate Fair Market Value of all shares with respect to which ISOs are exercisable by a Participant for the first time during any year shall not exceed $100,000. The aggregate Fair Market Value of such shares shall be
determined at the time the Option is granted. 
 (v)    No Repricing.  Except for
adjustments made pursuant to Section 10, the Option Exercise Price for any outstanding Option granted under the Plan may not be decreased after the date of grant nor may any outstanding Option granted under the Plan be surrendered to the
Company as consideration for the grant of a new Option with a lower Option Exercise Price without the approval of PepsiCo’s shareholders. 
 (vi)    Buy Out of Option Gains.  At any time after any Option becomes exercisable, the Committee shall have the right to elect, in its sole discretion and without the consent of
the holder thereof, to cancel such Option and to cause PepsiCo to pay to the Participant the excess of the Fair Market Value of the shares of Common Stock covered by such Option over the Option Exercise Price of such Option at the date the Committee
provides written notice (the “Buy Out Notice”) of its intention to exercise such right. Buy outs pursuant to this provision shall be effected by PepsiCo as promptly as possible after the date of the Buy Out Notice. Payments of buy out
amounts shall be made in shares of Common Stock. The number of shares shall be determined by dividing the amount of the payment to be made by the Fair Market Value of a share of Common Stock at the date of the Buy Out Notice, and by rounding up any
fractional share to a whole share. The rights provided by this provision are the exclusive rights that are available with respect to any Option in the event of a buy out, notwithstanding the terms of any outstanding agreement. 
 (b)    Stock Appreciation Rights. 
 (i)    Grants.  Subject to the terms and provisions of this Plan, SARs may be granted to Eligible Participants. SARs may be granted alone or in tandem with
Options. With respect to SARs granted in tandem with Options, the exercise of either such Options or such SARs will result in the simultaneous cancellation of the same number of tandem SARs or Options, as the case may be. 
 (ii)    Purchase Price.  The purchase price per share of Common Stock covered by a SAR granted
pursuant to this Plan shall be equal to or greater than Fair Market Value on the date the SAR is granted, unless the SAR was granted through the assumption of, or in substitution for, outstanding awards previously granted to individuals who became
employees of the Company as a result of a merger, consolidation, acquisition or other corporate transaction involving the Company. 
 (iii)    Term.  The term of a SAR shall be determined by the Committee in its sole discretion, but in no event shall the term exceed ten (10) years from the date of grant; provided, however, that
Awards covering up to five (5) million shares of Common Stock may be issued with a term of up to fifteen (15) years. 
 (iv)    Form of Payment.  The Committee may authorize payment of a SAR in the form of cash, Common Stock valued at its Fair Market Value on the date of the exercise, a combination thereof, or by any
other method as the Committee may determine. 
 (c)    Restricted Shares / Restricted Share Units.

 (i)    Grants. Subject to the terms and provisions of the Plan, Restricted Shares or Restricted
Share Units may be granted to Eligible Participants. 
  

 6 

 (ii)    Restrictions.  The Committee shall impose
such terms, conditions and/or restrictions on any Restricted Shares or Restricted Share Units granted pursuant to the Plan as it may deem advisable including, without limitation: a requirement that Participants pay a stipulated purchase price for
each Restricted Share or each Restricted Share Unit; restrictions based upon the achievement of specific performance goals (Company-wide, divisional, and/or individual); time-based restrictions on vesting; and/or restrictions under applicable
Federal or state securities laws. Unless otherwise determined by the Committee at the time of grant, any time-based restriction period shall be for a minimum of three years. To the extent the Restricted Shares or Restricted Share Units are intended
to be deductible under Code Section 162(m), the applicable restrictions shall be based on the achievement of Performance Goals over a Performance Period, as described in Section 7(d) below. 
 (iii)    Payment of Units.  Restricted Share Units that become payable in accordance with their
terms and conditions shall be settled in cash, shares of Common Stock, or a combination of cash and shares, as determined by the Committee. 
 (iv)    No Disposition During Restriction Period.  During the Restriction Period, Restricted Shares may not be sold, assigned, transferred or otherwise disposed of, or mortgaged,
pledged or otherwise encumbered. In order to enforce the limitations imposed upon the Restricted Shares, the Committee may (a) cause a legend or legends to be placed on any certificates relating to such Restricted Shares, and/or (b) issue
“stop transfer” instructions, as it deems necessary or appropriate. 
 (v)    Dividend and
Voting Rights.  Unless otherwise determined by the Committee, during the Restriction Period, Participants who hold Restricted Shares and Restricted Share Units shall have the right to receive dividends in cash or other property or
other distribution or rights in respect of such shares, and Participants who hold Restricted Shares shall have the right to vote such shares as the record owner thereof. Unless otherwise determined by the Committee, any dividends payable to a
Participant during the Restriction Period shall be distributed to the Participant only if and when the restrictions imposed on the applicable Restricted Shares or Restricted Share Units lapse. 
 (vi)    Ownership of Restricted Shares.  Restricted Shares shall be registered in the name of the
Participant subject to the applicable restrictions. At the end of the Restriction Period, the number of shares to which the Participant is then entitled shall be delivered to the Participant free and clear of the restrictions, either in certificated
or uncertificated form. No shares shall be registered in the name of the Participant with respect to a Restricted Share Unit unless and until such unit is paid in shares of Common Stock. 
 (d)    Performance Awards. 
 (i)    Grants.  Subject to the provisions of the Plan, Performance Awards consisting of Performance Shares or Performance Units may be granted to Eligible
Participants. Performance Awards may be granted either alone or in addition to other Awards made under the Plan. 
 (ii)    Performance Goals.  Unless otherwise determined by the Committee, Performance Awards shall be conditioned on the achievement of Performance Goals (which shall be based on one or more Performance
Measures, as determined by the Committee) over a Performance Period. The Performance Period shall be one year, unless otherwise determined by the Committee. 
 (iii)    Performance Measures.  The Performance Measure(s) to be used for purposes of Performance Awards may be described in terms of objectives that are
related to the individual Participant or objectives that are Company-wide or related to a subsidiary, division, department, region, function or business unit of the Company in which the Participant is employed, and may consist of one or more or any
combination of the following criteria: stock price, market share, sales revenue, cash flow, sales volume, earnings per share, return on equity, return on assets, return on sales, return on invested capital, economic value added, net earnings, total
shareholder return, gross margin, and/or costs. The Performance Goals based on these Performance Measures may be made relative to the performance of other corporations. 
  

 7 

 (iv)    Negative Discretion.  Notwithstanding the
achievement of any Performance Goal established under this Plan, the Committee has the discretion, by Participant, to reduce some or all of a Performance Award that would otherwise be paid. 
 (v)    Extraordinary Events.  At, or at any time after, the time an Award is granted, and to the
extent permitted under Code Section 162(m) and the regulations thereunder without adversely affecting the treatment of the Award under the Performance Based Exception, the Committee may provide for the manner in which performance will be
measured against the Performance Goals (or may adjust the Performance Goals) to reflect the impact of specific corporate transactions, accounting or tax law changes and other extraordinary and nonrecurring events. 
 (vi)    Interpretation.  With respect to any Award that is intended to satisfy the conditions for
the Performance Based Exception under Code Section 162(m): (A) the Committee shall interpret the Plan and this Section 7 in light of Code Section 162(m) and the regulations thereunder; (B) the Committee shall have no
discretion to amend the Award in any way that would adversely affect the treatment of the Award under Code Section 162(m) and the regulations thereunder; and (C) such Award shall not be paid until the Committee shall first have certified
that the Performance Goals have been achieved. 
 (e)    Common Stock Awards. 
 (i)    Grants.  Subject to the provisions of the Plan, Common Stock Awards consisting of vested
shares of Common Stock may be granted to Eligible Participants other than employees and officers. Common Stock Awards may be granted either alone or in addition to other Awards made under the Plan. 
 (ii)    Ownership of Shares.  Shares of Common Stock granted under Section 7(e)(i) shall be
registered in the name of the Participant free and clear of restrictions. 
  

	 8.
	 Awards to Non-Employee Directors. 

 (a)    Awards.  Non-Employee Directors are eligible to receive any and all types of Awards under this Plan other than ISOs. 
 (b)    Initial Grants.  Each newly appointed Non-Employee Director shall, as soon as practicable
after initially becoming a member of the Board, be granted: (i) 1,000 shares of Common Stock; (ii) an Annual Grant (as defined below), which for a Non-Employee Director elected after October 1 shall be pro-rated to reflect his or her
date of election to the Board; and (iii) a Retainer Award, which for a Non-Employee Director elected after October 1 shall be pro-rated to reflect his or her date of election to the Board. 
 (c)    Annual Grants.  Each Non-Employee Director shall receive the following on October 1 (or
on such other date as is determined by the Committee) of each year: 
 (i)    An Award (the “Annual
Grant”) consisting of (A) vested shares of Common Stock (subject to the transfer restrictions in Section 8(e)(iii) below), the number of which shall be determined by dividing $50,000 by the Fair Market Value on the grant date, and
(B) Options, the number of which shall be determined by multiplying the number of shares of Common Stock awarded under Section 8(c)(i)(A) hereof by four. 
 (ii)    A retainer fee of $120,000 for each Non-Employee Director who is the chairman of a committee of the Board or who is the presiding director (if any) and $100,000 for
each other Non-Employee Director (the “Retainer Award”). Each Non-Employee Director may elect to receive the Retainer Award in the form of (A) cash or (B) deferred stock units. 
 (d)    Death, Total Disability and Retirement.  In the event of the death, Total Disability or
Retirement of a Non-Employee Director prior to the granting of an Annual Grant and Retainer Award in respect of the fiscal year in which such event occurred, an Annual Grant and Retainer Award may, in the discretion of the Committee, be granted in
respect of such fiscal year to the retired or disabled Non- 
  

 8 

 Employee Director or his or her estate. If any Non-Employee Director ceases to be a member of the Board
for any reason other than death, Total Disability or Retirement, his or her rights to any Award to be granted in respect of the fiscal year during which such cessation occurred will terminate unless the Committee determines otherwise. 
 (e)    Terms of Awards Granted to Non-Employee Directors. 
 (i)    Each Option granted to a Non-Employee Director shall have an Option Exercise Price equal to the Fair Market
Value on the grant date. 
 (ii)    Each Option granted to a Non-Employee Director prior to
October 1, 2003 shall be fully vested and exercisable on the grant date. Subject to subparagraph (iv) below, each Option granted to a Non-Employee Director on or after October 1, 2003 shall vest (and become exercisable) on the third
anniversary of the grant date. Each Option granted to a Non-Employee Director shall have a term of ten years. 
 (iii)    Subject to subparagraph (iv) below, each Restricted Share Unit granted to a Non-Employee Director on or after October 1, 2003 and before October 1, 2006 shall vest on the third anniversary of the
grant date. Shares of Common Stock granted to a Non-Employee Director on or after October 1, 2006 shall be immediately vested at grant. However, a Non-Employee Director may not transfer beneficial ownership or sell such shares prior to when the
Non-Employee Director terminates membership on the Board (except that this transfer restriction shall not prohibit: (A) PepsiCo’s retaining shares to satisfy required tax withholding under Section 12(e)(ii), and (B) intra-family
transfers permitted by the Committee). 
 (iv)    In the event a Non-Employee Director terminates
membership on the Board prior to the vesting date of an Award, then (A) if such termination is the result of such Non-Employee Director’s death, Total Disability or Retirement, such Award shall immediately vest and, in the case of Options,
be exercisable, and (B) if such termination is the result of an event other than death, Total Disability or Retirement, such unvested Award shall immediately terminate and expire. 
 (v)    No Options granted to a Non-Employee Director may be exercised after he or she ceases to be a member of the
Board, except that: (A) if such cessation occurs by reason of death, the Options then held by the Non-Employee Director may be exercised by his or her designated beneficiary (or, if none, his or her legal representative) until the expiration of
such Options in accordance with the terms hereof; (B) if such cessation occurs by reason of the Non-Employee Director incurring a Total Disability, the Options then held by the Non-Employee Director may be exercised by him or her until the
expiration of such Options in accordance with the terms hereof; and (C) if such cessation occurs by reason of the Non-Employee Director’s Retirement, the Options then held by the Non-Employee Director may be exercised by him or her until
the expiration of such Options in accordance with the terms hereof. 
 (f)    Exercise of Options
Granted to Non-Employee Directors. 
 (i)    To exercise an Option, a Non-Employee Director must
provide to PepsiCo (A) a written notice specifying the number of Options to be exercised and (B) to the extent applicable, any required payments due upon exercise. 
 (ii)    Non-Employee Directors may exercise Options under either of the following methods: 
           (A)    Cashless Exercise. Non-Employee Directors may exercise Options through a registered broker-dealer pursuant
to cashless exercise procedures that are, from time to time, approved by the Committee. Proceeds from any such exercise shall be used to pay the exercise costs, which include the Option Exercise Price, applicable taxes, brokerage commissions and SEC
fees. Any remaining proceeds from the sale shall be delivered to the Non-Employee Director in cash or stock, as specified by the Non-Employee Director. 
  

 9 

         (B)    Standard
Exercise. Non-Employee Directors may exercise Options by paying to PepsiCo an amount in cash from his or her own funds equal to the Option Exercise Price and any taxes required at exercise. A Non-Employee director shall become the owner of the
shares of Common Stock subject to an Option only after the Option Exercise Price and the applicable taxes have been paid. 
  

	 9.
	 Deferred Payments. 

 Subject to the terms of this Plan, the Committee may determine that all or a portion of any Award to a Participant, whether it is to be paid in cash, shares of Common Stock or a combination thereof, shall be deferred or may, in its sole
discretion, approve deferral elections made by Participants. Deferrals shall be for such periods and upon such terms as the Committee may determine in its sole discretion. 
  

	 10.
	 Dilution and Other Adjustments. 

 In the event of any merger, reorganization, consolidation, recapitalization, stock dividend, stock split, combination or exchange of shares or other change in corporate structure affecting any class of Common Stock,
the Committee may, but shall not be required to, make such adjustments in the class and aggregate number of shares which may be delivered under this Plan as described in Section 5, the individual award maximums under Section 6, the class,
number, and Option Exercise Price of outstanding Options and the class and number of shares subject to any other Awards granted under this Plan (provided the number of shares of any class subject to any Award shall always be a whole number), as may
be determined to be appropriate by the Committee, and any such adjustment may, in the sole discretion of the Committee, take the form of Options covering more than one class of Common Stock. Such adjustment shall be conclusive and binding for all
purposes of the Plan. 
  

	 11.
	 Change in Control. 

 Upon a Change in Control, the following shall occur: 
 (a)    Options.  Effective on the date of such Change in Control, all outstanding and unvested Options granted under the Plan shall immediately vest and become exercisable, and all Options then
outstanding under the Plan shall remain outstanding in accordance with their terms. Notwithstanding anything to the contrary in this Plan, in the event that any Option granted under the Plan becomes unexercisable during its term on or after a Change
in Control because: (i) the individual who holds such Option is involuntarily terminated (other than for cause) within two (2) years after the Change in Control; (ii) such Option is terminated or adversely modified; or
(iii) Common Stock is no longer issued and outstanding, or no longer traded on a national securities exchange, then the holder of such Option shall immediately be entitled to receive equity (e.g., common stock) of the “Acquiring
Entity” (as defined below) with a fair market value (taking into account any marketability limitations) equal to (A) the gain on such Option or (B) only if greater than the gain and only with respect to NQSOs the Black-Scholes value
of such Option (as determined by a nationally recognized independent investment banker chosen by PepsiCo), in either case calculated on the date such Option becomes unexercisable. For purposes of the preceding sentence, the gain on an Option shall
be calculated as the difference between the closing price per share of Common Stock as of the date such Option becomes unexercisable less the Option Exercise Price. 
 (b)    Stock Appreciation Rights.  Effective on the date of such Change in Control, all outstanding and unvested SARs granted under the Plan shall immediately
vest and become exercisable, and all SARs then outstanding under the Plan shall remain outstanding in accordance with their terms. In the event that any SAR granted under the Plan becomes unexercisable during its term on or after a Change in Control
because: (i) the individual who holds such SAR is involuntarily terminated (other than for cause) within two (2) years after the Change in Control; (ii) such SAR is terminated or adversely modified; or (iii) Common Stock is no
longer issued and outstanding, or no longer traded on a national securities exchange, then the holder of such SAR shall immediately be entitled to receive equity (e.g., common stock) of the Acquiring Entity with a fair market value (taking into
account any marketability limitations) equal to the gain on such SAR. For purposes of the preceding sentence, the gain on a SAR shall be calculated as the difference 
  

 10 

 between the closing price per share of Common Stock as of the date such SAR becomes unexercisable and the
purchase price per share of Common Stock covered by the SAR. 
 (c)    Restricted Shares/Restricted
Share Units.  Upon a Change of Control all Restricted Shares and Restricted Share Units shall immediately vest and be distributed to Participants, effective as of the date of the Change of Control. 
 (d)    Performance Awards.  Each Performance Award granted under the Plan that is outstanding on the
date of the Change in Control shall immediately vest and the holder of such Performance Award shall be entitled to a lump sum cash payment equal to the amount of such Performance Award payable at the end of the Performance Period as if 100% of the
Performance Goals have been achieved. 
 (e)    Timing of Payment.  Any amount required
to be paid pursuant to this Section 11 shall be paid as soon as practical after the date such amount becomes payable. 
 (f)    Definition.  “Change in Control” means the occurrence of any of the following events: (i) acquisition of 20% or more of the outstanding voting securities of PepsiCo, Inc. by another
entity or group; excluding, however, the following (A) any acquisition by PepsiCo, Inc., or (B) any acquisition by an employee benefit plan or related trust sponsored or maintained by PepsiCo, Inc.; (ii) during any consecutive
two-year period, persons who constitute the Board of Directors of PepsiCo, Inc. (the “Board”) at the beginning of the period cease to constitute at least 50% of the Board (unless the election of each new Board member was approved by a
majority of directors who began the two-year period); (iii) PepsiCo, Inc. shareholders approve a merger or consolidation of PepsiCo, Inc. with another company, and PepsiCo, Inc. is not the surviving company; or, if after such transaction, the
other entity owns, directly or indirectly, 50% or more of the outstanding voting securities of PepsiCo, Inc.; (iv) PepsiCo, Inc. shareholders approve a plan of complete liquidation of PepsiCo, Inc. or the sale or disposition of all or
substantially all of PepsiCo, Inc.’s assets; or (v) any other event, circumstance, offer or proposal occurs or is made, which is intended to effect a change in the control of PepsiCo, Inc., and which results in the occurrence of one or
more of the events set forth in clauses (i) through (iv) of this paragraph. For purposes of the Plan, the group or entity that triggers a Change in Control under clause (i), that is directly or indirectly responsible for the change in the
Board under clause (ii), that survives the merger or consolidation referred to in clause (iii), or that acquires the assets under clause (iv) is referred to as the “Acquiring Entity.” 
 (g)    Exclusive Rights.  The rights provided by this Section are the exclusive rights that are
available with respect to any Award in the event of a Change in Control. 
  

	 12.
	 Miscellaneous Provisions. 

 (a)    Misconduct.  Except as otherwise provided in agreements covering Awards hereunder, a Participant shall forfeit all rights in his or her outstanding Awards under the Plan,
and all such outstanding Awards shall automatically terminate and lapse, if the Committee determines that such Participant has (i) used for profit or disclosed to unauthorized persons, confidential information or trade secrets of the Company,
(ii) breached any contract with or violated any fiduciary obligation to the Company, including without limitation, a violation of any Company code of conduct, (iii) engaged in unlawful trading in the securities of PepsiCo or of another
company based on information gained as a result of that Participant’s employment or other relationship with the Company, or (iv) committed a felony or other serious crime. 
 (b)    Rights as Shareholder.  Except as otherwise provided herein, a Participant shall have no
rights as a holder of Common Stock with respect to Awards hereunder, unless and until the shares have been registered to the Participant as the owner. 
 (c)    No Loans.  No loans from the Company to Participants shall be permitted under this Plan. 
 (d)    Assignment or Transfer.  Unless the Committee shall specifically determine otherwise, or except as otherwise provided under the Plan, no Award under
the Plan or any rights or interests therein shall be transferable other than by will or the laws of descent and distribution and shall be exercisable, during the 
  

 11 

 Participant’s lifetime, only by the Participant. Once awarded, the shares of Common Stock received
by Participants may be freely transferred, assigned, pledged or otherwise subjected to lien, subject to: (i) the transfer restrictions for Non-Employee Directors in Section 8(e)(iii) above; and (ii) the restrictions imposed by the
Securities Act of 1933, Section 16 of the Securities Exchange Act of 1934 and PepsiCo’s Insider Trading Policy, each as amended from time to time. 
 (e)    Withholding Taxes. 
 (i)    Eligible Participants.  PepsiCo shall have the right to deduct from all Awards paid in cash to an Eligible Participant any taxes required by law to be withheld with respect to such Awards. All
legally required withholding taxes arising with respect to Awards paid in Common Stock to a an Eligible Participant shall be satisfied by PepsiCo retaining shares of Common Stock having a Fair Market Value on the date the tax is to be determined
that is equal to the amount of such required withholding (rounded, if necessary, to the next highest whole number of shares of Common Stock). Such withholding shall also apply in connection with Option exercises, except to the extent that the
Eligible Participant provides for satisfying it through cash proceeds from the exercise transaction. 
 (ii)    Non-Employee Directors.  Federal income tax withholding at 25% (or such higher rate as may be legally required) and all other tax withholding that is legally required with respect to Awards to a
Non-Employee Director of vested shares of Common Stock shall be satisfied by PepsiCo retaining shares of Common Stock having a Fair Market Value, on the date such Common Stock is taxable to the Non-Employee Director, that is equal to the amount of
such withholding (rounded, if necessary, to the next highest whole number of shares of PepsiCo Common Stock). 
 (f)    No Rights to Awards.  Neither the Plan nor any action taken hereunder shall be construed as giving any employee any right to be retained in the employ of PepsiCo or any of its subsidiaries,
divisions or affiliates. Except as set forth herein, no employee or other person shall have any claim or right to be granted an Award under the Plan. By accepting an Award, the Participant acknowledges and agrees (i) that the Award will be
exclusively governed by the terms of the Plan, including the right reserved by the Company to amend or cancel the Plan at any time without the Company incurring liability to the Participant (except for Awards already granted under the Plan),
(ii) that Awards are not a constituent part of salary and that the Participant is not entitled, under the terms and conditions of employment, or by accepting or being granted Awards under this Plan to require Awards to be granted to him or her
in the future under this Plan or any other plan, (iii) that the value of Awards received under the Plan will be excluded from the calculation of termination indemnities or other severance payments, and (iv) that the Participant will seek
all necessary approval under, make all required notifications under and comply with all laws, rules and regulations applicable to the ownership of Options and stock and the exercise of Options, including, without limitation, currency and exchange
laws, rules and regulations. The obligations of PepsiCo to make delivery of Awards in cash or Common Stock shall be subject to currency or other restrictions imposed by any government. 
 (g)    Beneficiary Designation.  To the extent allowed by the Committee, each Participant under the
Plan may, from time to time, name any beneficiary or beneficiaries (who may be named on a contingent or successive basis) to whom any benefit under the Plan is to be paid in case of his or her death before he or she receives any or all of such
benefit. Unless the Committee determines otherwise, each such designation shall revoke all prior designations by the same Participant, shall be in a form prescribed by the Committee, and will be effective only when filed by the Participant in
writing with the Company during the Participant’s lifetime. In the absence of any such designation, benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate. 
 (h)    Costs and Expenses.  The cost and expenses of administering the Plan shall be borne by
PepsiCo and not charged to any Award or to any Participant. 
 (i)    Fractional
Shares.  Fractional shares of Common Stock shall not be issued or transferred under an Award, but the Committee may pay cash in lieu of a fraction or round the fraction, in its discretion. 
  

 12 

 (j)    Funding of Plan.  PepsiCo shall not be
required to establish or fund any special or separate account or to make any other segregation of assets to assure the payment of any Award under the Plan. 
 (k)    Indemnification.  Provisions for the indemnification of officers and directors of the Company in connection with the administration of the Plan shall
be as set forth in PepsiCo’s Certificate of Incorporation and Bylaws as in effect from time to time. 
 (l)    Successors.  All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company. 
  

	 13.
	 Effective Date, Governing Law, Amendments and Termination. 

 (a)    Effective Date.  The Plan was approved by the Board on January 30, 2003 and shall become effective on the date it is approved by PepsiCo’s
shareholders. 
 (b)    Amendments.  The Board may at any time terminate or from time to
time amend the Plan in whole or in part, but no such action shall adversely affect any rights or obligations with respect to any Awards granted prior to the date of such termination or amendment. Notwithstanding the foregoing, unless PepsiCo’s
shareholders shall have first approved the amendment, no amendment of the Plan shall be effective which would (i) increase the maximum number of shares of Common Stock which may be delivered under the Plan or to any one individual (except to
the extent such amendment is made pursuant to Section 10 hereof), (ii) extend the maximum period during which Awards may be granted under the Plan, (iii) add to the types of awards that can be made under the Plan, (iv) change the
Performance Measures pursuant to which Performance Awards are earned, (v) modify the requirements as to eligibility for participation in the Plan, or (vi) require shareholder approval pursuant to this Plan or applicable law to be
effective. With the consent of the Participant affected, the Committee may amend outstanding agreements evidencing Awards under the Plan in a manner not inconsistent with the terms of the Plan. 
 (c)    Governing Law.  All questions pertaining to the construction, interpretation, regulation,
validity and effect of the provisions of the Plan shall be determined in accordance with the laws of the State of North Carolina without giving effect to conflict of laws principles. 
 (d)    Termination.  No Awards shall be made under the Plan after the tenth anniversary of the date
on which PepsiCo’s shareholders approve the Plan. 
  

 13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00111-of-00352.parquet"}]]