|
Delaware
|
|
58-0628465
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
One Coca-Cola Plaza
|
|
|
|
Atlanta
|
Georgia
|
|
30313
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $0.25 Par Value
|
KO
|
New York Stock Exchange
|
0.000% Notes Due 2021
|
KO21B
|
New York Stock Exchange
|
Floating Rate Notes Due 2021
|
KO21C
|
New York Stock Exchange
|
1.125% Notes Due 2022
|
KO22
|
New York Stock Exchange
|
0.125% Notes Due 2022
|
KO22B
|
New York Stock Exchange
|
0.75% Notes Due 2023
|
KO23B
|
New York Stock Exchange
|
0.500% Notes Due 2024
|
KO24
|
New York Stock Exchange
|
1.875% Notes Due 2026
|
KO26
|
New York Stock Exchange
|
0.750% Notes Due 2026
|
KO26C
|
New York Stock Exchange
|
1.125% Notes Due 2027
|
KO27
|
New York Stock Exchange
|
1.250% Notes Due 2031
|
KO31
|
New York Stock Exchange
|
1.625% Notes Due 2035
|
KO35
|
New York Stock Exchange
|
1.100% Notes Due 2036
|
KO36
|
New York Stock Exchange
|
Class of Common Stock
|
|
Shares Outstanding as of April 21, 2020
|
$0.25 Par Value
|
|
4,294,891,353
|
|
|
|
Page
|
|
||
|
|
|
|
|
|
|
|
|
Item 1.
|
||
|
|
|
|
Three Months Ended March 27, 2020 and March 29, 2019
|
|
|
|
|
|
Three Months Ended March 27, 2020 and March 29, 2019
|
|
|
|
|
|
March 27, 2020 and December 31, 2019
|
|
|
|
|
|
Three Months Ended March 27, 2020 and March 29, 2019
|
|
|
|
|
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
|
|
|
|
|
|
Item 1.
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 5.
|
||
|
|
|
Item 6.
|
||
|
|
Three Months Ended
|
|||||
|
March 27,
2020 |
|
March 29,
2019 |
|
||
Net Operating Revenues
|
$
|
8,601
|
|
$
|
8,694
|
|
Cost of goods sold
|
3,371
|
|
3,365
|
|
||
Gross Profit
|
5,230
|
|
5,329
|
|
||
Selling, general and administrative expenses
|
2,648
|
|
2,767
|
|
||
Other operating charges
|
202
|
|
127
|
|
||
Operating Income
|
2,380
|
|
2,435
|
|
||
Interest income
|
112
|
|
133
|
|
||
Interest expense
|
193
|
|
245
|
|
||
Equity income (loss) — net
|
167
|
|
133
|
|
||
Other income (loss) — net
|
544
|
|
(231
|
)
|
||
Income Before Income Taxes
|
3,010
|
|
2,225
|
|
||
Income taxes
|
215
|
|
522
|
|
||
Consolidated Net Income
|
2,795
|
|
1,703
|
|
||
Less: Net income (loss) attributable to noncontrolling interests
|
20
|
|
25
|
|
||
Net Income Attributable to Shareowners of The Coca-Cola Company
|
$
|
2,775
|
|
$
|
1,678
|
|
Basic Net Income Per Share1
|
$
|
0.65
|
|
$
|
0.39
|
|
Diluted Net Income Per Share1
|
$
|
0.64
|
|
$
|
0.39
|
|
Average Shares Outstanding
|
4,289
|
|
4,271
|
|
||
Effect of dilutive securities
|
36
|
|
35
|
|
||
Average Shares Outstanding Assuming Dilution
|
4,325
|
|
4,306
|
|
|
Three Months Ended
|
|||||
|
March 27,
2020 |
|
March 29,
2019 |
|
||
Consolidated Net Income
|
$
|
2,795
|
|
$
|
1,703
|
|
Other Comprehensive Income:
|
|
|
||||
Net foreign currency translation adjustments
|
(2,621
|
)
|
926
|
|
||
Net gains (losses) on derivatives
|
16
|
|
8
|
|
||
Net change in unrealized gains (losses) on available-for-sale debt securities
|
(8
|
)
|
15
|
|
||
Net change in pension and other benefit liabilities
|
6
|
|
31
|
|
||
Total Comprehensive Income
|
188
|
|
2,683
|
|
||
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
(435
|
)
|
(3
|
)
|
||
Total Comprehensive Income Attributable to Shareowners of The Coca-Cola Company
|
$
|
623
|
|
$
|
2,686
|
|
|
March 27,
2020 |
|
December 31,
2019 |
|
||
ASSETS
|
||||||
Current Assets
|
|
|
||||
Cash and cash equivalents
|
$
|
13,561
|
|
$
|
6,480
|
|
Short-term investments
|
1,713
|
|
1,467
|
|
||
Total Cash, Cash Equivalents and Short-Term Investments
|
15,274
|
|
7,947
|
|
||
Marketable securities
|
2,392
|
|
3,228
|
|
||
Trade accounts receivable, less allowances of $527 and $524, respectively
|
4,430
|
|
3,971
|
|
||
Inventories
|
3,558
|
|
3,379
|
|
||
Prepaid expenses and other assets
|
2,580
|
|
1,886
|
|
||
Total Current Assets
|
28,234
|
|
20,411
|
|
||
Equity method investments
|
18,020
|
|
19,025
|
|
||
Other investments
|
652
|
|
854
|
|
||
Other assets
|
6,001
|
|
6,075
|
|
||
Deferred income tax assets
|
2,275
|
|
2,412
|
|
||
Property, plant and equipment, less accumulated depreciation of
$8,285 and $8,083, respectively
|
10,993
|
|
10,838
|
|
||
Trademarks with indefinite lives
|
10,457
|
|
9,266
|
|
||
Bottlers' franchise rights with indefinite lives
|
108
|
|
109
|
|
||
Goodwill
|
16,673
|
|
16,764
|
|
||
Other intangible assets
|
600
|
|
627
|
|
||
Total Assets
|
$
|
94,013
|
|
$
|
86,381
|
|
LIABILITIES AND EQUITY
|
||||||
Current Liabilities
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
12,640
|
|
$
|
11,312
|
|
Loans and notes payable
|
13,657
|
|
10,994
|
|
||
Current maturities of long-term debt
|
5,642
|
|
4,253
|
|
||
Accrued income taxes
|
458
|
|
414
|
|
||
Total Current Liabilities
|
32,397
|
|
26,973
|
|
||
Long-term debt
|
31,094
|
|
27,516
|
|
||
Other liabilities
|
8,832
|
|
8,510
|
|
||
Deferred income tax liabilities
|
1,856
|
|
2,284
|
|
||
The Coca-Cola Company Shareowners' Equity
|
|
|
||||
Common stock, $0.25 par value; authorized — 11,200 shares; issued — 7,040 shares
|
1,760
|
|
1,760
|
|
||
Capital surplus
|
17,312
|
|
17,154
|
|
||
Reinvested earnings
|
66,870
|
|
65,855
|
|
||
Accumulated other comprehensive income (loss)
|
(15,696
|
)
|
(13,544
|
)
|
||
Treasury stock, at cost — 2,746 and 2,760 shares, respectively
|
(52,088
|
)
|
(52,244
|
)
|
||
Equity Attributable to Shareowners of The Coca-Cola Company
|
18,158
|
|
18,981
|
|
||
Equity attributable to noncontrolling interests
|
1,676
|
|
2,117
|
|
||
Total Equity
|
19,834
|
|
21,098
|
|
||
Total Liabilities and Equity
|
$
|
94,013
|
|
$
|
86,381
|
|
|
Three Months Ended
|
|||||
|
March 27,
2020 |
|
March 29,
2019 |
|
||
Operating Activities
|
|
|
||||
Consolidated net income
|
$
|
2,795
|
|
$
|
1,703
|
|
Depreciation and amortization
|
367
|
|
275
|
|
||
Stock-based compensation expense
|
(5
|
)
|
40
|
|
||
Deferred income taxes
|
(122
|
)
|
122
|
|
||
Equity (income) loss — net of dividends
|
(157
|
)
|
(120
|
)
|
||
Foreign currency adjustments
|
(59
|
)
|
(39
|
)
|
||
Significant (gains) losses — net
|
(919
|
)
|
87
|
|
||
Other operating charges
|
190
|
|
55
|
|
||
Other items
|
235
|
|
147
|
|
||
Net change in operating assets and liabilities
|
(1,769
|
)
|
(1,482
|
)
|
||
Net Cash Provided by Operating Activities
|
556
|
|
788
|
|
||
Investing Activities
|
|
|
|
|
||
Purchases of investments
|
(1,455
|
)
|
(1,062
|
)
|
||
Proceeds from disposals of investments
|
1,603
|
|
1,994
|
|
||
Acquisitions of businesses, equity method investments and nonmarketable securities
|
(984
|
)
|
(5,322
|
)
|
||
Proceeds from disposals of businesses, equity method investments and nonmarketable securities
|
36
|
|
261
|
|
||
Purchases of property, plant and equipment
|
(327
|
)
|
(388
|
)
|
||
Proceeds from disposals of property, plant and equipment
|
91
|
|
27
|
|
||
Other investing activities
|
(48
|
)
|
31
|
|
||
Net Cash Provided by (Used in) Investing Activities
|
(1,084
|
)
|
(4,459
|
)
|
||
Financing Activities
|
|
|
|
|
||
Issuances of debt
|
12,563
|
|
10,256
|
|
||
Payments of debt
|
(4,833
|
)
|
(9,652
|
)
|
||
Issuances of stock
|
413
|
|
190
|
|
||
Purchases of stock for treasury
|
(94
|
)
|
(397
|
)
|
||
Other financing activities
|
(239
|
)
|
24
|
|
||
Net Cash Provided by (Used in) Financing Activities
|
7,810
|
|
421
|
|
||
Effect of Exchange Rate Changes on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents
|
(54
|
)
|
56
|
|
||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents
|
|
|
|
|
||
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents
during the period
|
7,228
|
|
(3,194
|
)
|
||
Cash, cash equivalents, restricted cash and restricted cash equivalents at beginning of period
|
6,737
|
|
9,318
|
|
||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents at End of Period
|
13,965
|
|
6,124
|
|
||
Less: Restricted cash and restricted cash equivalents at end of period
|
404
|
|
276
|
|
||
Cash and Cash Equivalents at End of Period
|
$
|
13,561
|
|
$
|
5,848
|
|
|
March 27,
2020 |
|
December 31,
2019 |
|
||
Cash and cash equivalents
|
$
|
13,561
|
|
$
|
6,480
|
|
Cash and cash equivalents included in other assets1
|
404
|
|
257
|
|
||
Cash, cash equivalents, restricted cash and restricted cash equivalents
|
$
|
13,965
|
|
$
|
6,737
|
|
|
March 29,
2019 |
|
December 31, 2018
|
|
||
Cash and cash equivalents
|
$
|
5,848
|
|
$
|
9,077
|
|
Cash and cash equivalents included in other assets1
|
276
|
|
241
|
|
||
Cash, cash equivalents, restricted cash and restricted cash equivalents
|
$
|
6,124
|
|
$
|
9,318
|
|
|
United States
|
|
International
|
|
Total
|
|
|||
Three Months Ended March 27, 2020
|
|
|
|
|
|
|
|||
Concentrate operations
|
$
|
1,324
|
|
$
|
3,465
|
|
$
|
4,789
|
|
Finished product operations
|
1,483
|
|
2,329
|
|
3,812
|
|
|||
Total
|
$
|
2,807
|
|
$
|
5,794
|
|
$
|
8,601
|
|
Three Months Ended March 29, 2019
|
|
|
|
|
|
|
|||
Concentrate operations
|
$
|
1,185
|
|
$
|
3,593
|
|
$
|
4,778
|
|
Finished product operations
|
1,460
|
|
2,456
|
|
3,916
|
|
|||
Total
|
$
|
2,645
|
|
$
|
6,049
|
|
$
|
8,694
|
|
|
Fair Value with Changes Recognized in Income
|
|
Measurement Alternative — No Readily Determinable Fair Value
|
|
||
March 27, 2020
|
|
|
||||
Marketable securities
|
$
|
275
|
|
$
|
—
|
|
Other investments
|
599
|
|
53
|
|
||
Other assets
|
889
|
|
—
|
|
||
Total equity securities
|
$
|
1,763
|
|
$
|
53
|
|
December 31, 2019
|
|
|
||||
Marketable securities
|
$
|
329
|
|
$
|
—
|
|
Other investments
|
772
|
|
82
|
|
||
Other assets
|
1,118
|
|
—
|
|
||
Total equity securities
|
$
|
2,219
|
|
$
|
82
|
|
|
Three Months Ended
|
|||||
|
March 27, 2020
|
|
March 29, 2019
|
|
||
Net gains (losses) recognized during the period related to equity securities
|
$
|
(396
|
)
|
$
|
147
|
|
Less: Net gains (losses) recognized during the period related to equity securities sold
during the period |
(16
|
)
|
7
|
|
||
Net unrealized gains (losses) recognized during the period related to equity securities
still held at the end of the period
|
$
|
(380
|
)
|
$
|
140
|
|
|
|
Gross Unrealized
|
Estimated Fair Value
|
|
||||||||
|
Cost
|
|
Gains
|
|
Losses
|
|
||||||
March 27, 2020
|
|
|
|
|
||||||||
Trading securities
|
$
|
33
|
|
$
|
—
|
|
$
|
(2
|
)
|
$
|
31
|
|
Available-for-sale securities
|
2,365
|
|
98
|
|
(4
|
)
|
2,459
|
|
||||
Total debt securities
|
$
|
2,398
|
|
$
|
98
|
|
$
|
(6
|
)
|
$
|
2,490
|
|
December 31, 2019
|
|
|
|
|
||||||||
Trading securities
|
$
|
46
|
|
$
|
1
|
|
$
|
—
|
|
$
|
47
|
|
Available-for-sale securities
|
3,172
|
|
113
|
|
(4
|
)
|
3,281
|
|
||||
Total debt securities
|
$
|
3,218
|
|
$
|
114
|
|
$
|
(4
|
)
|
$
|
3,328
|
|
|
March 27, 2020
|
|
December 31, 2019
|
||||||||||
|
Trading Securities
|
|
Available-for-Sale Securities
|
|
|
Trading Securities
|
|
Available-for-Sale Securities
|
|
||||
Cash and cash equivalents
|
$
|
—
|
|
$
|
97
|
|
|
$
|
—
|
|
$
|
123
|
|
Marketable securities
|
31
|
|
2,086
|
|
|
47
|
|
2,852
|
|
||||
Other assets
|
—
|
|
276
|
|
|
—
|
|
306
|
|
||||
Total debt securities
|
$
|
31
|
|
$
|
2,459
|
|
|
$
|
47
|
|
$
|
3,281
|
|
|
Cost
|
|
Estimated
Fair Value |
|
||
Within 1 year
|
$
|
1,374
|
|
$
|
1,393
|
|
After 1 year through 5 years
|
761
|
|
805
|
|
||
After 5 years through 10 years
|
58
|
|
68
|
|
||
After 10 years
|
172
|
|
193
|
|
||
Total
|
$
|
2,365
|
|
$
|
2,459
|
|
|
Three Months Ended
|
|||||
|
March 27, 2020
|
|
March 29, 2019
|
|
||
Gross gains
|
$
|
8
|
|
$
|
5
|
|
Gross losses
|
(2
|
)
|
(3
|
)
|
||
Proceeds
|
906
|
|
722
|
|
|
March 27,
2020 |
|
December 31,
2019 |
|
||
Raw materials and packaging
|
$
|
2,282
|
|
$
|
2,180
|
|
Finished goods
|
901
|
|
851
|
|
||
Other
|
375
|
|
348
|
|
||
Total inventories
|
$
|
3,558
|
|
$
|
3,379
|
|
|
|
Fair Value1,2
|
|||||
Derivatives Designated as Hedging Instruments
|
Balance Sheet Location1
|
March 27,
2020 |
|
December 31, 2019
|
|
||
Assets:
|
|
|
|
||||
Foreign currency contracts
|
Prepaid expenses and other assets
|
$
|
140
|
|
$
|
24
|
|
Foreign currency contracts
|
Other assets
|
228
|
|
91
|
|
||
Interest rate contracts
|
Prepaid expenses and other assets
|
12
|
|
10
|
|
||
Interest rate contracts
|
Other assets
|
517
|
|
427
|
|
||
Total assets
|
|
$
|
897
|
|
$
|
552
|
|
Liabilities:
|
|
|
|
||||
Foreign currency contracts
|
Accounts payable and accrued expenses
|
$
|
84
|
|
$
|
40
|
|
Foreign currency contracts
|
Other liabilities
|
231
|
|
48
|
|
||
Interest rate contracts
|
Other liabilities
|
23
|
|
21
|
|
||
Total liabilities
|
|
$
|
338
|
|
$
|
109
|
|
|
|
Fair Value1,2
|
|||||
Derivatives Not Designated as Hedging Instruments
|
Balance Sheet Location1
|
March 27,
2020 |
|
December 31, 2019
|
|
||
Assets:
|
|
|
|
||||
Foreign currency contracts
|
Prepaid expenses and other assets
|
$
|
88
|
|
$
|
13
|
|
Foreign currency contracts
|
Other assets
|
2
|
|
—
|
|
||
Commodity contracts
|
Prepaid expenses and other assets
|
1
|
|
8
|
|
||
Commodity contracts
|
Other assets
|
—
|
|
2
|
|
||
Other derivative instruments
|
Prepaid expenses and other assets
|
—
|
|
12
|
|
||
Other derivative instruments
|
Other assets
|
1
|
|
1
|
|
||
Total assets
|
|
$
|
92
|
|
$
|
36
|
|
Liabilities:
|
|
|
|
||||
Foreign currency contracts
|
Accounts payable and accrued expenses
|
$
|
130
|
|
$
|
39
|
|
Foreign currency contracts
|
Other liabilities
|
4
|
|
—
|
|
||
Commodity contracts
|
Accounts payable and accrued expenses
|
70
|
|
13
|
|
||
Commodity contracts
|
Other liabilities
|
28
|
|
1
|
|
||
Other derivative instruments
|
Accounts payable and accrued expenses
|
44
|
|
—
|
|
||
Total liabilities
|
|
$
|
276
|
|
$
|
53
|
|
|
Gain (Loss)
Recognized in OCI
|
Location of Gain (Loss) Recognized in Income
|
Gain (Loss) Reclassified from AOCI into Income
|
||||
Three Months Ended March 27, 2020
|
|
|
|
||||
Foreign currency contracts
|
$
|
103
|
|
Net operating revenues
|
$
|
(4
|
)
|
Foreign currency contracts
|
11
|
|
Cost of goods sold
|
1
|
|
||
Foreign currency contracts
|
—
|
|
Interest expense
|
(2
|
)
|
||
Foreign currency contracts
|
(90
|
)
|
Other income (loss) — net
|
15
|
|
||
Interest rate contracts
|
8
|
|
Interest expense
|
(11
|
)
|
||
Total
|
$
|
32
|
|
|
$
|
(1
|
)
|
Three Months Ended March 29, 2019
|
|
|
|
||||
Foreign currency contracts
|
$
|
(2
|
)
|
Net operating revenues
|
$
|
6
|
|
Foreign currency contracts
|
1
|
|
Cost of goods sold
|
4
|
|
||
Foreign currency contracts
|
—
|
|
Interest expense
|
(2
|
)
|
||
Foreign currency contracts
|
(22
|
)
|
Other income (loss) — net
|
(50
|
)
|
||
Interest rate contracts
|
—
|
|
Interest expense
|
(10
|
)
|
||
Total
|
$
|
(23
|
)
|
|
$
|
(52
|
)
|
Hedging Instruments and Hedged Items
|
Location of Gain (Loss) Recognized in Income
|
Gain (Loss)
Recognized in Income
|
|||||
Three Months Ended
|
|||||||
March 27,
2020 |
|
March 29,
2019 |
|
||||
Interest rate contracts
|
Interest expense
|
$
|
112
|
|
$
|
212
|
|
Fixed-rate debt
|
Interest expense
|
(103
|
)
|
(210
|
)
|
||
Net impact to interest expense
|
|
$
|
9
|
|
$
|
2
|
|
Net impact of fair value hedging instruments
|
|
$
|
9
|
|
$
|
2
|
|
|
Carrying Value of Hedged Items
|
|
Cumulative Amount of Fair Value Hedging Adjustments Included in Carrying Value of Hedged Items1
|
||||||||||
Balance Sheet Location of Hedged Items
|
March 27,
2020 |
|
December 31,
2019 |
|
|
March 27,
2020 |
|
December 31,
2019 |
|
||||
Current maturities of long-term debt
|
$
|
1,007
|
|
$
|
1,004
|
|
|
$
|
8
|
|
$
|
5
|
|
Long-term debt
|
12,123
|
|
12,087
|
|
|
539
|
|
448
|
|
|
Notional Amount
|
|
Gain (Loss) Recognized in OCI
|
||||||||||
|
as of
|
|
Three Months Ended
|
||||||||||
|
March 27,
2020 |
|
December 31, 2019
|
|
|
March 27,
2020 |
|
March 29,
2019 |
|
||||
Foreign currency contracts
|
$
|
491
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
$
|
22
|
|
Foreign currency denominated debt
|
12,255
|
|
12,334
|
|
|
79
|
|
131
|
|
||||
Total
|
$
|
12,746
|
|
$
|
12,334
|
|
|
$
|
76
|
|
$
|
153
|
|
Derivatives Not Designated as Hedging Instruments
|
Location of Gain (Loss) Recognized in Income
|
Gain (Loss)
Recognized in Income
|
|||||
Three Months Ended
|
|||||||
March 27,
2020 |
|
March 29,
2019 |
|
||||
Foreign currency contracts
|
Net operating revenues
|
$
|
24
|
|
$
|
(11
|
)
|
Foreign currency contracts
|
Cost of goods sold
|
14
|
|
(1
|
)
|
||
Foreign currency contracts
|
Other income (loss) — net
|
(91
|
)
|
21
|
|
||
Commodity contracts
|
Cost of goods sold
|
(85
|
)
|
20
|
|
||
Other derivative instruments
|
Selling, general and administrative expenses
|
(56
|
)
|
17
|
|
||
Other derivative instruments
|
Other income (loss) — net
|
(57
|
)
|
34
|
|
||
Total
|
|
$
|
(251
|
)
|
$
|
80
|
|
•
|
$1,000 million total principal amount of notes due March 25, 2025, at a fixed interest rate of 2.950 percent;
|
•
|
$1,000 million total principal amount of notes due March 25, 2027, at a fixed interest rate of 3.375 percent;
|
•
|
$1,250 million total principal amount of notes due March 25, 2030, at a fixed interest rate of 3.450 percent;
|
•
|
$500 million total principal amount of notes due March 25, 2040, at a fixed interest rate of 4.125 percent; and
|
•
|
$1,250 million total principal amount of notes due March 25, 2050, at a fixed interest rate of 4.200 percent.
|
|
March 27,
2020 |
|
|
December 31, 2019
|
|
||
Foreign currency translation adjustments
|
$
|
(13,436
|
)
|
|
$
|
(11,270
|
)
|
Accumulated derivative net gains (losses)
|
(193
|
)
|
|
(209
|
)
|
||
Unrealized net gains (losses) on available-for-sale debt securities
|
67
|
|
|
75
|
|
||
Adjustments to pension and other benefit liabilities
|
(2,134
|
)
|
|
(2,140
|
)
|
||
Accumulated other comprehensive income (loss)
|
$
|
(15,696
|
)
|
|
$
|
(13,544
|
)
|
|
Three Months Ended March 27, 2020
|
||||||||
|
Shareowners of
The Coca-Cola Company
|
|
Noncontrolling
Interests
|
|
Total
|
|
|||
Consolidated net income
|
$
|
2,775
|
|
$
|
20
|
|
$
|
2,795
|
|
Other comprehensive income:
|
|
|
|
||||||
Net foreign currency translation adjustments
|
(2,166
|
)
|
(455
|
)
|
(2,621
|
)
|
|||
Net gains (losses) on derivatives1
|
16
|
|
—
|
|
16
|
|
|||
Net change in unrealized gains (losses) on available-for-sale debt
securities2
|
(8
|
)
|
—
|
|
(8
|
)
|
|||
Net change in pension and other benefit liabilities
|
6
|
|
—
|
|
6
|
|
|||
Total comprehensive income (loss)
|
$
|
623
|
|
$
|
(435
|
)
|
$
|
188
|
|
Three Months Ended March 27, 2020
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the period
|
$
|
(2,281
|
)
|
|
$
|
212
|
|
|
$
|
(2,069
|
)
|
Reclassification adjustments recognized in net income
|
3
|
|
|
—
|
|
|
3
|
|
|||
Gains (losses) on intra-entity transactions that are of a long-term investment nature
|
(157
|
)
|
|
—
|
|
|
(157
|
)
|
|||
Gains (losses) on net investment hedges arising during the period1
|
76
|
|
|
(19
|
)
|
|
57
|
|
|||
Net foreign currency translation adjustments
|
$
|
(2,359
|
)
|
|
$
|
193
|
|
|
$
|
(2,166
|
)
|
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
$
|
23
|
|
|
$
|
(8
|
)
|
|
$
|
15
|
|
Reclassification adjustments recognized in net income
|
1
|
|
|
—
|
|
|
1
|
|
|||
Net gains (losses) on derivatives1
|
$
|
24
|
|
|
$
|
(8
|
)
|
|
$
|
16
|
|
Available-for-sale debt securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
$
|
(8
|
)
|
|
$
|
5
|
|
|
$
|
(3
|
)
|
Reclassification adjustments recognized in net income
|
(6
|
)
|
|
1
|
|
|
(5
|
)
|
|||
Net change in unrealized gains (losses) on available-for-sale debt securities2
|
$
|
(14
|
)
|
|
$
|
6
|
|
|
$
|
(8
|
)
|
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
$
|
(25
|
)
|
|
$
|
(1
|
)
|
|
$
|
(26
|
)
|
Reclassification adjustments recognized in net income
|
43
|
|
|
(11
|
)
|
|
32
|
|
|||
Net change in pension and other benefit liabilities
|
$
|
18
|
|
|
$
|
(12
|
)
|
|
$
|
6
|
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company
|
$
|
(2,331
|
)
|
|
$
|
179
|
|
|
$
|
(2,152
|
)
|
1
|
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments.
|
2
|
Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.
|
Three Months Ended March 29, 2019
|
Before-Tax Amount
|
|
|
Income Tax
|
|
|
After-Tax Amount
|
|
|||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Translation adjustments arising during the period
|
$
|
997
|
|
|
$
|
(73
|
)
|
|
$
|
924
|
|
Reclassification adjustments recognized in net income
|
192
|
|
|
—
|
|
|
192
|
|
|||
Gains (losses) on intra-entity transactions that are of a long-term investment nature
|
(287
|
)
|
|
—
|
|
|
(287
|
)
|
|||
Gains (losses) on net investment hedges arising during the period1
|
153
|
|
|
(28
|
)
|
|
125
|
|
|||
Net foreign currency translation adjustments
|
$
|
1,055
|
|
|
$
|
(101
|
)
|
|
$
|
954
|
|
Derivatives:
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
$
|
(36
|
)
|
|
$
|
4
|
|
|
$
|
(32
|
)
|
Reclassification adjustments recognized in net income
|
53
|
|
|
(13
|
)
|
|
40
|
|
|||
Net gains (losses) on derivatives1
|
$
|
17
|
|
|
$
|
(9
|
)
|
|
$
|
8
|
|
Available-for-sale debt securities:
|
|
|
|
|
|
||||||
Unrealized gains (losses) arising during the period
|
$
|
24
|
|
|
$
|
(7
|
)
|
|
$
|
17
|
|
Reclassification adjustments recognized in net income
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||
Net change in unrealized gains (losses) on available-for-sale debt securities2
|
$
|
22
|
|
|
$
|
(7
|
)
|
|
$
|
15
|
|
Pension and other benefit liabilities:
|
|
|
|
|
|
||||||
Net pension and other benefit liabilities arising during the period
|
$
|
(1
|
)
|
|
$
|
4
|
|
|
$
|
3
|
|
Reclassification adjustments recognized in net income
|
37
|
|
|
(9
|
)
|
|
28
|
|
|||
Net change in pension and other benefit liabilities
|
$
|
36
|
|
|
$
|
(5
|
)
|
|
$
|
31
|
|
Other comprehensive income (loss) attributable to shareowners of The Coca-Cola
Company |
$
|
1,130
|
|
|
$
|
(122
|
)
|
|
$
|
1,008
|
|
1
|
Refer to Note 6 for additional information related to the net gains or losses on derivative instruments.
|
2
|
Refer to Note 4 for additional information related to the net unrealized gains or losses on available-for-sale debt securities.
|
|
|
Amount Reclassified from AOCI
into Income
|
||
Description of AOCI Component
|
Financial Statement Line Item
|
Three Months Ended March 27, 2020
|
||
Foreign currency translation adjustments:
|
|
|
||
Divestitures, deconsolidations and other1
|
Other income (loss) — net
|
$
|
3
|
|
|
Income before income taxes
|
3
|
|
|
|
Income taxes
|
—
|
|
|
|
Consolidated net income
|
$
|
3
|
|
Derivatives:
|
|
|
||
Foreign currency contracts
|
Net operating revenues
|
$
|
4
|
|
Foreign currency contracts
|
Cost of goods sold
|
(1
|
)
|
|
Foreign currency contracts
|
Other income (loss) — net
|
(15
|
)
|
|
Foreign currency and interest rate contracts
|
Interest expense
|
13
|
|
|
|
Income before income taxes
|
1
|
|
|
|
Income taxes
|
—
|
|
|
|
Consolidated net income
|
$
|
1
|
|
Available-for-sale debt securities:
|
|
|
||
Sale of debt securities
|
Other income (loss) — net
|
$
|
(6
|
)
|
|
Income before income taxes
|
(6
|
)
|
|
|
Income taxes
|
1
|
|
|
|
Consolidated net income
|
$
|
(5
|
)
|
Pension and other benefit liabilities:
|
|
|
||
Recognized net actuarial loss
|
Other income (loss) — net
|
$
|
44
|
|
Recognized prior service cost (credit)
|
Other income (loss) — net
|
(1
|
)
|
|
|
Income before income taxes
|
43
|
|
|
|
Income taxes
|
(11
|
)
|
|
|
Consolidated net income
|
$
|
32
|
|
1
|
Related to the sale of a portion of our ownership interest in one of our equity method investments. Refer to Note 2.
|
|
|
|
Shareowners of The Coca-Cola Company
|
|
|
||||||||||||||||||
Three Months Ended March 27, 2020
|
Common Shares Outstanding
|
|
Total
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Common
Stock
|
|
Capital
Surplus
|
|
Treasury
Stock
|
|
Non-
controlling
Interests
|
|
|||||||
December 31, 2019
|
4,280
|
|
$
|
21,098
|
|
$
|
65,855
|
|
$
|
(13,544
|
)
|
$
|
1,760
|
|
$
|
17,154
|
|
$
|
(52,244
|
)
|
$
|
2,117
|
|
Comprehensive income (loss)
|
—
|
|
188
|
|
2,775
|
|
(2,152
|
)
|
—
|
|
—
|
|
—
|
|
(435
|
)
|
|||||||
Dividends paid/payable to
shareowners of The Coca-Cola
Company ($0.41 per share)
|
—
|
|
(1,760
|
)
|
(1,760
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Dividends paid to noncontrolling
interests
|
—
|
|
(6
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(6
|
)
|
|||||||
Impact related to stock-based
compensation plans
|
14
|
|
314
|
|
—
|
|
—
|
|
—
|
|
158
|
|
156
|
|
—
|
|
|||||||
March 27, 2020
|
4,294
|
|
$
|
19,834
|
|
$
|
66,870
|
|
$
|
(15,696
|
)
|
$
|
1,760
|
|
$
|
17,312
|
|
$
|
(52,088
|
)
|
$
|
1,676
|
|
|
|
|
Shareowners of The Coca-Cola Company
|
|
|
||||||||||||||||||
Three Months Ended March 29, 2019
|
Common Shares Outstanding
|
|
Total
|
|
Reinvested
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Common
Stock
|
|
Capital
Surplus
|
|
Treasury
Stock
|
|
Non-
controlling
Interests
|
|
|||||||
December 31, 2018
|
4,268
|
|
$
|
19,058
|
|
$
|
63,234
|
|
$
|
(12,814
|
)
|
$
|
1,760
|
|
$
|
16,520
|
|
$
|
(51,719
|
)
|
$
|
2,077
|
|
Adoption of accounting standards
|
—
|
|
(18
|
)
|
501
|
|
(519
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Comprehensive income (loss)
|
—
|
|
2,683
|
|
1,678
|
|
1,008
|
|
—
|
|
—
|
|
—
|
|
(3
|
)
|
|||||||
Dividends paid/payable to
shareowners of The Coca-Cola
Company ($0.40 per share)
|
—
|
|
(1,709
|
)
|
(1,709
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Dividends paid to noncontrolling
interests
|
—
|
|
(5
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5
|
)
|
|||||||
Purchases of treasury stock
|
(9
|
)
|
(398
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(398
|
)
|
—
|
|
|||||||
Impact related to stock-based
compensation plans
|
9
|
|
193
|
|
—
|
|
—
|
|
—
|
|
57
|
|
136
|
|
—
|
|
|||||||
March 29, 2019
|
4,268
|
|
$
|
19,804
|
|
$
|
63,704
|
|
$
|
(12,325
|
)
|
$
|
1,760
|
|
$
|
16,577
|
|
$
|
(51,981
|
)
|
$
|
2,069
|
|
|
Accrued Balance
December 31, 2019
|
|
Costs Incurred
|
|
Payments
|
|
Noncash
and Exchange |
|
Accrued Balance
March 27, 2020
|
|
|||||
Severance pay and benefits
|
$
|
58
|
|
$
|
1
|
|
$
|
(7
|
)
|
$
|
(2
|
)
|
$
|
50
|
|
Outside services
|
1
|
|
27
|
|
(27
|
)
|
—
|
|
1
|
|
|||||
Other direct costs
|
7
|
|
11
|
|
(11
|
)
|
(4
|
)
|
3
|
|
|||||
Total
|
$
|
66
|
|
$
|
39
|
|
$
|
(45
|
)
|
$
|
(6
|
)
|
$
|
54
|
|
|
Pension Benefit Plans
|
|
Other Postretirement
Benefit Plans
|
||||||||||
|
Three Months Ended
|
||||||||||||
|
March 27,
2020 |
|
March 29,
2019 |
|
|
March 27,
2020 |
|
March 29,
2019 |
|
||||
Service cost
|
$
|
28
|
|
$
|
26
|
|
|
$
|
3
|
|
$
|
2
|
|
Interest cost
|
59
|
|
72
|
|
|
6
|
|
7
|
|
||||
Expected return on plan assets1
|
(147
|
)
|
(138
|
)
|
|
(4
|
)
|
(3
|
)
|
||||
Amortization of prior service credit
|
—
|
|
(1
|
)
|
|
(1
|
)
|
(1
|
)
|
||||
Amortization of net actuarial loss
|
43
|
|
38
|
|
|
1
|
|
1
|
|
||||
Net periodic benefit cost (income)
|
$
|
(17
|
)
|
$
|
(3
|
)
|
|
$
|
5
|
|
$
|
6
|
|
March 27, 2020
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Other3
|
|
Netting
Adjustment
|
|
4
|
Fair Value
Measurements
|
|
|
|||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Equity securities with readily determinable values1
|
$
|
1,457
|
|
$
|
194
|
|
$
|
15
|
|
|
$
|
97
|
|
$
|
—
|
|
|
$
|
1,763
|
|
|
|
Debt securities1
|
—
|
|
2,452
|
|
38
|
|
|
|
—
|
|
—
|
|
|
2,490
|
|
|
||||||
Derivatives2
|
1
|
|
988
|
|
—
|
|
|
—
|
|
(670
|
)
|
5
|
319
|
|
7
|
|||||||
Total assets
|
$
|
1,458
|
|
$
|
3,634
|
|
$
|
53
|
|
|
$
|
97
|
|
$
|
(670
|
)
|
|
$
|
4,572
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Contingent consideration liability
|
$
|
—
|
|
$
|
—
|
|
$
|
(281
|
)
|
8
|
|
$
|
—
|
|
$
|
—
|
|
|
$
|
(281
|
)
|
|
Derivatives2
|
(42
|
)
|
(572
|
)
|
—
|
|
|
—
|
|
572
|
|
6
|
(42
|
)
|
7
|
|||||||
Total liabilities
|
$
|
(42
|
)
|
$
|
(572
|
)
|
$
|
(281
|
)
|
|
$
|
—
|
|
$
|
572
|
|
|
$
|
(323
|
)
|
|
5
|
The Company is obligated to return $233 million in cash collateral it has netted against its derivative position.
|
6
|
The Company has the right to reclaim $95 million in cash collateral it has netted against its derivative position.
|
December 31, 2019
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
|
Other3
|
|
Netting
Adjustment
|
|
4
|
Fair Value
Measurements
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity securities with readily determinable values1
|
$
|
1,877
|
|
$
|
219
|
|
$
|
14
|
|
|
$
|
109
|
|
$
|
—
|
|
|
$
|
2,219
|
|
|
Debt securities1
|
—
|
|
3,291
|
|
37
|
|
|
—
|
|
—
|
|
|
3,328
|
|
|
||||||
Derivatives2
|
9
|
|
579
|
|
—
|
|
|
—
|
|
(392
|
)
|
5
|
196
|
|
6
|
||||||
Total assets
|
$
|
1,886
|
|
$
|
4,089
|
|
$
|
51
|
|
|
$
|
109
|
|
$
|
(392
|
)
|
|
$
|
5,743
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Derivatives2
|
$
|
—
|
|
$
|
(162
|
)
|
$
|
—
|
|
|
$
|
—
|
|
$
|
130
|
|
|
$
|
(32
|
)
|
6
|
Total liabilities
|
$
|
—
|
|
$
|
(162
|
)
|
$
|
—
|
|
|
$
|
—
|
|
$
|
130
|
|
|
$
|
(32
|
)
|
|
1
|
Refer to Note 4 for additional information related to the composition of our equity securities with readily determinable values and debt securities.
|
3
|
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy but are included to reconcile to the amounts presented in Note 4.
|
6
|
The Company's derivative financial instruments are recorded at fair value in our condensed consolidated balance sheet as follows: $196 million in the line item other assets and $32 million in the line item other liabilities. Refer to Note 6 for additional information related to the composition of our derivative portfolio.
|
|
Gains (Losses)
|
|||||||
|
Three Months Ended
|
|
||||||
|
March 27,
2020 |
|
|
March 29,
2019 |
|
|
||
Impairment of intangible asset
|
$
|
(152
|
)
|
1
|
$
|
—
|
|
|
Other-than-temporary impairment charges
|
—
|
|
|
(343
|
)
|
3
|
||
Investment in former equity method investee
|
—
|
|
|
(121
|
)
|
4
|
||
Impairment of equity investment without a readily determinable fair value
|
(26
|
)
|
2
|
—
|
|
|
||
Total
|
$
|
(178
|
)
|
|
$
|
(464
|
)
|
|
|
Europe, Middle East & Africa
|
|
|
Latin
America |
|
North
America |
|
Asia Pacific
|
|
Global Ventures
|
|
Bottling
Investments |
|
|
Corporate
|
|
Eliminations
|
|
Consolidated
|
|
|||||||||
As of and for the Three Months Ended March 27, 2020
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Third party
|
$
|
1,573
|
|
|
$
|
930
|
|
$
|
2,849
|
|
$
|
989
|
|
$
|
573
|
|
$
|
1,656
|
|
|
$
|
31
|
|
$
|
—
|
|
$
|
8,601
|
|
Intersegment
|
152
|
|
|
—
|
|
1
|
|
139
|
|
—
|
|
2
|
|
|
—
|
|
(294
|
)
|
—
|
|
|||||||||
Total net operating revenues
|
1,725
|
|
|
930
|
|
2,850
|
|
1,128
|
|
573
|
|
1,658
|
|
|
31
|
|
(294
|
)
|
8,601
|
|
|||||||||
Operating income (loss)
|
960
|
|
|
539
|
|
387
|
|
511
|
|
19
|
|
63
|
|
|
(99
|
)
|
—
|
|
2,380
|
|
|||||||||
Income (loss) before income taxes
|
971
|
|
|
535
|
|
402
|
|
513
|
|
18
|
|
198
|
|
|
373
|
|
—
|
|
3,010
|
|
|||||||||
Identifiable operating assets
|
8,172
|
|
1
|
1,853
|
|
20,600
|
|
2,312
|
|
7,378
|
|
10,184
|
|
1
|
24,842
|
|
—
|
|
75,341
|
|
|||||||||
Investments2
|
498
|
|
|
661
|
|
357
|
|
225
|
|
11
|
|
12,968
|
|
|
3,952
|
|
—
|
|
18,672
|
|
|||||||||
As of and for the Three Months Ended March 29, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Net operating revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Third party
|
$
|
1,634
|
|
|
$
|
896
|
|
$
|
2,681
|
|
$
|
1,060
|
|
$
|
583
|
|
$
|
1,808
|
|
|
$
|
32
|
|
$
|
—
|
|
$
|
8,694
|
|
Intersegment
|
138
|
|
|
—
|
|
2
|
|
127
|
|
2
|
|
2
|
|
|
—
|
|
(271
|
)
|
—
|
|
|||||||||
Total net operating revenues
|
1,772
|
|
|
896
|
|
2,683
|
|
1,187
|
|
585
|
|
1,810
|
|
|
32
|
|
(271
|
)
|
8,694
|
|
|||||||||
Operating income (loss)
|
978
|
|
|
496
|
|
586
|
|
542
|
|
66
|
|
100
|
|
|
(333
|
)
|
—
|
|
2,435
|
|
|||||||||
Income (loss) before income taxes
|
988
|
|
|
491
|
|
537
|
|
550
|
|
68
|
|
(100
|
)
|
|
(309
|
)
|
—
|
|
2,225
|
|
|||||||||
Identifiable operating assets
|
8,379
|
|
1
|
1,838
|
|
18,316
|
|
2,088
|
|
7,350
|
|
10,867
|
|
1
|
19,305
|
|
—
|
|
68,143
|
|
|||||||||
Investments2
|
719
|
|
|
786
|
|
343
|
|
223
|
|
—
|
|
14,360
|
|
|
3,773
|
|
—
|
|
20,204
|
|
|||||||||
As of December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Identifiable operating assets
|
$
|
8,143
|
|
1
|
$
|
1,801
|
|
$
|
17,687
|
|
$
|
2,060
|
|
$
|
7,265
|
|
$
|
11,170
|
|
1
|
$
|
18,376
|
|
$
|
—
|
|
$
|
66,502
|
|
Investments2
|
543
|
|
|
716
|
|
358
|
|
224
|
|
14
|
|
14,093
|
|
|
3,931
|
|
—
|
|
19,879
|
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $152 million for North America due to an impairment charge related to a trademark, which was primarily driven by revised projections of future operating results due to reduced availability at retail customer outlets and a change in brand focus in the Company's portfolio. Refer to Note 15.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $39 million for Corporate due to the Company's productivity and reinvestment program. Refer to Note 12.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $11 million for Corporate related to the remeasurement of our contingent consideration liability to fair value in conjunction with our acquisition of the remaining interest in fairlife. Refer to Note 2.
|
•
|
Income (loss) before income taxes was increased by $902 million for Corporate in conjunction with our acquisition of the remaining interest in fairlife, which resulted from the remeasurement of our previously held equity interest in fairlife to fair value. Refer to Note 2.
|
•
|
Income (loss) before income taxes was increased by $18 million for Corporate related to the sale of a portion of our ownership interest in one of our equity method investments.
|
•
|
Income (loss) before income taxes was reduced by $392 million for Corporate related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities. Refer to Note 4.
|
•
|
Income (loss) before income taxes was reduced by $38 million for Bottling Investments due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $1 million for Europe, Middle East and Africa, $17 million for North America, $2 million for Bottling Investments and $48 million for Corporate due to the Company's productivity and reinvestment program. Refer to Note 12.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $46 million for Corporate related to transaction costs associated with the purchase of Costa, which we acquired in January 2019. Refer to Note 2.
|
•
|
Operating income (loss) and income (loss) before income taxes were reduced by $11 million for Bottling Investments related to costs incurred to refranchise certain of our North America bottling operations. Refer to Note 11.
|
•
|
Income (loss) before income taxes was increased by $149 million for Corporate related to realized and unrealized gains and losses on equity securities and trading debt securities as well as realized gains and losses on available-for-sale debt securities. Refer to Note 4.
|
•
|
Income (loss) before income taxes was increased by $39 million for Corporate related to the sale of a portion of our equity ownership interest in Andina. Refer to Note 2.
|
•
|
Income (loss) before income taxes was reduced by $286 million for Bottling Investments due to an other-than-temporary impairment charge related to CCBJHI, an equity method investee. Refer to Note 15.
|
•
|
Income (loss) before income taxes was reduced by $121 million for Corporate resulting from a loss in conjunction with our acquisition of the remaining interest in CHI. Refer to Note 2 and Note 15.
|
•
|
Income (loss) before income taxes was reduced by $57 million for North America due to an other-than-temporary impairment charge related to one of our equity method investees. Refer to Note 15.
|
•
|
Income (loss) before income taxes was reduced by $42 million for Bottling Investments due to the Company's proportionate share of significant operating and nonoperating items recorded by certain of our equity method investees.
|
•
|
To ensure the health and safety of Coca-Cola system employees
|
•
|
To support and make a difference in the communities we serve
|
•
|
To keep our brands in supply and to maintain the quality and safety of our products
|
•
|
To best serve our customers across all channels as they adapt to the shifting demands of consumers during the crisis
|
•
|
To best position ourselves to emerge strong when this crisis ends
|
|
Percent Change 2020 versus 2019
|
|
||||
|
Three Months Ended March 27, 2020
|
|
||||
|
Unit Cases1,2,3
|
|
Concentrate
Sales4
|
|
|
|
Worldwide
|
(1
|
)%
|
|
—
|
%
|
|
Europe, Middle East & Africa
|
—
|
%
|
|
(1
|
)%
|
|
Latin America
|
—
|
|
|
5
|
|
|
North America
|
3
|
|
|
4
|
|
6
|
Asia Pacific
|
(7
|
)
|
|
1
|
|
7
|
Global Ventures
|
(2
|
)
|
|
(3
|
)
|
|
Bottling Investments
|
(5
|
)
|
5
|
N/A
|
|
5
|
After considering the impact of structural changes, unit case volume for Bottling Investments for the three months ended March 27, 2020 declined 4 percent.
|
|
Percent Change 2020 versus 2019
|
|||||||||
|
Volume1
|
|
Price, Product & Geographic Mix
|
|
Foreign Currency Fluctuations
|
|
Acquisitions & Divestitures2
|
|
Total
|
|
Consolidated
|
—
|
%
|
—
|
%
|
(2
|
)%
|
1
|
%
|
(1
|
)%
|
Europe, Middle East & Africa
|
(1
|
)%
|
—
|
%
|
(3
|
)%
|
1
|
%
|
(3
|
)%
|
Latin America
|
5
|
|
8
|
|
(10
|
)
|
—
|
|
4
|
|
North America
|
3
|
|
1
|
|
—
|
|
2
|
|
6
|
|
Asia Pacific
|
(3
|
)
|
(4
|
)
|
(1
|
)
|
2
|
|
(5
|
)
|
Global Ventures
|
(3
|
)
|
1
|
|
—
|
|
—
|
|
(2
|
)
|
Bottling Investments
|
(4
|
)
|
(2
|
)
|
(1
|
)
|
(1
|
)
|
(8
|
)
|
•
|
Europe, Middle East and Africa — favorable price, product and package mix, offset by negative geographic mix, including the impact of the Brexit inventory build in the prior year;
|
•
|
Latin America — favorable price and package mix in Mexico and the impact of inflationary environments in certain markets;
|
•
|
North America — favorable pricing initiatives, partially offset by unfavorable product mix resulting from strong sales in packaged water;
|
•
|
Asia Pacific — unfavorable channel and product mix across a majority of the business units;
|
•
|
Global Ventures — favorable product mix; and
|
•
|
Bottling Investments — unfavorable product and package mix primarily in our bottling operations in Africa.
|
|
Three Months Ended
|
|||||
|
March 27,
2020 |
|
March 29,
2019 |
|
||
Stock-based compensation expense (income)
|
$
|
(5
|
)
|
$
|
40
|
|
Advertising expenses
|
902
|
|
953
|
|
||
Selling and distribution expenses
|
698
|
|
675
|
|
||
Other operating expenses
|
1,053
|
|
1,099
|
|
||
Selling, general and administrative expenses
|
$
|
2,648
|
|
$
|
2,767
|
|
|
Three Months Ended
|
|||||
|
March 27,
2020 |
|
March 29,
2019 |
|
||
Europe, Middle East & Africa
|
$
|
—
|
|
$
|
1
|
|
Latin America
|
—
|
|
—
|
|
||
North America
|
152
|
|
17
|
|
||
Asia Pacific
|
—
|
|
—
|
|
||
Global Ventures
|
—
|
|
—
|
|
||
Bottling Investments
|
—
|
|
13
|
|
||
Corporate
|
50
|
|
96
|
|
||
Total
|
$
|
202
|
|
$
|
127
|
|
|
Three Months Ended
|
|||
|
March 27,
2020 |
|
March 29,
2019 |
|
Europe, Middle East & Africa
|
40.3
|
%
|
40.1
|
%
|
Latin America
|
22.7
|
|
20.4
|
|
North America
|
16.3
|
|
24.1
|
|
Asia Pacific
|
21.5
|
|
22.3
|
|
Global Ventures
|
0.8
|
|
2.7
|
|
Bottling Investments
|
2.6
|
|
4.1
|
|
Corporate
|
(4.2
|
)
|
(13.7
|
)
|
Total
|
100.0
|
%
|
100.0
|
%
|
|
Three Months Ended
|
|||
|
March 27,
2020 |
|
March 29,
2019 |
|
Consolidated
|
27.7
|
%
|
28.0
|
%
|
Europe, Middle East & Africa
|
61.1
|
%
|
59.8
|
%
|
Latin America
|
58.0
|
|
55.4
|
|
North America
|
13.6
|
|
21.9
|
|
Asia Pacific
|
51.6
|
|
51.2
|
|
Global Ventures
|
3.3
|
|
11.2
|
|
Bottling Investments
|
3.8
|
|
5.5
|
|
Corporate
|
*
|
|
*
|
|
•
|
$1,000 million total principal amount of notes due March 25, 2025, at a fixed interest rate of 2.950 percent;
|
•
|
$1,000 million total principal amount of notes due March 25, 2027, at a fixed interest rate of 3.375 percent;
|
•
|
$1,250 million total principal amount of notes due March 25, 2030, at a fixed interest rate of 3.450 percent;
|
•
|
$500 million total principal amount of notes due March 25, 2040, at a fixed interest rate of 4.125 percent; and
|
•
|
$1,250 million total principal amount of notes due March 25, 2050, at a fixed interest rate of 4.200 percent.
|
•
|
We have experienced a decrease in sales of certain of our products in markets around the world that have been affected by the COVID-19 pandemic. In particular, sales of our products in the away-from-home channels have been significantly negatively affected by shelter-in-place regulations or recommendations, closings of restaurants and cancellations of major sporting and other events. This negative trend is likely to continue, with the most significant impact expected to occur in the second quarter of fiscal year 2020. If the COVID-19 pandemic intensifies and expands geographically, its negative impacts on our sales could be more prolonged and may become more severe. While we have experienced increased sales in the at-home channels since the outbreak from pantry loading as consumers stock up on certain of our products with the expectation of spending more time at home during the crisis, such increased sales levels may not continue in the longer term and will not offset the pressure we are experiencing in the away-from-home channels.
|
•
|
In certain COVID-19 affected markets, consumer demand has shifted away from some of our more profitable beverages and away-from-home consumption to lower-margin products and at-home consumption, and this shift in consumer purchasing patterns is likely to continue while shelter-in-place and social distancing behaviors are mandated or encouraged.
|
•
|
Deteriorating economic and political conditions in many of our major markets affected by the COVID-19 pandemic, such as increased unemployment, decreases in disposable income, declines in consumer confidence, or economic slowdowns or recessions, could cause a further decrease in demand for our products.
|
•
|
We have experienced temporary disruptions in certain of our concentrate production operations. We are taking measures to protect our employees and facilities around the world, which include, but are not limited to, checking the temperature of employees when they enter our facilities, requiring employees to wear masks and other protective clothing as appropriate, and implementing additional cleaning and sanitization routines. These measures may not be sufficient to prevent the spread of COVID-19 among our employees and, therefore, we may face additional concentrate production disruptions in the future, which may place constraints on our ability to supply concentrates to our bottling partners in a timely manner or may increase our concentrate supply costs.
|
•
|
We have faced, and may continue to face, increasing delays in the delivery of concentrates to our bottling partners as a result of shipping delays due to, among other things, additional safety requirements imposed by port authorities, closures of or congestion at ports, and capacity constraints experienced by our transportation contractors.
|
•
|
Some of our bottling partners have experienced, and may experience in the future, temporary plant closures, production slowdowns and disruptions in distribution operations as a result of the impact of the COVID-19 pandemic on their respective businesses.
|
•
|
Disruptions in supply chains may place constraints on our and our bottling partners’ ability to source beverage containers, such as glass bottles and cans, which may increase our and their packaging costs.
|
•
|
We have experienced, and expect to continue to experience, adverse fluctuations in foreign currency exchange rates, particularly an increase in the value of the U.S. dollar against certain key foreign currencies, which negatively affected, and we expect will continue to negatively affect, our reported results of operations and financial condition.
|
•
|
Our borrowing costs have increased as a result of disruptions and increased volatility and pricing in the commercial paper and debt markets caused by the COVID-19 pandemic and, if the current uncertain conditions in the credit markets continue or worsen, our borrowing costs may continue to increase.
|
•
|
The current uncertain credit market conditions and their actual or perceived effects on our and our major bottling partners' results of operations and financial condition, along with the current unfavorable economic environment in the United States and much of the world, may increase the likelihood that one or more of the major independent credit agencies will downgrade our credit ratings, which could have a negative effect on our borrowing costs.
|
•
|
Governmental authorities in the United States and throughout the world may increase or impose new income taxes or indirect taxes, or revise interpretations of existing tax rules and regulations, as a means of financing the costs of stimulus and other measures enacted or taken, or that may be enacted or taken in the future, to protect populations and economies from the impact of the COVID-19 pandemic. Such actions could have an adverse effect on our results of operations and cash flows.
|
•
|
We rely on third-party service providers and business partners, such as cloud data storage and other information technology service providers, suppliers, distributors, contractors, joint venture partners and other external business partners, for certain functions or for services in support of key portions of our operations. These third-party service providers and business partners are subject to risks and uncertainties related to the COVID-19 pandemic, which may interfere with their ability to fulfill their respective commitments and responsibilities to us in a timely manner and in accordance with the agreed-upon terms.
|
•
|
The financial impact of the COVID-19 pandemic may cause one or more of our counterparty financial institutions to fail or default on their obligations to us, which could cause us to incur significant losses.
|
•
|
We may be required to record significant impairment charges with respect to noncurrent assets, including trademarks, bottler franchise rights, goodwill and other intangible assets, equity method investments and other long-lived assets whose fair values may be negatively affected by the effects of the COVID-19 pandemic on our operations. Also, we may be required to write off obsolete inventory and the unamortized balances of advanced funding provided to customers that permanently close as a result of the COVID-19 pandemic’s damaging impacts on their respective businesses. In addition, we are required to record impairment charges related to our proportionate share of impairment charges that may be recorded by equity method investees, and such charges may be significant.
|
•
|
The significant declines in the equity markets and in the valuation of other assets precipitated by the COVID-19 pandemic have negatively affected the values of our pension plan assets. If these negative effects continue and the fair values of our pension plan assets remain lower than pre-pandemic levels, we may incur increased pension expense in future periods.
|
•
|
As a result of the COVID-19 pandemic, including related governmental guidance or directives, we have required most office-based employees, including most employees based at our global headquarters in Atlanta, to work remotely. We may experience reductions in productivity and disruptions to our business routines while our remote work policy remains in place.
|
•
|
Actions we have taken or may take, or decisions we have made or may make, as a consequence of the COVID-19 pandemic may result in legal claims or litigation against us.
|
Period
|
Total Number
of Shares
Purchased1
|
|
Average
Price Paid
Per Share
|
|
Total Number
of Shares
Purchased as
Part of
Publicly
Announced
Plan2
|
|
Maximum
Number of
Shares That May
Yet Be
Purchased Under
Publicly
Announced
Plans3
|
|
|
January 1, 2020 through January 24, 2020
|
37,271
|
|
$
|
54.55
|
|
—
|
|
161,029,667
|
|
January 25, 2020 through February 21, 2020
|
2,715,361
|
|
59.90
|
|
—
|
|
161,029,667
|
|
|
February 22, 2020 through March 27, 2020
|
28,002
|
|
49.09
|
|
—
|
|
161,029,667
|
|
|
Total
|
2,780,634
|
|
$
|
59.72
|
|
—
|
|
|
|
•
|
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
•
|
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
EXHIBIT INDEX
|
|
Exhibit No.
|
|
(With regard to applicable cross-references in the list of exhibits below, the Company's Current, Quarterly and Annual Reports are filed with the Securities and Exchange Commission (the "SEC") under File No. 001-02217; and Coca-Cola Refreshments USA, Inc.'s (formerly known as Coca-Cola Enterprises Inc.) Current, Quarterly and Annual Reports are filed with the SEC under File No. 001-09300).
|
|
4.1
|
Intentionally omitted.
|
4.2
|
As permitted by the rules of the SEC, the Company has not filed certain instruments defining the rights of holders of long-term debt of the Company or consolidated subsidiaries under which the total amount of securities authorized does not exceed 10 percent of the total assets of the Company and its consolidated subsidiaries. The Company agrees to furnish to the SEC, upon request, a copy of any omitted instrument.
|
|
|
THE COCA-COLA COMPANY
(Registrant)
|
|
|
|
|
|
/s/ KATHY LOVELESS
|
Date:
|
April 24, 2020
|
Kathy Loveless
Vice President and Controller
(On behalf of the Registrant)
|
|
|
|
|
|
/s/ MARK RANDAZZA
|
Date:
|
April 24, 2020
|
Mark Randazza
Vice President, Assistant Controller and Chief Accounting Officer
(Principal Accounting Officer)
|
BY-LAWS OF THE COCA-COLA COMPANY
|
AS AMENDED AND RESTATED THROUGH APRIL 22, 2020
|
Performance Period(s)
|
|
Performance Certification Date
|
[Date], on the date of the Compensation Committee meeting
|
Release Date
|
|
(1)
|
General Conditions. This Award is in the form of performance share units that settle in Shares at the Release Date. If all of the conditions set forth in this Agreement are satisfied, the Shares will be released to the Recipient as soon as administratively possible following the Release Date. If these conditions are not satisfied, the Award shall be forfeited. Capitalized terms in this Agreement refer to defined terms in the Plan, except as otherwise defined herein.
|
(2)
|
Shares, Dividends and Voting Rights. As soon as administratively practicable following the Release Date, or as otherwise provided in Section 3 below, the number of Shares determined based on the Performance Criteria shall be issued to the Recipient, provided all conditions set forth in Section 1 above are satisfied. Except as provided in Section 3 below, all Awards shall be settled in Shares.
|
(1)
|
withholding from the Recipient’s wages or other cash compensation paid to the Recipient by the Company and/or the Employer, or any other payment of any kind otherwise due to the Recipient by the Company and/or the Employer; or
|
(2)
|
withholding from proceeds of the sale of Shares acquired upon vesting/settlement of the Award, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Recipient’s behalf pursuant to this authorization without further consent); or
|
(3)
|
retention of or withholding in Shares to be issued upon vesting/settlement of the Award.
|
(i)
|
To direct, instruct, authorize and prepare and execute any document necessary to have Merrill Lynch (or any successor broker designated by the Company) sell on the Recipient’s behalf a set percentage of the Shares the Recipient receives at vesting as may be needed to cover Tax-Related Items due at vesting;
|
(ii)
|
To direct, instruct, authorize and prepare and execute any document necessary to have the Company and/or Merrill Lynch (or any successor broker designated by the Company) use the Recipient’s bank and/or brokerage account information and any other information as required to effectuate the sale of Shares the Recipient receives at vesting as may be needed to cover Tax-Related Items due at vesting;
|
(iii)
|
To take any additional action that may be necessary or appropriate for implementation of the Plan with any competent taxing authority; and
|
(iv)
|
To constitute and appoint, in the Recipient’s place and stead, and as the Recipient’s substitute, one representative or more, with power of revocation.
|
(i)
|
The revocation must be made within one week after the acceptance of the Agreement.
|
(ii)
|
The revocation must be in written form to be valid. It is sufficient if the Recipient returns the Agreement to the Company or the Company’s representative with language that can be understood as the Recipient’s refusal to conclude or honor the Agreement, provided the revocation is sent within the period discussed above.
|
(1)
|
General Conditions. This Award is in the form of restricted stock units that settle in Shares at the Release Date. If all of the conditions set forth in this Agreement are satisfied, the Shares will be released to the Recipient as soon as administratively possible following the Release Date. If these conditions are not satisfied, the Award shall be forfeited. Capitalized terms in this Agreement refer to defined terms in the Plan, except as otherwise defined herein. Except as provided in Section 3 or in Appendix A, the Shares shall be released on the Release Date only if the Recipient is continuously employed by the Company, or if different, the Recipient’s employer (the “Employer”), or an Affiliate from the Award Date until the Release Date.
|
(2)
|
Shares, Dividends and Voting Rights. As soon as administratively practicable following the Release Date, or as otherwise provided in Section 3 below, the number of indicated Shares shall be issued to the Recipient, provided all conditions set forth in Section 1 above are satisfied. Except as provided in Section 3 below, all Awards shall be settled in Shares.
|
Event
|
Impact on Vesting
|
Impact on Release
|
Disability
|
Award continues to vest if employee is still employed.
|
Award shall be settled in Shares on Release Date.
|
Employment with the Company or a Subsidiary terminates because of Disability
|
Award immediately vests.
|
Shares will be released within 90 days after the date of termination.
|
(1)
|
withholding from the Recipient’s wages or other cash compensation paid to the Recipient by the Company and/or the Employer, or any other payment of any kind otherwise due to the Recipient by the Company and/or the Employer; or
|
(2)
|
withholding from proceeds of the sale of Shares acquired upon vesting/settlement of the Award, either through a voluntary sale or through a mandatory sale arranged by the Company (on the Recipient’s behalf pursuant to this authorization without further consent); or
|
(3)
|
retention of or withholding in Shares to be issued upon vesting/settlement of the Award.
|
(i)
|
To direct, instruct, authorize and prepare and execute any document necessary to have Merrill Lynch (or any successor broker designated by the Company) sell on the Recipient’s behalf a set percentage of the Shares the Recipient receives at vesting as may be needed to cover Tax-Related Items due at vesting;
|
(ii)
|
To direct, instruct, authorize and prepare and execute any document necessary to have the Company and/or Merrill Lynch (or any successor broker designated by the Company) use the Recipient’s bank and/or brokerage account information and any other information as required to effectuate the sale of Shares the Recipient receives at vesting as may be needed to cover Tax-Related Items due at vesting;
|
(iii)
|
To take any additional action that may be necessary or appropriate for implementation of the Plan with any competent taxing authority; and
|
(iv)
|
To constitute and appoint, in the Recipient’s place and stead, and as the Recipient’s substitute, one representative or more, with power of revocation.
|
(i)
|
The revocation must be made within one week after the acceptance of the Agreement.
|
(ii)
|
The revocation must be in written form to be valid. It is sufficient if the Recipient returns the Agreement to the Company or the Company’s representative with language that can be understood as the Recipient’s refusal to conclude or honor the Agreement, provided the revocation is sent within the period discussed above.
|
Employment with the Company or a Subsidiary terminates after attaining age 55 and completing 10 Years of Service (“Retirement”)
|
Award held at least 12 months becomes immediately vested. Award held less than 12 months is forfeited.
|
Shares will be released within 90 days after the date of termination. If required by Section 409A of the Internal Revenue Code, Shares may not be released to specified employees until at least six months following termination of employment.
|
Job Grade
|
Benefit
|
18 or higher
|
104 times Weekly Pay
|
15, 16, 17
|
78 times Weekly Pay
|
13, 14
|
52 times Weekly Pay
|
1 through 12
Retail and Attraction
|
2 times Weekly Pay times Years of Service, with a minimum benefit of 12 times Weekly Pay and a maximum benefit of 52 times Weekly Pay
|
Regular Part-time (all job grades)
|
1 times Weekly Pay times Years of Service, with a minimum benefit of 2 times Weekly Pay and a maximum benefit of 12 times Weekly Pay
|
5.1
|
Right to File a Claim. Any Participant who believes he is entitled to a benefit
|
•
|
Your principal place of assignment will be Atlanta, GA.
|
•
|
Your annual base pay for your new position will be USD 358,000.
|
•
|
You will continue to be eligible to participate in the annual Performance Incentive Plan. This is an important, variable element of your total compensation. Your incentive opportunity for your new position is between 0% and 130% (maximum) of your annual base pay. Any payment will depend on both the business performance and your personal contributions. Awards are made at the discretion of the Compensation Committee of the Board of Directors based upon recommendations by Senior Management. As a discretionary program, the performance factors, eligibility criteria, payment frequency, award opportunity levels and other provisions are variable. The plan may be modified from time to time.
|
•
|
You will continue to be eligible to participate in The Coca-Cola Company’s Long-Term Incentive (LTI) program. Awards are made at the discretion of the Compensation Committee of the Board of Directors based upon recommendations by Senior Management. You will be eligible to receive LTI awards within guidelines for the job grade assigned to your position and based upon your leadership potential to impact the Company’s future growth. As a discretionary program, eligibility criteria, award opportunity levels, the award timing, frequency, size and mix of award vehicles are variable.
|
•
|
You will be expected to acquire and maintain share ownership at a level equal to two times your base pay. As part of the Company’s ownership expectations, you will have five years, or until December 31, 2025, to achieve this level of ownership. You will be asked to provide information in December each year on your progress toward your ownership goal, and that information will be reviewed with the Compensation Committee of the Board of Directors the following February. Further information regarding this requirement is enclosed.
|
•
|
You will be eligible for the Company’s Financial Planning Reimbursement Program which provides reimbursement of certain financial planning services, up to USD 7,500 annually, subject to taxes and withholding. Further information regarding this benefit is enclosed.
|
•
|
You will be eligible for the Emory Executive Health benefit which includes a comprehensive physical exam and one-on-one medical and lifestyle management consultation. Further information regarding this benefit is enclosed.
|
•
|
You are required to enter into the Agreement on Confidentiality, Non-Competition, and Non-Solicitation, as well as the Agreement Covering Inventions, Discoveries, Copyrightable Material, Trade Secrets, and Confidential Information, effective immediately (enclosed).
|
•
|
This letter is provided as information and does not constitute an employment contract.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Coca-Cola Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement 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 report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this 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 report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 24, 2020
|
|
|
|
|
/s/ JAMES QUINCEY
|
|
James Quincey
Chairman of the Board of Directors and Chief Executive Officer of
The Coca-Cola Company
|
1.
|
I have reviewed this quarterly report on Form 10-Q of The Coca-Cola Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement 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 report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this 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 report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, 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 report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
April 24, 2020
|
|
|
|
|
/s/ JOHN MURPHY
|
|
John Murphy
Executive Vice President and Chief Financial Officer of
The Coca-Cola Company
|
(1)
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to my knowledge, the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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/s/ JAMES QUINCEY
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James Quincey
Chairman of the Board of Directors and Chief Executive Officer of The Coca-Cola Company
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April 24, 2020
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/s/ JOHN MURPHY
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John Murphy
Executive Vice President and Chief Financial Officer of The Coca-Cola Company
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April 24, 2020
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1.
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When Options can be exercised.
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(a)
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General provisions.
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(b)
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Specific provisions. Except as otherwise provided in the Plan or in this Agreement, one fourth of the number of Options covered by this Agreement shall vest on each of the first, second, third and fourth anniversaries of the grant date.
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2.
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Employment Events.
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(a)
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The following chart describes the impact on vesting and the exercise period of certain events.
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Event
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Impact on Vesting
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Impact on Exercise Period
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Disability
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Options continue to vest if employee is still employed.
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Option expiration date provided in Agreement continues to apply.
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Event
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Impact on Vesting
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Impact on Exercise Period
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Employment with the Company or a Subsidiary terminates because of Disability
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All Options become immediately vested.
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Option expiration date provided in Agreement continues to apply.
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Employee is involuntary terminated from the Company or a Subsidiary after attaining age 50 and completing 10 Years of Service because of reduction in workforce, internal reorganization, or job elimination and employee signs a release of all claims and, if requested, an agreement on confidentiality and competition.
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Options held at least 12 months continue to vest for four years from termination date in accordance with the Option vesting schedule provided in the Agreement. Options held less than 12 months are forfeited.
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Expires upon earlier of (1) four years from termination date, or (2) the Option expiration date provided in the Agreement.
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Employment with the Company or a Subsidiary terminates after attaining age 60 and completing 10 Years of Service
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Options held at least 12 months become immediately vested. Options held less than 12 months are forfeited.
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Option expiration date provided in Agreement continues to apply.
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Employment with the Company or a Subsidiary terminates because of death
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All Options become immediately vested.
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Right of executor or administrator of estate to exercise Options terminates on earlier of (1) five years from the date of death, or (2) the Option expiration date provided in the Agreement.
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Employment with the Company or a Subsidiary involuntarily terminates for reason other than for cause within one year after a Change in Control
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Award shall be treated as described in the Plan.
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Award shall be treated as described in the Plan.
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Employment with the Company or a Subsidiary terminates for any other reason
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Unvested Options are forfeited.
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Expires upon earlier of (1) six months from termination date, or (2) the Option expiration date provided in the Agreement.
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US military leave
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Vesting continues during leave.
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Option expiration date provided in the Agreement continues to apply.
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Unpaid leave of absence pursuant to published Company policy of 12 months or less
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Vesting continues during leave.
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Option expiration date provided in the Agreement continues to apply.
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Transfer, at Company’s discretion, to an Affiliate that is not a Subsidiary
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Vesting continues after move.
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Option expiration date provided in the Agreement continues to apply.
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Transfer to a Subsidiary
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Vesting continues after move.
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Option expiration date provided in the Agreement continues to apply.
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Event
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Impact on Vesting
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Impact on Exercise Period
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Optionee’s employer is no longer an Affiliate under the terms of the Plan (this constitutes a termination of employment under the Plan)
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Unvested Options are forfeited.
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Expires upon earlier of (1) six months from termination date or (2) Option expiration date provided in the Agreement.
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Employment with an Affiliate terminates for any reason
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Unvested Options are forfeited.
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Expires upon earlier of (1) six months from termination date or (2) Option expiration date provided in the Agreement.
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Death after termination but before option has expired. Note: Termination of employment may have resulted in a change to the original Option expiration date provided in the grant
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Not applicable
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Right of executor or administrator of estate terminates on earlier of (1) five years from the date of death, or (2) the Option expiration date that applied at the date of death.
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(b)
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“Years of Service” for purposes of this agreement means “Years of Vesting Service” as that term is defined in The Coca-Cola Company Pension Plan, regardless of whether the optionee is a participant in that plan.
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(c)
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Committee Discretion to Establish Different Terms. Notwithstanding the foregoing provisions, the Committee may, at its sole discretion, establish different terms and conditions pertaining to the effect of an optionee’s termination on the expiration or exercisability of Options at the time of grant or on the expiration or exercisability of outstanding Options. However, no Option can have a term of more than ten years.
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3.
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How to exercise the Options. In order to exercise an Option, it must be vested and must not have expired, and the optionee must do the following:
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(a)
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Pay the option price. The optionee must pay the option price. The optionee shall be informed of the acceptable form and method of payment at or before the time the optionee informs KO of his or her intention to exercise the Option. The acceptable forms and methods of payment of the option price may include payment in cash, pursuant to a cashless exercise authorized by KO, or by delivery, through attestation, of shares of KO Stock owned by the optionee. Not all forms and methods of payment are available in every country. The value of any shares delivered to pay the option price shall be computed on the basis of the most recent reported market price at which a share of KO Stock shall have been sold prior to the time of processing the optionee's election to deliver shares in payment of the option price, as reported on the New York Stock Exchange Composite Transactions listing.
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(b)
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Complete all paperwork. The optionee must complete, sign and return any paperwork required by KO or by Merrill Lynch, Pierce, Fenner & Smith ("Merrill Lynch"), or such other agent as may administer the Option program on behalf of KO from time to time.
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(c)
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Pay applicable Tax-Related Items.
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•
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withholding from the optionee’s wages or other cash compensation paid to the optionee by the Company and/or the Employer, or any other payment of any kind otherwise due to the optionee by the Company and/or the Employer; or
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•
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withholding from proceeds of the sale of shares of KO Stock acquired upon exercise of the Option, either through a voluntary sale or through a mandatory sale arranged by the Company. In this regard, the optionee agrees that, should KO or any Affiliate in its reasonable judgment determine that Tax-Related Items withholding is required upon exercise of the options, KO may instruct Merrill Lynch to withhold and/or sell shares of KO Stock acquired by the optionee upon exercise of his or her options, or
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•
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If the optionee is a U.S. taxpayer, he or she may elect to satisfy federal, state and local income Tax-Related Items liabilities due by reason of the exercise by having shares of KO Stock withheld or by
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(d)
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Pay applicable fees. The optionee agrees to pay to Merrill Lynch any costs associated with the sale of shares of KO Stock acquired upon exercise of the Options, whether such shares are sold to pay the option price, to satisfy Tax-Related Items or for other reasons.
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(e)
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Right of set-off. By accepting this Agreement, the optionee agrees that, should KO or any Affiliate in its reasonable judgment determine that optionee owes KO or any Affiliate any amount due to any loan, note, obligation or indebtedness, including but not limited to amounts owed to KO pursuant to KO’s tax equalization program or KO’s policies with respect to travel and business expenses, and if the optionee has not satisfied such obligation(s), then KO may instruct Merrill Lynch to withhold and/or sell shares of KO Stock acquired by the optionee upon exercise of his or her Options, or KO may deduct funds equal to the amount of such obligation from the optionee's salary or other funds due to the optionee from KO.
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(f)
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Comply with additional restrictions. The optionee agrees that the Compensation Committee of the Board of Directors of KO (the “Committee”), or its designee, may, in the exercise of its sole and absolute discretion at or before the time the optionee informs KO of his or her intention to exercise the Option, establish any additional conditions or restrictions with respect to the exercise of the Option, including, but not limited to, restrictions on the acceptable form or method of payment of the option price and restrictions for failing to promptly submit to KO or any Affiliate, a tax organizer, or such other tax-related documents reasonably requested by KO or, if different, the Employer, pursuant to KO’s tax equalization program (if optionee is a participant in such program). The optionee shall be informed of such restrictions. The optionee agrees to comply with any such additional conditions or restrictions.
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4.
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Non‑qualified Option under U.S. Tax Laws. The Options are not intended to be, and shall not be treated as, incentive stock options, as defined in Section 422 of the U.S. Internal Revenue Code of 1986, as amended.
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5.
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Options are not transferable. The optionee may not assign or transfer the Options in any situation, including, but not limited to, divorce; provided that upon the optionee's death the Options may be transferred to the executor or administrator of the estate. During the lifetime of the optionee, the Options shall be exercisable only by the optionee personally or, in the event of the optionee's Disability if a legal representative has been appointed to act on behalf of the optionee, then by the optionee's legal representative.
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6.
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Forfeiture of Options and Option gain In the event optionee shall engage in a “Prohibited Activity” (as defined on Schedule A hereto), at any time during the term of the Options, or within one year after termination of optionee’s employment from KO, the Employer or any Affiliate, or within one year after exercise of all or any portion of the Options, whichever occurs latest, this Option shall be rescinded and, if applicable, any gain associated with any exercise of this Option shall be forfeited and repaid to KO. Accordingly, if the optionee engages in a Prohibited Activity, then:
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(a)
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as of the date that the optionee participates in such Prohibited Activity, all unexercised portions of this Option immediately and automatically shall terminate, be forfeited, and shall cease to be exercisable (unless such Option has been terminated sooner by operation of another term or condition of the Plan or this Agreement); and
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(b)
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within ten days after receiving from KO written notice of the termination of this Option, the optionee shall pay to KO any and all gains associated with the exercise of all or any portion of this Option, plus interest calculated from the time of such notice through the date of repayment to KO. The gain associated with the
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7.
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Stock ownership guidelines and agreement to retain net shares. If the optionee is subject to KO’s stock ownership guidelines, the optionee expressly agrees as a condition of this grant that if optionee has not met the applicable stock ownership guidelines within the time prescribed therein, optionee will not sell the number of shares of KO Stock obtained upon exercise of the Options (after paying the Tax‑Related Items and the option price, if applicable) until the optionee has satisfied the optionee's share ownership guidelines and then only shares in excess of those guidelines. Section 16 Executive Officers who have not yet met their stock ownership objective agree to retain at least 50% of shares (after paying taxes) obtained from option exercises until the optionee has satisfied his or her share ownership guidelines. Nothing in this paragraph shall be construed to limit the optionee’s ability to execute a cashless exercise.
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8.
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Notices. Each notice relating to the Option or its exercise shall be in writing. Requests and other notices regarding the exercise of Options shall be delivered (whether by overnight delivery or by mail) as follows:
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9.
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Administrative matters. The optionee hereby agrees that the Committee may, subject to the provisions of the Plan, establish such rules and regulations as it deems necessary or advisable for the proper administration of the Plan, and may make determinations and may take such other action in connection with or in relation to the Plan as it deems necessary or advisable. Each determination or other action made or taken pursuant to the Plan, including interpretation of the Plan and the specific conditions and provisions of this Agreement and the Options, shall be final and conclusive for all purposes and upon all persons including, but without limitation, KO, Affiliates, the Committee, the KO Board of Directors, officers and the affected employees of KO, and the optionees and their respective successors in interest.
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10.
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Data Privacy. The following provisions shall apply to the optionee only if he or she resides outside the US, UK, the EU and EEA:
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(a)
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Optionee voluntarily consents to the collection, use and transfer, in electronic or other form, of his or her personal data as described in this Agreement and any other Plan materials (“Data”) by and among, as applicable, KO and any Affiliate or employer for the exclusive purpose of implementing, administering, and managing his or her participation in the Plan.
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(b)
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Optionee understands that KO and its Affiliates may hold certain personal information about him or her, including, but not limited to, his or her name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of KO Stock or directorships held in KO, details of all equity awards or any other entitlement to stock awarded, canceled, exercised, vested, unvested or outstanding in his or her favor, for the exclusive purpose of implementing, administering, and managing the Plan.
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(c)
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Optionee understands that Data will be transferred to one or more stock plan service provider(s) selected by KO, which may assist KO with the implementation, administration, and management of the Plan. Optionee understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipient’s country (e.g., the United States) may have different, including less stringent, data privacy laws and protections than optionee’s country. Optionee understands that if he or she resides outside the United States, he or she may request a list with the names and addresses of any potential recipients of the Data by contacting a local human resources representative. Optionee authorizes KO and any other possible recipients that may assist KO (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purposes of implementing, administering and managing optionee’s participation in the Plan.
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(d)
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Optionee understands that Data will be held only as long as is necessary to implement, administer and manage his or her participation in the Plan. Optionee understands that if he or she resides in certain jurisdictions outside the United States, to the extent required by applicable laws, optionee may, at any time, request access to Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents given by accepting the option, in any case without cost, by contacting in writing a local human resources representative. Further, optionee understands that he or she is providing these consents on a purely voluntary basis. If optionee does not consent or if he or she later seeks to revoke consent, his or her engagement as a service provider with KO or an Affiliate will not be adversely affected; the only consequence of refusing or withdrawing consent is that KO will not be able to grant him or her awards under the Plan or administer or maintain awards. Therefore, optionee understands that refusing or withdrawing consent may affect his or her ability to participate in the Plan (including the right to retain the Option). Optionee understands that he or she may contact a local human resources representative for more information on the consequences of refusal to consent or withdrawal of consent.
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(e)
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Data Collected and Purposes of Collection. Optionee understands that KO, acting as controller, as well as the employer, may collect, to the extent permissible under applicable law, certain personal information about him or her, including name, home address and telephone number, information necessary to process the option (e.g., mailing address for a check payment or bank account wire transfer information), date of birth, social insurance number or other identification number, salary, nationality, job title, employment location, any capital shares or directorships held in KO (but only where needed for legal or tax compliance), any other information necessary to process mandatory tax withholding and reporting, details of all options granted, canceled, vested, unvested or outstanding in his or her favor, and where applicable service termination date and reason for termination (all such personal information is referred to as “Data”). The Data is collected from the optionee, the employer, and from KO, for the exclusive purpose of implementing, administering and managing the Plan pursuant to the terms of this Agreement. The legal basis (that is, the legal justification) for processing the Data is to perform this Agreement. The Data must be provided in order for optionee to participate in the Plan and for the parties to this Agreement to perform their respective obligations thereunder. If optionee does not provide Data, he or she will not be able to participate in the Plan and become a party to this Agreement.
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(f)
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Transfers and Retention of Data. Optionee understands that the employer will transfer Data to KO for purposes of plan administration. KO and the employer may also transfer optionee’s Data to other service providers (such as accounting firms, payroll processing firms or tax firms), as may be selected by KO in the future, to assist KO with the implementation, administration and management of this Agreement. Optionee understands that the recipients of the Data may be located in the United States, a country that does not benefit from an adequacy decision issued by the European Commission. Where an optionee is located in a country that does not benefit from an adequacy decision, the transfer of the Data to that optionee will be made pursuant to an adequate transfer mechanism, such as the European Commission-approved Standard
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(g)
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Rights in Respect of Data. KO will take steps in accordance with applicable legislation to keep Data accurate, complete and up-to-date. Optionee is entitled to have any inadequate, incomplete or incorrect Data corrected (that is, rectified). Optionee also has the right to request access to his or her Data as well as additional information about the processing of that Data. Further, optionee is entitled to object to the processing of Data or have his or her Data erased, under certain circumstances. As from May 25, 2018, and subject to conditions set forth in applicable law, optionee also is entitled to (i) restrict the processing of his or her Data so that it is stored but not actively processed (e.g., while KO assesses whether he or she is entitled to have Data erased) and (ii) receive a copy of the Data provided pursuant to this Agreement or generated by optionee, in a common machine-readable format. To exercise his or her rights, optionee may contact a local human resources representative. Optionee may also contact the relevant data protection supervisory authority, as he or she has the right to lodge a complaint. The data protection officer may be contacted at samori@coca-cola.com.
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11.
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Nature of Grant. In accepting the Options, the optionee acknowledges, understands and agrees that:
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(a)
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the Plan is discretionary in nature, and KO can amend, modify, suspend, cancel or terminate it at any time, to the extent permitted under the Plan;
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(b)
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the grant of Options under the Plan is voluntary and occasional and does not create any contractual or other right to receive future grants of any Options, or benefits in lieu of any Options, even if Options have been granted repeatedly in the past;
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(c)
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all determinations with respect to any future awards, including, but not limited to, the times when Options shall be granted, the option price, and the time or times when each right shall be exercisable, will be at the sole discretion of the Committee;
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(d)
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participation in the Plan is voluntary;
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(e)
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the Option and any shares of KO Stock acquired under the Plan are not intended to replace any pension rights or compensation;
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(f)
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the future value of the shares of KO Stock underlying the Option is unknown, indeterminable and cannot be predicted with certainty;
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(g)
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if the underlying shares of KO Stock do not increase in value, the Option will have no value;
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(h)
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if the optionee exercises the Option and acquires shares of Stock, the value of such shares of KO Stock may increase or decrease in value, even below the option price;
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(i)
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the Options and any shares of KO Stock acquired under the Plan and any income derived therefrom are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any termination, severance, resignation, redundancy, dismissal, end of service payments, bonuses, long-service awards, life or accident insurance benefits, pension or retirement or welfare benefits or similar payments;
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(j)
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for purposes of the Option, the optionee's employment or service relationship will be considered terminated as of the date the optionee is no longer actively providing services to the Company or an Affiliate (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the optionee is employed or the terms of the optionee's employment agreement, if any), and unless otherwise expressly provided in this Agreement or determined by the Company, (i) the optionee's right to vest in the Option under the Plan, if any, will terminate as of such date and will not be extended by any notice period (e.g., the optionee's period of service would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where the optionee is employed or the terms of the optionee's employment agreement, if any); and (ii) the period (if any) during which the optionee may exercise the Option after such termination of the optionee's employment or service relationship will commence on the date the optionee ceases to actively provide services and will not be extended by any notice period mandated under employment laws in the jurisdiction where the optionee is employed or terms of the optionee's employment agreement, if any; the Committee shall have the exclusive discretion to determine when the optionee is no longer actively providing services for purposes of the optionee's Option grant (including whether the optionee may still be considered to be providing services while on a leave of absence);
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(k)
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no claim or entitlement to compensation or damages shall arise from forfeiture of the Option resulting from the termination of the optionee's employment or other service relationship (for any reason whatsoever, whether or not later found to be invalid or in breach of employment laws in the jurisdiction where the optionee is employed or the terms of the optionee's employment agreement, if any), and in consideration of the grant of the Option to which the optionee is otherwise not entitled, the optionee irrevocably agrees
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(l)
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the Option grant and the optionee's participation in the Plan shall not create a right to employment or be interpreted as forming an employment or service contract with the Company, the Employer or any Affiliate, and shall not interfere with the ability of the Company, the Employer or any Affiliate, as applicable, to terminate the optionee's employment or service relationship (if any); and
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(m)
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if the optionee is providing services outside the United States, the optionee acknowledges and agrees that neither the Company, the Employer nor any Affiliate shall be liable for any foreign exchange rate fluctuation between the optionee's local currency and the United States Dollar that may affect the value of the Option or of any amounts due to me pursuant to the exercise of the Option or the subsequent sale of any shares of KO Stock acquired upon exercise.
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12.
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No Advice Regarding Grant. The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the optionee's participation in the Plan, or optionee's acquisition or sale of the underlying shares of KO Stock. The optionee is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding the optionee's participation in the Plan before taking any action related to the Plan.
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13.
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Entire Agreement Severability. The Plan and this Agreement set forth the entire understanding between the optionee, the Employer, the Company, and any Affiliate regarding the acquisition of the shares of KO Stock and supersedes all prior oral and written agreements pertaining to this Option. If all or any part or application of the provisions of this Agreement are held or determined to be invalid or unenforceable for any reason whatsoever by a court of competent jurisdiction in an action between optionee and KO, each and all of the other provisions of this Agreement shall remain in full force and effect.
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14.
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Governing Law and Venue. The Option grant and this Agreement has been made in and shall be governed by, construed under and in accordance with the laws of the State of Delaware, United States of America, without regard to the conflict of law provisions, as provided in the Plan. Any and all disputes relating to, concerning or arising from this Agreement, or relating to, concerning or arising from the relationship between the parties evidenced by the Options or this Agreement, shall be brought and heard exclusively in the United States District Court for the District of Delaware or the Delaware Superior Court, New Castle County. Each of the parties hereby represents and agrees that such party is subject to the personal jurisdiction of said courts; hereby irrevocably consents to the jurisdiction of such courts in any legal or equitable proceedings related to, concerning or arising from such dispute, and waives, to the fullest extent permitted by law, any objection which such party may now or hereafter have that the laying of the venue of any legal or equitable proceedings related to, concerning or arising from such dispute which is brought in such courts is improper or that such proceedings have been brought in an inconvenient forum.
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15.
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Electronic Delivery and Acceptance. The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means. The optionee hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company and that such online or electronic participation shall have the same force and effect as documentation executed in written form.
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16.
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Language. If the optionee has received this Agreement, or any other document related to the Option and/or the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
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17.
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Appendix. Notwithstanding any provisions in this Agreement, the Option grant shall be subject to any special terms and conditions set forth in the Appendix to this Agreement for the optionee's country. Moreover, if the optionee relocates to one of the countries included in the Appendix, the special terms and conditions for such country will apply to the optionee, to the extent the Company determines that the application of such terms and conditions is necessary or advisable for legal or administrative reasons. The Appendix constitutes part of this Agreement.
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18.
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Imposition of Other Requirements. The Company reserves the right to impose other requirements on the optionee's participation in the Plan, on the Option and on any shares of KO Stock purchased upon exercise of the Option, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require the optionee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
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19.
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Waiver. The optionee acknowledges that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by the optionee or any other optionee.
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20.
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Insider Trading Restrictions/Market Abuse Laws. The optionee acknowledges that, depending on the optionee’s country of residence, the optionee may be subject to insider trading restrictions and/or market abuse laws, which may affect the optionee’s ability to acquire or sell shares of KO Stock or rights to shares of KO Stock (e.g., Options) under the Plan during such times as the optionee is considered to have “inside information” regarding the Company (as defined by the laws in the optionee’s country). Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under KO’s insider trading policy. The optionee acknowledges that it is his or her responsibility to comply with any applicable restrictions, and the optionee is advised to speak to his or her personal advisor on this matter.
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(a)
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Non-Disparagement – making any statement, written or verbal, in any forum or media, or taking any action in disparagement of KO, the Employer and/or any Affiliate thereof, including but not limited to negative references to KO or its products, services, corporate policies, or current or former officers or employees, customers, suppliers, or business partners or associates;
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(b)
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No Publicity – publishing any opinion, fact, or material, delivering any lecture or address, participating in the making of any film, radio broadcast or television transmission, or communicating with any representative of the media relating to confidential matters regarding the business or affairs of KO, the Employer and/or any Affiliate which optionee was involved with during optionee’s employment;
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(c)
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Non-Disclosure of Trade Secrets – failure to hold in confidence all Trade Secrets of KO that came into optionee’s knowledge during optionee’s employment by KO, the Employer or any Affiliate, or disclosing, publishing, or making use of at any time such Trade Secrets, where the term "Trade Secret" means any technical or non-technical data, formula, pattern, compilation, program, device, method, technique, drawing, process, financial data, financial plan, product plan, list of actual or potential customers or suppliers or other information similar to any of the foregoing, which (i) derives economic value, actual or potential, from not being generally known to and not being readily ascertainable by proper means by, other persons who can derive economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy;
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(d)
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Non-Disclosure of Confidential Information – failure to hold in confidence all Confidential Information of KO, the Employer and/or any Affiliate that came into optionee’s knowledge during optionee’s employment by KO, the Employer or any Affiliate, or disclosing, publishing, or making use of such Confidential Information, where the term "Confidential Information" means any data or information, other than Trade Secrets, that is valuable to KO and not generally known to the public or to competitors of KO;
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(e)
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Return of Materials – failure of optionee, in the event of optionee’s termination of employment for any reason, promptly to deliver to KO all memoranda, notes, records, manuals or other documents, including all copies of such materials and all documentation prepared or produced in connection therewith, containing Trade Secrets or Confidential Information regarding KO's business, whether made or compiled by optionee or furnished to optionee by virtue of optionee’s employment with KO, the Employer or any Affiliate, or failure promptly to deliver to KO all vehicles, computers, credit cards, telephones, handheld electronic devices, office equipment, and other property furnished to optionee by virtue of optionee’s employment with KO, the Employer or any Affiliate;
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(f)
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Non-Compete – rendering services for any organization which, or engaging directly or indirectly in any business which, in the sole judgment of the Committee or the Chief Executive Officer of KO or any senior officer designated by the Committee, is or becomes competitive with KO;
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(g)
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Non-Solicitation –soliciting or attempting to solicit for employment for or on behalf of any corporation, partnership, or other business entity any employee of the Company or an Affiliate with whom optionee had professional interaction during the last twelve months of optionee’s employment with KO or the Affiliate; or
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(h)
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Violation of KO Policies – violating any written policies of KO or the Employer applicable to optionee, including without limitation, KO’s insider trading policy.
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(i)
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The revocation must be made within one week after the acceptance of the Agreement.
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(ii)
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The revocation must be in written form to be valid. It is sufficient if the optionee returns the Agreement to KO or KO’s representative with language that can be understood as the optionee’s refusal to conclude or honor the Agreement, provided the revocation is sent within the period discussed above.
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Event
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Impact on Vesting
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Impact on Exercise Period
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Employment with the Company or a Subsidiary terminates after attaining age 55 (noted as age 60 in Section 2(a) of the Agreement) and completing 10 Years of Service (“Retirement”)
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Options held at least 12 months become immediately vested. Options held less than 12 months are forfeited.
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Expires upon earlier of (1) six months from termination date or (2) Option expiration date provided in the Agreement.
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Employment with the Company or a Subsidiary terminates because of Disability
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All Options become immediately vested.
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Expires upon earlier of (1) six months from termination date or (2) Option expiration date provided in the Agreement.
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