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<SEC-DOCUMENT>0000950123-03-006620.txt : 20030529
<SEC-HEADER>0000950123-03-006620.hdr.sgml : 20030529
<ACCEPTANCE-DATETIME>20030529091803
ACCESSION NUMBER:		0000950123-03-006620
CONFORMED SUBMISSION TYPE:	S-4/A
PUBLIC DOCUMENT COUNT:		10
FILED AS OF DATE:		20030529

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PEPSICO INC
		CENTRAL INDEX KEY:			0000077476
		STANDARD INDUSTRIAL CLASSIFICATION:	BEVERAGES [2080]
		IRS NUMBER:				131584302
		STATE OF INCORPORATION:			NC
		FISCAL YEAR END:			1228

	FILING VALUES:
		FORM TYPE:		S-4/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-102035-01
		FILM NUMBER:		03722477

	BUSINESS ADDRESS:	
		STREET 1:		700 ANDERSON HILL RD
		CITY:			PURCHASE
		STATE:			NY
		ZIP:			10577
		BUSINESS PHONE:		9142532000

	MAIL ADDRESS:	
		STREET 1:		700 ANDERSON HILL ROAD
		CITY:			PURCHASE
		STATE:			NY
		ZIP:			10577-1444

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PEPSI COLA CO
		DATE OF NAME CHANGE:	19700903

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			BOTTLING GROUP LLC
		CENTRAL INDEX KEY:			0001087835
		STANDARD INDUSTRIAL CLASSIFICATION:	BEVERAGES [2080]
		IRS NUMBER:				134042452
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		S-4/A
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-102035
		FILM NUMBER:		03722476

	BUSINESS ADDRESS:	
		STREET 1:		ONE PEPSI WAY
		CITY:			SOMERS
		STATE:			NY
		ZIP:			10589-2201
		BUSINESS PHONE:		9142532884

	MAIL ADDRESS:	
		STREET 1:		ONE PEPSI WAY
		CITY:			SOMERS
		STATE:			NY
		ZIP:			10589-2201
</SEC-HEADER>
<DOCUMENT>
<TYPE>S-4/A
<SEQUENCE>1
<FILENAME>y66832a1sv4za.txt
<DESCRIPTION>AMENDMENT NO. 1 TO FORM S-4
<TEXT>
<PAGE>


      AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 29, 2003



                                                 REGISTRATION NOS. 333-102035



                                                                   333-102035-01

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                             ---------------------

                                AMENDMENT NO. 1


                                       TO

                                    FORM S-4
            REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
                             ---------------------

<Table>
<S>                                                           <C>

                    BOTTLING GROUP, LLC                                              PEPSICO, INC.
                                 (Exact name of Registrant as specified in its charter)
</Table>

<Table>
<S>                                                           <C>
                         DELAWARE                                                   NORTH CAROLINA
                             (State or other jurisdiction of incorporation or organization)
</Table>

<Table>
<S>                                                           <C>
                           2086                                                          2080
                                (Primary Standard Industrial Classification Code Number)
</Table>

<Table>
<S>                                                           <C>
                        13-4042452                                                    13-1584302
                                         (I.R.S. Employer Identification Number)
</Table>

                             ---------------------

<Table>
<S>                                                           <C>
                    BOTTLING GROUP, LLC                                              PEPSICO, INC.
                       ONE PEPSI WAY                                            700 ANDERSON HILL ROAD
                  SOMERS, NEW YORK 10589                                       PURCHASE, NEW YORK 10577
                      (914) 767-6000                                                (914) 253-2000
                                   (Address, including zip code, and telephone number,
                            including area code, of registrant's principal executive offices)
</Table>

                             ---------------------

                                   COPIES TO:

<Table>
<S>                                                           <C>
                      STEVEN M. RAPP                                            THOMAS H. TAMONEY, JR.
              MANAGING DIRECTOR -- DELEGATEE                           VICE PRESIDENT, ASSOCIATE GENERAL COUNSEL
                    BOTTLING GROUP, LLC                                         AND ASSISTANT SECRETARY
                       ONE PEPSI WAY                                                 PEPSICO, INC.
                  SOMERS, NEW YORK 10589                                        700 ANDERSON HILL ROAD
                      (914) 767-6000                                           PURCHASE, NEW YORK 10577
                                                                                    (914) 253-3623
                                (Name, address, including zip code, and telephone number,
                                       including area code, of agent for service)
</Table>

                             ---------------------

                                WITH COPIES TO:

<Table>
<S>                                                           <C>
                     ALLAN R. WILLIAMS                                          WINTHROP B. CONRAD, JR.
                    PROSKAUER ROSE LLP                                           DAVIS POLK & WARDWELL
                       1585 BROADWAY                                             450 LEXINGTON AVENUE
                 NEW YORK, NEW YORK 10036                                      NEW YORK, NEW YORK 10017
                      (212) 969-3000                                                (212) 450-4000
</Table>

                             ---------------------

    APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:  As soon as
practicable after the effective date of this Registration Statement.

    If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box.  [ ]

    If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering.  [ ]

    If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.  [ ]


    THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, OR SEC, ACTING PURSUANT TO
SECTION 8(a), MAY DETERMINE.


- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN
OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT
PERMITTED.


                   SUBJECT TO COMPLETION, DATED MAY 29, 2003


PRELIMINARY PROSPECTUS

                                 $1,000,000,000

                              BOTTLING GROUP, LLC
                               OFFER TO EXCHANGE
               4 5/8% SERIES B SENIOR NOTES DUE NOVEMBER 15, 2012
                                      FOR
                            ANY AND ALL OUTSTANDING
                   4 5/8% SENIOR NOTES DUE NOVEMBER 15, 2012

                               ------------------

     This is an offer to exchange any and all outstanding, unregistered 4 5/8%
Senior Notes you now hold for new, substantially identical 4 5/8% Series B
Senior Notes that have been registered under the Securities Act of 1933, as
amended. The transfer restrictions and registration rights relating to the old
notes do not apply to the new notes. Like the old notes, payment of principal
and interest on the new notes will be unconditionally and irrevocably guaranteed
on a senior unsecured basis by PepsiCo, Inc. subject to the limitations
described herein. We have applied to list the new notes on the Luxembourg Stock
Exchange. We refer you to "Summary."

     This offer will expire at 5:00 p.m., New York City time, on          ,
2003, unless we extend it. You must tender your old, unregistered notes by the
deadline to obtain new, registered notes. Tenders of old notes may be withdrawn
at any time prior to the expiration of the exchange offer. The exchange of old
notes for new notes will not be a taxable exchange for U.S. federal income tax
purposes. Neither we nor PepsiCo will receive any proceeds from the exchange
offer.

     We and PepsiCo agreed with the initial purchasers of the old notes to make
this offer and to register the new notes. This offer applies to any and all old
notes tendered by the deadline.

     The new notes have the same financial terms and covenants as the old notes,
and are subject to the same business and financial risks.


     WE REFER YOU TO "RISK FACTORS" ON PAGE 15 OF THIS PROSPECTUS FOR A
DISCUSSION OF RISKS TO BE CONSIDERED IN CONNECTION WITH YOUR INVESTMENT
DECISION.


     Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these notes or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.


                                 May   , 2003.

<PAGE>

     Each broker-dealer that receives new notes for its own account pursuant to
the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of such new notes. Each letter of transmittal states
that by so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act of 1933, as amended, or the Securities Act. This prospectus, as
it may be amended or supplemented from time to time, may be used by a
broker-dealer in connection with resales of new notes received in exchange for
old notes acquired by such broker-dealer as a result of market-making activities
or other trading activities. We and PepsiCo have agreed that, for a period of
180 days after the expiration date (as defined herein) of this exchange offer,
Bottling LLC will make this prospectus available to any broker-dealer for use in
connection with any such resale. We refer you to "Plan of Distribution."

     YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT OR TO
WHICH WE OR PEPSICO, AS THE CASE MAY BE, HAVE REFERRED YOU. NEITHER WE NOR
PEPSICO HAS AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT.
THIS DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE
INFORMATION IN THIS DOCUMENT IS ONLY ACCURATE ON THE DATE OF THIS DOCUMENT OR ON
SUCH OTHER DATE STATED HEREIN.

                               TABLE OF CONTENTS


<Table>
<S>                                       <C>
WHERE YOU CAN FIND MORE INFORMATION....     i
PRINCIPAL EXECUTIVE OFFICES............   iii
MARKET AND INDUSTRY DATA...............   iii
DISCLOSURE REGARDING FORWARD-LOOKING
  STATEMENTS...........................   iii
SUMMARY................................     1
RISK FACTORS...........................    15
USE OF PROCEEDS........................    21
CAPITALIZATION.........................    22
THE EXCHANGE OFFER.....................    24
SELECTED HISTORICAL FINANCIAL DATA.....    33
BUSINESS...............................    39
MANAGEMENT.............................    47
DESCRIPTION OF THE NOTES AND THE
  GUARANTEE............................    52
CERTAIN UNITED STATES FEDERAL INCOME
  TAX CONSEQUENCES.....................    73
PLAN OF DISTRIBUTION...................    75
LEGAL MATTERS..........................    76
INDEPENDENT ACCOUNTANTS................    76
INCORPORATION OF CERTAIN INFORMATION BY
  REFERENCE............................    76
GENERAL INFORMATION....................    77
</Table>


                      WHERE YOU CAN FIND MORE INFORMATION

     We and PepsiCo each file reports and other information with the SEC under
the Securities Exchange Act of 1934, as amended, or the Exchange Act. You may
read and copy this information at the following location of the SEC:

                             Public Reference Room
                        450 Fifth Street, N.W., Rm. 1024
                             Washington, D.C. 20549

     You may obtain information on the operation of the Public Reference Room by
calling the SEC at 1-800-SEC-0330. You may also obtain copies of this
information by mail from the Public Reference Section of the SEC, 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. The SEC
also maintains an Internet World Wide Web site that contains reports, and other
information about issuers, like us and PepsiCo, which file information
electronically with the SEC. The address of that site is http://www.sec.gov.

     You can also inspect reports, proxy statements and other information about
PepsiCo at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005. For as long as the notes are listed on the Luxembourg
Stock Exchange and the rules of such exchange so requires, copies of these
documents will also be made available, free of charge, at the office of our and
PepsiCo's Luxembourg listing agent, The Bank of New York (Luxembourg) S.A.,
currently located at Aerogolf Centre, 1A, Hoehenhof, L-1736 Senningerberg,
Luxembourg.
<PAGE>

     TO OBTAIN TIMELY DELIVERY IN CONNECTION WITH THE EXCHANGE OFFER, YOU MUST
REQUEST THE INFORMATION NO LATER THAN           , 2003, OR FIVE BUSINESS DAYS
PRIOR TO THE EXPIRATION DATE OF THE EXCHANGE OFFER IF THE EXCHANGE OFFER IS
EXTENDED.

                                        ii
<PAGE>

     In this prospectus, unless indicated otherwise, "Bottling LLC," "we," "us"
and "our" refer to Bottling Group, LLC, the issuer of the notes, and its
subsidiaries and "PepsiCo" refers to PepsiCo, Inc., which will guarantee the
notes on and after the guarantee commencement date (subject to the limitations
described herein), and its divisions and subsidiaries.

     This prospectus includes information provided in order to comply with the
rules governing the listing of securities on the Luxembourg Stock Exchange. We
believe that this prospectus contains or incorporates by reference all
information with respect to us that is material in the context of the offer and
issuance of the new notes together with PepsiCo's guarantee and that this
information is true and accurate and is not misleading in any material respect.
We represent that our opinions and intentions expressed in this prospectus are
honestly held, are based on reasonable assumptions and have been reached after
considering all relevant circumstances. We represent that there are no other
facts, the omission of which would make any part of this prospectus misleading
in any material respect, and all reasonable inquiries have been made to verify
the accuracy of the information contained herein. PepsiCo believes that this
prospectus contains or incorporates by reference all information with respect to
PepsiCo that is material in the context of the issuance by PepsiCo of its
guarantee and that this information is true and accurate and is not misleading
in any material respect. PepsiCo represents that its opinions and intentions
expressed in this prospectus are honestly held, are based on reasonable
assumptions and have been reached after considering all relevant circumstances.
PepsiCo represents that there are no other facts with respect to PepsiCo, the
omission of which would make any part of this prospectus misleading in any
material respect, and all reasonable inquiries have been made to verify the
accuracy of such information contained herein. We accept responsibility for the
information contained in this prospectus other than information about PepsiCo.
PepsiCo accepts responsibility for the information about PepsiCo contained in
this prospectus. The Luxembourg Stock Exchange takes no responsibility for the
contents of this document, makes no representation as to its accuracy or
completeness and expressly disclaims any liability whatsoever for any loss
howsoever arising from or in reliance upon the whole or any part of the contents
of this prospectus.

     Inquiries regarding our and PepsiCo's listing status on the Luxembourg
Stock Exchange should be directed to our and PepsiCo's Luxembourg listing agent,
The Bank of New York (Luxembourg) S.A., currently located at Aerogolf Centre,
1A, Hoehenhof, L-1736 Senningerberg, Luxembourg.

                          PRINCIPAL EXECUTIVE OFFICES

     Bottling LLC's principal executives offices are located at One Pepsi Way,
Somers, New York 10589 and its telephone number is (914) 767-6000. PepsiCo's
principal executive offices are located at 700 Anderson Hill Road, Purchase, New
York 10577 and its telephone number is (914) 253-2000.

                            MARKET AND INDUSTRY DATA


     Some of the market and industry data contained or incorporated by reference
in this prospectus are based on internal surveys, market research, independent
industry publications or other publicly available information. Although we and
PepsiCo believe that the independent sources used by us and PepsiCo,
respectively, are reliable, neither we nor PepsiCo has independently verified
and cannot assure you as to the accuracy or completeness of this information.
Similarly, we believe our internal research is reliable, and PepsiCo believes
its internal research is reliable, but such research has not been verified by
any independent sources.


                DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

     All statements other than statements of historical facts included or
incorporated by reference in this prospectus, including, without limitation,
statements regarding our or PepsiCo's future financial position, business
strategy, budgets, projected costs and plans and objectives of management for
future operations, are forward-looking statements. Forward-looking statements
generally can be identified by the use of forward-looking terminology such as
"may," "will," "expect," "intend," "estimate," "anticipate," "believe" or
"continue" or the negative thereof or variations thereon or similar terminology.
Although we believe that the expectations reflected in our forward-looking
statements are reasonable and PepsiCo believes that

                                       iii
<PAGE>

the expectations reflected in its forward-looking statements are reasonable,
neither we nor PepsiCo can give any assurance that our or PepsiCo's expectations
will prove to have been correct. Important factors that could cause actual
results to differ materially from our or PepsiCo's expectations are disclosed
under "Risk Factors" and elsewhere in, or are incorporated by reference in, this
prospectus. All subsequent written and oral forward-looking statements
attributable to us or PepsiCo, or persons acting on our or PepsiCo's behalf, are
expressly qualified in their entirety by these cautionary statements. We and
PepsiCo do not undertake to update our or PepsiCo's respective forward-looking
statements or risk factors to reflect future events or circumstances, except as
may be required by applicable law.

                                        iv
<PAGE>

                                    SUMMARY

     This summary highlights information that we believe is especially important
concerning our business and this exchange offer and information that PepsiCo
believes is especially important concerning its business and its guarantee. It
does not contain all of the information that may be important to you and to your
investment decision. The following summary is qualified in its entirety by the
more detailed information included or incorporated by reference in this
prospectus and our and PepsiCo's respective financial statements and notes
thereto incorporated by reference in this prospectus. You should carefully read
this entire prospectus and should consider, among other things, the matters set
forth under "Risk Factors" before deciding to exchange your old notes. In this
prospectus, where the context requires, we and PepsiCo sometimes refer to the
notes and the guarantee, subject to the limitations described herein, that were
issued in a private placement on November 15, 2002 as the "old notes," the notes
and the guarantee, subject to the limitations described herein, that we and
PepsiCo are offering to exchange for the old notes as the "new notes" and the
old notes and the new notes collectively as the "notes."

                              BOTTLING GROUP, LLC

OVERVIEW


     We are the principal operating subsidiary of The Pepsi Bottling Group,
Inc., or PBG, and conduct substantially all of the operations, and own or lease,
directly or indirectly, substantially all of the assets of PBG. We are the
world's largest manufacturer, seller and distributor of carbonated and
non-carbonated Pepsi-Cola beverages. We have the exclusive right to manufacture,
sell and distribute Pepsi-Cola beverages in all or a portion of 41 states and
the District of Columbia in the United States, nine Canadian provinces, Spain,
Greece, Russia, Turkey and since our acquisition of Pepsi-Gemex, S.A. de C.V.,
or Gemex, all or a portion of 21 states in Mexico. In the fiscal year ended
December 28, 2002 and the 12-week period ended March 22, 2003, approximately 82%
and 80%, respectively, of our net revenues were generated in the United States
with the remaining 18% and 20%, respectively, generated outside of the United
States.



     The brands we sell are some of the best recognized trademarks in the world
and include Pepsi-Cola, Mountain Dew, Diet Pepsi, Aquafina, Lipton Brisk,
Mountain Dew Code Red, Sierra Mist, SoBe, Dole, Mug, Diet Mountain Dew, Pepsi
Twist, Starbucks Frappuccino and, outside the United States, Pepsi-Cola,
Mirinda, 7 UP, KAS, Electropura, Aqua Minerale, Manzanita Sol, Squirt, Garci
Crespo, Fiesta, Pepsi Light, IVI, Yedigun, and Fruko. In some of our U.S.
territories, we also have the right to manufacture, sell and distribute soft
drink products of other companies, including Dr Pepper and All Sport.



     We and PBG were formed by PepsiCo to effect the separation in 1999 of most
of PepsiCo's company-owned bottling business from its brand ownership. PBG
became a publicly traded company on March 31, 1999. As of April 19, 2003,
PepsiCo owned approximately 38.6% of PBG's outstanding common stock and 100% of
PBG's outstanding class B common stock, together representing approximately
43.8% of the voting power of all classes of PBG's voting stock (with the balance
owned by the public). In conjunction with PBG's initial public offering and
other subsequent transactions, PBG and PepsiCo contributed bottling businesses
and assets used in the bottling business to us. As of April 19, 2003, PBG owned
approximately 93.2% of our membership interests and PepsiCo indirectly owned the
remainder of our membership interests. Set forth below is a diagram showing this
relationship.


                                        1
<PAGE>

                                    [GRAPH]

RECENT DEVELOPMENTS


     On February 1, 2003, we completed an acquisition of a Pepsi-Cola bottler
based in Buffalo, New York for a purchase price of approximately $75 million.



     On November 5, 2002, we acquired approximately 99.8% of all of the
outstanding capital stock of Gemex, which was the largest bottler in Mexico and
the largest bottler outside the United States of Pepsi-Cola soft drink products
based on sales volume, through simultaneous tender offers in Mexico and the
United States. Following the offers, we funded a trust for the acquisition of
the balance of the outstanding capital stock and caused Gemex to carry out a
reverse stock split that eliminated for cash the outstanding capital stock held
by any remaining security holders other than us. Our total cost for the purchase
of Gemex was a net cash payment of $871 million and assumed debt of
approximately $305 million.



     Gemex was a Mexican holding company that, through its bottling and
distribution subsidiaries, produced, sold and distributed a variety of soft
drink products under the Pepsi-Cola, Pepsi Light, Pepsi Max, Pepsi Limon,
Mirinda, 7UP, Diet 7UP, KAS, Mountain Dew, Power Punch and Manzanita Sol
trademarks under exclusive franchise and bottling arrangements with PepsiCo and
certain affiliates of PepsiCo. Gemex also had rights to produce, sell and
distribute in Mexico soft drink products of other companies and it produced,
sold and distributed purified and mineral water in Mexico under the trademarks
Electropura and Garci Crespo.


                                        2
<PAGE>

                                 PEPSICO, INC.


     PepsiCo is a leading, global snack and beverage company. PepsiCo
manufactures, markets and sells a variety of salty, convenient, sweet and
grain-based snacks, carbonated and noncarbonated beverages and foods throughout
the world.



     Frito-Lay North America, or FLNA, PepsiCo's snack division, manufactures,
markets, sells and distributes branded snacks including Lay's potato chips,
Doritos flavored tortilla chips, Cheetos cheese flavored snacks, Fritos corn
chips, Tostitos tortilla chips, Ruffles potato chips, Rold Gold pretzels,
branded dips, Quaker Chewy granola bars, Sunchips multigrain snacks, Grandma's
cookies, Quaker Fruit & Oatmeal bars, Quaker Quakes corn and rice snacks, Quaker
rice cakes, Cracker Jack treats and Go Snacks.



     PepsiCo Beverages North America, or PBNA, PepsiCo's beverage division,
manufactures, markets and sells beverage concentrates, and sells fountain syrups
and finished goods, under the brands Pepsi, Mountain Dew, Sierra Mist, Mug,
Slice, FruitWorks, SoBe and Dole. PBNA manufactures, markets and sells
ready-to-drink tea and coffee products through joint ventures with Lipton and
Starbucks. PBNA sells concentrate and finished goods for these brands and
licenses the Aquafina water brand to its bottlers. PBNA also manufactures,
markets and sells Gatorade sports drinks, Tropicana Pure Premium, Dole,
Tropicana Season's Best and Tropicana Twister juices and juice drinks and Propel
fitness water.



     Quaker Foods North America, or QFNA, PepsiCo's food division, manufactures,
markets and sells cereals, rice, pasta and other branded products, including
Quaker oatmeal, Cap'n Crunch and Life ready-to-eat cereals, Rice-A-Roni, Pasta
Roni and Near East side dishes, Aunt Jemima mixes and syrups and Quaker grits.



     PepsiCo International, or PI, PepsiCo's international division,
manufactures, markets and sells beverage concentrates, fountain syrups and
finished goods under the brands Pepsi, 7UP, Mirinda, Mountain Dew, Gatorade and
Tropicana. PI also manufactures and sells many of the Frito-Lay and Quaker
branded snacks sold in North America as well as a number of leading snack brands
including Sabritas, Gamesa and Alegro brands in Mexico, Walkers and Wotsits
brands in the United Kingdom and Smith's brands in Australia.


                                        3
<PAGE>

                               THE EXCHANGE OFFER

General.......................   We are offering to exchange up to
                                 $1,000,000,000 aggregate principal amount of
                                 our 4 5/8% series B senior notes due November
                                 15, 2012 that have been registered under the
                                 Securities Act for up to $1,000,000,000
                                 aggregate principal amount of 4 5/8% senior
                                 notes due November 15, 2012 that were issued on
                                 November 15, 2002 in a private offering. Old
                                 notes may be exchanged in denominations of
                                 $1,000 and multiples thereof. We will issue the
                                 new notes promptly after the expiration of the
                                 exchange offer. The new notes are substantially
                                 identical to the old notes but will be free of
                                 the transfer restrictions that apply to the old
                                 notes and will not contain terms with respect
                                 to a potential increase in the interest rate.
                                 We refer you to "The Exchange Offer."

Expiration Date...............   The exchange offer will expire at 5:00 p.m.,
                                 New York City time, on           , 2003, unless
                                 we extend it. We do not currently intend to
                                 extend the exchange offer, although we reserve
                                 the right to do so, at our discretion after
                                 consulting with PepsiCo. We and PepsiCo have
                                 each agreed to use our best efforts to commence
                                 and complete the exchange offer promptly but no
                                 later than           , 2003. If the exchange
                                 offer is extended, the term expiration date
                                 will mean the latest date and time to which the
                                 exchange offer is extended.

Registration Rights
Agreement.....................   We sold the old notes on November 15, 2002 to
                                 Credit Suisse First Boston Corporation,
                                 Deutsche Bank Securities Inc., Salomon Smith
                                 Barney Inc., Banc of America Securities LLC,
                                 J.P. Morgan Securities Inc. and Lehman Brothers
                                 Inc., collectively, the initial purchasers. The
                                 initial purchasers then sold the old notes
                                 within the United States to qualified
                                 institutional buyers and outside the United
                                 States to buyers who were not U.S. persons.
                                 Prior to the initial sale of the old notes, we
                                 and PepsiCo entered into a registration rights
                                 agreement with the initial purchasers, in which
                                 we and PepsiCo agreed to file with the
                                 Securities and Exchange Commission, or SEC, a
                                 registration statement within 135 days after
                                 the date of original issuance of the old notes,
                                 with respect to a registered exchange offer to
                                 exchange new notes for your old notes.

                                 The exchange offer satisfies your rights under
                                 the registration rights agreement. After the
                                 exchange offer is over, you will not be
                                 entitled to any exchange or registration rights
                                 with respect to your old notes. Therefore, if
                                 you do not exchange your old notes, you will
                                 not be able to reoffer, resell or otherwise
                                 dispose of your old notes unless (1) you comply
                                 with the registration and prospectus delivery
                                 requirements of the Securities Act or (2) you
                                 qualify for an exemption from such Securities
                                 Act requirements.

Resale of New Notes...........   Based on interpretive letters written by the
                                 staff of the SEC to companies other than us, we
                                 believe that you, subject to certain
                                 exceptions, can offer for resale, resell or
                                 otherwise transfer the

                                        4
<PAGE>

                                 new notes without compliance with the
                                 registration and prospectus delivery
                                 requirements of the Securities Act if:

                                      - you are not our or PepsiCo's affiliate
                                        (as that term is defined under rule 405
                                        of the Securities Act);

                                      - you acquire the new notes in the
                                        ordinary course of your business; and

                                      - you are not engaged in, do not intend to
                                        engage in, and have no arrangement or
                                        understanding with any person to
                                        participate in, a distribution of the
                                        new notes.

                                 If any of these conditions is not satisfied and
                                 you offer, resell or otherwise transfer any new
                                 notes without delivering a proper prospectus or
                                 without qualifying for a registration exemption
                                 you may incur liability under the Securities
                                 Act. Neither we nor PepsiCo will assume or
                                 indemnify you against such liability.

                                 Each participating broker-dealer that receives
                                 new notes for its own account pursuant to the
                                 exchange offer in exchange for old notes that
                                 were acquired as a result of market-making or
                                 other trading activity must acknowledge that it
                                 will deliver a prospectus in connection with
                                 any resale of the new notes. We refer you to
                                 "Plan of Distribution."

Conditions to the Exchange
Offer.........................   The exchange offer is subject to customary
                                 conditions and to the terms of the registration
                                 rights agreement. We may terminate the exchange
                                 offer before the expiration date if we, after
                                 consulting with PepsiCo, determine that our
                                 ability to proceed with the exchange offer
                                 could be materially impaired due to:

                                      - any legal or governmental action;

                                      - any new law, statute, rule or
                                        regulation; or

                                      - any interpretation by the staff of the
                                        SEC of any existing law, statute, rule
                                        or regulation.

                                 We refer you to "The Exchange
                                 Offer -- Conditions to the Exchange Offer."

Tender
Procedures -- Beneficial
Owners........................   If you wish to tender old notes that are
                                 registered in the name of a broker, dealer,
                                 commercial bank, trust company or other
                                 nominee, you should contact the registered
                                 holder promptly and instruct the registered
                                 holder to tender on your behalf.

                                 IF YOU ARE A BENEFICIAL HOLDER, YOU SHOULD
                                 FOLLOW THE INSTRUCTIONS RECEIVED FROM YOUR
                                 BROKER OR NOMINEE WITH RESPECT TO TENDERING
                                 PROCEDURES AND CONTACT YOUR BROKER OR NOMINEE
                                 DIRECTLY.

Tender
Procedures -- Registered
Holders and DTC
Participants..................   If you are a registered holder of old notes and
                                 you wish to participate in the exchange offer,
                                 you must complete, sign and date the letter of
                                 transmittal delivered with this prospectus, or
                                 a facsimile thereof. If you are a participant
                                 in The Depository Trust Company, or DTC, and
                                 you wish to participate in the exchange offer,
                                 you must instruct DTC to transmit to the
                                 exchange agent a message (an agent's message)
                                 indicating that you agree to be bound by the
                                 terms of the letter of transmittal.

                                        5
<PAGE>

                                 You should mail or otherwise transmit the
                                 letter of transmittal or facsimile (or agent's
                                 message in lieu thereof), together with your
                                 old notes (in book-entry form if you are a
                                 participant in DTC) and any other required
                                 documentation to JPMorgan Chase Bank, as
                                 exchange agent.

Guaranteed Delivery
Procedures....................   If you are a registered holder of old notes and
                                 you wish to tender them, but they are not
                                 immediately available or you cannot deliver
                                 them or the letter of transmittal or the
                                 agent's message in lieu thereof to the exchange
                                 agent prior to the expiration date, you must
                                 tender your old notes according to special
                                 guaranteed delivery procedures. We refer you to
                                 "The Exchange Offer -- Guaranteed Delivery
                                 Procedures."

Withdrawal Rights.............   You may withdraw tenders of old notes at any
                                 time before 5:00 p.m., New York City time, on
                                 the expiration date as provided in "The
                                 Exchange Offer -- Withdrawal of Tenders." Any
                                 old notes not accepted for exchange for any
                                 reason will be returned without expense to the
                                 tendering holder promptly after the expiration
                                 or termination of the exchange offer.

Effect on Holders of Old
Notes.........................   If you are a holder of old notes and do not
                                 tender your old notes in the exchange offer,
                                 you will continue to hold the old notes and you
                                 will be entitled to all the rights and subject
                                 to the provisions applicable to the old notes
                                 in the indenture, except for any rights under
                                 the registration rights agreement that by their
                                 terms terminate upon the consummation of the
                                 exchange offer.

                                 PepsiCo will continue to be obligated to
                                 unconditionally and irrevocably guarantee the
                                 payment of principal of and interest and
                                 premium, if any, on the old notes on and after
                                 the guarantee commencement date, except that,
                                 under the circumstances described in
                                 "Description of the Notes and the
                                 Guarantee -- Guarantee," PepsiCo's guarantee
                                 may not become effective or may become
                                 effective as to less than all of the principal
                                 of and interest and premium, if any, on the
                                 outstanding old notes. We refer you to
                                 "Description of the Notes and the
                                 Guarantee -- Guarantee."

Consequences of Failure to
Exchange......................   All unexchanged old notes will continue to be
                                 subject to the restrictions on transfer
                                 provided for in the old notes. In general, the
                                 old notes may not be offered or sold unless
                                 registered under the Securities Act, except
                                 pursuant to an exemption from, or in a
                                 transaction not subject to, the Securities Act
                                 and applicable state securities laws. Other
                                 than the new notes being registered in
                                 connection with the exchange offer, we do not
                                 currently anticipate that we will register the
                                 old notes under the Securities Act. We refer
                                 you to "Risk Factors -- Risks Relating to Our
                                 Indebtedness and This Exchange Offer -- If you
                                 do not tender your old notes, or do so
                                 improperly, you will continue to hold
                                 unregistered old notes and your ability to
                                 transfer such notes will be adversely
                                 affected."

Certain U.S. Federal Income
Tax Consequences..............   An exchange of old notes for new notes pursuant
                                 to the exchange offer will not constitute a
                                 taxable event for U.S. federal

                                        6
<PAGE>

                                 income tax purposes. We refer you to "Certain
                                 United States Federal Income Tax Consequences."

Use of Proceeds...............   Neither we nor PepsiCo will receive any
                                 proceeds from the issuance of the new notes in
                                 the exchange offer.

Exchange Agent................   JPMorgan Chase Bank is the exchange agent for
                                 the exchange offer. The address and telephone
                                 number of the exchange agent are set forth in
                                 this prospectus under "The Exchange
                                 Offer -- Exchange Agent."

                                        7
<PAGE>

                       SUMMARY OF TERMS OF THE NEW NOTES

     The summary below describes the principal terms of the new notes and the
guarantee. Certain of the terms and conditions described below are subject to
important limitations and exceptions. The "Description of the Notes and the
Guarantee" section of this prospectus contains a more detailed description of
the terms and conditions of the new notes and the guarantee, including the
circumstances in which the guarantee may not become effective or may become
effective as to less than all of the principal of and interest and premium, if
any, on the new notes.


Issuer........................   Bottling Group, LLC.


Securities Offered............   $1,000,000,000 principal amount of 4 5/8%
                                 series B senior notes due November 15, 2012.

Maturity Date.................   November 15, 2012.


Interest Payment Dates........   Interest will accrue on the new notes from the
                                 date of original issuance of the new notes and
                                 will be payable on May 15 and November 15 of
                                 each year, beginning on November 15, 2003.
                                 Interest will be computed on the basis of a
                                 360-day year comprising twelve 30-day months.
                                 Holders of new notes will receive interest on
                                 November 15, 2003 from the date of original
                                 issuance of the new notes, plus an amount equal
                                 to the accrued, but unpaid, interest on the old
                                 notes through the date of exchange.


Optional Redemption...........   We may redeem the new notes at our option at
                                 any time prior to maturity, in whole but not in
                                 part, at a redemption price equal to the
                                 greater of:


                                   - 100% of the principal amount of the new
                                     notes; or


                                   - the sum of the present values of the
                                     remaining scheduled payments of principal
                                     and interest on the new notes from the
                                     redemption date to the maturity date at a
                                     discount rate equal to the Treasury rate
                                     (as defined under "Description of the Notes
                                     and the Guarantee -- Optional Redemption"),
                                     plus 15 basis points plus, in either of the
                                     above cases, accrued and unpaid interest on
                                     the new notes to the redemption date.

Ranking of the New Notes......   The new notes will be our general unsecured
                                 obligations and will rank on an equal basis
                                 with all of our other existing and future
                                 senior unsecured indebtedness, including the
                                 old notes, and senior to all of our existing
                                 and future subordinated indebtedness.

Certain Covenants.............   Both the new notes and the old notes are
                                 governed by the same indenture. The indenture
                                 limits, among other things, our ability and the
                                 ability of our restricted subsidiaries to:

                                   - create or assume liens;

                                   - enter into sale and lease-back
                                     transactions; and

                                   - engage in mergers or consolidations and
                                     transfer or lease all or substantially all
                                     of our assets.

                                 The Indenture also limits PepsiCo's ability to
                                 engage in mergers or consolidations and
                                 transfer or lease all or substantially all of
                                 PepsiCo's assets. In addition, on and after the
                                 guarantee commencement date (in the event such
                                 date occurs), the indenture will limit
                                 PepsiCo's and its restricted subsidiaries'

                                        8
<PAGE>

                                 ability to create or assume liens. We refer you
                                 to "Description of the Notes and the
                                 Guarantee -- Certain Covenants" for additional
                                 information, including information as to
                                 various exceptions to these covenants.

Guarantor.....................   PepsiCo, Inc.

Guarantee of the New Notes....   PepsiCo will continue to be obligated to
                                 unconditionally and irrevocably guarantee the
                                 payment of principal of and interest and
                                 premium, if any, on the new notes on and after
                                 the guarantee commencement date, except that,
                                 under the circumstances described in
                                 "Description of the Notes and the
                                 Guarantee -- Guarantee," PepsiCo's guarantee
                                 may not become effective or may become
                                 effective as to less than all of the principal
                                 of and interest and premium, if any, on the
                                 outstanding new notes. We refer you to
                                 "Description of the Notes and the
                                 Guarantee -- Guarantee."

                                 The terms of PepsiCo's guarantee of the new
                                 notes, including the scheduled guarantee
                                 commencement date, are intended to preserve the
                                 structure of our and PBG's separation from
                                 PepsiCo in March 1999. In connection with the
                                 separation, PepsiCo guaranteed some of our
                                 indebtedness, including $1.0 billion of our
                                 5 3/8% senior notes due 2004, which will mature
                                 on February 17, 2004.

Ranking of the Guarantee......   The guarantee, if and when it becomes
                                 effective, will be PepsiCo's general unsecured
                                 obligation and will rank on an equal basis with
                                 all of PepsiCo's other existing and future
                                 senior unsecured obligations and senior to all
                                 of PepsiCo's existing and future subordinated
                                 obligations.

Listing.......................   We and PepsiCo have applied to list the new
                                 notes on the Luxembourg Stock Exchange in
                                 accordance with the rules of the Luxembourg
                                 Stock Exchange.


Governing Law.................   State of New York.



Trustee.......................   JPMorgan Chase Bank.


                                  RISK FACTORS

     Before exchanging your old notes for new notes, you should consider
carefully the information included in the "Risk Factors" section, as well as all
other information included or incorporated by reference in this prospectus.

                                        9
<PAGE>

                       SUMMARY HISTORICAL FINANCIAL DATA

BOTTLING LLC


     The following table sets forth our summary historical financial data: (a)
as of and for each of the five fiscal years ended December 28, 2002 and (b) as
of March 23, 2002 and March 22, 2003 and for each of the 12-week periods then
ended. The summary historical financial data as of and for each of the five
fiscal years ended December 28, 2002 have been derived from our audited
consolidated financial statements. The summary historical financial data as of
and for the 12-week periods ended March 23, 2002 and March 22, 2003 have been
derived from our unaudited condensed consolidated financial statements and
include all adjustments, consisting only of normal recurring adjustments, which
are, in our opinion, necessary for a fair presentation of our financial position
at such dates and the results of operations for such periods. The results of
operations for the 12-week period ended March 22, 2003 are not necessarily
indicative of the results for the full year, especially in view of the
seasonality of our business. You should read the following financial information
with our historical consolidated financial statements and notes thereto
incorporated by reference in this prospectus.



<Table>
<Caption>
                                                     FISCAL YEAR ENDED                        12-WEEKS ENDED
                                    ----------------------------------------------------   ---------------------
                                    DEC. 26,   DEC. 25,   DEC. 30,   DEC. 29,   DEC. 28,   MARCH 23,   MARCH 22,
                                    1998(1)    1999(1)    2000(2)      2001       2002       2002        2003
                                    --------   --------   --------   --------   --------   ---------   ---------
                                            (IN MILLIONS, EXCEPT FOR RATIO OF EARNINGS TO FIXED CHARGES)
<S>                                 <C>        <C>        <C>        <C>        <C>        <C>         <C>
STATEMENT OF OPERATIONS DATA:
Net revenues(3)...................  $ 7,041     $7,505     $7,982     $8,443    $ 9,216     $1,772      $ 1,874
Cost of sales(3)..................    4,181      4,296      4,405      4,580      5,001        942          927
                                    -------     ------     ------     ------    -------     ------      -------
Gross profit(3)...................    2,860      3,209      3,577      3,863      4,215        830          947
Selling, delivery and
  administrative expenses(3)......    2,583      2,813      2,986      3,185      3,318        695          828
Unusual impairment and other
  charges and credits(4)..........      222        (16)        --         --         --         --           --
                                    -------     ------     ------     ------    -------     ------      -------
Operating income(3)...............       55        412        591        678        897        135          119
Interest expense..................      166        140        136        132        131         30           38
Interest income...................        9         11         47         54         33          7            6
Other non-operating expenses,
  net.............................       26          1          1         --          7         --            3
Minority interest.................        4          5          8         14          9          1           --
                                    -------     ------     ------     ------    -------     ------      -------
Income (loss) before income
  taxes...........................     (132)       277        493        586        783        111           84
Income tax expense (benefit)(5)...       (1)         4         22         (1)        49          4            8
                                    -------     ------     ------     ------    -------     ------      -------
Income (loss) before cumulative
  effect of change in accounting
  principle.......................     (131)       273        471        587        734        107           76
Cumulative effect of change in
  accounting principle, net of
  tax(3)..........................       --         --         --         --         --         --            6
                                    -------     ------     ------     ------    -------     ------      -------
Net income (loss)(3)..............  $  (131)    $  273     $  471     $  587    $   734     $  107      $    70
                                    =======     ======     ======     ======    =======     ======      =======
OTHER FINANCIAL DATA:
Net cash provided by operations...  $   727     $  888     $  974     $1,073    $ 1,107     $  176      $   104
Net cash used for investments.....   (1,022)      (973)      (800)      (949)    (1,836)      (219)        (245)
Net cash provided by (used for)
  financing.......................      244        244        (42)      (173)       677        (20)          33
Capital expenditures..............     (507)      (560)      (515)      (593)      (623)      (110)        (112)
Ratio of earnings to fixed
  charges(6)......................       --(7)    2.76       4.31       5.09       6.21       4.30         2.95
BALANCE SHEET DATA (AT PERIOD
  END):
Total assets......................  $ 7,227     $7,799     $8,228     $8,677    $10,907     $8,845      $10,860
Total long-term debt..............    2,361      2,284      2,286      2,299      3,535      2,342        2,532
Owners' equity....................    3,283      3,928      4,321      4,596      5,186      4,738        5,245
</Table>


- ---------------

(1) Financial information for the periods prior to PBG's initial public offering
    in March 1999 has been carved out from PepsiCo's financial statements for
    the same periods based on the historical results of operations and the
    assets and liabilities of our business. Our financial information for these
    periods reflects some costs that may not

                                        10
<PAGE>

    necessarily be indicative of the costs that we would have incurred if we had
    operated as an independent, stand-alone entity during such periods.

(2) The 2000 fiscal year consisted of 53 weeks compared to 52 weeks in our
    normal fiscal year. The fifty-third week increased fiscal 2000 net revenues
    by an estimated $113 million and net income by an estimated $12 million.


(3) We adopted the Emerging Issues Task Force Issue No. (EITF) 02-16, or EITF
    Issue No. 02-16, "Accounting by a Customer (Including a Reseller) for
    Certain Consideration Received from a Vendor" beginning in our fiscal year
    2003. In prior periods, we classified worldwide bottler incentives received
    from PepsiCo and other brand owners as adjustments to net revenues and
    selling, delivery and administrative expenses depending on the objective of
    the program. In accordance with EITF Issue No. 02-16, we have classified
    certain bottler incentives as a reduction of cost of sales beginning in 2003
    and we also recorded a transition adjustment of $6 million, net of taxes,
    for the cumulative effect on prior years. This adjustment reflects the
    amount of bottler incentives that can be attributed to our 2003 beginning
    inventory balances. In accordance with EITF Issue No. 02-16, each of the
    five fiscal years ended December 28, 2002 and the 12-week period ended March
    23, 2002 have not been restated to reflect the adoption of EITF Issue No.
    02-16. However, the pro-forma disclosures of the effects on prior periods
    are presented in the Supplemental Pro Forma Information section.



(4) Unusual impairment and other charges and credits were comprised of the
    following:


     - a $45 million non-cash compensation charge in the second quarter of 1999,

     - a $53 million vacation accrual reversal in the fourth quarter of 1999,

     - an $8 million restructuring reserve reversal in the fourth quarter of
       1999, and

     - a $222 million charge related to the restructuring of our Russian
       bottling operations and the separation of Pepsi-Cola North America's
       concentrate and bottling organizations in the fourth quarter of 1998.


(5) Results for the fiscal year ended December 29, 2001 included Canadian tax
    law change benefits of $25 million.



(6) We have calculated our ratio of earnings to fixed charges by dividing
    earnings by fixed charges. For this purpose, earnings are before taxes and
    minority interest, plus fixed charges (excluding capitalized interest) and
    losses recognized from equity investments, reduced by undistributed income
    from equity investments. Fixed charges include interest expense, capitalized
    interest and one-third of net rent expense, which is the portion of rent
    deemed representative of the interest factor. Since our formation in 1999,
    we have distributed, and in the future we intend to distribute, pro rata to
    our members sufficient cash so that the aggregate amount of cash distributed
    to PBG will enable it to pay its taxes and make interest payments on its $1
    billion principal amount of 7% senior notes due 2029. Such distributions are
    not included in the calculation of fixed charges. Total distributions to our
    members in 2000, 2001 and 2002 were $45 million, $223 million and $156
    million, respectively.



(7) As a result of the losses incurred in the fiscal year ended December 26,
    1998, we were unable to fully cover fixed charges. Earnings did not cover
    fixed charges by $124 million in fiscal 1998.


SUPPLEMENTAL PRO FORMA INFORMATION


SFAS 142



     During 2001, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards 142, or SFAS 142, "Goodwill and Other Intangible
Assets," which requires that goodwill and intangible assets with indefinite
useful lives no longer be amortized, but instead tested for impairment.
Effective the first day of fiscal year 2002, we no longer amortize goodwill and
certain franchise rights, but evaluate them for impairment annually. We have
completed our annual impairment review and have determined that our intangible
assets were not impaired.


                                        11
<PAGE>


     The following table provides pro forma disclosure of the elimination of
goodwill and certain franchise rights amortization in 2000 and 2001, as if SFAS
142 had been adopted in 2000:



<Table>
<Caption>
                                                               FISCAL YEAR ENDED
                                                              -------------------
                                                              DEC. 30,   DEC. 29,
                                                                2000       2001
                                                              --------   --------
                                                                 (IN MILLIONS)
<S>                                                           <C>        <C>
Reported net income.........................................    $471       $587
  Add back: Goodwill amortization, net of tax...............      37         35
  Add back: Franchise rights amortization, net of tax.......      86         88
                                                                ----       ----
Adjusted net income.........................................    $594       $710
                                                                ====       ====
</Table>



EITF Issue No. 02-16



     In January 2003, the EITF reached a consensus on Issue No. 02-16,
addressing the recognition and income statement classification of various cash
consideration given by a vendor to a customer. The consensus requires that
certain cash consideration received by a customer from a vendor are presumed to
be a reduction of the price of the vendor's products, and therefore should be
characterized as a reduction of cost of sales when recognized in the customer's
income statement, unless certain criteria are met. EITF Issue No. 02-16 became
effective beginning in our fiscal year 2003. In prior periods we classified
worldwide bottler incentives received from PepsiCo and other brand owners as
adjustments to net revenues and selling, delivery and administrative expenses
depending on the objective of the program. In accordance with EITF Issue No.
02-16, we have classified certain bottler incentives as a reduction of cost of
sales beginning in 2003. We have recorded a transition adjustment of $6 million,
net of taxes, for the cumulative effect on prior years. This adjustment reflects
the amount of bottler incentives that can be attributed to our 2003 beginning
inventory balances. This accounting change did not have a material effect on our
income before cumulative effect of change in accounting principle in the first
12-week period of 2003 and is not expected to have a material effect on such
amounts for the balance of fiscal 2003.



     The following pro forma information summarizes our consolidated statements
of operations to reflect the adoption of EITF Issue No. 02-16 as if it had been
in effect for all periods presented:



<Table>
<Caption>
                                                FISCAL YEAR ENDED                        12-WEEKS ENDED
                               ----------------------------------------------------   ---------------------
                               DEC. 26,   DEC. 25,   DEC. 30,   DEC. 29,   DEC. 28,   MARCH 23,   MARCH 22,
                                 1998       1999       2000       2001       2002       2002        2003
                               --------   --------   --------   --------   --------   ---------   ---------
                                                              (IN MILLIONS)
<S>                            <C>        <C>        <C>        <C>        <C>        <C>         <C>
Net revenues.................   $6,793     $7,242     $7,706     $8,165     $8,926     $1,713      $1,874
Cost of sales................    3,736      3,830      3,934      4,112      4,510        847         927
Selling, delivery and
  administrative expenses....    2,780      3,016      3,181      3,375      3,519        732         828
Operating income.............       55        412        591        678        897        134         119
Net income...................   $ (131)    $  273     $  471     $  587     $  734     $  106      $   76
</Table>


                                        12
<PAGE>

PEPSICO


     The following table sets forth PepsiCo's summary historical financial
data:(a) as of and for each of the five fiscal years ended December 28, 2002 and
(b) as of March 23, 2002 and March 22, 2003 and for each of the 12-week periods
then ended. The summary historical financial data as of and for each of the five
fiscal years ended December 28, 2002 have been derived from PepsiCo's audited
consolidated financial statements, except for net sales for 1998 and 1999, which
have been restated to reflect the adoption of EITF 01-9, and long-term debt as
of December 26, 1998, which has been derived from PepsiCo's unaudited
consolidated financial information. The summary historical financial data as of
and for the 12-week periods ended March 23, 2002 and March 22, 2003 have been
derived from PepsiCo's unaudited condensed consolidated financial statements and
include all adjustments, consisting only of normal recurring adjustments, which
are, in PepsiCo's opinion, necessary for a fair presentation of PepsiCo's
financial position at such dates and the results of operations for such periods.
The results of operations for the 12-week period ended March 22, 2003 are not
necessarily indicative of the results for the full year, especially in view of
the seasonality of PepsiCo's business. In 2001, PepsiCo merged with The Quaker
Oats Company, or Quaker, in a transaction accounted for as a
pooling-of-interests. Prior year results have been restated to reflect the
transaction, except for cash dividends per common share, which reflect those of
pre-merger PepsiCo prior to the effective date of the merger. As a result of the
bottling deconsolidation in 1999, PepsiCo's acquisition of Tropicana Products,
or Tropicana, late in 1998, the consolidation of Snack Ventures Europe in 2002,
and the items discussed below, PepsiCo's financial statements that include these
periods may not be fully comparable with prior periods. You should read the
following financial information with PepsiCo's historical consolidated financial
statements and notes thereto incorporated by reference in this prospectus.



<Table>
<Caption>
                                            FISCAL YEAR ENDED                            12-WEEKS ENDED
                       ------------------------------------------------------------   ---------------------
                        DEC. 26,     DEC. 25,     DEC. 30,     DEC. 29,    DEC. 28,   MARCH 23,   MARCH 22,
                       1998(1)(2)   1999(1)(3)   2000(1)(4)   2001(1)(5)   2002(5)     2002(5)     2003(5)
                       ----------   ----------   ----------   ----------   --------   ---------   ---------
                          (IN MILLIONS, EXCEPT PER SHARE AMOUNTS AND RATIO OF EARNINGS TO FIXED CHARGES)
<S>                    <C>          <C>          <C>          <C>          <C>        <C>         <C>
Net sales............   $24,605      $22,183      $22,337      $23,512     $25,112     $ 5,311     $ 5,530
Net income...........     2,278        2,505        2,543        2,662       3,313         689         777
Income per common
  share -- basic.....      1.27         1.41         1.45         1.51        1.89        0.39        0.45
Income per common
  share -- diluted...      1.23         1.38         1.42         1.47        1.85        0.38        0.45
Cash dividends
  declared per common
  share(6)...........     0.515        0.535        0.555        0.575       0.595       0.145        0.15
Total assets (at
  period end)........    25,170       19,948       20,757       21,695      23,474      22,611      23,238
Long-term debt (at
  period end)........     4,823        3,527        3,009        2,651       2,187       2,276       2,202
Ratio of earnings to
  fixed charges(7)...      6.03         9.82        11.91        15.21       19.92       22.67       21.20
</Table>


- ---------------


(1) Includes other impairment and restructuring charges of $482 million ($379
    million after-tax or $0.21 per share) in 1998, $73 million ($45 million
    after-tax or $0.02 per share) in 1999, $184 million ($111 million after-tax
    or $0.06 per share) in 2000 and $31 million ($19 million after-tax or $0.01
    per share) in 2001.



(2) Includes a tax benefit of $494 million (or $0.27 per share) related to final
    agreement with the Internal Revenue Service to settle a case related to
    concentrate operations in Puerto Rico.



(3) Includes a net gain on bottling transactions of $1.0 billion ($270 million
    after-tax or $0.15 per share), a tax provision related to the PepCom
    bottling transaction of $25 million (or $0.01 per share) and a Quaker
    favorable tax adjustment of $59 million (or $0.03 per share).


                                        13
<PAGE>


(4) The 2000 fiscal year consisted of 53 weeks compared to 52 weeks in PepsiCo's
    normal fiscal year. The fifty-third week increased 2000 net sales by an
    estimated $294 million and net income by an estimated $44 million (or $0.02
    per share).



(5) Includes Quaker merger-related costs of $356 million ($322 million after-tax
    or $0.18 per share) in 2001, $224 million ($190 million after-tax or $0.11
    per share) in 2002, $36 million ($30 million after-tax or $0.02 per share)
    for the 12-week period ended March 23, 2002 and $11 million ($10 million
    after-tax) for the 12-week period ended March 22, 2003.



(6) Prior to the effective date of PepsiCo's merger with Quaker on August 1,
    2001, cash dividends per common share are those of pre-merger PepsiCo.



(7) The ratio of earnings to fixed charges is calculated by dividing earnings by
    fixed charges. For this purpose, earnings principally reflect income before
    taxes excluding the results of minority-owned equity investments, minority
    interest income, interest expense and an estimate of the interest portion of
    rent expense. In addition, earnings are adjusted to include 100% of the
    losses of majority-owned equity investments and dividends from
    minority-owned equity investments. Fixed charges principally include
    interest expense and an estimate of the interest portion of rent expense.


SUPPLEMENTAL PRO FORMA INFORMATION

     PepsiCo adopted SFAS 142 in 2002. As a result of this adoption,
amortization ceased for nonamortizable intangibles and the remaining useful
lives of certain amortizable intangibles were reduced.

     The following reflects the impact that SFAS 142 would have had on the
results of the prior periods indicated below if SFAS 142 had been in effect for
such periods.


<Table>
<Caption>
                                                                    FISCAL YEAR ENDED
                                                              -----------------------------
                                                              DEC. 30, 2000   DEC. 29, 2001
                                                              -------------   -------------
                                                                  (IN MILLIONS, EXCEPT
                                                                   PER SHARE AMOUNTS)
<S>                                                           <C>             <C>
Reported net income.........................................     $2,543          $2,662
  Cease goodwill amortization...............................        112             112
  Adjust brands amortization................................        (22)            (67)
  Cease equity investee goodwill amortization...............         61              57
                                                                 ------          ------
  Adjusted net income.......................................     $2,694          $2,764
                                                                 ======          ======
Reported earnings per common share -- diluted...............     $ 1.42          $ 1.47
  Cease goodwill amortization...............................       0.06            0.06
  Adjust brands amortization................................      (0.01)          (0.03)
  Cease equity investee goodwill amortization...............       0.03            0.03
                                                                 ------          ------
Adjusted earnings per common share -- diluted...............     $ 1.50          $ 1.53
                                                                 ======          ======
</Table>



     The impact on basic earnings per common share is the same as the diluted
earnings per common share amounts reported above.


                                        14
<PAGE>

                                  RISK FACTORS

     An investment in the new notes and the guarantee, like the old notes and
the guarantee, involves risks. Before exchanging your old notes for new notes in
this exchange offer, you should carefully consider the following risk factors in
addition to the other information included or incorporated by reference in this
prospectus.

RISKS RELATING TO OUR BUSINESS

  Because we depend upon PepsiCo to provide us with concentrate, certain funding
  and various services, changes in our relationship with PepsiCo could adversely
  affect our business and financial results.

     We conduct our business primarily under PBG's beverage agreements with
PepsiCo, including a master bottling agreement, non-cola bottling agreements and
a master syrup agreement. Although we are not a direct party to these
agreements, as the principal operating subsidiary of PBG, we enjoy rights and
are subject to obligations under these agreements.

     PBG is party to a master bottling agreement with PepsiCo for cola products
in the United States as well as other agreements with PepsiCo relating to
non-cola products and fountain syrup in the United States and similar agreements
relating to Pepsi-Cola beverages in foreign countries where we sell our
products. These agreements provide that PBG must purchase all of the concentrate
for such beverages at prices and on other terms that are set by PepsiCo in its
sole discretion. Any concentrate price increases could materially affect our
business and financial results. Prices under PBG's beverage agreements with
PepsiCo may increase materially, and we may not be able to pass on any increased
costs to our customers.


     PepsiCo has also traditionally provided bottler incentives and funding to
its bottling operations. PepsiCo does not have to continue to provide bottler
incentives under PBG's beverage agreements with PepsiCo and any support provided
to us by PepsiCo will be at PepsiCo's sole discretion. Decreases in bottler
incentives and funding levels could materially affect our business and financial
results.


     PBG also has to submit annual marketing, advertising, management and
financial plans each year to PepsiCo for its review and approval. If PBG fails
to submit these plans, or if PBG fails to carry them out in all material
respects, PepsiCo can terminate PBG's beverage agreements with PepsiCo. If PBG's
beverage agreements with PepsiCo are terminated for this or for any other
reason, it would have a material adverse effect on our business and financial
results.


     Under our shared services agreement, we obtain various services from
PepsiCo, which includes procurement of raw materials and certain information
technology and administrative services. In the absence of the shared services
agreement, we would have to obtain such services on our own. We might not be
able to obtain these services on terms, including cost, that are as favorable as
those we receive from PepsiCo.


  Our agreements with PepsiCo restrict our sources of supply for some raw
  materials, which could increase our costs.

     With respect to the soft drink products of PepsiCo, concentrates and all
authorized containers, closures, cases, cartons and other packages and labels
may be purchased only from PepsiCo or manufacturers approved by PepsiCo. This
may restrict our ability to obtain raw materials from other suppliers.

     The supply or cost of specific materials could be adversely affected by
price changes, strikes, weather conditions, governmental controls or other
factors. Any sustained interruption in the supply of these raw materials or any
significant increase in their prices could have a material adverse effect on our
business and financial results.

                                        15
<PAGE>

  PepsiCo's equity ownership of PBG could affect matters concerning us.


     As of April 19, 2003, PepsiCo owned approximately 43.8% of the combined
voting power of PBG's voting stock (with the balance owned by the public). As of
April 19, 2003, PBG owned approximately 93.2% of our membership interests and
PepsiCo indirectly owned the remainder of our membership interests. PepsiCo will
be able to significantly affect the outcome of PBG's stockholder votes, thereby
affecting matters concerning us.


  We may have potential conflicts of interest with PepsiCo because of our past
  and ongoing relationships with PepsiCo, which could result in PepsiCo's
  objectives being favored over our objectives.

     These conflicts could arise over:

     - the nature, quality and pricing of services or products provided to us by
       PepsiCo or by us to PepsiCo;

     - potential acquisitions of bottling territories and/or assets from PepsiCo
       or other independent PepsiCo bottlers;

     - the divestment of parts of our bottling operations;

     - the payment of distributions by us; or

     - balancing the objectives of increasing sales volume of Pepsi-Cola
       beverages and maintaining or increasing our profitability.

  One of our managing directors may have a conflict of interest because he is
  also a PepsiCo officer.

     One of our managing directors is also the Senior Vice President of Finance
of PepsiCo, a situation which may create conflicts of interest.

  Our acquisition strategy may be limited by geographical restrictions on
  acquisitions in our agreements with PepsiCo, by our ability to successfully
  integrate acquired businesses into ours and by the requirement that we obtain
  PepsiCo's approval of any acquisition of an independent PepsiCo bottler.


     We intend to acquire bottling assets and territories from PepsiCo's
independent bottlers, such as our acquisition of Gemex and a Pepsi-Cola bottler
in Buffalo, New York. This strategy will involve reviewing and potentially
reorganizing acquired business operations, corporate infrastructure and systems
and financial controls. The success of our acquisition strategy may be limited
because of unforeseen expenses, difficulties, complications and delays
encountered in connection with the expansion of our operations through
acquisitions. We may not be able to acquire or manage profitably additional
businesses or to integrate successfully any acquired businesses into our
business without substantial costs, delays or other operational or financial
difficulties. In addition, we may be required to incur additional debt or issue
equity to pay for future acquisitions. Any of the foregoing could adversely
affect our business and financial results and, therefore, our ability to service
or pay our indebtedness, including the new notes.



     We must obtain PepsiCo's approval to acquire any independent PepsiCo
bottler. Under the master bottling agreement, PepsiCo has agreed not to withhold
approval for any acquisition within agreed upon U.S. territories, currently
representing approximately 12.6% of PepsiCo's U.S. bottling system in terms of
volume, if we have successfully negotiated the acquisition and, in PepsiCo's
reasonable judgment, satisfactorily performed our obligations under the master
bottling agreement. We have agreed not to acquire or attempt to acquire any
independent PepsiCo bottler outside of those agreed-upon territories without
PepsiCo's prior written approval.


                                        16
<PAGE>

  If we are unable to fund our substantial capital requirements, it could cause
  us to reduce our planned capital expenditures and could result in a material
  adverse effect on our business and financial results.

     We will require substantial capital expenditures to implement our business
plans. If we do not have sufficient funds or if we are unable to obtain
financing in the amounts desired or on acceptable terms, we may have to reduce
our planned capital expenditures, which could have a material adverse effect on
our business and financial results and, therefore, our ability to service and
pay our indebtedness, including the new notes.

  Our success depends on key members of our management, the loss of whom could
  disrupt our business operations.

     Our success depends largely on the efforts and abilities of key management
employees. The loss of the services of key personnel or the inability to attract
qualified employees could have a material adverse effect on our business and
financial results. Key management employees are not parties to employment
agreements with us.

RISKS RELATING TO OUR AND PEPSICO'S RESPECTIVE BUSINESSES

  We or PepsiCo may be unable to compete successfully in the highly competitive
  carbonated and non-carbonated beverage markets, and PepsiCo may be unable to
  compete in its other businesses, certain of which are also highly competitive.

     The carbonated and non-carbonated beverage markets are both highly
competitive. In addition, the markets for certain of PepsiCo's food products are
highly competitive. Competition in our and PepsiCo's various markets could cause
us or PepsiCo to reduce prices, increase capital and other expenditures or lose
market share, which could have a material adverse effect on our or PepsiCo's
business and financial results.

  Our and PepsiCo's foreign operations are subject to social, political and
  economic risks and may be adversely affected by foreign currency fluctuations.


     In the fiscal year ended December 28, 2002 and the 12-week period ended
March 22, 2003, approximately 18% and 20%, respectively, of our net revenues
were generated in Canada, Spain, Greece, Russia, Turkey and, as a result of our
acquisition in November, 2002 of Gemex, Mexico. For 2002, international
operations constituted about one-fifth of PepsiCo's annual division operating
profit. Social, economic and political conditions in these international markets
may adversely affect our or PepsiCo's business and financial results. The
overall risks to our and PepsiCo's respective international businesses include
changes in foreign governmental policies and other political or economic
developments. These developments may lead to new product pricing, tax or other
policies and monetary fluctuations which may adversely impact our and PepsiCo's
respective businesses and financial results. In addition, our and PepsiCo's
respective results of operations and the value of our and PepsiCo's respective
foreign assets are affected by fluctuations in foreign currency exchange rates.


  We or PepsiCo may incur material losses and costs as a result of product
  liability claims that may be brought against us or PepsiCo or any product
  recalls we or PepsiCo have to make.

     We or PepsiCo may be liable if the consumption of any of our or PepsiCo's
products causes injury, illness or death. We or PepsiCo also may be required to
recall products if they become contaminated or are damaged or mislabeled. A
significant product liability judgment against us or PepsiCo or a widespread
recall of our or PepsiCo's products could have a material adverse effect on our
or PepsiCo's business and financial results.

  Newly adopted governmental regulations could increase our or PepsiCo's costs
  or liabilities.

     Our and PepsiCo's respective operations and properties are subject to
regulation by various federal, state and local government entities and agencies
as well as foreign governmental entities. Neither we nor

                                        17
<PAGE>

PepsiCo can assure you that we or PepsiCo, as the case may be, have been or will
at all times be in compliance with all regulatory requirements or that we or
PepsiCo, as the case may be, will not incur material costs or liabilities in
connection with existing or new regulatory requirements.

RISKS RELATING TO OUR INDEBTEDNESS AND THIS EXCHANGE OFFER

  If you do not tender your old notes, or do so improperly, you will continue to
  hold unregistered old notes and your ability to transfer such notes will be
  adversely affected.

     We will only issue new notes in exchange for old notes that are timely
received by the exchange agent together with all required documents, including a
properly completed and signed letter of transmittal, as described in this
prospectus. Therefore, you should allow sufficient time to ensure timely
delivery of your old notes and you should carefully follow the instructions on
how to tender your old notes. Neither we nor the exchange agent are required to
tell you of any defects or irregularities with respect to your tender of your
old notes. If you do not tender your old notes or if we do not accept your old
notes because you did not tender your old notes properly, then, after we
complete the exchange offer, you will continue to hold old notes that are
subject to the existing transfer restrictions and you will no longer have any
registration rights with respect to the old notes. In addition:

     - if you tender your old notes for the purpose of participating in a
       distribution of the new notes, you will be required to comply with the
       registration and prospectus delivery requirements of the Securities Act
       in connection with any resale of the new notes; and

     - if you are a broker-dealer that receives new notes for your own account
       in exchange for old notes that you acquired as a result of market-making
       activities or any other trading activities, you will be required to
       acknowledge that you will deliver a prospectus in connection with any
       resale of those new notes.

     We and PepsiCo have agreed that, for a period of 180 days after the
expiration date of this exchange offer, Bottling LLC will make this prospectus
available to any broker-dealer for use in connection with any such resale. We
refer you to "Plan of Distribution."

     After the exchange offer is consummated, if you continue to hold any old
notes you may have difficulty selling them because there will be fewer old notes
outstanding. In addition, if a large principal amount of old notes is not
tendered or is tendered improperly, the limited principal amount of new notes
that would be issued and outstanding after we consummate the exchange offer
could adversely affect the liquidity and the market price of the new notes.

  Our substantial indebtedness could adversely affect our financial health and
  prevent us from making payments on the notes.


     We have a substantial amount of indebtedness. As of March 22, 2003, we had
approximately $3.6 billion of indebtedness. In addition, we guarantee an
additional $1.0 billion of PBG's indebtedness.


     Our substantial debt could have important consequences to you. For example,
it could:

     - make it more difficult for us, or make us unable, to satisfy our
       obligations with respect to the notes;

     - make us vulnerable to general adverse economic and industry conditions;

     - limit our ability to obtain additional financing for future working
       capital expenditures, strategic acquisitions and other general corporate
       requirements;

     - expose us to interest rate fluctuations because the interest on some of
       our indebtedness is at variable rates;

     - require us to dedicate a substantial portion of our cash flow from
       operations to payments on our debt, thereby reducing the availability of
       our cash flow for operations and other purposes;

                                        18
<PAGE>

     - limit our flexibility in planning for, or reacting to, changes in our
       business and the industry in which we operate; and

     - place us at a competitive disadvantage compared with any competitors that
       have less debt.

  Our ability to service our debt will require a significant amount of cash.

     To service our debt, we will require a significant amount of cash. Our
ability to generate cash, make scheduled payments or to refinance our
obligations depends on our successful financial and operating performance. Our
financial and operating performance, cash flow and capital resources depend upon
prevailing economic conditions and certain financial, business and other
factors, many of which are beyond our control. These factors include among
others:

     - economic and competitive conditions;

     - operating difficulties, increased operating costs or pricing pressures we
       may experience; and

     - delays in implementing any strategic projects.

     If our cash flow and capital resources are insufficient to fund our debt
service obligations, we may be forced to reduce or delay capital expenditures,
sell material assets or operations, obtain additional capital or restructure our
debt.

  We may incur additional debt.

     We and our subsidiaries may incur substantial additional indebtedness in
the future. The terms of the indenture permit us to incur additional debt and
our credit facilities permit additional borrowings under certain circumstances.
Accordingly, this additional indebtedness could further exacerbate all the risks
described above.

  The notes are unsecured and effectively subordinated to our secured
  indebtedness.

     The old notes are not, and the new notes will not be, secured by any of our
assets. Accordingly, the old notes are, and the new notes will be, effectively
subordinated to any of our secured obligations to the extent of the value of the
assets securing such obligations. As of the date hereof, we do not have any
material secured long-term debt obligations.

  Under certain circumstances, PepsiCo's guarantee may not become effective or
  may become effective for less than all of the principal of and interest and
  premium, if any, on the notes.

     PepsiCo will unconditionally and irrevocably guarantee the payment of
principal of and interest and premium, if any, on the notes on or after the
guarantee commencement date, except that, under the circumstances described in
"Description of the Notes and the Guarantee -- Guarantee," PepsiCo's guarantee
may not become effective or may become effective as to less than all of the
principal of and interest and premium, if any, on the outstanding notes. For the
convenience of readers, we have included six illustrative examples in
"Description of the Notes and the Guarantee -- Guarantee" to describe some
hypothetical situations involving PepsiCo's guarantee. Those examples are for
illustrative purposes only and do not describe all of the situations that could
occur involving PepsiCo's guarantee. You should carefully review the terms of
PepsiCo's guarantee described in "Description of the Notes and the Guarantee --
Guarantee," including as to whether PepsiCo's guarantee, if and when it becomes
effective, will be for all, or less than all, of the principal of and interest
and premium, if any, on the outstanding notes.

  The guarantee may not be enforceable because of fraudulent conveyance laws.

     The incurrence of the guarantee by PepsiCo may be subject to review under
U.S. federal bankruptcy law or relevant state fraudulent conveyance laws if a
bankruptcy case or lawsuit is commenced by or on

                                        19
<PAGE>

behalf of PepsiCo's unpaid creditors. Under these laws, if in such a case or
lawsuit a court were to find that, at the time PepsiCo guaranteed the notes,
PepsiCo:

     - incurred the guarantee of the notes with the intent of hindering,
       delaying or defrauding current or future creditors; or

     - received less than reasonably equivalent value or fair consideration for
       incurring the guarantee of the notes and PepsiCo:

      -- was insolvent or was rendered insolvent;

      -- was engaged, or was about to engage, in a business or transaction for
         which its remaining assets constituted unreasonably small capital to
         carry on its business; or

      -- intended to incur, or believed that it would incur, debts beyond its
         ability to pay as such debts matured (as all of the foregoing terms are
         defined in or interpreted under the relevant fraudulent transfer or
         conveyance statutes);

then such court could void the guarantee of PepsiCo or subordinate the amounts
owing under such guarantee to PepsiCo's presently existing or future debt or
take other actions detrimental to you.

     The measure of insolvency for purposes of the foregoing considerations will
vary depending upon the law of the jurisdiction that is being applied in any
such proceeding. Generally, a company would be considered insolvent if, at the
time it incurred the debt or issued the guarantee:

     - the sum of its debts (including contingent liabilities) is greater than
       its assets, at fair valuation; or

     - the present fair saleable value of its assets is less than the amount
       required to pay the probable liability on its total existing debts and
       liabilities (including contingent liabilities) as they become absolute
       and matured; or

     - it could not pay its debts as they became due.

     If PepsiCo's guarantee is voided as a fraudulent conveyance or found to be
unenforceable for any reason, you will not have a claim against PepsiCo under
its guarantee and will only have a claim against us.

  An active trading market may not develop for the new notes.


     The new notes are a new issue of securities for which there currently is no
market. We have not and do not intend to list the notes on any U.S. national
securities exchange or quotation system. On December 20, 2002, we applied to
list the new notes on the Luxembourg Stock Exchange. However, we cannot assure
you that an active trading market in the new notes will develop and continue
after this exchange offer. Certain of the initial purchasers of the old notes
have advised us that they intend to make a market in the new notes as permitted
by applicable law. They are not obligated, however, to make a market in the new
notes and any market-making may be discontinued at any time at their sole
discretion. In addition, any such market-making activity will be subject to the
limits imposed by the Securities Act and the Securities Exchange Act of 1934, as
amended, or the Exchange Act. Accordingly, no assurance can be given as to the
development or liquidity of any market for the new notes.


     The liquidity of, and trading market for, the new notes may also be
adversely affected by, among other things:

     - changes in the overall market for debt securities;

     - changes in our or PepsiCo's financial performance or prospects;

     - the prospects for companies in our industry generally;

     - the number of holders of the new notes;

     - the interest of securities dealers in making a market for the new notes;
       and

     - prevailing interest rates.
                                        20
<PAGE>

                                USE OF PROCEEDS

     Neither we nor PepsiCo will receive any proceeds from the issuance of the
new notes. In consideration for issuing the new notes as contemplated in this
prospectus, we will receive old notes in like principal amount, which will be
cancelled and, as such, will not result in any increase in our indebtedness. We
have agreed to bear the expenses of the exchange offer. No underwriter is being
used in connection with the exchange offer.

     The net proceeds of the old notes, after deducting expenses and the initial
purchasers' discount, were approximately $994 million. We used these net
proceeds, together with approximately $184 million of available cash on hand,
for our acquisition of Gemex and the covenant defeasance and repayment of
Gemex's debt.

                                        21
<PAGE>

                                 CAPITALIZATION

BOTTLING LLC


     We are a limited liability company organized under the law of the state of
Delaware. As of April 19, 2003, PBG owned approximately 93.2% of our membership
interests and PepsiCo indirectly owned the remainder of our membership
interests. In connection with our formation, PepsiCo and PBG contributed
bottling businesses and assets used in the bottling business to us. No further
capital contributions are required to be made by our members. Additional or
substitute members may be admitted, additional capital contributions may be made
and membership interests may be adjusted from time to time to reflect such
changes, each in accordance with the provisions of our limited liability company
agreement.



     The following table sets forth our cash and cash equivalents and
capitalization as of March 22, 2003. There has been no material change in our
cash and cash equivalents or capitalization since March 22, 2003. This
presentation should be read in conjunction with our historical financial
statements and the related notes thereto incorporated by reference into this
prospectus.



<Table>
<Caption>
                                                                  AS OF
                                                                MARCH 22,
                                                                  2003
                                                              -------------
                                                              (IN MILLIONS)
<S>                                                           <C>
Cash and cash equivalents...................................     $   93
                                                                 ======
Short-term borrowings.......................................     $   82
Current maturities of long-term debt........................      1,014
Long-term debt(1)...........................................      2,532
Owners' equity:
  Owners' net investment....................................      5,859
  Deferred compensation.....................................         (5)
  Accumulated other comprehensive loss......................       (609)
                                                                 ------
Total owners' equity........................................      5,245
                                                                 ------
Total capitalization........................................     $8,873
                                                                 ======
</Table>


- ---------------

(1) Does not include our guarantee of $1.0 billion of PBG's indebtedness.

                                        22
<PAGE>


PEPSICO



     The following table sets forth PepsiCo's cash and cash equivalents and
capitalization as of March 22, 2003. There has been no material change in
PepsiCo's cash and cash equivalents or capitalization since March 22, 2003. This
presentation should be read in conjunction with the historical financial
statements and the related notes thereto of PepsiCo incorporated by reference
into this prospectus. As of March 22, 2003, the authorized capital stock of
PepsiCo consisted of 3.6 billion shares of common stock, 1.7 billion of which
were issued and outstanding, and 3 million shares of convertible preferred
stock, 0.6 million of which were issued and outstanding. All of PepsiCo's issued
and outstanding shares of capital stock are fully paid and non-assessable.



<Table>
<Caption>
                                                                  AS OF
                                                                MARCH 22,
                                                                   2003
                                                              --------------
                                                              (IN MILLIONS)
<S>                                                           <C>
Cash and cash equivalents...................................     $   926
                                                                 =======
Short-term borrowings.......................................     $   241
Long-term debt(1)...........................................       2,202
Preferred stock, no par value...............................          41
Repurchased preferred stock.................................         (51)
Common shareholders' equity
  Common stock, par value 1 2/3 cents per share:
     Authorized 3,600 million shares, issued 1,782 million
      shares................................................          30
  Retained earnings.........................................      13,933
  Accumulated other comprehensive loss......................      (1,747)
  Less: repurchased shares, at cost.........................      (2,680)
                                                                 -------
  Total common shareholders' equity.........................       9,536
                                                                 -------
     Total capitalization...................................     $11,969
                                                                 =======
</Table>


- ---------------


(1) Does not include certain guarantees or commercial commitments in the
    ordinary course of business. As discussed in PepsiCo's Annual Report on Form
    10-K for the year ended December 28, 2002, the most significant of these
    guarantees or commitments is PepsiCo's unconditional guarantee of $2.3
    billion of our long-term debt.


                                        23
<PAGE>

                               THE EXCHANGE OFFER

PURPOSE OF THE EXCHANGE OFFER

     In connection with the issuance of the old notes, we and PepsiCo entered
into a registration rights agreement with the initial purchasers of the old
notes for the benefit of the initial purchasers and the holders of the old notes
and the guarantee. The following summary of selected provisions of the
registration rights agreement does not purport to be complete and is subject to,
and is qualified in its entirety by reference to the registration rights
agreement, a copy of which has been filed as an exhibit to the registration
statement filed by us and PepsiCo with the SEC, of which this prospectus is a
part. Copies of the registration rights agreement are available from us or
PepsiCo upon request or, for so long as the notes are registered on the
Luxembourg Stock Exchange, from our and PepsiCo's listing agent in Luxembourg as
described under "Where You Can Find More Information."

     Pursuant to the registration rights agreement, we and PepsiCo agreed, at
our and PepsiCo's expense:

     - by the 135th day after the date of original issuance of the old notes,
       which we refer to as the issue date, to file a registration statement,
       which we refer to as the exchange offer registration statement, with the
       SEC with respect to a registered exchange offer to exchange the old notes
       for the new notes, which will have terms substantially identical in all
       material respects except that the new notes will not contain terms with
       respect to transfer restrictions and payment of additional interest; and

     - by the 195th day after the issue date, to use our and PepsiCo's best
       efforts to cause the exchange offer registration statement to be declared
       effective under the Securities Act.

     Upon the effectiveness of the exchange offer registration statement,
pursuant to the registered exchange offer, we and PepsiCo agreed to offer to the
holders of the old notes the opportunity to exchange their old notes for the new
notes. We and PepsiCo agreed to use our and PepsiCo's best efforts to keep the
registered exchange offer effective for not less than 30 days (or longer if
required by applicable law) after the date notice of the registered exchange
offer is mailed to the holders of the old notes. We and PepsiCo agreed to
consummate the registered exchange offer not later than 40 days from the date
the exchange offer registration statement is declared effective. For each old
note surrendered to us pursuant to the registered exchange offer, the holder of
that old note will receive a new note having a principal amount equal to that of
the surrendered old note.

EFFECT OF THE EXCHANGE OFFER

     Based on existing interpretations of the Securities Act by the staff of the
SEC set forth in several no-action letters to third parties, we believe that the
new notes will in general be freely transferable after the completion of the
registered exchange offer without further compliance with the registration and
prospectus delivery requirements of the Securities Act. However, any holder of
the old notes who is an affiliate of us or PepsiCo or who intends to participate
in the exchange offer for the purpose of distributing the new notes or who is an
initial purchaser holding an unsold allotment from the original sale of the old
notes:

     - will not be able to rely on these interpretations of the staff of the
       SEC; and

     - must comply with the registration and prospectus delivery requirements of
       the Securities Act in connection with any sale or transfer of the new
       notes unless such sale or transfer is made pursuant to an exemption from
       such requirements.

     We and PepsiCo have not sought, and do not intend to seek, our own
no-action letter, and we cannot assure you that the staff of the SEC would make
a similar determination with respect to the new notes as it has in its no action
letters to other third parties.

                                        24
<PAGE>

     Each holder of old notes that wishes to exchange its old notes for new
notes in the exchange offer will be required to make certain representations,
including representations that:

     - any new notes to be acquired by it in exchange for the old notes will be
       acquired in the ordinary course of business;

     - it has no arrangement or understanding with any person to participate in
       a distribution (within the meaning of the Securities Act) of the new
       notes;

     - it is not an "affiliate," as defined in Rule 405 under the Securities
       Act, of us or PepsiCo, or if it is an affiliate, it will comply with the
       registration and prospectus delivery requirements of the Securities Act
       to the extent applicable.

     - if such holder is not a broker-dealer, it will not engage in, and does
       not intend to engage in, a distribution of new notes; and

     - if such holder is a broker-dealer, it will receive new notes for its own
       account in exchange for old notes that were acquired as a result of
       market-making activities or other trading activities (we refer below to
       such broker-dealers as exchanging broker-dealers) and that it will
       deliver a prospectus meeting the requirements of the Securities Act in
       connection with any resale of such new notes; however, by so
       acknowledging and by delivering a prospectus, it will not be deemed to
       admit that it is an "underwriter" within the meaning of the Securities
       Act. We refer you to "Plan of Distribution."

     The SEC has taken the position that exchanging broker-dealers may fulfill
their prospectus delivery requirements with respect to the new notes with this
prospectus contained in the exchange offer registration statement. Under the
registration rights agreement, we are required to allow exchanging
broker-dealers and other persons, if any, subject to similar prospectus delivery
requirements, to use this prospectus in connection with the resale of the new
notes.

     The information set forth above concerning certain interpretations and
positions taken is not intended to constitute legal advice, and you should
consult your own legal advisors with respect to these matters.

     Neither we nor PepsiCo has entered into any arrangement or understanding
with any person to distribute the new notes to be received in the exchange
offer.

     The exchange offer is not being made to, nor will we accept tenders for, or
exchange from, holders of old notes in any jurisdiction in which the exchange
offer or the acceptance thereof would not be in compliance with the securities
or blue sky laws of such jurisdiction. We refer you to "Plan of Distribution."

TERMS OF THE EXCHANGE OFFER

     Upon the terms and subject to the conditions set forth in this prospectus
and in the letter of transmittal, we will accept for exchange any old notes
properly tendered and not properly withdrawn prior to 5:00 p.m., New York City
time, on the expiration date. Old notes may be tendered only in denominations of
$1,000 and multiples thereof. We will issue $1,000 principal amount of new notes
in exchange for each $1,000 principal amount of old notes surrendered in the
exchange offer.

     The form and terms of the new notes will be the same as the form and terms
of the old notes, except that the new notes will be registered under the
Securities Act while the old notes were not and the new notes will not contain
transfer restrictions or terms with respect to a potential increase in the
interest rate. The new notes will evidence the same debt as the old notes. The
new notes will be issued under and entitled to the benefits of the same
indenture that authorized the issuance of the old notes. Consequently, both the
old notes and the new notes will be treated as a single class of debt securities
under that indenture.

     As of the date of this prospectus, $1,000,000,000 in aggregate principal
amount of the old notes is outstanding. This prospectus, together with the
letter of transmittal, is being sent to all holders of old
                                        25
<PAGE>

notes. There will be no fixed record date for determining registered holders of
old notes entitled to participate in the exchange offer.

     We intend to conduct the exchange offer in accordance with the provisions
of the registration rights agreement, the applicable requirements of the
Securities Act and the Exchange Act and the rules and regulations of the SEC.
Old notes that are not tendered for exchange in the exchange offer will remain
outstanding, will continue to accrue interest and will be entitled to the rights
and benefits they currently have under the indenture with the exception of
registration rights and a potential increase in the interest rate. If any
tendered old notes are not accepted for exchange because of an invalid tender,
the occurrence of certain other events set forth herein or otherwise,
certificates for any such unaccepted old notes will be returned, without
expense, to the tendering holder thereof as promptly as practicable after the
expiration date of the exchange offer (as described below).

     We will be deemed to have accepted for exchange properly tendered old notes
when we have given oral (promptly confirmed in writing) or written notice of the
acceptance to the exchange agent. The exchange agent will act as agent for the
tendering holders for the purposes of receiving the new notes from us and
delivering new notes to those holders.

     Holders who tender old notes in the exchange offer will not be required to
pay brokerage commissions or fees, or, subject to the instructions in the letter
of transmittal, transfer taxes with respect to the exchange of old notes. We
will pay all charges and expenses, other than certain applicable taxes described
below, in connection with the exchange offer. It is important that you read the
"-- Fees and Expenses" section below for more details regarding fees and
expenses incurred in the exchange offer.

EXPIRATION DATE; EXTENSIONS; AMENDMENTS

     The term "expiration date" means 5:00 p.m., New York City time on
          , 2003, unless we, at our discretion, after consulting with PepsiCo,
extend the exchange offer, in which case the term "expiration date" will mean
the latest date and time to which the exchange offer is extended.

     In order to extend the exchange offer, we will notify the exchange agent of
any extension orally (promptly confirmed in writing) or in writing and we will
notify the registered holders of old notes of the extension not later than 9:00
a.m., New York City time, on the first business day after the previously
scheduled expiration date.

     We reserve the right, at our discretion, after consulting with PepsiCo:

     - to delay acceptance of, or refuse to accept, any old notes not previously
       accepted, to extend the exchange offer or to terminate the exchange offer
       if any of the conditions set forth under "-- Conditions to the Exchange
       Offer" below have not been satisfied, by giving oral (promptly confirmed
       in writing) or written notice of the delay, extension or termination to
       the exchange agent; or

     - subject to the terms of the registration rights agreement, to amend the
       terms of the exchange offer in any manner.

     Any delay in acceptance, extension, termination or amendment will be
followed as promptly as practicable by oral or written notice to the registered
holders of old notes. If we amend the exchange offer in a manner that we or
PepsiCo determine to constitute a material change, we and PepsiCo will promptly
disclose such amendment in a manner reasonably calculated to inform you of the
amendment and we will extend the exchange offer to the extent required by law.
During any of these extensions, all old notes previously tendered will remain
subject to the exchange offer and we may accept them for exchange unless they
have been previously withdrawn. We will return any old notes that we do not
accept for exchange for any reason without expense to their tendering holder as
promptly as practicable after the expiration or termination of the exchange
offer.

                                        26
<PAGE>

     Without limiting the manner in which we may choose to make public
announcements of any delay in acceptance, extension, termination or amendment of
the exchange offer, we will not have any obligation to publish, advertise or
otherwise communicate any such public announcement, other than by making a
timely release to a financial news service.

     Upon satisfaction or waiver of all of the conditions to the exchange offer,
we will accept, promptly after the expiration date, all old notes properly
tendered and will issue the new notes promptly after acceptance of the old
notes. We refer you to "-- Conditions to the Exchange Offer."

     In all cases, issuance of new notes for old notes that are accepted for
exchange in the exchange offer will be made only after timely receipt by the
exchange agent of a properly completed and duly executed letter of transmittal
(or facsimile thereof or an agent's message, as hereinafter defined, in lieu
thereof) and all other required documents; provided, however, that we, after
consulting with PepsiCo, reserve the absolute right to waive any defects or
irregularities in the tender or conditions of the exchange offer. If any
tendered old notes are not accepted for any reason set forth in the terms and
conditions of the exchange offer or if old notes are submitted for a greater
principal amount than the holder desires to exchange, then such unaccepted or
not-exchanged old notes evidencing the unaccepted or not-exchanged portion will
be returned without expense to the tendering holder thereof as promptly as
practicable after the expiration or termination of the exchange offer.

CONDITIONS TO THE EXCHANGE OFFER

     We will determine all questions as to the validity, form, eligibility
(including time of receipt), acceptance and withdrawal of the tendered old notes
at our discretion. Our determination will be final and binding. We may reject
any and all old notes which are not properly tendered or any old notes of which
our acceptance would, in the opinion of our counsel, be unlawful. We also may
waive any irregularities or conditions of tender as to particular old notes. Our
interpretation of the terms and conditions of the exchange offer (including the
instructions in the letter of transmittal) will be final and binding on all
parties. Unless waived, you must cure any defects or irregularities in
connection with tenders of old notes within such time as we shall determine.

     Although we intend to notify tendering holders of defects or irregularities
with respect to tenders of old notes, neither we nor anyone else has any duty to
do so. Neither we nor anyone else shall incur any liability for failure to give
such notification. Your old notes will not be deemed tendered until you have
cured or we have waived any irregularities. As soon as practicable following the
expiration date the exchange agent will return any old notes that we reject due
to improper tender or otherwise unless you cured all defects or irregularities
or we waive them.

     We reserve the right in our discretion, after consulting with PepsiCo:

     - to purchase or make offers for any old notes that remain outstanding
       subsequent to the expiration date;

     - to terminate the exchange offer, as set forth below; and

     - to the extent permitted by applicable law, to purchase old notes in the
       open market, in privately negotiated transactions or otherwise.

     The terms of any such purchases or offers may differ from the terms of the
exchange offer.

     We will not be required to accept for exchange, or to issue new notes for,
any old notes, and we may terminate or amend the exchange offer before the
acceptance of old notes if, in our judgment, after consulting with PepsiCo, any
of the following conditions has occurred or exists or has not been satisfied:

     - the exchange offer, or the making of any exchange by a holder of old
       notes, violates applicable interpretations of the staff of the SEC;

     - any person shall have initiated or threatened an action or proceeding in
       any court or by or before any governmental agency or body with respect to
       the exchange offer; or
                                        27
<PAGE>

     - any legislative or regulatory body shall have adopted or enacted any law,
       statute, rule or regulation that can reasonably be expected to impair our
       ability to proceed with the exchange offer.

     If we determine, after consulting with PepsiCo, that we may terminate the
exchange offer for any of these reasons, we may:

     - refuse to accept any old notes and return any old notes that have been
       tendered to the tendering holders;

     - extend the exchange offer and retain all old notes tendered prior to the
       expiration date of the exchange offer, subject to the rights of the
       holders of the tendered old notes to withdraw such old notes; or

     - waive such termination event with respect to the exchange offer and
       accept the properly tendered old notes that have not been withdrawn.

     If we, after consulting with PepsiCo, determine that such waiver
constitutes a material change in the exchange offer, we will promptly disclose
such change in a manner reasonably calculated to inform the holders of such
change and we will extend the exchange offer to the extent required by law.

     We may assert or waive any of these conditions in our discretion, after
consulting with PepsiCo.

PROCEDURES FOR TENDERING

     Registered holders of old notes, as well as beneficial owners who are
direct participants in DTC, who desire to participate in the exchange offer
should follow the directions set forth below and in the letter of transmittal.
All other beneficial owners should follow the instructions received from their
broker or nominee and should contact their broker or nominee directly, if the
instructions set forth below and in the letter of transmittal do not apply to
such beneficial owners.

  Registered Holders

     To tender in the exchange offer, a registered holder must complete, sign
and date the letter of transmittal, or facsimile thereof, have the signatures
thereon guaranteed if required by the letter of transmittal, and mail or
otherwise deliver such letter of transmittal or such facsimile to the exchange
agent prior to the expiration date. In addition, either

     - certificates for such holder's old notes must be received by the exchange
       agent along with the letter of transmittal; or

     - the holder must comply with the guaranteed delivery procedures described
       in "-- Guaranteed Delivery Procedures."

     To be tendered effectively, the letter of transmittal and other required
documents must be received by the exchange agent at the address set forth below
under "-- Exchange Agent" prior to the expiration date.

     The tender by a holder which is not withdrawn prior to the expiration date
will constitute an agreement between such holder and us in accordance with the
terms and subject to the conditions set forth herein and in the letter of
transmittal.

     The method of delivery of old notes, the letter of transmittal and all
other required documents to the exchange agent is at the election and risk of
the registered holder, but the delivery will be deemed made only when actually
received or confirmed by the exchange agent. Instead of delivery by mail, it is
recommended that registered holders use an overnight or hand delivery service.
In all cases, sufficient time should be allowed to assure delivery to the
exchange agent before the expiration date. No letter of transmittal or old notes
should be sent to us. Registered holders may request their respective brokers,
dealers, commercial banks, trust companies or nominees to effect the above
transactions for them.

                                        28
<PAGE>

     Signatures on a letter of transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by an eligible institution (as defined below)
unless the old notes tendered pursuant thereto are tendered:

     - by a registered holder who has not completed the box entitled, "Special
       Issuance Instructions" or "Special Delivery Instructions" on the letter
       of transmittal; or

     - for the account of an eligible institution.

     If signatures on a letter of transmittal or a notice of withdrawal, as the
case may be, are required to be guaranteed, such guarantor, which we refer to as
an eligible institution, must be a member firm of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.,
a commercial bank or trust company having an office or correspondent in the
United States or an "eligible guarantor institution" within the meaning of Rule
17Ad-15 under the Exchange Act.

     If the letter of transmittal is signed by a person other than the
registered holder of any old notes listed therein, such old notes must be
endorsed or accompanied by a properly completed bond power signed by such
registered holder as such registered holder's name appears on such old notes.

     If the letter of transmittal or any old notes or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and unless waived by us, evidence
satisfactory to us of their authority so to act must be submitted with the
letter of transmittal.

  DTC Participants

     Any financial institution that is a participant in DTC's systems may make
book-entry delivery of old notes by causing DTC to transfer such old notes into
the exchange agent's account at DTC in accordance with DTC's procedures for
transfer. Such delivery must be accompanied by either:

     - the letter of transmittal or facsimile thereof, with any required
       signature guarantees; or

     - an agent's message (as hereinafter defined),

and any other required documents, and must, in any case, be transmitted to and
received by the exchange agent at the address set forth below under "-- Exchange
Agent" prior to the expiration date or the guaranteed delivery procedures
described below must be complied with. Unless already established, the exchange
agent will make a request to establish an account with respect to the old notes
at DTC for purposes of the exchange offer within two business days after the
date of this prospectus.

     Subject to the establishment of the account, any financial institution that
is a participant in DTC's system may make book-entry delivery of old notes by
causing DTC to transfer them into the exchange agent's account with respect to
old notes. Each institution must do this in accordance with DTC's Automated
Tender Offer Program procedures for such transfer. However, the exchange agent
will only exchange the old notes so tendered after a timely confirmation of
their book-entry transfer into the exchange agent's account, and timely receipt
of an agent's message and any other documents required by the letter of
transmittal.

     The term "agent's message" means a message, transmitted by DTC, and
received by, the exchange agent and forming part of the confirmation of a
book-entry transfer, which states that:

     - DTC has received an express acknowledgment from a participant tendering
       old notes stating the aggregate principal amount of old notes which have
       been tendered by such participant and that participant has received the
       letter of transmittal and agrees to be bound by its terms; and

     - we may enforce such agreement against the participant.

     Although you may effect delivery of old notes through DTC into the exchange
agent's account at DTC, you must provide the exchange agent a completed and
executed letter of transmittal with any required signature guarantee (or an
agent's message in lieu thereof) and all other required documents prior
                                        29
<PAGE>

to the expiration date. If you comply with the guaranteed delivery procedures
described below, you must provide the letter of transmittal (or an agent's
message in lieu thereof) to the exchange agent within the time period provided.
Delivery of documents to DTC does not constitute delivery to the exchange agent.

GUARANTEED DELIVERY PROCEDURES

     If you wish to tender your old notes and:

          (a) your old notes are not immediately available;

          (b) you cannot deliver your old notes, the letter of transmittal or
     any other required documents to the exchange agent prior to the expiration
     date; or

          (c) you cannot complete the procedures for book-entry tender on a
     timely basis, you may instead effect a tender if:

             (1) you make the tender through an eligible institution;

             (2) prior to the expiration date, the exchange agent receives from
        such eligible institution a properly completed and duly executed notice
        of guaranteed delivery (by facsimile transmittal, mail or hand
        delivery), setting forth the name and address of the holder, certificate
        number(s) of such old notes (unless tender is to be made by book-entry
        transfer) and the principal amount of old notes tendered, stating that
        the tender is being made thereby and guaranteeing that, within three New
        York Stock Exchange trading days after the date of execution of the
        notice of guaranteed delivery, the certificates for all physically
        tendered old notes, in proper form for transmittal, together with a
        properly completed and duly executed letter of transmittal, or a
        confirmation of a book-entry transfer into the exchange agent's account
        at DTC together with a properly completed and duly executed letter of
        transmittal (or facsimile hereof or an agent's message in lieu thereof),
        and any other documents required by the letter of transmittal will be
        deposited by the eligible institution with the exchange agent; and

             (3) the certificates for all physically tendered old notes (or
        book-entry transfer confirmation) and/or all other documents referred to
        in clause (2) above must be received by the exchange agent within the
        time specified above.

     Upon request to the exchange agent, a notice of guaranteed delivery will be
sent to holders who wish to tender their old notes according to the guaranteed
delivery procedures set forth above.

WITHDRAWAL OF TENDERS

     Except as otherwise provided in this prospectus, holders of old notes may
withdraw their tenders at any time prior to 5:00 p.m., New York City time, on
the expiration date.

     To withdraw a tender of old notes in the exchange offer, a written or
facsimile transmission notice of withdrawal must be received by the exchange
agent at its address or its facsimile number set forth herein prior to 5:00
p.m., New York City time, on the expiration date. Any such notice of withdrawal
must:

     - specify the name of the person having deposited the old notes to be
       withdrawn;

     - identify the old notes to be withdrawn (including the certificate number,
       unless tendered by book-entry transfer);

     - be signed by the holder in the same manner as the original signature on
       the letter of transmittal by which such old notes were tendered
       (including any required signature guarantees); and

     - if old notes have been tendered pursuant to book-entry transfer, any
       notice of withdrawal must specify the name and number of the account at
       DTC to be credited with the withdrawn old notes and otherwise comply with
       the procedures of such facility, in which case a notice of withdrawal
       will be effective if delivered to the exchange agent by any method of
       delivery described in this paragraph.
                                        30
<PAGE>

     All questions as to the validity, form and eligibility (including time of
receipt) of such notice will be determined by us, after consulting with PepsiCo,
and our determination shall be final and binding on all parties. Any old notes
so withdrawn will be deemed not to have been validly tendered for purposes of
the exchange offer and will be returned to the holder thereof without cost to
such holder as soon as practicable after withdrawal. Properly withdrawn old
notes will not be deemed validly tendered for purposes of the exchange offer but
may be retendered by following one of the procedures described above under
"-- Procedures for Tendering" at any time prior to the expiration date.

EXCHANGE AGENT

     JPMorgan Chase Bank has been appointed as exchange agent for the exchange
offer. Delivery of the certificates evidencing the old notes, book-entry
confirmations, agent's messages, letters of transmittal, notices of guaranteed
delivery and any other required documents, questions and requests for
assistance, requests for additional copies of this prospectus or the letter of
transmittal and requests for the notice of guaranteed delivery should be
directed to the exchange agent addressed as follows:

<Table>
<S>                               <C>                           <C>
   By Facsimile Transmission      Overnight Courier or by Hand  By Registered or Certified Mail
         (214) 468-6494               JPMorgan Chase Bank             JPMorgan Chase Bank
(For Eligible Institutions Only)        ITS Bond Events                 ITS Bond Events
      Confirm by Telephone        2001 Bryan Street, 9th Floor            PO Box 2320
         (214) 468-6464               Dallas, Texas 75201             Dallas, Texas 75221
     Attention: Frank Ivins
</Table>

FEES AND EXPENSES

     We will bear the expenses of soliciting tenders. The principal solicitation
is being made by mail; however, we may make additional solicitations by
telecopier, telephone or in person by our officers and regular employees and
those of our affiliates.

     We have not retained any dealer-manager in connection with the exchange
offer and will not make any payments to broker-dealers or others soliciting
acceptances of the exchange offer. We will, however, pay the exchange agent
reasonable and customary fees for its services and reimburse it for its related
reasonable out-of-pocket expenses in connection therewith and will indemnify the
exchange agent for certain losses and claims incurred by it as a result of the
exchange offer. We may also pay brokerage houses and other custodians, nominees
and fiduciaries the reasonable out of pocket expenses incurred by them in
forwarding copies of this prospectus, letters of transmittal and related
documents to the beneficial owners of the old notes and in handling or
forwarding tenders for exchanges.


     Our expenses in connection with the exchange offer are estimated in the
aggregate to be approximately $395,000 and include, among other things:


     - SEC registration fees;

     - fees and expenses of the exchange agent and the trustee;

     - accounting and legal fees and printing costs; and

     - related fees and expenses.


     In addition, PepsiCo estimates that it will incur approximately $75,000 of
accounting and legal fees in connection with the exchange offer.


TRANSFER TAXES

     We will pay all transfer taxes, if any, applicable to the exchange of old
notes in the exchange offer. The tendering holder, however, will be required to
pay any transfer taxes (whether imposed on the registered holder or any other
person) if:

     - tendered old notes are registered in the name of any person other than
       the person signing the letter of transmittal; or

                                        31
<PAGE>

     - any transfer tax is imposed for any reason other than the exchange of old
       notes in the exchange offer.

     If you do not submit satisfactory evidence of payment of taxes for which
you are liable or exemption from them with your letter of transmittal, we will
bill you for the amount of these transfer taxes directly.

CONSEQUENCES OF FAILURE TO EXCHANGE

     Holders of old notes who do not exchange their old notes for new notes in
the exchange offer will remain subject to the restrictions on transfer
applicable to the old notes as set forth in the offering circular distributed in
connection with the private offering of the old notes and certain rights under
the registration rights agreement will terminate.

     In general, you may not offer or sell the old notes unless they are
registered under the Securities Act, or if the offer or sale is exempt from
registration under, or is not subject to, the securities act and applicable
state securities laws. Except as required by the registration rights agreement,
we do not intend to register resales of the old notes under the Securities Act.
Based on interpretations of the staff of the SEC, new notes issued in the
exchange offer may be offered for resale, resold or otherwise transferred by
their holders (other than any such holder that is an "affiliate" of ours or
PepsiCo's within the meaning of Rule 405 under the Securities Act) without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such holders acquired the new notes in the
ordinary course of the holders' business and the holders have no arrangement or
understanding with respect to the distribution of the new notes to be acquired
in the exchange offer. Any holder who tenders in the exchange offer for the
purpose of participating in a distribution of the new notes:

     - will not be able to rely on the applicable interpretations of the SEC;
       and

     - must comply with the registration and prospectus delivery requirements of
       the Securities Act in connection with any secondary resale transaction of
       the new notes.

     After the exchange offer is consummated, if you continue to hold any old
notes, you may have difficulty selling them because there will be fewer old
notes outstanding. In addition, if a large amount of old notes is not tendered
or is tendered improperly, the limited amount of new notes that would be issued
and outstanding after we consummate the exchange offer could adversely affect
the liquidity and the market price of the new notes.

ACCOUNTING TREATMENT

     We will record the new notes in our accounting records at the same carrying
value as the old notes, as reflected in our accounting records on the date of
exchange. Accordingly, we will not recognize any gain or loss for accounting
purposes in connection with the exchange offer. We will capitalize the expenses
of the exchange offer for accounting purposes. We will classify these expenses
as deferred financing costs and include them in other assets on our balance
sheet. We will amortize these expenses on the interest yield method over the
life of the new notes.

OTHER

     Participation in the exchange offer is voluntary and you should carefully
consider whether or not to participate. You are urged to consult your financial
and tax advisors in making your own decision on what action to take.

     We may in the future seek to acquire untendered old notes in open market or
privately negotiated transactions, through subsequent exchange offers or
otherwise. We have no present plans to acquire any old notes that are not
tendered in the exchange offer or to file a registration statement to permit
resales of any untendered old notes.

     All notices regarding the new notes, the beginning of the exchange offer
and the result of the exchange offer will be published in an authorized
newspaper in Luxembourg, which is expected to be the Luxemburger Wort.
                                        32
<PAGE>

                       SELECTED HISTORICAL FINANCIAL DATA

BOTTLING LLC


     The following table sets forth our selected historical financial data: (a)
as of and for each of the five fiscal years ended December 28, 2002 and (b) as
of March 23, 2002 and March 22, 2003 and for each of the 12-week periods then
ended. The selected historical financial data as of and for each of the five
fiscal years ended December 28, 2002 have been derived from our audited
consolidated financial statements. The selected historical financial data as of
and for the 12-week periods ended March 23, 2002 and March 22, 2003 have been
derived from our unaudited condensed consolidated financial statements and
include all adjustments, consisting only of normal recurring adjustments, which
are, in our opinion, necessary for a fair presentation of our financial position
at such dates and the results of operations for such periods. The results of
operations for the 12-week period ended March 22, 2003 are not necessarily
indicative of the results for the full year, especially in view of the
seasonality of our business. You should read the following financial information
with our historical consolidated financial statements and notes thereto
incorporated by reference in this prospectus.



<Table>
<Caption>
                                             FISCAL YEAR ENDED                        12-WEEKS ENDED
                            ----------------------------------------------------   ---------------------
                            DEC. 26,   DEC. 25,   DEC. 30,   DEC. 29,   DEC. 28,   MARCH 23,   MARCH 22,
                            1998(1)    1999(1)    2000(2)      2001       2002       2002        2003
                            --------   --------   --------   --------   --------   ---------   ---------
                                    (IN MILLIONS, EXCEPT FOR RATIO OF EARNINGS TO FIXED CHARGES)
<S>                         <C>        <C>        <C>        <C>        <C>        <C>         <C>
STATEMENT OF OPERATIONS
  DATA:
Net revenues(3)...........  $ 7,041     $7,505     $7,982    $ 8,443    $ 9,216     $1,772      $ 1,874
Cost of sales(3)..........    4,181      4,296      4,405      4,580      5,001        942          927
                            -------     ------     ------    -------    -------     ------      -------
Gross profit(3)...........    2,860      3,209      3,577      3,863      4,215        830          947
Selling, delivery and
  administrative
  expenses(3).............    2,583      2,813      2,986      3,185      3,318        695          828
Unusual impairment and
  other charges and
  credits(4)..............      222        (16)        --         --         --         --           --
                            -------     ------     ------    -------    -------     ------      -------
Operating income(3).......       55        412        591        678        897        135          119
Interest expense..........      166        140        136        132        131         30           38
Interest income...........        9         11         47         54         33          7            6
Other non-operating
  expenses, net...........       26          1          1         --          7         --            3
Minority interest.........        4          5          8         14          9          1           --
                            -------     ------     ------    -------    -------     ------      -------
Income (loss) before
  income taxes............     (132)       277        493        586        783        111           84
Income tax expense
  (benefit)(5)............       (1)         4         22         (1)        49          4            8
                            -------     ------     ------    -------    -------     ------      -------
Income (loss) before
  cumulative effect of
  change in accounting
  principle...............     (131)       273        471        587        734        107           76
Cumulative effect of
  change in accounting
  principle, net of
  tax(3)..................       --         --         --         --         --         --            6
                            -------     ------     ------    -------    -------     ------      -------
Net income (loss)(3)......  $  (131)    $  273     $  471    $   587    $   734     $  107      $    70
                            =======     ======     ======    =======    =======     ======      =======
</Table>


                                        33
<PAGE>


<Table>
<Caption>
                                             FISCAL YEAR ENDED                        12-WEEKS ENDED
                            ----------------------------------------------------   ---------------------
                            DEC. 26,   DEC. 25,   DEC. 30,   DEC. 29,   DEC. 28,   MARCH 23,   MARCH 22,
                            1998(1)    1999(1)    2000(2)      2001       2002       2002        2003
                            --------   --------   --------   --------   --------   ---------   ---------
                                    (IN MILLIONS, EXCEPT FOR RATIO OF EARNINGS TO FIXED CHARGES)
<S>                         <C>        <C>        <C>        <C>        <C>        <C>         <C>
OTHER FINANCIAL DATA:
Net cash provided by
  operations..............  $   727     $  888     $  974    $ 1,073    $ 1,107     $  176      $   104
Net cash used for
  investments.............   (1,022)      (973)      (800)      (949)    (1,836)      (219)        (245)
Net cash provided by (used
  for) financing..........      244        244        (42)      (173)       677        (20)          33
Capital expenditures......     (507)      (560)      (515)      (593)      (623)      (110)        (112)
Ratio of earnings to fixed
  charges(6)..............       --(7)    2.76       4.31       5.09       6.21       4.30         2.95
BALANCE SHEET DATA (AT
  PERIOD END):
Total assets..............  $ 7,227     $7,799     $8,228    $ 8,677    $10,907     $8,845      $10,860
Long-term debt
  Allocation of PepsiCo
     long-term debt(8)....    2,300         --         --         --         --         --           --
  Due to third parties....       61      2,284      2,286      2,299      3,535      2,342        2,532
                            -------     ------     ------    -------    -------     ------      -------
  Total long-term debt....    2,361      2,284      2,286      2,299      3,535      2,342        2,532
Minority interest.........      112        141        147        154         --        152           --
Accumulated other
  comprehensive loss......     (238)      (222)      (253)      (416)      (596)      (400)        (609)
Owners' equity............    3,283      3,928      4,321      4,596      5,186      4,738        5,245
</Table>


- ---------------

(1) Financial information for the periods prior to PBG's initial public offering
    in March 1999 has been carved out from PepsiCo's financial statements for
    the same periods based on the historical results of operations and the
    assets and liabilities of our business. Our financial information for these
    periods reflects some costs that may not necessarily be indicative of the
    costs that we would have incurred if we had operated as an independent,
    stand-alone entity during such periods.

(2) The 2000 fiscal year consisted of 53 weeks compared to 52 weeks in our
    normal fiscal year. The fifty-third week increased fiscal 2000 net revenues
    by an estimated $113 million and net income by an estimated $12 million.


(3) We adopted EITF Issue No. 02-16 beginning in our fiscal year 2003. In prior
    periods, we classified worldwide bottler incentives received from PepsiCo
    and other brand owners as adjustments to net revenues and selling, delivery
    and administrative expenses depending on the objective of the program. In
    accordance with EITF Issue No. 02-16, we have classified certain bottler
    incentives as a reduction of cost of sales beginning in 2003 and we also
    recorded a transition adjustment of $6 million, net of taxes, for the
    cumulative effect on prior years. This adjustment reflects the amount of
    bottler incentives that can be attributed to our 2003 beginning inventory
    balances. In accordance with EITF Issue No. 02-16, each of the five fiscal
    years ended December 28, 2002 and the 12-week period ended March 23, 2002
    have not been restated to reflect the adoption of EITF Issue No. 02-16.
    However, the pro-forma disclosures of the effects on prior periods are
    presented in the Supplemental Pro Forma Information section.



(4) Unusual impairment and other charges and credits were comprised of the
    following:


     - a $45 million non-cash compensation charge in the second quarter of 1999;

     - a $53 million vacation accrual reversal in the fourth quarter of 1999;

     - an $8 million restructuring reserve reversal in the fourth quarter of
       1999; and

                                        34
<PAGE>

     - a $222 million charge related to the restructuring of our Russian
       bottling operations and the separation of Pepsi-Cola North America's
       concentrate and bottling organizations in the fourth quarter of 1998.


(5) Results for the fiscal year ended December 29, 2001 included Canadian tax
    law change benefits of $25 million.



(6) We have calculated our ratio of earnings to fixed charges by dividing
    earnings by fixed charges. For this purpose, earnings are before taxes and
    minority interest, plus fixed charges (excluding capitalized interest) and
    losses recognized from equity investments, reduced by undistributed income
    from equity investments. Fixed charges include interest expense, capitalized
    interest and one-third of net rent expense, which is the portion of rent
    deemed representative of the interest factor. Since our formation in 1999,
    we have distributed, and in the future we intend to distribute, pro rata to
    our members sufficient cash so that the aggregate amount of cash distributed
    to PBG will enable it to pay its taxes and make interest payments on its $1
    billion principal amount of 7% senior notes due 2029. Such distributions are
    not included in the calculation of fixed charges. Total distributions to our
    members in 2000, 2001 and 2002 were $45 million, $223 million and $156
    million, respectively.



(7) As a result of the losses incurred in the fiscal year ended December 26,
    1998, we were unable to fully cover fixed charges. Earnings did not cover
    fixed charges by $124 million in fiscal 1998.



(8) For the periods prior to the initial public offering of PBG and prior to our
    issuance of $1.3 billion of 5 5/8% senior notes and $1.0 billion of 5 3/8%
    senior notes on February 9, 1999, $2.3 billion of our long-term debt was
    allocated to us from PepsiCo.


SUPPLEMENTAL PRO FORMA INFORMATION


  SFAS 142



     Effective the first day of fiscal year 2002, in accordance with SFAS 142,
we no longer amortize goodwill and certain franchise rights, but evaluate them
for impairment annually. We have completed our annual impairment review and have
determined that our intangible assets were not impaired.



     The following table provides pro forma disclosure of the elimination of
goodwill and certain franchise rights amortization in 2000 and 2001, as if SFAS
142 had been adopted in 2000:



<Table>
<Caption>
                                                               FISCAL YEAR ENDED
                                                              -------------------
                                                              DEC. 30,   DEC. 29,
                                                                2000       2001
                                                              --------   --------
                                                                 (IN MILLIONS)
<S>                                                           <C>        <C>
Reported net income.........................................    $471       $587
  Add back: Goodwill amortization, net of tax...............      37         35
  Add back: Franchise rights amortization, net of tax.......      86         88
                                                                ----       ----
Adjusted net income.........................................    $594       $710
                                                                ====       ====
</Table>



  EITF Issue No. 02-16



     In January 2003, the EITF reached a consensus on Issue No. 02-16 addressing
the recognition and income statement classification of various cash
consideration given by a vendor to a customer. The consensus requires that
certain cash consideration received by a customer from a vendor are presumed to
be a reduction of the price of the vendor's products, and therefore should be
characterized as a reduction of cost of sales when recognized in the customer's
income statement, unless certain criteria are met. EITF Issue No. 02-16 became
effective beginning in our fiscal year 2003. In prior periods we classified
worldwide bottler incentives received from PepsiCo and other brand owners as
adjustments to net revenues and selling, delivery and administrative expenses
depending on the objective of the program. In accordance with EITF Issue No.
02-16, we have classified certain bottler incentives as a reduction of cost of
sales beginning in 2003. We have recorded a transition adjustment of $6 million,
net of taxes, for the cumulative effect on prior years. This adjustment reflects
the amount of bottler incentives that can be attributed to our 2003 beginning
inventory balances. This accounting change did not have a material effect on our
income


                                        35
<PAGE>


before cumulative effect of change in accounting principle in the first 12-week
period of 2003 and is not expected to have a material effect on such amounts for
the balance of fiscal 2003.



     The following pro forma information summarizes our consolidated statements
of operations to reflect the adoption of EITF Issue No. 02-16 as if it had been
in effect for all periods presented:



<Table>
<Caption>
                                                FISCAL YEAR ENDED                        12-WEEKS ENDED
                               ----------------------------------------------------   ---------------------
                               DEC. 26,   DEC. 25,   DEC. 30,   DEC. 29,   DEC. 28,   MARCH 23,   MARCH 22,
                                 1998       1999       2000       2001       2002       2002        2003
                               --------   --------   --------   --------   --------   ---------   ---------
                                                              (IN MILLIONS)
<S>                            <C>        <C>        <C>        <C>        <C>        <C>         <C>
Net revenues.................   $6,793     $7,242     $7,706     $8,165     $8,926     $1,713      $1,874
Cost of sales................    3,736      3,830      3,934      4,112      4,510        847         927
Selling, delivery and
  administrative expenses....    2,780      3,016      3,181      3,375      3,519        732         828
Operating income.............       55        412        591        678        897        134         119
Net income...................   $ (131)    $  273     $  471     $  587     $  734     $  106      $   76
</Table>


                                        36
<PAGE>

PEPSICO


     The following table sets forth PepsiCo's selected historical financial
data: (a) as of and for each of the five fiscal years ended December 28, 2002
and (b) as of March 23, 2002 and March 22, 2003 and for each of the 12-week
periods then ended. The selected historical financial data as of and for each of
the five fiscal years ended December 28, 2002 have been derived from PepsiCo's
audited consolidated financial statements, except for net sales for 1998 and
1999, which have been restated to reflect the adoption of EITF 01-9, and
long-term debt as of December 26, 1998, which has been derived from PepsiCo's
unaudited consolidated financial information. The selected historical financial
data as of and for the 12-week periods ended March 23, 2002 and March 22, 2003
have been derived from PepsiCo's unaudited condensed consolidated financial
statements and include all adjustments, consisting only of normal recurring
adjustments, which are, in PepsiCo's opinion, necessary for a fair presentation
of PepsiCo's financial position at such dates and results of operation for such
periods. The results of operations for the 12-week period ended March 22, 2003
are not necessarily indicative of the results for the full year, especially in
view of the seasonality of PepsiCo's business. In 2001, PepsiCo merged with
Quaker in a transaction accounted for as a pooling of interests. Prior year
results have been restated to reflect the transaction, except for cash dividends
per common share, which reflect those of pre-merger PepsiCo prior to the
effective date of the merger. As a result of the bottling deconsolidation in
1999, the Tropicana acquisition late in 1998, the consolidation of Snack
Ventures Europe in 2002, and the items discussed below, PepsiCo's financial
statements that include these periods may not be fully comparable with prior
periods. You should read the following financial information with PepsiCo's
historical consolidated financial statements and notes thereto incorporated by
reference in this prospectus.



<Table>
<Caption>
                                              FISCAL YEAR ENDED                              12-WEEKS ENDED
                        --------------------------------------------------------------   -----------------------
                         DEC. 26,     DEC. 25,     DEC. 30,     DEC. 29,     DEC. 28,    MARCH 23,    MARCH 22,
                        1998(1)(2)   1999(1)(3)   2000(1)(4)   2001(1)(5)    2002(5)      2002(5)      2003(5)
                        ----------   ----------   ----------   ----------   ----------   ----------   ----------
                                        (IN MILLIONS, EXCEPT PER SHARE AMOUNTS AND
                                            RATIO OF EARNINGS TO FIXED CHARGES)
<S>                     <C>          <C>          <C>          <C>          <C>          <C>          <C>
Net sales.............   $24,605      $22,183      $22,337      $23,512      $25,112      $ 5,311        5,530
Net income............     2,278        2,505        2,543        2,662        3,313          689          777
Income per common
  share -- basic......      1.27         1.41         1.45         1.51         1.89         0.39         0.45
Income per common
  share -- diluted....      1.23         1.38         1.42         1.47         1.85         0.38         0.45
Cash dividends
  declared per common
  share(6)............     0.515        0.535        0.555        0.575        0.595        0.145         0.15
Total assets (at
  period end).........    25,170       19,948       20,757       21,695       23,474       22,611       23,238
Long-term debt (at
  period end).........     4,823        3,527        3,009        2,651        2,187        2,276        2,202
Ratio of earnings to
  fixed charges(7)....      6.03         9.82        11.91        15.21        19.92        22.67        21.20
</Table>



- ---------------



(1) Includes other impairment and restructuring charges of $482 million ($379
    million after-tax or $0.21 per share) in 1998, $73 million ($45 million
    after-tax or $0.02 per share) in 1999, $184 million ($111 million after-tax
    or $0.06 per share) in 2000 and $31 million ($19 million after-tax or $0.01
    per share) in 2001.


(2) Includes a tax benefit of $494 million (or $0.27 per share) related to final
    agreement with the Internal Revenue Service to settle a case related to
    concentrate operations in Puerto Rico.


(3) Includes a net gain on bottling transactions of $1.0 billion ($270 million
    after-tax or $0.15 per share), a tax provision related to the PepCom
    bottling transaction of $25 million (or $0.01 per share), and a Quaker
    favorable tax adjustment of $59 million (or $0.03 per share).


(4) The 2000 fiscal year consisted of 53 weeks compared to 52 weeks in PepsiCo's
    normal fiscal year. The fifty-third week increased 2000 net sales by an
    estimated $294 million and net income by an estimated $44 million (or $0.02
    per share).


                                        37
<PAGE>


(5) Includes Quaker merger-related costs of $356 million ($322 million after-tax
    or $0.18 per share) in 2001, $224 million ($190 million after-tax or $0.11
    per share) in 2002, $36 million ($30 million after-tax or $0.02 per share)
    for the 12-week period ended March 23, 2002 and $11 million ($10 million
    after-tax) for the 12-week period ended March 22, 2003.


(6) Prior to the effective date of PepsiCo's merger with Quaker on August 1,
    2001, cash dividends per common share are those of pre-merger PepsiCo.


(7) The ratio of earnings to fixed charges is calculated by dividing earnings by
    fixed charges. For this purpose, earnings principally reflect income before
    taxes excluding the results of minority-owned equity investments, minority
    interest income, interest expense and an estimate of the interest portion of
    rent expense. In addition, earnings are adjusted to include 100% of the
    losses of majority-owned equity investments and dividends from
    minority-owned equity investments. Fixed charges principally include
    interest expense and an estimate of the interest portion of rent expense.


SUPPLEMENTAL PRO FORMA INFORMATION

     PepsiCo adopted SFAS 142 in 2002. As a result of this adoption,
amortization ceased for nonamortizable intangibles and the remaining useful
lives of certain amortizable intangibles were reduced.

     The following reflects the impact that SFAS 142 would have had on the
results of the prior periods indicated below if SFAS 142 had been in effect for
such periods.


<Table>
<Caption>
                                                                     FISCAL YEAR ENDED
                                                              -------------------------------
                                                              DEC. 30, 2000    DEC. 29, 2001
                                                              --------------   --------------
                                                              (IN MILLIONS, EXCEPT PER SHARE
                                                                         AMOUNTS)
<S>                                                           <C>              <C>
Reported net income.........................................      $2,543           $2,662
  Cease goodwill amortization...............................         112              112
  Adjust brands amortization................................         (22)             (67)
  Cease equity investee goodwill amortization...............          61               57
                                                                  ------           ------
Adjusted net income.........................................      $2,694           $2,764
                                                                  ======           ======
Reported earnings per common share -- diluted...............      $ 1.42           $ 1.47
  Cease goodwill amortization...............................        0.06             0.06
  Adjust brands amortization................................       (0.01)           (0.03)
  Cease equity investee goodwill amortization...............        0.03             0.03
                                                                  ------           ------
Adjusted earnings per common share -- diluted...............      $ 1.50           $ 1.53
                                                                  ======           ======
</Table>



     The impact on basic earnings per common share is the same as the diluted
earnings per common share amounts reported above.


                                        38
<PAGE>

                                    BUSINESS

                              BOTTLING GROUP, LLC

INTRODUCTION


     We are the principal operating subsidiary of PBG and conduct substantially
all of the operations, and own or lease, directly or indirectly, substantially
all of the assets of PBG. We are the world's largest manufacturer, seller and
distributor of carbonated and non-carbonated Pepsi-Cola beverages. The brands we
sell are some of the best recognized trademarks in the world and include
Pepsi-Cola, Mountain Dew, Diet Pepsi, Aquafina, Lipton Brisk, Mountain Dew Code
Red, Sierra Mist, SoBe, Dole, Mug, Diet Mountain Dew, Pepsi Twist, Starbucks
Frappuccino and, outside the United States, Pepsi-Cola, Mirinda, 7 UP, KAS,
Electropura, Aqua Minerale, Manzanita Sol, Squirt, Garci Crespo, Fiesta, Pepsi
Light, IVI, Yedigun, and Fruko. In some of our United States territories, we
also have the right to manufacture, sell and distribute soft drink products of
other companies, including Dr Pepper and All Sport. We have the exclusive right
to manufacture, sell and distribute Pepsi-Cola beverages in all or a portion of
41 states and the District of Columbia in the United States, nine Canadian
provinces, Spain, Greece, Russia, Turkey and, since our acquisition of Gemex,
Mexico. In the fiscal year ended December 28, 2002 and the 12-week period ended
March 22, 2003, approximately 82% and 80%, respectively, of our net revenues
were generated in the United States with the remaining 18% and 20%,
respectively, generated outside the United States. We have an extensive direct
store distribution system in the United States, Mexico and Canada. In Russia,
Spain, Greece and Turkey, we use a combination of direct store distribution and
distribution through wholesalers, depending on local marketplace considerations.



     We and PBG were formed by PepsiCo to effect the separation in 1999 of most
of PepsiCo's company-owned bottling business from its brand ownership. PBG
became a publicly traded company on March 31, 1999. As of April 19, 2003,
PepsiCo owned approximately 38.6% of PBG's outstanding common stock and 100% of
PBG's outstanding class B common stock, together representing approximately
43.8% of the voting power of all classes of PBG's voting stock (with the balance
owned by the public). In conjunction with PBG's initial public offering and
other subsequent transactions, PepsiCo and PBG contributed bottling businesses
and assets used in the bottling business to us. As of April 19, 2003, PBG owned
approximately 93.2% of our membership interests and PepsiCo indirectly owned the
remainder of our membership interests.


RECENT DEVELOPMENTS


     On February 1, 2003, we completed an acquisition of a Pepsi-Cola bottler
based in Buffalo, New York for a purchase price of approximately $75 million.



     On November 5, 2002, we acquired approximately 99.8% of all of the
outstanding capital stock of Gemex, which was the largest bottler in Mexico and
the largest bottler outside the United States of Pepsi-Cola soft drink products
based on sales volume, through simultaneous tender offers in Mexico and the
United States. Following the offers, we funded a trust for the acquisition of
the balance of the outstanding capital stock and caused Gemex to carry out a
reverse stock split that eliminated for cash the outstanding capital stock held
by any remaining security holders other than us. Our total cost for the purchase
of Gemex was a net cash payment of $871 million and assumed debt of
approximately $305 million.



     Gemex was the largest bottler in Mexico and the largest bottler outside the
United States of Pepsi-Cola soft drink products based on sales volume. Gemex was
a Mexican holding company that, through its bottling and distribution
subsidiaries, produced, sold and distributed a variety of soft drink products
under the Pepsi-Cola, Pepsi Light, Pepsi Max, Pepsi Limon, Mirinda, 7UP, Diet
7UP, KAS, Mountain Dew, Power Punch and Manzanita Sol trademarks under exclusive
franchise and bottling arrangements with PepsiCo and certain affiliates of
PepsiCo.



     Gemex also had rights to produce, sell and distribute in Mexico soft drink
products of other companies, including tonic water, club soda and ginger ale
under the Seagram trademark. Gemex also produced, sold and distributed purified
and mineral water in Mexico under the trademarks Electropura and Garci Crespo.


                                        39
<PAGE>

PATENTS, TRADEMARKS, LICENSES AND FRANCHISES

     Our portfolio of beverage products includes some of the best recognized
trademarks in the world. The majority of our volume is derived from brands
licensed from PepsiCo or PepsiCo joint ventures.


     We conduct our business primarily pursuant to PBG's beverage agreements
with PepsiCo. Although we are not a direct party to these agreements, as the
principal operating subsidiary of PBG, we enjoy rights and are subject to
obligations under these agreements as described below. These agreements give us
the exclusive right to market, distribute and produce beverage products of
PepsiCo in authorized containers in specified territories.


     Set forth below is a description of PBG's beverage agreements with PepsiCo
and other bottling agreements from which we benefit and under which we are
obligated as the principal operating subsidiary of PBG.


     Master Bottling Agreement.  The master bottling agreement under which we
manufacture, package, sell and distribute the cola beverages bearing the
Pepsi-Cola and Pepsi trademarks in the U.S. was entered into in March 1999. The
master bottling agreement gives us the exclusive and perpetual right to
distribute cola beverages for sale in specified territories in authorized
containers of the nature currently used by us. The master bottling agreement
provides that we will purchase our entire requirements of concentrates for the
cola beverages from PepsiCo at prices, and on terms and conditions, determined
from time to time by PepsiCo. PepsiCo may determine from time to time what types
of containers to authorize for use by us. PepsiCo has no rights under the master
bottling agreement with respect to the prices at which we sell our products.


     Under the master bottling agreement, we are obligated to:


     - maintain such plant and equipment, staff, and distribution and vending
       facilities that are capable of manufacturing, packaging and distributing
       cola beverages in sufficient quantities to fully meet the demand for
       these beverages in our territories;


     - undertake adequate quality control measures prescribed by PepsiCo;

     - push vigorously the sale of the cola beverages in our territories;

     - increase and fully meet the demand for the cola beverages in our
       territories;

     - use all approved means and spend such funds on advertising and other
       forms of marketing beverages as may be reasonably required to meet the
       objective; and

     - maintain such financial capacity as may be reasonably necessary to assure
       performance under the master bottling agreement by us.


     The master bottling agreement requires us to meet annually with PepsiCo to
discuss plans for the ensuing year and the following two years. At such
meetings, we are obligated to present plans that set out in reasonable detail
our marketing plan, our management plan and advertising plan with respect to the
cola beverages for the year. We must also present a financial plan showing that
we have the financial capacity to perform our duties and obligations under the
master bottling agreement for that year, as well as sales, marketing,
advertising and capital expenditure plans for the two years following such year.
PepsiCo has the right to approve such plans, which approval shall not be
unreasonably withheld. PepsiCo approved our 2003 annual plan.


     If we carry out our annual plan in all material respects, we will be deemed
to have satisfied our obligations to push vigorously the sale of the cola
beverages, increase and fully meet the demand for the cola beverages in our
territories and maintain the financial capacity required under the master
bottling agreement. Failure to present a plan or carry out approved plans in all
material respects would constitute an event of default that, if not cured within
120 days of notice of the failure, would give PepsiCo the right to terminate the
master bottling agreement.

     The master bottling agreement provides that if we present a plan that
PepsiCo does not approve, such failure constitutes a primary consideration for
determining whether we have satisfied our obligations to

                                        40
<PAGE>

maintain our financial capacity, push vigorously the sale of the cola beverages
and increase and fully meet the demand for the cola beverages in our
territories.

     If we fail to carry out our annual plan in all material respects in any
segment of our territory, whether defined geographically or by type of market or
outlet, and if that failure is not cured within six months after notice of the
failure, PepsiCo may reduce the territory covered by the master bottling
agreement by eliminating the territory, market or outlet with respect to which
that failure has occurred.

     PepsiCo has no obligation to participate with us in advertising and
marketing spending, but it may contribute to these expenditures and undertake
independent advertising and marketing activities, as well as cooperative
advertising and sales promotion programs that would require our cooperation and
support. Although PepsiCo has advised us that it intends to continue to provide
cooperative advertising funds, it is not obligated to do so under the master
bottling agreement.

     The master bottling agreement provides that PepsiCo may in its sole
discretion reformulate any of the cola beverages or discontinue them, with some
limitations, so long as all cola beverages are not discontinued. PepsiCo may
also introduce new beverages under the Pepsi-Cola trademarks or any modification
thereof. If that occurs, we will be obligated to manufacture, package,
distribute and sell such new beverages with the same obligations as then exist
with respect to other cola beverages. We are prohibited from producing or
handling cola products, other than those of PepsiCo, or products or packages
that imitate, infringe or cause confusion with the products, containers or
trademarks of PepsiCo. The master bottling agreement also imposes requirements
with respect to the use of PepsiCo's trademarks, authorized containers,
packaging and labeling.

     If we acquire control, directly or indirectly, of any bottler of cola
beverages, we must cause the acquired bottler to amend its bottling appointments
for the cola beverages to conform to the terms of the master bottling agreement.


     Under the master bottling agreement, PepsiCo has agreed not to withhold
approval for any acquisition of rights to manufacture and sell Pepsi trademarked
cola beverages within a specific area, currently representing approximately
12.6% of PepsiCo's U.S. bottling system in terms of volume, if we have
successfully negotiated the acquisition and, in PepsiCo's reasonable judgment,
satisfactorily performed our obligations under the master bottling agreement. We
have agreed not to acquire or attempt to acquire any rights to manufacture and
sell Pepsi trademarked cola beverages outside of that specific area without
PepsiCo's prior written approval.


     The master bottling agreement is perpetual, but may be terminated by
PepsiCo in the event of PBG's default. Events of default include:

     - PBG's insolvency, bankruptcy, dissolution, receivership or the like;


     - any disposition of any voting securities of one of PBG's bottling
       subsidiaries or substantially all of PBG's bottling assets without the
       consent of PepsiCo;


     - PBG's entry into any business other than the business of manufacturing,
       selling or distributing non-alcoholic beverages or any business which is
       directly related and incidental to such beverage business; and

     - any material breach under the master bottling agreement that remains
       uncured for 120 days after notice by PepsiCo.


     An event of default will also occur if any person or affiliated group
acquires any contract, option, conversion privilege, or other right to acquire,
directly or indirectly, beneficial ownership of more than 15% of any class or
series of PBG's voting securities without the consent of PepsiCo. As of February
21, 2003, to our knowledge, no shareholder of PBG, other than PepsiCo, held more
than 6.0% of PBG's common stock.


     PBG is prohibited from assigning, transferring or pledging the master
bottling agreement or any interest therein, whether voluntarily, or by operation
of law, including by merger or liquidation, without the prior consent of
PepsiCo.

                                        41
<PAGE>


     The master bottling agreement was entered into by PBG in the context of its
and our separation from PepsiCo and, therefore, its provisions were not the
result of arm's-length negotiations. Consequently, the agreement contains
provisions that are less favorable to PBG than the exclusive bottling
appointments for cola beverages currently in effect for independent bottlers in
the United States.



     Non-Cola Bottling Agreements.  The beverage products covered by the
non-cola bottling agreements are beverages licensed to PBG by PepsiCo and
include Mountain Dew, Diet Mountain Dew, Mountain Dew Code Red, Slice, Sierra
Mist, Fruitworks, Mug root beer and cream soda. The non-cola bottling agreements
contain provisions that are similar to those contained in the master bottling
agreement with respect to pricing, territorial restrictions, authorized
containers, planning, quality control, transfer restrictions, term, and related
matters. PBG's non-cola bottling agreements will terminate if PepsiCo terminates
the master bottling agreement. The exclusivity provisions contained in the
non-cola bottling agreement would prevent us from manufacturing, selling or
distributing beverage products that imitate, infringe upon, or cause confusion
with, the beverage products covered by the non-cola bottling agreements. PepsiCo
may also elect to discontinue the manufacture, sale or distribution of a
non-cola beverage and terminate the applicable non-cola bottling agreement upon
six months notice to PBG.



     PBG also has agreements with PepsiCo granting PBG exclusive rights to
distribute Aquafina, AMP and Dole in all of PBG's territories and SoBe in
certain specified territories. PBG has the right to manufacture Aquafina in
certain locations depending on the availability of appropriate equipment. The
distribution agreements contain provisions generally similar to those in the
master bottling agreement as to use of trademarks, trade names, approved
containers and labels and causes for termination. PBG recently obtained the
rights to sell and distribute Gatorade in Spain, Greece and Russia and in
certain limited channels of distribution in the U.S. Some of these beverage
agreements have limited terms and, in most instances, prohibit PBG from dealing
in similar beverage products.



     Master Syrup Agreement.  The master syrup agreement grants PBG the
exclusive right to manufacture, sell and distribute fountain syrup to local
customers in PBG's territories. The master syrup agreement also grants PBG the
right to act as a manufacturing and delivery agent for national accounts within
PBG's territories that specifically request direct delivery without using a
middleman. In addition, PepsiCo may appoint PBG to manufacture and deliver
fountain syrup to national accounts that elect delivery through independent
distributors. Under the master syrup agreement, PBG has the exclusive right to
service fountain equipment for all of the national account customers within
PBG's territories. The master syrup agreement provides that the determination of
whether an account is local or national is at the sole discretion of PepsiCo.



     The master syrup agreement contains provisions that are similar to those
contained in the master bottling agreement with respect to pricing, territorial
restrictions with respect to local customers and national customers electing
direct-to-store delivery only, planning, quality control, transfer restrictions
and related matters. The master syrup agreement has an initial term of five
years and is automatically renewable for additional five-year periods unless
PepsiCo terminates it for cause. PepsiCo has the right to terminate the master
syrup agreement without cause at the conclusion of the initial five-year period
or at any time during a renewal term upon 24 months' notice. In the event
PepsiCo terminates the master syrup agreement without cause, PepsiCo is required
to pay PBG the fair market value of PBG's rights thereunder.


     The master syrup agreement will terminate if PepsiCo terminates the master
bottling agreement.


     Country Specific Bottling Agreements.  The country specific bottling
agreements contain provisions similar to those contained in the master bottling
agreement and the non-cola bottling agreements and, in Canada, the master syrup
agreement with respect to authorized containers, planning, quality control,
transfer restrictions, term, causes for termination and related matters. These
bottling agreements differ from the master bottling agreement because, except
for Canada, they include both fountain syrup and non-fountain beverages. Certain
of these bottling agreements contain certain provisions that have been modified
to reflect the laws and regulations of the applicable country. For example, the
bottling agreements in Spain


                                        42
<PAGE>


do not contain a restriction on the sale and shipment of Pepsi-Cola beverages
into PBG's territory by others in response to unsolicited orders.


     Other U.S. Bottling Agreements.  PBG has also entered into bottling
agreements with other licensors of beverage products, including:


     - Cadbury Schweppes plc for Dr. Pepper, Schweppes, Canada Dry and Hawaiian
       Punch products;


     - The Pepsi/Lipton Tea Partnership for Lipton Brisk and Lipton's Iced Tea
       products;

     - The North American Coffee Partnership for Starbucks Frappuccino products;
       and


     - Monarch Beverage Company, Inc. for All Sport products.


     These bottling agreements contain provisions generally similar to those in
PBG's master bottling agreement with PepsiCo as to use of trademarks, trade
names, approved containers and labels, sales of imitations, and causes for
termination. Some of these beverage agreements have limited terms and, in most
instances, prohibit us from dealing in similar beverage products.

EMPLOYEES


     As of December 28, 2002, we employed approximately 65,000 full-time
workers, of whom approximately 29,500 were employed in the United States and
approximately 25,900 were employed in Mexico. Approximately 8,700 of our
full-time workers in the United States are union members and approximately
18,800 of our workers outside the United States are union members. We consider
relations with our employees to be good and have not experienced significant
interruptions of operations due to labor disagreements.


PROPERTIES


     As of December 28, 2002, we operated 95 soft drink production facilities
worldwide, of which 89 were owned and six were leased. In addition, one facility
used for the manufacture of soft drink packaging materials was operated by a PBG
joint venture in Turkey. Of our 532 distribution facilities, 360 were owned and
172 were leased. We believe that our bottling, canning and syrup filling lines
and our distribution facilities are sufficient to meet present needs. We also
lease headquarters office space in Somers, New York.



     We own or lease and operate approximately 39,900 vehicles, including
delivery trucks, delivery and transport tractors and trailers and other trucks
and vans used in the sale and distribution of our soft drink products. We also
own more than 1.5 million soft drink dispensing and vending machines.


     With a few exceptions, leases of plants in the United States and Canada are
on a long-term basis, expiring at various times, with options to renew for
additional periods. Most international plants are leased for various and usually
shorter periods, with or without renewal options. We believe that our properties
are in good operating condition and are adequate to serve our current
operational needs.


LEGAL PROCEEDINGS


     From time to time we are a party to various litigation matters incidental
to the conduct of our business. There is no pending or, to our best knowledge,
threatened legal proceeding to which we are a party that, in the opinion of
management, is likely to have a material adverse effect on our business or
future financial results.

                                        43
<PAGE>


                                 PEPSICO, INC.



PEPSICO DIVISIONS



     PepsiCo is a leading, global snack and beverage company. PepsiCo
manufactures, markets and sells a variety of salty, convenient, sweet and
grain-based snacks, carbonated and noncarbonated beverages and foods. Beginning
in 2003, PepsiCo combined the results of its North American beverage businesses
as PepsiCo Beverages North America, and its international food and beverage
businesses as PepsiCo International, to reflect operating and management
changes. PepsiCo is now organized in four divisions:



     - Frito-Lay North America,



     - PepsiCo Beverages North America,



     - Quaker Foods North America, and



     - PepsiCo International.



     PepsiCo's North American divisions operate in the United States and Canada.
PepsiCo's international divisions operate in over 175 countries, with its
largest operations in Mexico and the United Kingdom.



  Frito-Lay North America



     FLNA manufactures, markets, sells and distributes branded snacks. These
snacks include Lay's potato chips, Doritos flavored tortilla chips, Cheetos
cheese flavored snacks, Fritos corn chips, Tostitos tortilla chips, Ruffles
potato chips, Rold Gold pretzels, branded dips, Quaker Chewy granola bars,
Sunchips multigrain snacks, Grandma's cookies, Quaker Fruit & Oatmeal bars,
Quaker Quakes corn and rice cakes, Quaker rice cakes, Cracker Jack treats, and
Go Snacks. These branded products are sold to independent distributors and
retailers. FLNA's net sales were $8.6 billion in 2002 and $8.2 billion in 2001
and accounted for 34% of PepsiCo's total division net sales in each of those
years.



  PepsiCo Beverages North America



     PBNA manufactures, markets, and sells beverage concentrates, and sells
fountain syrups and finished goods, under the brands Pepsi, Mountain Dew, Sierra
Mist, Mug, Slice, FruitWorks, SoBe and Dole. PBNA manufactures, markets and
sells ready-to-drink tea and coffee products through joint ventures with Lipton
and Starbucks. PBNA sells concentrate and finished goods for these brands and
licenses the Aquafina water brand to its bottlers. The franchise bottlers sell
PepsiCo's brands as finished goods to independent distributors and retailers.
PBNA also manufactures, markets and sells Gatorade sports drinks, Tropicana Pure
Premium, Dole, Tropicana Season's Best and Tropicana Twister juices and juice
drinks and Propel fitness water. These branded products are sold to independent
distributors and retailers. PBNA's net sales were $7.2 billion in 2002 and $6.9
billion in 2001 and accounted for 29% of PepsiCo's total division net sales in
each of those years.



  Quaker Foods North America



     QFNA manufacturers, markets and sells cereals, rice, pasta and other
branded products. QFNA's products include Quaker oatmeal, Cap'n Crunch and Life
ready-to-eat cereals, Rice-A-Roni, Pasta Roni and Near East side dishes, Aunt
Jemima mixes and syrups and Quaker grits. These branded products are sold to
independent distributors and retailers. QFNA's net sales were $1.5 billion in
2002 and $1.4 billion in 2001 and accounted for 6% of PepsiCo's total division
net sales in each of those years.



  PepsiCo International



     PI manufactures, markets and sells beverage concentrates, fountain syrups
and finished goods under the brands Pepsi, 7UP, Mirinda, Mountain Dew, Gatorade
and Tropicana. Generally, PI's brands are sold to franchise bottlers. However,
in certain markets, PI operates bottling plants and distribution facilities. PI
also licenses Aquafina water brand to certain of its franchise bottlers. PI also
manufactures and sells many of the Frito-Lay and Quaker branded snacks sold in
North America as well as a number of leading snack brands including Sabritas,
Gamesa and Alegro brands in Mexico, Walkers and Wotsits brands in the


                                        44
<PAGE>


United Kingdom and Smith's brands in Australia. PI's net sales were $7.7 billion
in 2002 and $7.5 billion in 2001 and accounted for 31% of PepsiCo's total
division net sales in each of those years.



PEPSICO'S DISTRIBUTION NETWORK



     PepsiCo's products are brought to market through direct-store-delivery,
broker-warehouse and food service and vending distribution networks. The
distribution system used depends on customer needs, product characteristics, and
local trade practices.



  Direct-Store-Delivery



     PepsiCo and its bottlers operate direct-store-delivery systems that deliver
snacks and beverages directly to retail stores where the products are
merchandised by PepsiCo's employees or bottlers. Direct-store-delivery enables
PepsiCo to merchandise with maximum visibility and appeal. Direct-store-delivery
is especially well-suited for products that have high retail turnover and
respond to in-store promotion and merchandising.



  Broker-Warehouse Systems



     Some of PepsiCo's products are delivered from its warehouses to customer
warehouses and retail stores. These less costly systems generally work best for
products that are less fragile and perishable, have lower turnover, and are less
likely to be impulse purchases.



  Foodservice and Vending



     PepsiCo's foodservice and vending sales force distributes snacks, foods and
beverages to third-party foodservice and vending distributors and operators, and
through its bottlers. This distribution system supplies PepsiCo's products to
schools, businesses, stadiums, restaurants and similar locations.



PEPSICO'S BRANDS



     PepsiCo owns numerous valuable trademarks which are essential to its
worldwide businesses, including Alegro, AMP, Aquafina, Aunt Jemima, Cap'n
Crunch, Cheetos, Cracker Jack, Diet Pepsi, Doritos, Frito-Lay, Fritos,
Fruitworks, Gamesa, Gatorade, Golden Grain, Grandma's, Lay's, Life, Mirinda,
Mountain Dew, Mountain Dew Code Red, Mr. Green, Mug, Near East, Pasta Roni,
Pepsi, Pepsi Blue, Pepsi Max, Pepsi One, Pepsi Twist, Pepsi-Cola, Propel,
Quaker, Quaker Chewy, Quaker Quakes, Rice-A-Roni, Rold Gold, Ruffles, Sabritas,
7UP and Diet 7UP (outside the United States), Sierra Mist, Slice, Smith's, SoBe,
Sunchips, Tostitos, Tropicana, Tropicana Pure Premium, Tropicana Pure Tropics,
Tropicana Season's Best, Tropicana Twister, Walkers, Wild Cherry Pepsi and
Wotsits. Trademarks remain valid so long as they are used properly for
identification purposes, and PepsiCo emphasizes correct use of its trademarks.
PepsiCo has authorized, through licensing arrangements, the use of many of its
trademarks in such contexts as snack food joint ventures and beverage bottling
appointments. In addition, PepsiCo licenses the use of its trademarks on
promotional items for the primary purpose of enhancing brand awareness.



     PepsiCo either owns or has licenses to use a number of patents which relate
to some of its products, production processes and the design and operation of
various equipment used in its businesses. Some of these patents are licensed to
others.



EMPLOYEES



     As of December 28, 2002, PepsiCo employed, subject to seasonal variations,
approximately 142,000 people worldwide, including approximately 61,000 people
employed within the United States. PepsiCo believes that relations with its
employees are generally good.



PEPSICO'S PROPERTIES



     PepsiCo owns its corporate headquarters building in Purchase, New York.
Leases of plants in North America generally are on a long-term basis, expiring
at various times, with options to renew for additional periods. Most
international plants are leased for varying and usually shorter periods, with or
without


                                        45
<PAGE>


renewal options. PepsiCo's believes that its properties are in good operating
condition and are suitable for the purposes for which they are being used.



  Frito-Lay North America



     FLNA owns or leases approximately 50 food manufacturing and processing
plants and approximately 2,000 warehouses, distribution centers and offices,
including its headquarters building and a research facility in Plano, Texas.



  PepsiCo Beverages North America



     PBNA owns or leases approximately 10 manufacturing and processing plants
and approximately 30 distribution centers, warehouses and offices, including
Tropicana's corporate office space in Bradenton, Florida. Licensed bottlers in
which PepsiCo has an ownership interest own or lease approximately 70 bottling
plants.



  Quaker Foods North America



     QFNA owns or leases approximately 10 manufacturing plants and distribution
centers in North America.



  PepsiCo International



     PI owns or leases approximately 150 manufacturing and bottling plants and
approximately 1,300 warehouses, distribution centers and offices outside of
North America.



SHARED PROPERTIES



     FLNA and QFNA share 2 plants that manufacture oat-based foods and snacks.
FLNA, QFNA and PBNA share approximately 20 distribution centers, warehouses and
offices in North America including a research and development laboratory in
Barrington, Illinois, and corporate office space in downtown Chicago, Illinois.



LEGAL PROCEEDINGS



     PepsiCo is subject to various claims and contingencies related to lawsuits,
taxes, environmental and other matters arising out of the normal course of
business. PepsiCo's management believes that the ultimate liability, if any, in
excess of amounts already recognized for such claims or contingencies is not
likely to have a material adverse effect on its results of operations, financial
condition or liquidity.


                                        46
<PAGE>

                                   MANAGEMENT

OUR EXECUTIVE OFFICERS AND MANAGING DIRECTORS


     Set forth below is information, as of March 25, 2003, with respect to our
executive officers and managing directors:



<Table>
<Caption>
NAME                                    AGE                  POSITION
- ----                                    ---                  --------
<S>                                     <C>   <C>
John T. Cahill........................  45    Principal Executive Officer and
                                              Managing Director
Alfred H. Drewes......................  47    Principal Financial Officer
Andrea L. Forster.....................  43    Principal Accounting Officer
Pamela C. McGuire.....................  55    Managing Director
Matthew M. McKenna....................  52    Managing Director
</Table>



     John T. Cahill is our Managing Director and Principal Executive Officer.
Mr. Cahill is also PBG's Chairman of the Board and Chief Executive Officer. He
has been PBG's Chief Executive Officer since September 2001. Previously, Mr.
Cahill served as PBG's President and Chief Operating Officer from August 2000 to
September 2001. Mr. Cahill has been a member of PBG's Board of Directors since
January 1999 and served as PBG's Executive Vice President and Chief Financial
Officer prior to becoming President and Chief Operating Officer in August 2000.
He was Executive Vice President and Chief Financial Officer of the Pepsi-Cola
Company from April 1998 until November 1998. Prior to that, Mr. Cahill was
Senior Vice President and Treasurer of PepsiCo, having been appointed to that
position in April 1997. In 1996, he became Senior Vice President and Chief
Financial Officer of Pepsi-Cola North America. Mr. Cahill joined PepsiCo in 1989
where he held several other senior financial positions through 1996.



     Alfred H. Drewes is our Principal Financial Officer. Mr. Drewes is also the
Senior Vice President and Chief Financial Officer of PBG. Appointed to this
position in June 2001, Mr. Drewes previously served as Senior Vice President and
Chief Financial Officer of PepsiCo Beverages International. Mr. Drewes joined
PepsiCo in 1982 as a financial analyst in New Jersey. During the next nine
years, he rose through increasingly responsible finance positions within
Pepsi-Cola North America in field operations and headquarters. In 1991, Mr.
Drewes joined PepsiCo Beverages International as Vice President of Manufacturing
Operations, with responsibility for the global concentrate supply organization.


     Andrea L. Forster is our Principal Accounting Officer. Ms. Forster is also
Vice President and Controller of PBG. In September 2000, Ms. Forster was also
named Corporate Compliance Officer for PBG. Following several years with
Deloitte Haskins and Sells, Ms. Forster joined PepsiCo in 1987 as a Senior
Analyst in External Reporting. She progressed through a number of positions in
the accounting and reporting functions and, in 1998, was appointed Assistant
Controller of the Pepsi-Cola Company. She was named Assistant Controller of PBG
in 1999.

     Pamela C. McGuire is our Managing Director. Ms. McGuire is also the Senior
Vice President, General Counsel and Secretary of PBG. Ms. McGuire joined PepsiCo
in 1977 and served as Vice President and Division Counsel of Pepsi-Cola Company
from 1989 to March 1998, when she was named Vice President and Associate General
Counsel of the Pepsi-Cola Company.

     Matthew M. McKenna is our Managing Director. Mr. McKenna is also the Senior
Vice President of Finance of PepsiCo. Previously he was Senior Vice President
and Treasurer of PepsiCo and before that, Senior Vice President, Taxes of
PepsiCo. Prior to joining PepsiCo in 1993, he was a partner with the law firm of
Winthrop, Stimson, Putnam & Roberts in New York.

                                        47
<PAGE>

PEPSICO'S EXECUTIVE OFFICERS AND DIRECTORS


     Set forth below is information, as of March 25, 2003, with respect to the
executive officers and directors of PepsiCo:



<Table>
<Caption>
NAME                                           AGE                    POSITION
- ----                                           ---                    --------
<S>                                            <C>   <C>
John F. Akers................................  68    Director
Robert E. Allen..............................  68    Director
David R. Andrews.............................  61    Senior Vice President, Government Affairs,
                                                     General Counsel and Secretary
Peter A. Bridgman............................  50    Senior Vice President and Controller
Abelardo E. Bru..............................  54    President and Chief Executive Officer,
                                                     Frito-Lay North America
Peter Foy....................................  62    Director
Ray L. Hunt..................................  59    Director
Arthur C. Martinez...........................  63    Director
Matthew M. McKenna...........................  52    Senior Vice President of Finance
Margaret D. Moore............................  55    Senior Vice President of Human Resources
Indra K. Nooyi...............................  48    President, Chief Financial Officer and
                                                     Director
Lionel L. Nowell III.........................  48    Senior Vice President and Treasurer
Franklin D. Raines...........................  54    Director
Steven S Reinemund...........................  54    Chairman and Chief Executive Officer
Sharon Percy Rockefeller.....................  58    Director
Gary M. Rodkin...............................  50    President and Chief Executive Officer,
                                                     PepsiCo Beverages and Foods North America
James J. Schiro..............................  57    Director
Franklin A. Thomas...........................  68    Director
Cynthia M. Trudell...........................  49    Director
Solomon D. Trujillo..........................  51    Director
Daniel Vasella...............................  49    Director
Michael D. White.............................  51    Chairman and Chief Executive Officer,
                                                     PepsiCo International
</Table>



     John F. Akers is the former Chairman of the Board and Chief Executive
Officer of International Business Machines Corporation, has been a member of
PepsiCo's Board since 1991 and is Chairman of its Compensation Committee. Mr.
Akers joined IBM in 1960 and was Chairman and Chief Executive Officer from 1986
until 1993. He is also a director of Hallmark Cards, Inc., Lehman Brothers
Holdings, Inc., The New York Times Company and W.R. Grace & Co.



     Robert E. Allen is the former Chairman of the Board and Chief Executive
Officer of AT&T Corp., has been a member of PepsiCo's Board since 1990 and is
Chairman of its Nominating and Corporate Governance Committee. He began his
career at AT&T in 1957 when he joined Indiana Bell. He was elected President and
Chief Operating Officer of AT&T in 1986, and was Chairman and Chief Executive
Officer from 1988 until 1997. He is also a director of Bristol-Myers Squibb
Company and WhisperWire and a Trustee of The Mayo Foundation and Wabash College.


     David R. Andrews became PepsiCo's Senior Vice President, Government
Affairs, General Counsel and Secretary in February 2002. Before joining PepsiCo,
Mr. Andrews was a partner in the law firm of McCutchen, Doyle, Brown & Enersen,
LLP, a position he held from 2000 to 2002 and from 1981 to 1997.

                                        48
<PAGE>

From 1997 to 2000, he served as the legal advisor to the U.S. Department of
State and former Secretary of State Madeleine Albright.


     Peter A. Bridgman has been Senior Vice President and Controller of PepsiCo
since August 2000. Mr. Bridgman began his career with PepsiCo at Pepsi-Cola
International in 1985 and became Chief Financial Officer for Central Europe in
1990. He became Senior Vice President and Controller for Pepsi-Cola North
America in 1992 and Senior Vice President and Controller for PBG in 1999.



     Abelardo E. Bru was appointed Chairman and Chief Executive Officer of
Frito-Lay North America in February 2003. Mr. Bru served as President and Chief
Executive Officer of Frito-Lay North America from 1999 to 2003 and as President
and General Manager of PepsiCo's Sabritas snack unit from 1992 to 1999. Mr. Bru
has served in various senior international positions with PepsiCo Foods
International since joining PepsiCo in 1976.



     Peter Foy is the Chairman of Whitehead Mann Group, an executive search firm
based in London, a position he has held since January 1, 2001. He was elected to
PepsiCo's Board in 1997. He is the former Chairman of Baring Brothers
International Ltd., the corporate finance section of ING Group's investment
bank. Mr. Foy joined McKinsey & Co., Inc. in 1968, became a director and head of
its U.K. Consumer Goods Practice in 1980, the managing director of McKinsey U.K.
in 1983, and was Senior Partner from 1990 until 1996. In 1996, he became
Chairman of Baring Brothers, a position he held until he retired in December
1998. Mr. Foy is also a director of P&O Princess Cruises plc and Safeway PLC.



     Ray L. Hunt is the Chairman and Chief Executive Officer of Hunt Oil Company
and Chairman, Chief Executive Officer and President of Hunt Consolidated, Inc.
and was elected to PepsiCo's Board in 1996. Mr. Hunt began his association with
Hunt Oil Company in 1958 and has held his current position since 1976. He is
also a director of Halliburton Company, Electronic Data Systems Corporation,
King Ranch, Inc. and Chairman of the Board of Directors of the Federal Reserve
Bank of Dallas.



     Arthur C. Martinez is the former Chairman of the Board, President and Chief
Executive Officer of Sears, Roebuck and Co., and was elected to PepsiCo's Board
in May 1999. Mr. Martinez was Chairman and Chief Executive Officer of the former
Sears Merchandise Group from 1992 to 1995 and served as Chairman of the Board,
President and Chief Executive Officer of Sears, Roebuck and Co. from 1995 until
2000. He served as Vice Chairman and a director of Saks Fifth Avenue from 1990
to 1992. Mr. Martinez is also a director of Liz Claiborne, Inc., International
Flavors and Fragrances, Inc. and Martha Stewart Living Omnimedia, Inc. Mr.
Martinez is a member of the Supervisory Board of ABN AMRO Holding, N.V.


     Matthew M. McKenna has been Senior Vice President of Finance of PepsiCo
since August 2001. Mr. McKenna began his career at PepsiCo as Vice President,
Taxes in 1993. In 1998, he became Senior Vice President, Taxes and served as
Senior Vice President and Treasurer from 1998 until 2001. Prior to joining
PepsiCo, he was a partner with the law firm of Winthrop, Stimson, Putnam &
Roberts in New York.

     Margaret D. Moore is Senior Vice President, Human Resources of PepsiCo, a
position she assumed at the end of 1999. From November 1998 to December 1999,
she was Senior Vice President and Treasurer of PBG. Prior to joining PBG, Ms.
Moore spent 25 years with PepsiCo in a number of senior financial and human
resources positions. She has been a director of PBG since January 2001.


     Indra K. Nooyi was elected to PepsiCo's Board and became President and
Chief Financial Officer in May 2001, after serving as Senior Vice President and
Chief Financial Officer since February 2000. Ms. Nooyi also served as Senior
Vice President, Strategic Planning and Senior Vice President, Corporate Strategy
and Development from 1994 until 2000. Prior to joining PepsiCo, Ms. Nooyi spent
four years as Senior Vice President of Strategy, Planning and Strategic
Marketing for Asea Brown Boveri, Inc. She was also Vice President and Director
of Corporate Strategy and Planning at Motorola, Inc. Ms. Nooyi is also a
director of Motorola, Inc.


                                        49
<PAGE>

     Lionel L. Nowell, III has been Senior Vice President and Treasurer of
PepsiCo since August 2001. Mr. Nowell joined PepsiCo as Senior Vice President
and Controller in 1999 and then became Senior Vice President and Chief Financial
Officer of PBG. Prior to joining PepsiCo, he was Senior Vice President, Strategy
and Business Development for RJR Nabisco, Inc. From 1991 to 1998, he served as
Chief Financial Officer of Pillsbury North America, and its Pillsbury
Foodservice and Haagen Dazs units, serving as Vice President and Controller of
the Pillsbury Company, Vice President of Food and International Retailing Audit
and Director of Internal Audit.

     Franklin D. Raines was elected to PepsiCo's Board in May 1999 and is
Chairman of its Audit Committee. Mr. Raines has been Chairman of the Board and
Chief Executive Officer of Fannie Mae since January 1999. He was Director of the
U.S. Office of Management and Budget from 1996 to 1998. From 1991 to 1996, he
was Vice Chairman of Fannie Mae and in 1998, he became Chairman and CEO-
Designate. Prior to joining Fannie Mae, Mr. Raines was a general partner at
Lazard Freres & Co., an investment banking firm. Mr. Raines is also a director
of AOL Time Warner Inc. and Pfizer Inc.


     Steven S Reinemund has been PepsiCo's Chairman and Chief Executive Officer
since May 2001. He was elected a director of PepsiCo in 1996 and, before
assuming his current position, served as President and Chief Operating Officer
of PepsiCo from September 1999 until May 2001. Mr. Reinemund began his career
with PepsiCo in 1984 as a senior operating officer of Pizza Hut, Inc. He became
President and Chief Executive Officer of Pizza Hut in 1986, and President and
Chief Executive Officer of Pizza Hut Worldwide in 1991. In 1992, Mr. Reinemund
became President and Chief Executive Officer of Frito-Lay, Inc., and Chairman
and Chief Executive Officer of the Frito-Lay Company in 1996.


     Sharon Percy Rockefeller was elected a director of PepsiCo in 1986. She is
President and Chief Executive Officer of WETA public stations in Washington,
D.C., a position she has held since 1989, and was a member of the Board of
Directors of WETA from 1985 to 1989. She is a member of the Board of Directors
of Public Broadcasting Service, Washington, D.C. and was a member of the Board
of Directors of the Corporation for Public Broadcasting until 1992. Mrs.
Rockefeller is also a director of Sotheby's Holdings, Inc.


     Gary M. Rodkin was appointed Chairman and Chief Executive Officer of
PepsiCo Beverages and Foods North America in February 2003. Mr. Rodkin became
President and Chief Executive Officer of PepsiCo Beverages and Foods North
America in 2002. He served as Chief Executive Officer of Pepsi-Cola North
America from 1999 to 2002. From 1995 to 1998, Mr. Rodkin was President of
Tropicana North America from 1995 to 1998 and became President and Chief
Executive Officer when PepsiCo acquired Tropicana in 1998.



     James J. Schiro was elected to PepsiCo's Board in January 2003. Mr. Schiro
became Chief Executive Officer of Zurich Financial Services in May 2002, after
serving as Chief Operating Officer -- Group Finance since March 2002. He joined
Price Waterhouse in 1967, where he held various management positions. In 1994 he
was elected Chairman and senior partner of Price Waterhouse, and in 1998 became
Chief Executive Officer of PricewaterhouseCoopers, after the merger of Price
Waterhouse and Coopers & Lybrand.



     Franklin A. Thomas was elected to PepsiCo's Board in 1994. From 1967 to
1977, he was President and Chief Executive Officer of the Bedford-Stuyvesant
Restoration Corporation. From 1977 to 1979, Mr. Thomas had a private law
practice in New York City. Mr. Thomas was President of the Ford Foundation from
1979 to April 1996 and is currently a consultant to the TFF Study Group, a
non-profit organization assisting development in southern Africa. He is also a
director of ALCOA Inc., Avaya Inc., Citigroup, Inc., Cummins, Inc. and Lucent
Technologies.



     Cynthia M. Trudell has been the President of Sea-Ray Group since 2001 and
was elected to PepsiCo's Board in January 2000. From 1999 until 2001, Ms.
Trudell served as General Motors' Vice President and Chairman and President of
Saturn Corporation, a wholly owned subsidiary of GM. Ms. Trudell began her
career with the Ford Motor Co. as a chemical process engineer. In 1981, she
joined GM and held various engineering and manufacturing supervisory positions.
In 1995, she became plant


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<PAGE>

manager at GM's Wilmington Assembly Center in Delaware. In 1996, she became
President of IBC Vehicles in Luton, England, a joint venture between General
Motors and Isuzu.


     Solomon D. Trujillo has been the Chief Executive Officer of Orange SA since
March 2003 and was elected to PepsiCo's Board in January 2000. Previously, Mr.
Trujillo was Chairman, Chief Executive Officer and President of Graviton, Inc.
from November 2000, Chairman of US WEST from May 1999, and President and Chief
Executive Officer of US West beginning in 1998. He served as President and Chief
Executive Officer of US WEST Communications Group and Executive Vice President
of US WEST from 1995 until 1998 and President and Chief Executive Officer of US
WEST Dex, Inc. from 1992 to 1995. Mr. Trujillo is also a director of Gannett
Company, Inc., Orange SA and Target Corporation.



     Daniel Vasella was elected to PepsiCo's Board in February 2002. Dr. Vasella
became Chairman of the Board and Chief Executive Officer of Novartis AG in 1999,
after serving as President since 1996. From 1992 to 1996, Dr. Vasella held the
positions of Chief Executive Officer, Chief Operating Officer, Senior Vice
President and Head of Worldwide Development and Head of Corporate Marketing at
Sandoz Pharma Ltd. He also served at Sandoz Pharmaceuticals Corporation from
1988 to 1992. Dr. Vasella is also a director of Credit Suisse Group.



     Michael D. White was appointed Chairman and Chief Executive Officer of
PepsiCo International in February 2003, after serving as President and Chief
Executive Officer of Frito-Lay's Europe/Africa/ Middle East division since 2000.
From 1998 to 2000, Mr. White was Senior Vice President and Chief Financial
Officer of PepsiCo. Mr. White has also served as Executive Vice President and
Chief Financial Officer of PepsiCo Foods International and Chief Financial
Officer of Frito-Lay North America. He joined Frito-Lay in 1990 as Vice
President of Planning.


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                   DESCRIPTION OF THE NOTES AND THE GUARANTEE

GENERAL

     We issued the old notes and will issue the new notes under an indenture
among us, as issuer, PepsiCo, as guarantor, and JPMorgan Chase Bank, as trustee.
The terms of the notes include those stated in the indenture and those made part
of the indenture by reference to the Trust Indenture Act of 1939, as amended, or
the Trust Indenture Act. The following summary of select provisions of the
indenture does not purport to be complete and is qualified in its entirety by
reference to the indenture, including the definitions in the indenture and the
Trust Indenture Act of some of the terms used below. A copy of the indenture is
filed as an exhibit to the registration statement filed by us and PepsiCo with
the SEC, of which this prospectus is a part. A copy of the indenture may, as
long as the notes are listed on the Luxembourg Stock Exchange, also be obtained
from our and PepsiCo's listing agent in Luxembourg.

     The notes are our general unsecured obligations and will rank on an equal
basis with all of our other existing and future senior unsecured indebtedness
and senior to all of our existing and future subordinated indebtedness.

     We may redeem the notes at our option at any time, in whole but not in
part, at the redemption price, as more fully described in "-- Optional
Redemption" below. There is no sinking fund for the notes.

     The indenture contains restrictive covenants with respect to us and our
restricted subsidiaries (as defined in "Certain Covenants -- Limitation on
Liens -- Definitions" below), including restrictions on creating or assuming
liens, restrictions on sale and lease-back transactions and restrictions on
consolidation, merger or transfer or lease of all or substantially all of our
assets, subject to the exceptions described below. These restrictive covenants
do not apply to PBG, and the indenture does not contain any provision that would
restrict PBG from creating or assuming liens, entering into sale and lease-back
transactions or engaging in a consolidation, merger or transfer or lease of all
or substantially all of PBG's assets.

     The indenture contains restrictive covenants with respect to PepsiCo's
ability to engage in mergers, consolidations or transfers of all or
substantially all of PepsiCo's assets, subject to the exceptions described
below. In addition, the indenture contains restrictive covenants with respect to
PepsiCo's and its restricted subsidiaries' ability to create or assume liens on
and after the guarantee commencement date (in the event such date occurs),
subject to the exceptions described below. The indenture does not contain any
provision that would restrict PepsiCo or any of its restricted subsidiaries from
entering into sale and lease-back transactions. The indenture does not contain a
cross-default provision with respect to any indebtedness of PepsiCo other than
PepsiCo's guarantee of the notes.

     The indenture does not contain any financial ratios or specified levels of
net worth or liquidity to which we or PepsiCo must adhere or any restrictions on
the amount of debt we or PepsiCo may issue or guarantee. The indenture does not
contain any provision that would require that we or PepsiCo repurchase, redeem
or otherwise modify the terms of any of the notes or the guarantee upon a change
in control or other event involving us, PBG or PepsiCo that may adversely affect
our or PepsiCo's creditworthiness or the value of the notes.


     The old notes have been listed, and on December 20, 2002 we applied to list
the new notes, on the Luxembourg Stock Exchange in accordance with the rules of
the Luxembourg Stock Exchange.


     Payment of principal of and interest and premium, if any, on the notes will
be unconditionally and irrevocably guaranteed on a senior unsecured basis by
PepsiCo, with such guarantee becoming effective on the guarantee commencement
date as described in "-- Guarantee," except that, under the circumstances
described in "-- Guarantee," PepsiCo's guarantee may not become effective or may
become effective as to less than all of the principal of and interest and
premium, if any, on the outstanding notes.

     The terms of PepsiCo's guarantee of the notes, including the scheduled
guarantee commencement date, are intended to preserve the structure of our and
PBG's separation from PepsiCo in March 1999. In connection with the separation,
PepsiCo guaranteed some of our indebtedness, including the 2004 notes.

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<PAGE>

PRINCIPAL, MATURITY AND INTEREST


     The old notes were issued in the aggregate principal amount of
$1,000,000,000 and the new notes will be issued in exchange for the old notes in
an aggregate principal amount of up to $1,000,000,000 and each will mature on
November 15, 2012. Each note will bear interest at the rate of 4 5/8% per annum.
We will pay interest on the new notes semi-annually in arrears on each May 15
and November 15, beginning November 15, 2003. Holders of new notes will receive
interest on November 15, 2003 from the date of initial issuance of the new
notes, plus an amount equal to the accrued, but unpaid, interest on the old
notes through the date of exchange.


     As a result of the making of, and upon acceptance for exchange of all
validly tendered old notes under the terms of, the exchange offer, we will have
fulfilled a covenant contained in the registration rights agreement and,
accordingly, we will not be obligated to pay an increased interest rate on the
old notes as described in the registration rights agreement. If you are a holder
of old notes and do not tender your old notes in the exchange offer, you will
continue to hold the old notes and you will be entitled to all the rights and
limitations applicable to the old notes in the indenture, except for any rights
under the registration rights agreement that by their terms terminate upon the
consummation of the exchange offer.


     Interest will be computed on the basis of a 360-day year comprising twelve
30-day months. If a payment date is not a business day, payment may be made on
the next succeeding day that is a business day, and interest will accrue for the
intervening period (and will be included in the next payment, if any). Principal
of and interest and premium, if any, on the notes will be payable at our office
or agency maintained for this purpose within New York City or, at our option,
payment of interest on the notes may be made by check mailed to the holders of
the notes at their respective addresses set forth in the register of holders of
notes. A holder of $10,000,000 or more in aggregate principal amount of notes
will be entitled to receive payments of interest, other than interest due at
maturity or the redemption date, if any, by wire transfer of immediately
available funds, provided that the trustee receives from that holder a written
request with appropriate wire transfer instructions no later than 15 calendar
days prior to the applicable interest payment date. Until we otherwise
designate, our office or agency in New York City will be the office of the
trustee maintained for this purpose. The old notes were, and the new notes will
be, issued in minimum denominations of $1,000 and integral multiples of $1,000
in excess thereof. The trustee initially will be a paying agent and registrar
under the indenture and J.P. Morgan Bank Luxembourg S.A. will be an additional
paying agent. We may act as paying agent or registrar under the indenture.


     Notwithstanding the foregoing paragraph, payments of principal of and
interest and premium, if any, with respect to notes represented by one or more
global notes will be made to DTC or the nominee of DTC, as the case may be, as
the registered owner thereof. Neither we, the trustee nor any paying agent for
the notes will have any responsibility or liability for any aspect of the
records relating to, or for payments made on account of, beneficial ownership
interests in a global note, or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests. We expect that,
immediately upon receipt of any payment of principal of and interest or premium,
if any, on the notes represented by a global note, DTC will credit each
participant's account with the amount of such payment that is proportionate to
its respective ownership interest in the principal amount of such global note
(as shown on the records of DTC). Payments by participants to persons who hold
beneficial interests in such global note through such participants will be the
responsibility of such participants. We refer you to "-- Depository Procedures"
below.

OPTIONAL REDEMPTION

     We will not be required to make mandatory redemption or sinking fund
payments prior to the maturity of the notes.

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<PAGE>

     We may redeem the notes at our option and in accordance with the provisions
of the indenture, at any time, in whole but not in part, on giving not less than
30 nor more than 60 days' notice prior to the maturity date at a redemption
price equal to the greater of:


     - 100% of the principal amount of the notes; or


     - as determined by one of the reference Treasury dealers appointed by the
       trustee after consultation with us, the sum of the present values of the
       remaining scheduled payments of principal of and interest on the notes
       from the redemption date to the maturity date discounted to the
       redemption date on a semi-annual basis (assuming a 360-day year
       consisting of twelve 30-day months) at a discount rate equal to the
       Treasury rate, as defined in the indenture, plus 15 basis points;

plus, in either of the above cases, accrued and unpaid interest on the notes to,
but not including, the redemption date.

     In the event that:

     - the redemption date is after the guarantee commencement date (in the
       event such date occurs);

     - PepsiCo's guarantee is for less than all of principal of and interest and
       premium, if any, on the notes; and

     - we default in the payment of the redemption price on the redemption date;
       then

the amount of payment of the redemption price each holder of the notes is
entitled to receive from PepsiCo under PepsiCo's guarantee will be limited to
the partial guarantee percentage of the redemption price payable on such
holder's notes as more fully described under "-- Guarantee -- Partial Guarantee"
below. A replacement note in the principal amount equal to the portion of the
principal of the note that was not redeemed because PepsiCo's guarantee was a
partial guarantee and because we defaulted in the payment of the redemption
price on the redemption date would be issued in the name of the holder of the
notes upon cancellation of the original note. Any such replacement notes would
not be guaranteed by PepsiCo and would be solely our obligation.

     The following are definitions of some terms used in the above description.
We refer you to the indenture for a full description of all of these terms, as
well as any other terms used herein for which no definition is provided.

     "Treasury rate" means, with respect to any redemption date for the notes:


     - the yield, under the heading that represents the average for the
       immediately preceding week, appearing in the most recently published
       statistical release designated "H.15(519)" or any successor publication
       that is published weekly by the Board of Governors of the Federal Reserve
       System and that establishes yields on actively traded United States
       Treasury securities adjusted to constant maturity under the caption
       "Treasury Constant Maturities," for the maturity corresponding to the
       comparable Treasury issue. If no maturity is within three months before
       or after the remaining term of the notes to be redeemed, yields for the
       two published maturities most closely corresponding to the comparable
       Treasury issue will be calculated, and the Treasury rate will be
       interpolated or extrapolated from such yields on a straight-line basis,
       rounding to the nearest month; or


     - if the foregoing statistical release (or any successor statistical
       release) is not published during the week preceding the date of
       calculation of the redemption price or does not contain such yields, the
       rate per annum equal to the semi-annual equivalent yield to maturity of
       the comparable Treasury issue, calculated using a price for the
       comparable Treasury issue (expressed as a percentage of its principal
       amount) equal to the comparable Treasury price for such redemption date.

     The Treasury rate will be calculated on the third business day preceding
the redemption date.

     "Comparable Treasury issue" means the United States Treasury security
selected by one of the reference Treasury dealers appointed by the trustee after
consultation with us as having a maturity
                                        54
<PAGE>

comparable to the remaining term of the notes that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the notes.

     "Comparable Treasury price" means, with respect to the redemption date for
the notes:

     - the average of four reference Treasury dealer quotations for the
       redemption date, after excluding the highest and lowest such reference
       Treasury dealer quotations; or

     - if the trustee obtains fewer than four such reference Treasury dealer
       quotations, the average of all such quotations.

     "Reference Treasury dealer" means Credit Suisse First Boston Corporation,
Deutsche Bank Securities Inc., Salomon Smith Barney Inc. and one other primary
U.S. Government securities dealer in New York City (each of which we refer to as
a primary Treasury dealer) appointed by the trustee in consultation with us;
provided, however, that if any of the foregoing ceases to be a primary Treasury
dealer, we will substitute therefor another primary Treasury dealer.

     "Reference Treasury dealer quotations" means, with respect to each
reference Treasury dealer and the redemption date, the average, as determined by
the trustee, of the bid and asked prices for the comparable Treasury issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the trustee by such reference Treasury dealer at 5:00 p.m. on the
third business day preceding the redemption date.

EVENTS OF DEFAULT AND REMEDIES

     Events of Default in Respect of Us.  The indenture provides that the
occurrence of any of the following events with respect to us from the date of
issuance of the notes constitutes an event of default under the indenture and
the notes:

     - our failure to make any payment, when due, of principal of or premium, if
       any, on the notes;

     - our failure to make any payment, when due, of interest (including in the
       case of the old notes additional interest pursuant to the registration
       rights agreement) on the notes for 30 days;

     - our failure to observe or perform any of our other covenants or
       warranties under the indenture for the benefit of the holders of the
       notes that continues for 90 days after written notice is given to us;

     - certain events of bankruptcy, insolvency or reorganization with respect
       to PBG or any of PBG's restricted subsidiaries (including us); and

     - the acceleration of maturity of any debt of PBG or the debt of any of
       PBG's restricted subsidiaries (including us), other than the notes,
       having a then outstanding principal amount in excess of $50 million by
       any holder or holders thereof or any trustee or agent acting on behalf of
       such holder or holders, in accordance with the provisions of any contract
       evidencing such debt or the failure to pay at the stated maturity (and
       the expiration of any grace period) any debt of PBG or the debt of any of
       PBG's restricted subsidiaries (including us) having a then outstanding
       principal amount in excess of $50 million.

     Events of Default in Respect of PepsiCo.  The indenture provides that the
occurrence of any of the following events with respect to PepsiCo after the
guarantee commencement date (in the event such date occurs) constitutes an event
of default under the indenture and the notes:

     - PepsiCo's failure to observe or perform any of its covenants or
       warranties under the indenture for the benefit of the holders of the
       notes that continues for 90 days after written notice is given to
       PepsiCo;

     - certain events of bankruptcy, insolvency or reorganization with respect
       to PepsiCo; and

                                        55
<PAGE>

     - the guarantee of the notes ceasing to be in full force and effect or
       PepsiCo (or any successor guarantor) denying or disaffirming its
       obligations under the guarantee of the notes.

     A default under any indebtedness of PepsiCo other than the guarantee of the
notes will not constitute an event of default under the indenture.

     If any event of default (other than an event of default relating to certain
events of bankruptcy, insolvency or reorganization with respect to PBG or any of
PBG's restricted subsidiaries (including us)) occurs and is continuing, then
either the trustee or the holders of a majority in aggregate principal amount of
the outstanding notes may declare the principal of and interest on the
outstanding notes to be immediately due and payable. If an event of default
relating to certain events of bankruptcy, insolvency or reorganization with
respect to PBG or any of PBG's restricted subsidiaries (including us) occurs,
the principal of and interest on all the notes as of the date of such event of
default will become immediately due and payable without any declaration or other
act on the part of the trustee or the holders of the notes. However, at any time
before a judgment or decree for payment of the money due has been obtained by
the trustee as provided in the indenture, declarations of acceleration may be
rescinded and past defaults may be waived by the holders of a majority in
aggregate principal amount of the outstanding notes, with certain exceptions, as
described below.

     The indenture requires the trustee to give to the holders of the notes
notice of all uncured defaults known to the trustee within 90 days after the
occurrence of such default (the term "default" used here includes the events of
default summarized above, exclusive of any grace period or requirement that
notice of default be given); provided, however, that except in the case of a
default in the payment of principal of or interest or premium, if any, on the
outstanding notes, the trustee will be protected in withholding such notice if
it in good faith determines that the withholding of such notice is in the
interest of the holders of the outstanding notes.

     No holder of any notes may institute any action under the indenture unless
and until:

     - such holder has given the trustee written notice of a continuing event of
       default;

     - the holders of a majority in aggregate principal amount of the
       outstanding notes have requested the trustee to institute proceedings in
       respect of such event of default;

     - such holder or holders has or have offered the trustee such reasonable
       indemnity as the trustee may require;

     - the trustee has failed to institute an action for 60 days thereafter; and

     - no inconsistent direction has been given to the trustee during such
       60-day period by the holders of a majority in aggregate principal amount
       of the outstanding notes.

     The holders of a majority in aggregate principal amount of the outstanding
notes will have the right, subject to certain limitations, to direct the time,
method and place of conducting any proceeding for any remedy available to the
trustee or of exercising any trust or power conferred on the trustee with
respect to the notes. The indenture provides that if an event of default has
occurred and is continuing, the trustee, in exercising its rights and powers
under the indenture, will be required to use the degree of care of a prudent
person in the conduct of his or her own affairs. The indenture further provides
that the trustee will not be required to expend or risk its own funds, or
otherwise incur any financial liability in the performance of any of its duties
under the indenture, if the trustee has reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured.

     The holders of a majority in aggregate principal amount of the outstanding
notes may, on behalf of the holders of all notes, waive any past default with
respect to the notes, except a default not already cured in the payment of any
principal of or interest or premium, if any, on any notes, or in respect of a
covenant or provision in the indenture that cannot be modified without the
consent of the holder of each outstanding note. We refer you to "-- Modification
of the Indenture" below.

                                        56
<PAGE>

     We are required to deliver to the trustee, within 120 days after the end of
each fiscal year, a certificate signed by certain of our officers stating
whether such officers have obtained knowledge of any event of default with
respect to us. PepsiCo is required to deliver to the trustee, within 120 days
after the end of each fiscal year, a certificate signed by certain of its
officers stating whether such officers have obtained knowledge of any event of
default with respect to PepsiCo.

CERTAIN COVENANTS

     The indenture contains covenants including, among others, the following:

  Limitation on Liens.

     Limitations on Liens Applicable to Us.  The indenture provides that we will
not, and will not permit any of our restricted subsidiaries to, incur, suffer to
exist or guarantee any debt secured by a mortgage, pledge or lien, which we
refer to collectively as liens, on any principal property or on any shares of
stock of (or other interests in) any of our restricted subsidiaries unless we or
such restricted subsidiary secures or causes such restricted subsidiary to
secure all the outstanding notes (and any of our or such restricted subsidiary's
other debt, at our option or such restricted subsidiary's option, as the case
may be, not subordinate to the notes), equally and ratably with (or prior to)
such secured debt, for as long as such secured debt will be so secured.

     These restrictions will not, however, apply to debt secured by:

     (1) any lien existing prior to the issuance of the old notes;

     (2) any lien on property of or shares of stock of (or other interests in)
         any entity existing at the time such entity becomes our restricted
         subsidiary;

     (3) any liens on property or shares of stock of (or other interests in) any
         entity existing at the time of acquisition of such shares (or other
         interests) or property (including acquisition through merger or
         consolidation);

     (4) any lien securing indebtedness incurred to finance all or any part of
         the purchase price of property or the cost of construction on such
         property (or additions, substantial repairs, alterations or substantial
         improvements thereto), provided that such lien and the indebtedness
         secured thereby are incurred within 365 days after the later of (a)
         acquisition of such property or the completion of construction (or
         addition, repair, alteration or improvement) thereon and (b) the
         commencement of full operation thereof;

     (5) any lien in favor of us or any of our restricted subsidiaries;

     (6) any liens in favor of, or required by contracts with, governmental
         entities; or

     (7) any extension, renewal, or refunding of liens referred to in any of the
         preceding clauses (1) through (6), provided that in the case of a lien
         permitted under clause (1), (2), (3), (4) or (5), the debt secured is
         not increased nor the lien extended to any additional assets.

     Notwithstanding the foregoing, we or any of our restricted subsidiaries may
incur, suffer to exist or guarantee any debt secured by a lien on any principal
property or on any shares of stock of (or other interests in) any of our
restricted subsidiaries if, after giving effect thereto, the aggregate amount of
exempted debt does not exceed 15% of our consolidated net tangible assets.

     These restrictions on secured debt do not apply to PBG. The indenture does
not restrict PBG from incurring secured debt (including debt secured by our
membership interests), and upon such incurrence, PBG is not required to secure
the notes equally and ratably with such secured debt.

     Limitation on Liens Applicable to PepsiCo.  The indenture also provides
that, from the guarantee commencement date (in the event such date occurs),
PepsiCo will not, and will not permit any of its restricted subsidiaries to,
incur, suffer to exist or guarantee any debt secured by a lien on any principal

                                        57
<PAGE>

property or on any shares of stock of (or other interests in) any of its
restricted subsidiaries unless PepsiCo or such restricted subsidiary secures or
causes such restricted subsidiary to secure the guarantee of the notes (and any
of its or such restricted subsidiary's other debt, at its option or such
restricted subsidiary's option, as the case may be, not subordinate to the
guarantee of the notes), equally and ratably with (or prior to) such secured
debt, for as long as such secured debt will be so secured.

     These restrictions will not, however, apply to debt secured by:

     (1) any lien existing prior to the guarantee commencement date;

     (2) any lien on property of or shares of stock of (or other interests in)
         any entity existing at the time such entity becomes PepsiCo's
         restricted subsidiary;

     (3) any liens on property or shares of stock of (or other interests in) any
         entity (a) existing at the time of acquisition of such property or
         shares (or other interests) (including acquisition through merger or
         consolidation), (b) to secure the payment of all or any part of the
         purchase price of such property or shares (or other interests) or
         construction or improvement of such property or (c) to secure any debt
         incurred prior to, at the time of, or within 365 days after the later
         of the acquisition, the completion of construction or the commencement
         of full operation of such property or within 365 days after the
         acquisition of such shares (or other interests) for the purpose of
         financing all or any part of the purchase price of such shares (or
         other interests);

     (4) any liens in favor of PepsiCo or any of its restricted subsidiaries;

     (5) any liens in favor of, or required by contracts with, governmental
         entities; or

     (6) any extension, renewal, or refunding of liens referred to in any of the
         preceding clauses (1) through (5).

     Notwithstanding the foregoing, PepsiCo or any of its restricted
subsidiaries may incur, suffer to exist or guarantee any debt secured by a lien
on any principal property or on any shares of stock of (or other interests in)
any of its restricted subsidiaries if, after giving effect thereto, the
aggregate amount of such debt does not exceed 15% of PepsiCo's consolidated net
tangible assets.

     The indenture does not restrict the transfer by PepsiCo of a principal
property to an unrestricted subsidiary of PepsiCo or the ability of PepsiCo to
change the designation of a subsidiary owning principal property from a
restricted subsidiary to an unrestricted subsidiary and, if PepsiCo were to do
so, any such unrestricted subsidiary would not be restricted from incurring
secured debt nor would PepsiCo be required, upon such incurrence, to secure the
guarantee of the notes equally and ratably with such secured debt.

     Definitions.  The following are definitions of some terms used in the above
description. We refer you to the indenture for a full description of all of
these terms, as well as any other terms used herein for which no definition is
provided.

     "Consolidated net tangible assets" means, with respect to us or PepsiCo,
the total amount of our assets and our subsidiaries' assets, or PepsiCo's assets
and its subsidiaries' assets, as the case may be, minus:

     - all applicable depreciation, amortization and other valuation reserves;

     - the amount of assets resulting from write-ups of capital assets of us and
       our subsidiaries or of PepsiCo and its subsidiaries, as the case may be
       (except write-ups in connection with accounting for acquisitions in
       accordance with U.S. GAAP);

     - all current liabilities of ours and our subsidiaries (excluding any
       intercompany liabilities) or of PepsiCo and its subsidiaries (excluding
       any intercompany liabilities), as the case may be; and

     - all goodwill, trade names, trademarks, patents, unamortized debt discount
       and expense and other like intangibles, all as set forth on our and our
       subsidiaries', or PepsiCo's and its subsidiaries', as

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       the case may be, latest quarterly or annual consolidated balance sheets
       prepared in accordance with U.S. GAAP.

     "Debt" means, with respect to us, any indebtedness of ours for borrowed
money, capitalized lease obligations and purchase money obligations, or any
guarantee of such debt, in any such case which would appear on our consolidated
balance sheet as a liability.

     "Debt" means, with respect to PepsiCo, any indebtedness of PepsiCo for
borrowed money.

     "Exempted debt" means, with respect to us, the sum, without duplication, of
the following items outstanding as of the date exempted debt is being
determined:

     - debt incurred after the date of the indenture and secured by liens
       created or assumed or permitted to exist on any principal property or on
       any shares of stock of any of our restricted subsidiaries, other than
       debt secured by liens described in clauses (1) through (7) under
       "Limitation on Liens -- Limitation on Liens Applicable to Us;" and

     - our and our restricted subsidiaries' attributable debt in respect of all
       sale and lease-back transactions with regard to any principal property,
       other than sale and lease-back transactions permitted under the second
       paragraph under "Limitation on Sale and Leaseback Transactions."

     "Principal property" means, with respect to us, any single manufacturing or
processing plant, office building or warehouse owned or leased by us or any of
our subsidiaries located in the 50 states of the United States of America, the
District of Columbia or Puerto Rico other than a plant, warehouse, office
building, or portion thereof which, in the opinion of our managing directors
evidenced by a resolution, is not of material importance to the business
conducted by us and our subsidiaries taken as an entirety.

     "Principal property" means, with respect to PepsiCo, any single
manufacturing or processing plant, office building or warehouse owned or leased
by PepsiCo or any of its restricted subsidiaries located in the 50 states of the
United States of America, the District of Columbia or Puerto Rico other than a
plant, warehouse, office building or portion thereof which, in the opinion of
PepsiCo's board of directors evidenced by a resolution, is not of material
importance to the business conducted by PepsiCo and its restricted subsidiaries
taken as an entirety.

     "Restricted subsidiary" of us or PBG means any current or future subsidiary
(1) substantially all of the property of which is located, or substantially all
of the business of which is carried on, within the 50 states of the United
States of America, the District of Columbia or Puerto Rico and which is not a
foreign corporation and (2) which owns or leases any principal property.

     "Restricted subsidiary" of PepsiCo means, at any time, any subsidiary which
at the time is not an unrestricted subsidiary of PepsiCo.

     "Subsidiary" of a specified person means any entity, at least a majority of
the outstanding voting stock of which shall at the time be owned, directly or
indirectly, by the specified person or by one or more of its subsidiaries, or
both.

     "Unrestricted subsidiary" of PepsiCo means any subsidiary of PepsiCo (not
at the time designated as PepsiCo's restricted subsidiary) (1) the major part of
whose business consists of finance, banking, credit, leasing, insurance,
financial services or other similar operations, or any combination thereof, (2)
substantially all the assets of which consist of the capital stock of one or
more subsidiaries engaged in the operations referred to in the preceding clause
(1), (3) substantially all of the property of which is located, or substantially
all of the business of which is carried on, outside of the 50 states of the
United States of America, the District of Columbia and Puerto Rico or (4)
designated as an unrestricted subsidiary by PepsiCo's board of directors.

     Limitation on Sale and Lease-back Transactions.  The indenture provides
that we will not, and will not permit any of our restricted subsidiaries to,
sell or transfer, directly or indirectly, except to us or any of our restricted
subsidiaries, any principal property as an entirety, or any substantial portion
thereof, with the

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intention of taking back a lease of all or part of such property, except a lease
for a period of three years or less at the end of which it is intended that the
use of such property by the lessee will be discontinued.

     These restrictions will not, however, apply and we or any of our restricted
subsidiaries may sell a principal property and lease it back for a longer
period:

     - if we or such restricted subsidiary would be entitled, pursuant to the
       covenant applicable to us or such restricted subsidiary, as the case may
       be, described under "-- Limitations on Liens -- Limitation on Liens
       Applicable to Us" above to create a lien on the property to be leased
       securing debt in an amount equal to the attributable debt with respect to
       the sale and lease-back transaction without equally and ratably securing
       the outstanding notes; or

     - if:

       (1) we promptly inform the trustee of such transactions;

       (2) the net proceeds of such transactions are at least equal to the fair
           value (as determined by a resolution of our managing directors) of
           such property; and

       (3) we cause an amount equal to the net proceeds of the sale to be
           applied

            (a) to the retirement (whether by redemption, cancellation after
                open-market purchases, or otherwise), within 365 days after
                receipt of such proceeds, of funded debt (which need not include
                the notes) having an outstanding principal amount equal to such
                net proceeds; or

            (b) to the purchase or acquisition (or in the case of property, the
                construction) of property or assets used in our or any of our
                restricted subsidiaries' businesses within 365 days after
                receipt of such proceeds.

     Notwithstanding the foregoing paragraph, we or any of our restricted
subsidiaries may enter into sale and lease-back transactions in addition to
those permitted by this limitation, and without any obligation to retire any
outstanding funded debt or to purchase property or assets, provided that at the
time of entering into such sale and lease-back transactions and after giving
effect thereto, the aggregate amount of exempted debt does not exceed 15% of our
consolidated net tangible assets.

     These restrictions on sale and lease-back transactions do not apply to PBG
or PepsiCo.

     As used in the above description, "attributable debt" for a lease means the
aggregate of present values (discounted at a rate per annum equal to the
interest rate borne by the notes and compounded semi-annually) of our or any of
our restricted subsidiaries' obligations for net rental payments during the
remaining term of such lease (including any period for which such lease has been
extended or may, at the option of the lessor, be extended). The term "net rental
payments" under any lease of any period shall mean the sum of the rental and
other payments required to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee on account of
maintenance and repairs, reconstruction, insurance, taxes, assessments, water
rates or similar charges required to be paid by such lessee thereunder or any
amounts required to be paid by such lessee thereunder contingent upon the amount
of sales, maintenance and repairs, reconstruction, insurance, taxes,
assessments, water rates or similar charges. Attributable debt may be reduced by
the present value of the rental obligations, calculated on the same basis, that
any sublessee has for all or part of the leased property.

     "Funded debt" means all debt having a maturity of more than one year from
the date of its creation or having a maturity of less than one year but by its
terms being renewable or extendible, at our option, in respect thereof, beyond
one year from its creation.

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 Consolidation, Merger, Conveyance or Transfer.

     Consolidation, Merger, Conveyance or Transfer Applicable to Us.  The
indenture provides that we may consolidate or merge with or into, or transfer or
lease all or substantially all of our assets to, any entity (including, without
limitation, a limited partnership or a limited liability company) that is
organized and validly existing under the laws of any state of the United States
of America or the District of Columbia, and may permit any such entity to
consolidate with or merge into us or convey, transfer or lease all or
substantially all of its assets to us; provided that:

     - we will be the surviving entity or, if not, that the successor will
       expressly assume by a supplemental indenture the due and punctual payment
       of principal of and interest and premium, if any, on the notes and the
       performance of every covenant of the indenture to be performed or
       observed by us;

     - immediately after giving effect to such transaction, no event of default,
       and no default or other event which, after notice or lapse of time, or
       both, would become an event of default, will have happened and be
       continuing; and

     - we will have delivered to the trustee an officers' certificate and an
       opinion of counsel, each stating that such consolidation, merger,
       conveyance, transfer or lease complies with the indenture. In the event
       of any such consolidation, merger, conveyance, transfer or lease, any
       such successor will succeed to and be substituted for us as issuer on the
       notes with the same effect as if it had been named in the indenture as
       the issuer.

     Consolidation, Merger, Conveyance or Transfer Applicable to PepsiCo.  The
indenture provides that PepsiCo may consolidate or merge with or into, or
transfer or lease all or substantially all of its assets to, any entity
(including, without limitation, a limited partnership or a limited liability
company); provided that:

     - PepsiCo will be the surviving entity or, if not, that the successor will
       be an entity that is organized and validly existing under the laws of any
       state of the United States of America or the District of Columbia and
       will expressly assume by a supplemental indenture the obligations of
       PepsiCo under the indenture and the guarantee and the performance of
       every covenant of the indenture to be performed or observed by PepsiCo;

     - immediately after giving effect to such transaction, no event of default,
       and no default or other event which, after notice or lapse of time, or
       both, would become an event of default, will have happened and be
       continuing; and

     - PepsiCo will have delivered to the trustee an officers' certificate and
       an opinion of counsel, each stating that such consolidation, merger,
       transfer or lease complies with the indenture. In the event of any such
       consolidation, merger, conveyance, transfer or lease, any such successor
       will succeed to and be substituted for PepsiCo as guarantor on the notes
       with the same effect as if it had been named in the indenture as
       guarantor.

     The above provision will cease to apply to PepsiCo if PepsiCo's guarantee
does not become effective and the guarantee commencement date does not occur as
described in the "Description of the Notes and the Guarantee -- Guarantee -- No
Guarantee."

     Reports to Holders.  We and PepsiCo will comply with the provisions of
Section 314(a) and 314(c) of the Trust Indenture Act.

     We and PepsiCo have each agreed that so long as it is not subject to
Section 13 or 15(d) of the Exchange Act, upon the request of a holder of the old
notes, it will promptly furnish or cause the trustee to furnish to such holder
or to a prospective purchaser of a note designated by such holder, as the case
may be, the information required to be delivered by it pursuant to Rule
144A(d)(4) under the Securities Act to permit compliance with Rule 144A in
connection with resales of the old notes.

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<PAGE>

SATISFACTION AND DISCHARGE; DEFEASANCE OF COVENANTS

     The indenture will be discharged with respect to the notes and will cease
to be of further effect as to all notes when:

     - either:

      (1) all notes authenticated and delivered (except lost, stolen or
          destroyed notes which have been replaced or paid and notes for whose
          payment money has been deposited in trust or segregated and held in
          trust by us and thereafter repaid to us or discharged from such trust)
          have been delivered to the trustee cancelled or for cancellation; or

      (2) all notes not delivered to the trustee cancelled or for cancellation
          (a) have become due and payable, (b) will become due and payable
          within one year or (c) are to be called for redemption under
          arrangements satisfactory to the trustee for the giving of notice of
          redemption by the trustee in the name, and at the expense, of us;

      and in any of the cases described in (a), (b) or (c) above, we have
      deposited irrevocably with the trustee sufficient cash or U.S.
      governmental securities to pay and discharge the principal of and interest
      and premium, if any, and any other sums due on the notes to the date of
      such deposit (in the case of notes that have become due and payable), or
      to maturity or redemption, as the case may be;

     - we have paid or caused to be paid all sums payable by us with respect to
       the notes under the indenture;

     - no event of default or event which with notice or lapse of time would
       become an event of default with respect to the notes has occurred and is
       continuing with respect to such notes on the date of such deposit;

     - we have delivered to the trustee an officers' certificate and an opinion
       of counsel, each stating that all conditions precedent to satisfaction
       and discharge of the indenture with respect to the notes have been
       complied with, and, in the case of the opinion of counsel, stating:


      (1) such deposit and defeasance will not cause the holders of such notes
          to recognize income, gain or loss for federal income tax purposes and
          such holders will be subject to federal income tax on the same amount
          and in the same manner and at the same times as would have been the
          case if such option had not been exercised; and


      (2) either that no requirement to register under the Investment Company
          Act of 1940, as amended, will arise as a result of the satisfaction
          and discharge of the indenture or that any such registration
          requirement has been complied with; and

     - such deposit and defeasance will not result in a material breach or
       violation of, or constitute a default under any material agreement or
       instrument to which we are a party.

     The indenture also provides that, at our option, we will be discharged from
any and all obligations with respect to the notes on the 123rd day after our
satisfaction of the conditions described below (except for certain obligations
to replace any such notes that have been stolen, lost or mutilated, and to
maintain paying agencies and hold moneys for payment in trust in respect of such
notes) and PepsiCo will be discharged from any and all obligations with respect
to its guarantee, which we refer to as legal defeasance, or we and PepsiCo need
not comply with certain covenants of the indenture applicable to us or PepsiCo,
as the case may be, with respect to the notes (including those described in
"-- Certain Covenants" above), which we refer to as covenant defeasance, in each
case:

     - if we have deposited irrevocably with the trustee sufficient cash or U.S.
       government securities to pay and discharge the principal of and interest
       and premium, if any, and any other sums due on the notes to the date of
       such deposit (in the case of notes that have become due and payable), or
       to maturity or redemption, as the case may be;

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<PAGE>

     - no event of default or event which with notice or lapse of time would
       become an event of default with respect to the notes has occurred and is
       continuing with respect to the notes on the date of such deposit;


     - we have delivered to the trustee an officers' certificate and an opinion
       of counsel, each stating that all conditions precedent to legal or
       covenant defeasance, as the case may be, have been complied with, and, in
       the case of the opinion of counsel, stating that:


       (1) such deposit and defeasance will not cause the holders of such notes
           to recognize income, gain or loss for federal income tax purposes as
           a result of our exercise of such option and such holders will be
           subject to federal income tax on the same amount and in the same
           manner and at the same times as would have been the case if such
           option had not been exercised (and, in the case of legal defeasance
           only, such opinion of counsel must be based upon a ruling of the
           Internal Revenue Service to the same effect or a change in applicable
           federal income tax law or related Treasury regulations after the date
           of the indenture); and

       (2) either that no requirement to register under the Investment Company
           Act of 1940, as amended, will arise as a result of the satisfaction
           and discharge of the indenture or that any such registration
           requirement has been complied with; and

     - with respect to legal defeasance only, 123 days will have passed during
       which no event of default relating to certain events of bankruptcy,
       insolvency or reorganization with respect to us, PepsiCo or any of our
       restricted subsidiaries has occurred.

MODIFICATION OF THE INDENTURE

     In general, our rights and obligations and the rights of the holders of the
notes under the indenture may be modified if the holders of a majority in
aggregate principal amount of the outstanding notes affected by the modification
consent to it. However, the indenture provides that, unless each affected holder
of the notes agrees, the amendment cannot:

     - make any adverse change to any payment term of the notes or the
       guarantee, such as changing the maturity date, reducing the principal
       amount or any amount of interest we or PepsiCo have to pay, changing the
       method of computing the interest, changing any place of payment, changing
       the currency in which we or PepsiCo have to make any payment of principal
       of or interest or premium, if any or impairing any right of a holder of
       the notes to bring suit for payment;

     - reduce the percentage of the principal amount of notes whose holders must
       consent to an amendment or waiver; or

     - make any change to the provisions of the indenture concerning
       modification contained in this paragraph or waivers of defaults or event
       of defaults by holders of the notes.

     We, PepsiCo and the trustee may amend the indenture without the consent of
any of the holders of the notes to:

       (1) evidence the succession of another corporation to us or PepsiCo in
           accordance with the provisions of the indenture;

       (2) add to our or PepsiCo's covenants;

       (3) surrender any of our or PepsiCo's rights or powers;

       (4) cure any ambiguity or defect, correct or supplement any provision of
           the indenture which may be inconsistent with any other provisions of
           the indenture;

       (5) add any provisions expressly permitted by the Trust Indenture Act;

       (6) evidence and provide for the acceptance of a successor trustee;

       (7) add to the rights of the holders of the notes;
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<PAGE>

       (8) establish additional events of default; or

       (9) provide for the issuance of the private exchange securities (as
           defined in the registration rights agreement);

provided that no modification may be made with respect to the matters described
in clause (2), (3), (4), (7) or (8) above, if to do so would adversely affect
the interests of the holders of any outstanding notes.

GUARANTEE

     Definitions.  The following are definitions of some terms used in this
description of PepsiCo's unconditional and irrevocable guarantee of the notes
and the circumstances under which the guarantee may not become effective or may
become effective as to less than all of the principal of and interest and
premium, if any, on the outstanding notes. We refer you to the indenture for a
full description of all of these terms, as well as any other terms used herein
for which no definition is provided.

     "Guarantee commencement date" means, in the event PepsiCo's guarantee
becomes effective, one business day prior to the 2004 notes payment date.

     "Partial guarantee percentage" means a fraction, the numerator of which is
the aggregate principal amount of the notes outstanding on the 2004 notes
payment date minus the principal amount of the 2004 notes that PepsiCo has
determined in good faith that it is likely to have to pay on the 2004 notes
payment date under the 2004 notes guarantee and that is specified in PepsiCo's
notice given to us and the trustee by 5:00 p.m., New York City time, on the 2004
notes payment deposit date, and the denominator of which is the aggregate
principal amount of the notes outstanding on the 2004 notes payment date.

     "2004 notes" means our outstanding $1.0 billion 5 3/8% senior notes due
2004 guaranteed by PepsiCo.

     "2004 notes guarantee" means PepsiCo's unconditional and irrevocable
guarantee of the 2004 notes.

     "2004 notes payment date" means February 17, 2004 or, if earlier, the date
scheduled for payment of (1) the redemption price of the 2004 notes (in the
event of a redemption in whole) or (2) the principal of and interest and
premium, if any, on the 2004 notes (in the event of acceleration).

     "2004 notes payment deposit date" means two business days prior to the 2004
notes payment date.

     "2004 notes trustee" means JPMorgan Chase Bank, in its capacity as the
trustee under the indenture relating to the 2004 notes or its successor under
that indenture.

     When we use the term "business day," we mean any day that is not a
Saturday, Sunday or any other day that is not a legal holiday or on which
banking institutions in New York City or Luxembourg are authorized or required
by law, regulation or executive order to close.

     Full Guarantee.  In the event that:

     - we have deposited irrevocably with the 2004 notes trustee, prior to the
       2004 notes payment deposit date, sufficient cash in immediately available
       funds to pay in full the principal of and interest and premium, if any,
       that will become due and payable on the 2004 notes on the 2004 notes
       payment date; or

     - (1) we have not deposited irrevocably with the 2004 notes trustee, prior
       to the 2004 notes payment deposit date, sufficient cash in immediately
       available funds to pay in full the principal of and interest and premium,
       if any, that will become due and payable on the 2004 notes on the 2004
       notes payment date; and (2) PepsiCo has not delivered to us and the
       trustee a written notice by 5:00 p.m., New York City time, on the 2004
       notes payment deposit date, stating that PepsiCo has determined in good
       faith that it is likely to have to pay some or all of the principal of
       the 2004 notes on the 2004 notes payment date under the 2004 notes
       guarantee; then

beginning on the guarantee commencement date, PepsiCo will unconditionally and
irrevocably guarantee, on a senior unsecured basis, the payment of principal of
and interest and premium, if any, on the notes

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<PAGE>

when due and payable, whether at maturity, by acceleration, redemption or
otherwise (and in the case of any extension of time of payment or renewal of any
notes under the indenture or the notes, the payment of the same when due and
payable in accordance with the terms of such extension or renewal).

     Partial Guarantee.  In the event that:

     - we have not deposited irrevocably with the 2004 notes trustee prior to
       the 2004 notes payment deposit date, sufficient cash in immediately
       available funds to pay in full the principal of and interest and premium,
       if any, that will become due and payable on the 2004 notes on the 2004
       notes payment date; and

     - PepsiCo has delivered to us and the trustee a written notice by 5:00
       p.m., New York City time, on the 2004 notes payment deposit date, stating
       that PepsiCo has determined in good faith that it is likely to have to
       pay some but not all of the principal of the 2004 notes on the 2004 notes
       payment date under the 2004 notes guarantee; then

beginning on the guarantee commencement date, PepsiCo will unconditionally and
irrevocably guarantee, on a senior unsecured basis, the payment of the partial
guarantee percentage of each of the principal of and interest and premium, if
any, on the notes when due and payable, whether at maturity, by acceleration,
redemption or otherwise (and in the case of any extension of time of payment or
renewal of any notes under the indenture or the notes, the payment of such
amount when due and payable in accordance with the terms of such extension or
renewal).

     Payment upon Maturity, Redemption or Acceleration.  If we default in the
payment of principal of and interest and premium, if any, on the outstanding
notes upon maturity, redemption, acceleration or otherwise, in each case, on or
after the guarantee commencement date, then the amount of payment each holder of
the notes is entitled to receive from PepsiCo under PepsiCo's guarantee will be
the product of (1) the partial guarantee percentage and (2) the amount of
principal of and interest and premium, if any, due and payable on such holder's
notes.

     A replacement note in the principal amount equal to the portion of the
principal of the note that was not paid or redeemed because PepsiCo's guarantee
was a partial guarantee and because we defaulted in the payment of principal of
and interest and premium, if any, on the note upon maturity, redemption,
acceleration or otherwise will be issued in the name of the holder of the notes
upon cancellation of the original note. Any such replacement notes would not be
guaranteed by PepsiCo and would solely be our obligation.

     Interest Payment without Acceleration.  In the event that:

     - we fail to make an interest payment on any scheduled interest payment
       date occurring on or after the guarantee commencement date (in the event
       that such date occurs); but

     - holders of a majority in aggregate principal amount of the outstanding
       notes do not accelerate the principal of and interest on all the notes;
       then

holders of the notes will have the benefit of PepsiCo's guarantee with respect
to the payment of such interest payment. The amount of payment each holder of
the notes will be entitled to receive from PepsiCo under PepsiCo's guarantee
will be the product of (1) the partial guarantee percentage and (2) the amount
of such interest payment. PepsiCo will continue unconditionally and irrevocably
to guarantee, on a senior unsecured basis, the payment of the partial guarantee
percentage of each of the principal of and remaining interest (excluding the
portion of the interest payment that we failed to make and that was not paid by
PepsiCo under PepsiCo's guarantee) and premium, if any, on the notes when due
and payable, whether at maturity, by acceleration, redemption or otherwise (and
in the case of any extension of time of payment or renewal of any notes under
the indenture or the notes, the payment of such amount when due in accordance
with the terms of such extension or renewal).

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<PAGE>

     No Guarantee.  PEPSICO'S OBLIGATIONS UNDER THE GUARANTEE WILL ONLY BECOME
EFFECTIVE IF AND WHEN A GUARANTEE COMMENCEMENT DATE OCCURS. ACCORDINGLY, IN THE
EVENT THAT:

     - prior to any scheduled guarantee commencement date, we fail to pay
       principal of, interest (including any additional interest pursuant to the
       registration rights agreement) or premium, if any, on the notes or any of
       our other monetary obligations under the indenture or the notes whether
       upon acceleration, redemption or otherwise;

     - prior to any scheduled guarantee commencement date, any other event of
       default with respect to the indenture and the notes occurs or any default
       or other event which, with the giving of notice or passage of time, would
       constitute an event of default with respect to the indenture or the notes
       occurs; or

     - (1) we have not deposited irrevocably with the 2004 notes trustee, prior
       to the 2004 notes payment deposit date, sufficient cash in immediately
       available funds to pay in full the principal of and interest and premium,
       if any, that will become due and payable on the 2004 notes on the 2004
       notes payment date; and (2) PepsiCo has delivered to us and the trustee a
       written notice by 5:00 p.m., New York City time, on the 2004 notes
       payment deposit date, stating that PepsiCo has determined in good faith
       that it is likely to have to pay the full principal of the 2004 notes on
       the 2004 notes payment date under the 2004 notes guarantee; then

PEPSICO'S GUARANTEE WILL NOT BECOME EFFECTIVE, AND NO GUARANTEE COMMENCEMENT
DATE WILL OCCUR. Accordingly, the holders of the notes or the trustee will not
have the benefit of PepsiCo's guarantee or have any rights against PepsiCo under
the indenture, the notes or the guarantee. Instead, holders of the notes or the
trustee will only be able to exercise any of their respective rights under the
indenture and the notes against us.

     For illustrative purposes, we are providing you with the following six
hypothetical examples.

     EXAMPLE 1 (FULL GUARANTEE):  On February 12, 2004, we deposit with the 2004
notes trustee sufficient cash in immediately available funds to pay in full the
principal of and interest and premium, if any, that will become due and payable
on the 2004 notes on February 17, 2004, the scheduled maturity date of the 2004
notes. PepsiCo's guarantee of the notes becomes effective in full on February
16, 2004. We elect to redeem all of the outstanding notes and provide a notice
of such redemption to the holders of the notes on January 30, 2004. The
redemption date is scheduled for March 15, 2004. We fail to make the redemption
payment on March 15, 2004. Since the redemption date and the redemption payment
default occur after the guarantee commencement date, holders of the notes would
have the benefit of PepsiCo's full guarantee with respect to the redemption
price.

     EXAMPLE 2 (FULL GUARANTEE):  We fail to deposit with the 2004 notes trustee
prior to February 13, 2004 sufficient cash in immediately available funds to pay
in full the principal of and interest and premium, if any, that will become due
and payable on the 2004 notes on February 17, 2004. PepsiCo does not provide us
and the trustee with a written notice prior to 5:00 p.m., New York City time, on
February 13, 2004, setting forth the amount that PepsiCo had determined in good
faith that it is likely to have to pay on the 2004 notes on February 17, 2004
under the 2004 notes guarantee. PepsiCo's guarantee of the notes becomes
effective in full on February 16, 2004. We fail to make the principal and
interest payment on the 2004 notes on February 17, 2004, which triggers an event
of default under the notes. Holders of a majority in aggregate principal amount
of the outstanding notes accelerate the payment of the principal of and interest
on the notes to March 1, 2004. We fail to make the accelerated payment of
principal of and interest on the notes on March 1, 2004. Since the accelerated
payment default occurs after the guarantee commencement date, holders of the
notes would have the benefit of PepsiCo's full guarantee with respect to the
accelerated payment of the principal of and interest on the notes.

     EXAMPLE 3 (PARTIAL GUARANTEE):  We fail to deposit with the 2004 notes
trustee prior to February 13, 2004 sufficient cash in immediately available
funds to pay in full the principal of and interest and premium, if any, that
will become due and payable on the 2004 notes on February 17, 2004. PepsiCo
provides us and the trustee with a written notice on February 13, 2004, stating
that PepsiCo has
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determined in good faith that it is likely to have to pay on February 17, 2004
$700 million of the principal amount of the 2004 notes then outstanding (assumed
to be $1.0 billion for the purposes of this Example 3) under the 2004 notes
guarantee. PepsiCo's guarantee of the notes becomes effective on February 16,
but only to the extent of the partial guarantee percentage (which is 30% for the
purpose of this Example 3) of each of the principal of and interest and premium,
if any, on the notes.

     - Thereafter, we fail to make the payment of principal of and interest on
       the notes on the maturity date. For purposes of this Example 3, it is
       assumed that an aggregate of $1.0 billion of principal of and an
       aggregate of $25 million of interest on the notes are due and payable on
       the maturity date. Since our payment default occurs after the guarantee
       commencement date, holders of the notes would have the benefit of
       PepsiCo's partial guarantee, but only to the extent of $307,500,000
       (which amount is the partial guarantee percentage, or 30%, of
       $1,025,000,000, the aggregate amount of principal of and interest on the
       notes due and payable on the maturity date). The amount of payment each
       holder of the notes holding $1,000,000 in principal amount of the notes
       would be entitled to receive from PepsiCo under PepsiCo's partial
       guarantee would be $307,500 (which amount is the partial guarantee
       percentage, or 30%, of $1,025,000, the aggregate amount of principal of
       and interest on such holder's notes due and payable on the maturity
       date).

     - We fail to make our $25 million semi-annual interest payment that became
       due and payable on November 15, 2004 (assuming for the purposes of this
       Example 3 an interest rate of 5.0% per annum), but the holders of a
       majority in aggregate principal amount of the outstanding notes do not
       accelerate the principal of and interest and premium, if any, on the
       notes. Holders of the notes would have the benefit of PepsiCo's partial
       guarantee with respect to the payment of such interest.

       (1) A hypothetical holder of $1,000,000 of principal amount of the notes
           would be entitled, under PepsiCo's partial guarantee, to receive from
           PepsiCo $7,500 (which amount is the partial guarantee percentage, or
           30%, of $25,000, the interest due and payable on such holder's notes
           on November 15, 2004).

       (2) Each holder of the notes would continue to have the benefit of
           PepsiCo's partial guarantee of the partial guarantee percentage of
           the principal of and interest and premium, if any, on such holder's
           notes (other than $17,500, which amount is the interest amount that
           we failed to make and that was not paid by PepsiCo under PepsiCo's
           guarantee, as described in the preceding paragraph (1)).

     EXAMPLE 4 (NO GUARANTEE):  We fail to make our interest payment on the
notes that became due on November 15, 2003, and the holders of a majority in
aggregate principal amount of the outstanding notes accelerate the principal of
and interest on all the notes to February 25, 2004. Since our interest payment
default occurs prior to the scheduled guarantee commencement date (which is
assumed to be February 16, 2004 for the purpose of this example 4), although the
entire principal of and interest on the notes becomes due and payable after the
scheduled guarantee commencement date, PepsiCo's guarantee of the notes would
not become effective, and no guarantee commencement date would occur. Holders of
the notes would not have the benefit of PepsiCo's guarantee or have any rights
under the indenture, the notes or the guarantee against PepsiCo. Instead,
holders of the notes would only be able to exercise their rights under the
indenture and the notes against us.

     EXAMPLE 5 (NO GUARANTEE):  We file for bankruptcy proceedings on February
1, 2004. Since an event of default under the indenture and the notes occurs
prior to the scheduled guarantee commencement date (which is assumed to be
February 16, 2004 for the purpose of this Example 5), PepsiCo's guarantee of the
notes would not become effective, and no guarantee commencement date would
occur. Neither holders of the notes nor a bankruptcy trustee would have the
benefit of PepsiCo's guarantee or have any rights under the indenture, the notes
or the guarantee against PepsiCo, despite the continuation of the bankruptcy
proceedings on and after the scheduled guarantee commencement date.

     EXAMPLE 6 (NO GUARANTEE):  We fail to deposit with the 2004 notes trustee
prior to February 13, 2004 sufficient cash in immediately available funds to pay
in full the principal of and interest and

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premium, if any, that will become due and payable on the 2004 notes on February
17, 2004. PepsiCo provides us and the trustee with a written notice on February
13, 2004, stating that PepsiCo has made a good faith determination that it is
likely to have to pay the full principal of the 2004 notes on February 17, 2004
under the 2004 notes guarantee. We fail to make the payment of principal of and
interest on the 2004 notes on February 17, 2004, which triggers an event of
default. As a result, holders of a majority in aggregate principal amount of the
outstanding notes accelerate the principal of and interest on all the notes on
March 1, 2004. Since PepsiCo's guarantee of the notes would not become effective
and no guarantee commencement date would occur, holders of the notes would not
have the benefit of PepsiCo's guarantee or have any rights under the indenture,
the notes or the guarantee against PepsiCo. Instead, holders of the notes would
only be able to exercise their rights under the indenture and the notes against
us.


     On and after the guarantee commencement date (if such date occurs), the
guarantee will rank on an equal basis with all of PepsiCo's other existing and
future senior unsecured obligations and senior to all of PepsiCo's existing and
future subordinated indebtedness. As of March 22, 2003, PepsiCo had
approximately $2.4 billion of indebtedness and had certain guarantees and
commercial commitments in the ordinary course of business. As discussed in
PepsiCo's Annual Report on Form 10-K for the year ended December 28, 2002, the
most significant of these guarantees or commitments is PepsiCo's unconditional
guarantee of $2.3 billion of our long-term debt. Except for the limitation on
secured indebtedness (including secured guarantees) by PepsiCo and its
restricted subsidiaries described in "-- Certain Covenants" above, there are no
covenants in the indenture limiting or restricting PepsiCo or its subsidiaries
from incurring or issuing additional indebtedness (including guarantees).


     PepsiCo will give notice to the holders of the notes and the trustee as to
whether the guarantee commencement date has occurred, and if such date has
occurred, whether the guarantee is full or partial, and if partial, the partial
guarantee percentage, in accordance with the provisions of the indenture.

CONCERNING THE TRUSTEE

     JPMorgan Chase Bank, the trustee under the indenture, is also the trustee
under other indentures under which unsecured debt of ours and of our
subsidiaries and of PepsiCo and of its subsidiaries is outstanding (including
the 2004 notes), has from time to time made loans to us and our subsidiaries or
to PepsiCo and its subsidiaries and has performed other services for us and our
subsidiaries and for PepsiCo and its subsidiaries in the normal course of its
business, including investment banking, commercial banking and other financial
services, for which it has received and will receive compensation. JPMorgan
Chase Bank is also acting as exchange agent in connection with the exchange
offer.

NOTICES

     Notices to holders of the notes will be made by first class mail, postage
prepaid, to the registered holders. So long as the old notes or the new notes
are listed on the Luxembourg Stock Exchange, notices will also be made by
publication in an authorized newspaper in Luxembourg, which is expected to be
the Luxemburger Wort. Any notice will be deemed to have been given on the date
of publication or, if published more than once, on the date of the first
publication.

GOVERNING LAW

     The indenture, the notes and the guarantee will be governed by, and
construed in accordance with, the laws of the State of New York.

BOOK-ENTRY DELIVERY AND FORM

     The old notes were offered and sold within the United States to qualified
institutional buyers in reliance on Rule 144A or in offshore transactions in
reliance on Regulation S. The old notes were issued in registered, global form
in minimum denominations of $1,000 and integral multiples of $1,000 in excess
thereof.

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     Restricted global notes representing the old notes were deposited upon
issuance with the trustee as custodian for DTC, in New York, New York, and
registered in the name of DTC or its nominee, in each case, for credit to an
account of a direct or indirect participant in DTC. Restricted global notes
issued in reliance on Rule 144A, which we refer to as the Rule 144A global notes
(and any notes issued in exchange therefor), and the restricted global notes
issued in reliance on Regulation S, which we refer to as the Regulation S global
notes (and any notes issued in exchange therefor), including beneficial
interests in these restricted global notes, bear a legend regarding certain
restrictions on transfer set forth therein and in the indenture. The new notes
will be issued in fully registered form without interest coupons and will be
represented by one or more permanent global notes in definitive fully registered
form without interest coupons, which we refer to as a global exchange note, and
will be deposited with the trustee as custodian for DTC and registered in the
name of DTC or its nominee.

     Except as set forth below, the global notes may be transferred, in whole
and not in part, only to DTC or another nominee of DTC or to a successor of DTC
or its nominee. Beneficial interests in the global notes may not be exchanged
for notes in certificated form except in the limited circumstances described
below. We refer you to "-- Exchange of Global Notes for Certificated Notes."
Except in the limited circumstances described below, owners of beneficial
interests in the global notes will not be entitled to receive physical delivery
of notes in certificated form.

DEPOSITORY PROCEDURES

     The following description of the operations and procedures of DTC,
Euroclear and Clearstream, Luxembourg are provided solely as a matter of
convenience. These operations and procedures are solely within the control of
the respective settlement systems and are subject to changes by them. We take no
responsibility for these operations and procedures and urge investors to contact
the system or their participants directly to discuss these matters.

     We have been advised by DTC, Clearstream, Luxembourg and Euroclear,
respectively, as follows:

     - As to DTC:  DTC has advised us that it is a limited-purpose trust company
       organized under the New York Banking Law, a "banking organization" within
       the meaning of the New York Banking Law, a member of the Federal Reserve
       System, a "clearing corporation" within the meaning of the New York
       Uniform Commercial Code, and a "clearing agency" registered pursuant to
       the provisions of Section 17A of the Exchange Act. DTC was created to
       hold securities deposited with it by its participants and to facilitate
       clearance and the settlement of securities transactions among its
       participants in such securities through electronic computerized
       book-entry changes in accounts of the participants, thereby eliminating
       the need for physical movement of securities certificates. DTC's
       participants include securities brokers and dealers, banks, trust
       companies, clearing corporations and certain other organizations, some of
       which (and/or their representatives) own DTC. Access to DTC's book-entry
       system is also available to others, such as banks, brokers, dealers and
       trust companies that clear through or maintain a custodial relationship
       with a participant, either directly or indirectly.

       According to DTC, the foregoing information with respect to DTC has been
       provided to the financial community for informational purposes only and
       is not intended to serve as a representation, warranty or contract
       modification of any kind.

     - As to Euroclear:  Euroclear has advised us that it was created in 1968 to
       hold securities for participants of Euroclear and to clear and settle
       transactions between Euroclear participants through simultaneous
       electronic book-entry delivery against payment, thus eliminating the need
       for physical movement of certificates and risk from lack of simultaneous
       transfers of securities and cash. Transactions may now be settled in many
       currencies, including United States dollars. Euroclear provides various
       other services, including securities lending and borrowing and interfaces
       with domestic markets in several countries generally similar to the
       arrangements for cross-market transfers with DTC described below.


       Euroclear is operated by the Euroclear operator, under contract with
       Euroclear plc, a United Kingdom corporation. The Euroclear operator
       conducts all operations, and all Euroclear securities

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<PAGE>

       clearance accounts and Euroclear cash accounts are accounts with the
       Euroclear operator, not Euroclear plc. Euroclear plc establishes policy
       for Euroclear on behalf of Euroclear participants. Euroclear participants
       include banks (including central banks), securities brokers and dealers
       and other professional financial intermediaries and may include the
       initial purchasers of the notes. Indirect access to Euroclear is also
       available to other firms that clear through or maintain a custodial
       relationship with a Euroclear participant, either directly or indirectly.
       Euroclear is an indirect participant in DTC.

       The Euroclear operator is a Belgian bank. The Belgian Banking Commission
       and the National Bank of Belgium regulate and examine the Euroclear
       operator.

       The Terms and Conditions Governing Use of Euroclear and the related
       Operating Procedures of the Euroclear System, or the Euroclear Terms and
       Conditions, and applicable Belgian law govern securities clearance
       accounts and cash accounts with the Euroclear operator. Specifically,
       these terms and conditions govern:

      - transfers of securities and cash within Euroclear;

      - withdrawal of securities and cash from Euroclear; and

      - receipt of payments with respect to securities in Euroclear.

       All securities in Euroclear are held on a fungible basis without
       attribution of specific certificates to specific securities clearance
       accounts. The Euroclear operator acts under the terms and conditions only
       on behalf of Euroclear participants and has no record of or relationship
       with persons holding securities through Euroclear participants.

       Distributions with respect to notes held beneficially through Euroclear
       will be credited to the cash accounts of Euroclear participants in
       accordance with the Euroclear Terms and Conditions, to the extent
       received by the Euroclear operator.

     - As to Clearstream, Luxembourg:  Clearstream, Luxembourg has advised us
       that it was incorporated as a limited liability company under Luxembourg
       law. Clearstream, Luxembourg is owned by Cedel International, societe
       anonyme, and Deutsche Borse AG. The shareholders of these two entities
       are banks, securities dealers and financial institutions.

      Clearstream, Luxembourg holds securities for its customers and facilitates
      the clearance and settlement of securities transactions between
      Clearstream, Luxembourg customers through electronic book-entry changes in
      accounts of Clearstream, Luxembourg customers, thus eliminating the need
      for physical movement of certificates. Transactions may be settled by
      Clearstream, Luxembourg in many currencies, including United States
      dollars. Clearstream, Luxembourg provides to its customers, among other
      things, services for safekeeping, administration, clearance and settlement
      of internationally traded securities, securities lending and borrowing.
      Clearstream, Luxembourg also deals with domestic securities markets in
      over 30 countries through established depository and custodial
      relationships. Clearstream, Luxembourg interfaces with domestic markets in
      a number of countries. Clearstream, Luxembourg has established an
      electronic bridge with Euroclear Bank S.A./N.V., the operator of
      Euroclear, or the Euroclear operator, to facilitate settlement of trades
      between Clearstream, Luxembourg and Euroclear.

      As a registered bank in Luxembourg, Clearstream, Luxembourg is subject to
      regulation by the Luxembourg Commission for the Supervision of the
      Financial Sector. Clearstream, Luxembourg customers are recognized
      financial institutions around the world, including underwriters,
      securities brokers and dealers, banks, trust companies and clearing
      corporations. In the United States, Clearstream, Luxembourg customers are
      limited to securities brokers and dealers and banks, and include the
      initial purchasers of the notes. Other institutions that maintain a
      custodial relationship with a Clearstream, Luxembourg customer may obtain
      indirect access to Clearstream, Luxembourg. Clearstream, Luxembourg is an
      indirect participant in DTC.

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<PAGE>

      Distributions with respect to the notes held beneficially through
      Clearstream, Luxembourg will be credited to cash accounts of Clearstream,
      Luxembourg customers in accordance with its rules and procedures, to the
      extent received by Clearstream, Luxembourg.

     Investors in the global notes that are participants in DTC's system may
hold their interests therein directly through DTC. Investors in the global notes
that are not participants may hold their interests therein indirectly through
organizations (including Euroclear and Clearstream, Luxembourg) which are
participants in this system. All interests in a global note, including those
held through Euroclear or Clearstream, Luxembourg, may be subject to the
procedures and requirements of DTC. Those interests held through Euroclear or
Clearstream, Luxembourg may also be subject to the procedures and requirements
of these systems. The laws of some states require that certain persons take
physical delivery in definitive form of securities that they own. Consequently,
the ability to transfer beneficial interests in a global note to these persons
will be limited to that extent. Because DTC can act only on behalf of
participants, which in turn act on behalf of indirect participants, the ability
of a person having beneficial interests in a global note to pledge interests to
persons that do not participate in the DTC system, or otherwise take actions in
respect of these interests, may be affected by the lack of a physical
certificate evidencing these interests.

     EXCEPT AS DESCRIBED BELOW, OWNERS OF INTERESTS IN THE GLOBAL NOTES WILL NOT
HAVE NOTES REGISTERED IN THEIR NAMES, WILL NOT RECEIVE PHYSICAL DELIVERY OF
NOTES IN CERTIFICATED FORM AND WILL NOT BE CONSIDERED THE REGISTERED OWNERS OR
HOLDERS THEREOF UNDER THE INDENTURE FOR ANY PURPOSE.

     Payments in respect of the principal of and interest and premium, if any,
on a global note registered in the name of DTC or its nominee will be payable to
DTC in its capacity as the registered holder under the indenture. Under the
terms of the indenture, we, PepsiCo and the trustee will treat the persons in
whose names the notes, including the global notes, are registered as the owners
thereof for the purpose of receiving payments and for all other purposes.
Consequently, none of us, PepsiCo, the trustee or any of our or their respective
agents has or will have any responsibility or liability for:

     - any aspect of DTC's records or any participant's or indirect
       participant's records relating to or payments made on account of the
       beneficial ownership interests in the global notes;

     - maintaining, supervising or reviewing any of DTC's records or any
       participant's or indirect participant's records relating to the
       beneficial ownership interests in the global notes; or

     - any other matter relating to the actions and practices of DTC or any of
       its participants or indirect participants.

     DTC has advised us that its current practice, upon receipt of any payment
in respect of securities such as the notes (including principal and interest),
is to credit the accounts of the relevant participants with the payment on the
payment date unless DTC has reason to believe it will not receive payment on the
payment date. Each relevant participant is credited with an amount proportionate
to its beneficial ownership of an interest in the principal amount of the
relevant security as shown on the records of DTC. Payments by the participants
and the indirect participants to the beneficial owners of notes will be governed
by standing instructions and customary practices and will be the responsibility
of the participants or the indirect participants and will not be the
responsibility of DTC, the trustee, us or PepsiCo. None of us, PepsiCo or the
trustee will be liable for any delay by DTC or any of its participants in
identifying the beneficial owners of the notes, and we, PepsiCo and the trustee
may conclusively rely on and will be protected in relying on instructions from
DTC or its nominee for all purposes.

     Transfers between participants in DTC will be effected in accordance with
DTC's procedures, and will be settled in same-day funds, and transfers between
Euroclear participants and Clearstream, Luxembourg customers will be effected in
accordance with their respective rules and operating procedures.

     Cross-market transfers between the participants in DTC, on the one hand,
and Euroclear participants or Clearstream, Luxembourg customers, on the other
hand, will be effected through DTC in accordance with DTC's rules on behalf of
Euroclear or Clearstream, Luxembourg, as the case may be, by its respective U.S.
depositary; however, these cross-market transactions will require delivery of
instructions to

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Euroclear or Clearstream, Luxembourg, as the case may be, by the counterparty in
the system in accordance with the rules and procedures and within its
established deadlines (based on European time). Euroclear or Clearstream,
Luxembourg, as the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective U.S. depositary to take
action to effect final settlement on its behalf by delivering or receiving
interests in the relevant global note in DTC, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
DTC. Euroclear participants and Clearstream, Luxembourg customers may not
deliver instructions directly to their respective U.S. depositaries.

     Because of time-zone differences, credits of notes received in Euroclear or
Clearstream, Luxembourg as a result of a transaction with a DTC participant will
be made during subsequent securities settlement processing and dated the
business day following the DTC settlement date. Such credits or any transactions
in such notes settled during such processing will be reported to the relevant
Euroclear participants or Clearstream, Luxembourg customers on such business
day. Cash received in Euroclear or Clearstream, Luxembourg as a result of sales
of notes by or through a Euroclear participant or a Clearstream, Luxembourg
customer to a DTC participant will be received with value on the DTC settlement
date but will be available in the relevant Euroclear or Clearstream, Luxembourg
cash account only as of the business day following settlement in DTC.

     DTC has advised us and PepsiCo that it will take any action permitted to be
taken by a holder of notes only at the direction of one or more participants to
whose account DTC has credited the interests in the global notes and only in
respect of such portion of the aggregate principal amount of the notes as to
which the participant or participants has or have given such direction. However,
if there is an event of default under the notes, DTC reserves the right to
exchange the global notes for legended notes in certificated form, and to
distribute these notes to its participants.

     Although DTC, Euroclear and Clearstream, Luxembourg have agreed to the
foregoing procedures to facilitate transfers of interests in the Rule 144A
global notes, the Regulation S global notes and the global exchange notes among
participants in DTC, Euroclear and Clearstream, Luxembourg, they are under no
obligation to perform or to continue to perform those procedures, and may
discontinue those procedures at any time. None of we, PepsiCo or the trustee nor
any of our or its respective agents will have any responsibility for the
performance by DTC, Euroclear or Clearstream, Luxembourg or their respective
participants or indirect participants of their respective obligations under the
rules and procedures governing their operations. We, PepsiCo or the trustee may
conclusively rely on, and shall be protected in relying on, instructions from
DTC, Euroclear or Clearstream, Luxembourg, for all purposes.

EXCHANGE OF GLOBAL NOTES FOR CERTIFICATED NOTES

     A global note is exchangeable for definitive notes in registered
certificated form, which we refer to as certificated notes, if:

     - DTC notifies us that it is unwilling or unable to continue as depositary
       for the global notes and we fail to appoint a successor depositary or DTC
       has ceased to be a clearing agency registered under the Exchange Act;

     - we, at our option, notify the trustee in writing that we elect to cause
       the issuance of the certificated notes; or

     - there has occurred and is continuing an event of default with respect to
       the notes.

In addition, beneficial interests in a global note may be exchanged for
certificated notes upon prior written notice given to the trustee by or on
behalf of DTC in accordance with the indenture. In all cases, certificated notes
delivered in exchange for any global note or beneficial interests in global
notes will be registered in the names, and issued in any approved denominations,
requested by or on behalf of DTC (in accordance with its customary procedures)
and, in the case of old notes, will bear the applicable restrictive legend set
forth in the indenture, unless that legend is not required by applicable law.

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             CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

GENERAL

     The following discussion is a summary of the material United States federal
income and estate tax consequences resulting from the exchange of old notes for
new notes by a holder and the ownership and disposition of the new notes by a
Non-U.S. Holder (as defined below). This discussion only applies to a holder of
a new note who acquired an old note in the initial offering at the note's issue
price and who receives the new note in the exchange offer. The information
provided below is based on laws, regulations, rulings and decisions now in
effect. These authorities may change, possibly with retroactive effect, or the
Internal Revenue Service might interpret the existing authorities differently.
In either case, the tax consequences of purchasing, owning or disposing of notes
could differ from those described below.

     The summary generally applies only to holders that hold the notes as
"capital assets" (generally, for investment). The summary generally does not
address tax considerations that may be relevant to particular investors because
of their specific circumstances, or because they are subject to special rules.
For example, this summary does not address tax considerations applicable to
investors to whom special tax rules may apply, including:

     - banks or other financial institutions;

     - tax-exempt entities;

     - insurance companies;

     - regulated investment companies;

     - common trust funds;

     - brokers/dealers in securities or currencies;

     - persons that hold the notes as a hedge or hedged against currency risk or
       as part of an integrated investment, including a "straddle" or
       "conversion transaction," comprised of a note or one or more other
       positions; or

     - persons subject to the alternative minimum tax.

     Finally, the summary does not describe the effect of the federal gift tax
laws or the effects of any applicable foreign, state or local laws.

     THIS DISCUSSION IS FOR GENERAL INFORMATION ONLY AND IS NOT INTENDED AS
LEGAL OR TAX ADVICE TO ANY PARTICULAR INVESTOR. THIS SUMMARY DOES NOT PROVIDE A
COMPLETE ANALYSIS OR LISTING OF ALL POTENTIAL TAX CONSIDERATIONS. INVESTORS
SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE APPLICATION OF THE U.S.
FEDERAL INCOME AND ESTATE TAX LAWS TO THEIR PARTICULAR SITUATIONS AND THE
CONSEQUENCES OF FEDERAL GIFT TAX LAWS, FOREIGN, STATE OR LOCAL LAWS AND TAX
TREATIES, INCLUDING THE CONSEQUENCES OF ANY PROPOSED CHANGE IN APPLICABLE LAWS.

     For purposes of this discussion, the term "Non-U.S. Holder" means a
beneficial owner of a note that is, for United States federal income tax
purposes, an individual who is classified as a nonresident for U.S. federal
income tax purposes, a foreign corporation, or a nonresident alien fiduciary of
a foreign estate or trust.

     If a partnership or other entity treated as a pass-through for United
States federal income tax purposes owns notes, the tax treatment of an owner of
such entity will depend upon the status of the partner or the owner of such
entity and the activities of the entity. If a holder of notes is a partner in a
partnership or an owner of another entity that is treated as a pass-through for
United States federal income tax purposes, such holder is urged to consult its
tax advisors.

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TAX CONSEQUENCES OF EXCHANGE OF OLD NOTES FOR NEW NOTES

     A holder of old notes will not recognize any taxable gain or loss on the
exchange of the old notes for the new notes pursuant to the exchange offer, and
the holder will have the same adjusted tax basis and holding period in the new
notes as such holder had in the old notes immediately before the exchange.

TAX CONSEQUENCES TO NON-U.S. HOLDERS OF THE OWNERSHIP AND DISPOSITION OF NEW
NOTES

     The following is a general summary of the other material United States
federal income tax considerations that may be relevant to a beneficial owner of
new notes that is a Non-U.S. Holder:

     - No United States federal income or withholding tax will apply to a
       payment of interest on a new note to a Non-U.S. Holder, provided (i) the
       holder does not actually or constructively own 10% or more of the total
       membership interests of Bottling LLC and is not a controlled foreign
       corporation related, directly or indirectly, to Bottling LLC through
       equity ownership, (ii) the interest is not effectively connected with the
       conduct of a trade or business by the Non-U.S. Holder in the United
       States, and (iii) the beneficial owner certifies on IRS Form W-8BEN under
       penalties of perjury that it is a Non-U.S. Holder in compliance with
       applicable requirements.

     - A Non-U.S. Holder generally will not be subject to United States federal
       income or withholding tax on gain realized on the sale, exchange,
       retirement or other taxable disposition of a new note, unless (i) such
       gain is effectively connected with the conduct by such Non-U.S. Holder of
       a trade or business within the United States, or (ii) in the case of an
       individual Non-U.S. Holder, such individual is present in the United
       States for 183 days or more in the taxable year of the sale, retirement
       or other disposition and certain other conditions are met.

     - If a Non-U.S. Holder is engaged in a trade or business in the United
       States, and if interest on the note is effectively connected with the
       conduct of this trade or business, the Non-U.S. Holder, although exempt
       from the withholding tax discussed in the preceding paragraph, generally
       will be taxable under the same rules that govern the taxation of a United
       States person receiving or accruing interest on a note or realizing or
       recognizing gain or loss on the sale, exchange, retirement or other
       taxable disposition of a note, except that the holder will be required to
       provide to us a properly executed IRS Form W-8ECI in order to claim an
       exemption from withholding tax. These holders should consult their own
       tax advisors with respect to other U.S. tax consequences of the ownership
       and disposition of notes including the possible imposition of a 30%
       branch profits tax. Special rules might also apply to a Non-U.S. Holder
       that is a qualified resident of a country with which the United States
       has an income tax treaty.

     Federal Estate Taxes.  If interest on a new note is exempt from withholding
of U.S. federal income tax under the rules described above, the new note held by
an individual who at the time of death is a Non-U.S. Holder generally will not
be subject to United States federal estate tax upon such individual's death.

     Information Reporting and Backup Withholding.  In general, payments of
interest and the proceeds of the sale, exchange, redemption, retirement or other
disposition of the new notes payable by a United States paying agent or other
United States intermediary to a Non-U.S. Holder will be subject to information
reporting. In addition, backup withholding (currently at a rate of 30%) will
generally apply to these payments to a Non-U.S. Holder if the holder fails to
provide the certification on IRS Form W-8BEN (or IRS Form W-8ECI, if applicable)
or otherwise does not provide evidence of exempt status. Any amount paid as
backup withholding will be creditable against the holder's United States federal
income tax liability provided that the required information is timely furnished
to the IRS. Holders of notes should consult their tax advisors as to their
qualification for exemption from backup withholding and the procedure for
obtaining such an exemption.

                                        74
<PAGE>

                              PLAN OF DISTRIBUTION

     As discussed under the section entitled "The Exchange Offer," based on an
interpretation of the staff of the SEC, new notes issued in the exchange offer
may be offered for resale and resold or otherwise transferred by any holder of
such new notes (other than any such holder which is an "affiliate" of ours or
PepsiCo's within the meaning of Rule 405 under the Securities Act and except as
otherwise discussed below with respect to holders that are broker-dealers)
without compliance with the registration and prospectus delivery requirements of
the Securities Act so long as such new notes are acquired in the ordinary course
of such holder's business and such holder has no arrangement or understanding
with any person to participate in the distribution (within the meaning of the
Securities Act) of such new notes.


     Each broker-dealer that receives new notes for its own account in the
exchange offer must acknowledge that it will deliver a prospectus in connection
with any resale of those new notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker in connection with
resales of new notes received in exchange for old notes only where those old
notes were acquired as a result of market-making activities or other trading
activities. This is in addition to the obligation of dealers to deliver a
prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions. We and PepsiCo have agreed that, for a period of
180 days after the expiration date of this exchange offer, Bottling LLC will
make this prospectus available to any broker-dealer for use in connection with
any such resale.


     Neither we nor PepsiCo will receive any proceeds from any sale of new notes
by broker-dealers. New notes received by broker-dealers for their own account in
the exchange offer may be sold from time to time through:

     - one or more transactions in the over-the-counter market;

     - in negotiated transactions;

     - the writing of options on the new notes; or

     - a combination of such methods of resale.

     Such broker-dealer may sell at:

     - market prices prevailing at the time of resale;

     - prices related to such prevailing market prices; or

     - negotiated prices.

     Any such resale may be made directly to purchasers or to or through brokers
or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer or the purchasers of any new notes. Any
broker-dealer that resells new notes that were received by it for its own
account pursuant to the exchange offer and any broker or dealer that
participates in a distribution of those new notes may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit on any
such resale of new notes and any commissions or concessions received by such
persons may be deemed to be underwriting compensation under the Securities Act.
The letter of transmittal states that by acknowledging that it will deliver and
by delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.

     For a period of 180 days after the expiration date of the exchange offer,
we will promptly send additional copies of this prospectus and any amendment or
supplement to this prospectus to any broker-dealer that requests those documents
in the letter of transmittal. We have agreed to pay all expenses incident to the
exchange offer (including the expenses of one counsel for holders of the notes
but not including certain transfer taxes) other than commissions or concessions
of any broker-dealers and we and PepsiCo have each agreed to indemnify the
holders of the notes (including any broker-dealers) against certain liabilities,
including liabilities under the Securities Act.

                                        75
<PAGE>

                                 LEGAL MATTERS

     Certain matters with respect to the validity of the new notes will be
passed upon for us by Proskauer Rose LLP, New York, New York. Certain matters
with respect to the validity of the guarantee will be passed upon for PepsiCo by
Davis Polk & Wardwell, New York, New York and certain matters relating to North
Carolina law will be passed upon for PepsiCo by Womble Carlyle Sandridge & Rice,
PLLC, Durham, North Carolina.

                            INDEPENDENT ACCOUNTANTS


     Our consolidated financial statements and schedule as of December 28, 2002,
and December 29, 2001 and for each of the years in the three fiscal year period
ended December 28, 2002, have been incorporated by reference herein and in the
registration statement in reliance upon the reports of KPMG LLP, independent
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing. The audit report covering the
December 28, 2002, financial statements refers to the adoption of FASB 142,
"Goodwill and Other Intangible Assets," as of December 30, 2001.



     With respect to our unaudited interim financial information for the period
ended March 23, 2002 and March 22, 2003 incorporated by reference herein, the
independent accountants have reported that they applied limited procedures in
accordance with professional standards for a review of such information.
However, their separate report included in our quarterly report on Form 10-Q for
the quarter ended March 22, 2003, and incorporated by reference herein, states
that they did not audit and they do not express an opinion on that interim
financial information. Accordingly, the degree of reliance on their report on
such information should be restricted in light of the limited nature of review
procedures applied. The accountants are not subject to the liability provisions
of Section 11 of the Securities Act for their reports on the unaudited interim
financial information because those reports are not "reports" or "parts" of the
registration statement prepared or certified by the accountants within the
meaning of Sections 7 and 11 of the Securities Act.



     PepsiCo's consolidated financial statements as of December 28, 2002 and
December 29, 2001, and for each of the years in the three-year period ended
December 28, 2002, as reflected in PepsiCo's 2002 Form 10-K, have been
incorporated by reference herein and in the registration statement in reliance
upon the reports of KPMG LLP, independent accountants, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing. The audit report covering the December 28, 2002, financial statements
refers to the adoption of FASB 142, "Goodwill and Other Intangible Assets," as
of December 30, 2001.



     With respect to PepsiCo's unaudited interim financial information for the
periods ended March 23, 2002 and March 22, 2003 incorporated by reference
herein, the independent accountants have reported that they applied limited
procedures in accordance with professional standards for a review of such
information. However, their separate report included in PepsiCo's quarterly
report on Form 10-Q for the quarter ended March 22, 2003, and incorporated by
reference herein, states that they did not audit and they do not express an
opinion on that interim financial information. Accordingly, the degree of
reliance on their report on such information should be restricted in light of
the limited nature of the review procedures applied. The accountants are not
subject to the liability provisions of Section 11 of the Securities Act for
their reports on the unaudited interim financial information because those
reports are not "reports" or "parts" of the registration statement prepared or
certified by the accountants within the meaning of Sections 7 and 11 of the
Securities Act.



               INCORPORATION OF CERTAIN INFORMATION BY REFERENCE


     The information incorporated by reference in this prospectus as described
below is considered to be a part of this prospectus, except for any information
that is superseded by information that is included directly in this prospectus
or by a document subsequently filed with the SEC.

     This prospectus incorporates by reference the documents listed below that
we or PepsiCo have previously filed with the SEC. They contain important
information about us and PepsiCo and our and PepsiCo's respective financial
condition.

                                        76
<PAGE>


<Table>
<Caption>
BOTTLING LLC SEC FILINGS                                    PERIOD
- ------------------------                                    ------
<S>                                        <C>
Annual Report on Form 10-K...............  Year ended December 28, 2002, as filed on
                                           March 28, 2003
Annual Report on Form 10-K/A.............  Year ended December 28, 2002, as filed on
                                           May 23, 2003
Quarterly Report on Form 10-Q............  Quarterly period ended March 22, 2003, as
                                           filed on May 6, 2003
Quarterly Report on Form 10-Q/A..........  Quarterly period ended March 22, 2003, as
                                           filed on May 23, 2003
</Table>



<Table>
<Caption>
PEPSICO SEC FILINGS                                         PERIOD
- -------------------                                         ------
<S>                                        <C>
Annual Report on Form 10-K...............  Year ended December 28, 2002, as filed on
                                           March 7, 2003
Annual Report on Form 10-K/A.............  Year ended December 28, 2002, as filed on
                                           May 29, 2003
Quarterly Report on Form 10-Q............  Quarterly period ended March 22, 2003, as
                                           filed on April 25, 2003
Quarterly Report on Form 10-Q/A..........  Quarterly period ended March 22, 2003, as
                                           filed on May 29, 2003
Current Reports on Form 8-K or 8-K/A.....  Filed on:
                                           - January 30, 2003
                                           - February 6, 2003
                                           - March 4, 2003
</Table>



     We and PepsiCo each also incorporate by reference additional documents that
we or PepsiCo, as the case may be, may file with the SEC pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act from the date of this prospectus
and prior to the termination of this exchange offer. These documents include
periodic reports, such as Annual Reports on Form 10-K, Quarterly Reports on Form
10-Q and Current Reports on Form 8-K. Any statement contained in a previously
filed document incorporated by reference into this document is deemed to be
modified or superseded for purpose of this document to the extent that a
statement contained in this document (or in a subsequently filed document that
also is incorporated by reference herein) modifies or supersedes that statement.


     We have supplied all information contained or incorporated by reference in
this prospectus relating to us, and PepsiCo has supplied all information
contained or incorporated by reference in this prospectus relating to PepsiCo.

     You can obtain any of the documents incorporated by reference in this
document through us or PepsiCo, as the case may be, or from the SEC through the
SEC's Internet world wide web site at the address described above. Documents
incorporated by reference are available from us or PepsiCo, as the case may be,
without charge, excluding any exhibits to those documents, at the following
addresses:

<Table>
<S>                              <C>
Bottling Group, LLC              PepsiCo, Inc.
One Pepsi Way                    700 Anderson Hill Road
Somers, New York 10589           Purchase, New York 10577
Attention: Shareholder           Attention: Shareholder Relations
Relations                        Telephone: (914) 253-3055
Telephone: (914) 767-7216
Internet address:
Shareholder.Relations@Pepsi.com
</Table>

                              GENERAL INFORMATION

     We and PepsiCo have engaged The Bank of New York (Luxembourg) S.A. as the
Luxembourg listing agent in connection with the exchange offer. In Luxembourg,
you should contact the Luxembourg listing agent for services in connection with
the exchange offer, including to obtain copies of this prospectus and the letter
of transmittal or answers to questions about the terms and procedures of the
exchange offer, or to have a letter of transmittal submitted on your behalf. The
address and telephone number of the Luxembourg listing agent are as follows: The
Bank of New York (Luxembourg) S.A.,

                                        77
<PAGE>

Aerogolf Centre, 1A, Hoehenhof, L-1736 Senningerberg, Luxembourg, Telephone:
352-263-4771, Facsimile: 352-2634-0571.

     The old notes are listed, and application has been made to list the new
notes, on the Luxembourg Stock Exchange. In connection with the listing
application, our Articles of Formation and Amended and Restated Limited
Liability Company Agreement, PepsiCo's Restated Articles of Incorporation and a
legal notice relating to the issuance of the new notes have been deposited prior
to listing with Greffier en Chef du Tribunal d'Arrondissement de et a
Luxembourg, where copies thereof may be obtained upon request, for as long as
the notes are listed on the Luxembourg Stock Exchange. You may request copies of
these documents, together with this prospectus, the purchase agreement, the
registration rights agreement, the indenture and our and PepsiCo's respective
annual, quarterly and current reports, as well as all other documents
incorporated by reference in this prospectus, including all such future reports,
so long as any of the notes are outstanding, by following the directions under
"Where You Can Find More Information." These documents will also be made
available, free of charge, for as long as the notes are listed on the Luxembourg
Stock Exchange, at the main office of our and PepsiCo's Luxembourg listing agent
set forth above. Our and PepsiCo's Luxembourg listing agent will act as
intermediary between the Luxembourg Stock Exchange and us, PepsiCo and the
holders of the notes.

     Other than as disclosed or contemplated herein or in the documents
incorporated herein by reference, neither we nor any of our subsidiaries is
involved in litigation, arbitration or administrative proceedings relating to
claims or amounts that are material in the context of the issue of the notes. We
are not aware that any such litigation, arbitration or administrative
proceedings are pending or threatened.

     Other than as disclosed or contemplated herein or in the documents
incorporated herein by reference, neither PepsiCo nor any of its subsidiaries is
involved in litigation, arbitration or administrative proceedings related to
claims or amounts that are material in the context of the issue of the
guarantee. PepsiCo is not aware that any such litigation, arbitration or
administrative proceedings are pending or threatened.

     We have obtained all material consents, approvals and authorizations in
connection with the issuance of the notes. Resolutions relating to the issuance
and sale of the notes were adopted by our Managing Directors on September 5,
2002.

     PepsiCo has obtained all material consents, approvals and authorizations in
connection with the issuance of the guarantee. Resolutions relating to the
issuance of the guarantee were adopted by PepsiCo's Board of Directors on July
18, 2002 and November 13, 2002.

     We accept the responsibility for the information contained in this
prospectus other than information about PepsiCo.

     PepsiCo accepts the responsibility for the information with respect to
PepsiCo contained in this prospectus.

     The notes, the related guarantee, the indenture, the registration rights
agreement and the purchase agreement are governed by and will be construed in
accordance with the laws of the State of New York.

     The notes have been accepted for clearance through Clearstream, Luxembourg
and Euroclear. Relevant trading information is as follows:

<Table>
<Caption>
                                                   INTERNATIONAL SECURITY
                                  COMMON CODE   IDENTIFICATION NUMBER (ISIN)      CUSIP
                                  -----------   ----------------------------   -----------
<S>                               <C>           <C>                            <C>
4 5/8% Series B Senior Notes due
  November 15, 2012                 016041793           US10138MAB19           10138M AB 1
</Table>

     According to Chapter VI, Article 3, point A/II/2 of the Rules and
Regulations of the Luxembourg Stock Exchange the notes shall be freely
transferable and therefore no transaction made on the Luxembourg Stock Exchange
shall be cancelled.

     We and PepsiCo only publish consolidated financial statements.

     Our and PepsiCo's respective independent accountants are KPMG LLP.

                                        78
<PAGE>

                                    PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20.  INDEMNIFICATION OF DIRECTORS AND OFFICERS

     Section 18-108 of the Delaware Limited Liability Company Act provides that
a limited liability company may indemnify and hold harmless any member or
manager or other person from and against any and all claims and demands
whatsoever, subject to any standards and restrictions that may be set forth in
its limited liability company agreement. Section 12.1 of the amended and
restated limited liability company agreement of Bottling LLC, a Delaware limited
liability company, or Bottling LLC, provides that none of the managing directors
or members, or any officers, directors, stockholders, partners, employees,
representatives, consultants or agents of either of the foregoing, nor any
officer, employee, representative, consultant or agent of Bottling LLC or any of
its affiliates (referred to individually, as a Covered Person and, collectively,
as the Covered Persons) shall be liable to Bottling LLC or any other person for
any act or omission (in relation to Bottling LLC and the conduct of its
business, the limited liability company agreement, any related document or any
transaction contemplated by any such documents) taken or omitted in good faith
by a Covered Person and in the reasonable belief that such act or omission was
in, or was not contrary to, the best interests of Bottling LLC. Section 12.2 of
the amended and restated limited liability company agreement of Bottling LLC
provides that Bottling LLC shall indemnify and hold harmless each managing
director, member and officer of Bottling LLC and each officer or director of any
member (referred to individually, as an Indemnified Person and, collectively, as
the Indemnified Persons) from and against any and all losses, claims, demands,
liabilities, expenses, judgments, fines, settlements and other amounts arising
from any and all actions, suits or proceedings, whether civil, criminal,
administrative or investigative, in which such Indemnified Person may be
involved, or threatened to be involved, as a party or otherwise, by reason of
its management of the affairs of Bottling LLC or which relates to or arises out
of Bottling LLC or its property, business or affairs. Bottling LLC shall pay in
advance any legal or other expenses incurred in investigating or defending
against any loss, claim, damage or liability which may be subject to
indemnification, upon receipt of an undertaking from the Indemnified Person on
whose behalf such expenses are paid to repay such amount if it shall ultimately
be determined that such Indemnified Person is not entitled to be indemnified by
Bottling LLC. Bottling LLC has purchased insurance, to the extent available at
reasonable cost, to cover losses, claims, damages or liabilities subject to
indemnification. Upon a determination by the managing directors, Bottling LLC
may provide indemnification to any employees, representatives, agents or
consultants of Bottling LLC to the same extent provided to Indemnified Persons.

     PepsiCo, Inc., a North Carolina corporation, or PepsiCo, does not have any
provisions for indemnification of directors or officers in its amended and
restated articles of incorporation. Article 3.7 of the bylaws of PepsiCo
provides that unless the board of directors determines otherwise, PepsiCo shall
indemnify, to the full extent permitted by law, any person who was or is, or who
is threatened to be made, a party to an action, suit or proceeding, whether
civil, criminal, administrative or investigative, by reason of the fact that
such person, such person's testator or intestate, is or was a director, officer
or employee of PepsiCo, or is or was serving at the request of PepsiCo as a
director, officer or employee of another enterprise, against expenses (including
attorneys' fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding. Such indemnification may, in the discretion of the board of
directors, include advances of a director's, officer's or employee's expenses
prior to final disposition of such action, suit or proceeding. The right of
indemnification provided for by Section 3.7 shall not exclude any rights to
which such persons may otherwise be entitled by contract or as a matter of law.
Section 55-2-02 of the North Carolina Business Corporation Act, or the North
Carolina Act, enables a corporation in its articles of incorporation to
eliminate or limit, with certain exceptions, the personal liability of directors
for monetary damages for breach of their duties as directors. No such provision
is effective to eliminate or limit a director's liability for: (i) acts or
omissions that the director at the time of the breach knew or believed to be
clearly in conflict with the best interests of the corporation, (ii) improper
distributions as described in

                                       II-1
<PAGE>

Section 55-8-33 of the North Carolina Act, (iii) any transaction from which the
director derived an improper personal benefit, or (iv) acts or omissions
occurring prior to the date the exculpatory provision became effective.

     Sections 55-8-50 through 55-8-58 of the North Carolina Act permit a
corporation to indemnify its directors, officers, employees or agents under
either or both a statutory or nonstatutory scheme of indemnification. Under the
statutory scheme, a corporation may, with certain exceptions, indemnify a
director, officer, employee or agent of the corporation who was, is, or is
threatened to be made, a party to any threatened, pending or completed legal
action, suit or proceeding, whether civil, criminal, administrative, or
investigative because of the fact that such person was or is a director,
officer, agent or employee of the corporation, or is or was serving at the
request of such corporation as a director, officer, employee or agent of another
corporation or enterprise. This indemnity may include the obligation to pay any
judgment, settlement, penalty, fine (including an excise tax assessed with
respect to an employee benefit plan) or reasonable expenses incurred in
connection with a proceeding (including counsel fees), but no such
indemnification may be granted unless such director, officer, employee or agent
(i) conducted himself in good faith, (ii) reasonably believed (A) that any
action taken in his official capacity with the corporation was in the best
interests of the corporation or (B) that in all other cases his conduct was not
opposed to the corporation's best interests, and (iii) in the case of any
criminal proceeding, had no reasonable cause to believe his conduct was
unlawful. Whether a director has met the requisite standard of conduct for the
type of indemnification set forth above is determined by the board of directors,
a committee of directors, special legal counsel or the shareholders in
accordance with Section 55-8-55 of the North Carolina Act. A corporation may not
indemnify a director under the statutory scheme in connection with a proceeding
by or in the right of the corporation in which a director was adjudged liable to
the corporation or in connection with any other proceeding in which a director
was adjudged liable on the basis of having received an improper personal
benefit.

     In addition to, and notwithstanding the conditions of and limitations on,
the indemnification described above under the statutory scheme, Section 55-8-57
of the North Carolina Act permits a corporation to indemnify, or agree to
indemnify, any of its directors, officers, employees or agents against liability
and expenses (including attorneys' fees) in any proceeding (including
proceedings brought by or on behalf of the corporation) arising out of their
status as such or their activities in such capacities, except for any
liabilities or expenses incurred on account of activities that were, at the time
taken, known or believed by the person to be clearly in conflict with the best
interests of the corporation. Sections 55-8-52 and 55-8-56 of the North Carolina
Act require a corporation, unless its articles of incorporation provide
otherwise, to indemnify a director or officer who has been wholly successful, on
the merits or otherwise, in the defense of any proceeding to which such director
or officer was, or was threatened to be, made a party because he is or was a
director or officer of the corporation. Unless prohibited by the articles of
incorporation, a director or officer also may make application and obtain
court-ordered indemnification if the court determines that such director or
officer is fairly and reasonably entitled to such indemnification as provided in
Sections 55-8-54 and 55-8-56 of the North Carolina Act.

     Additionally, Section 55-8-57 of the North Carolina Act authorizes a
corporation to purchase and maintain insurance on behalf of an individual who is
or was a director, officer, employee or agent of the corporation against certain
liabilities incurred by such a person, whether or not the corporation is
otherwise authorized by the North Carolina Act to indemnify that person. PepsiCo
has purchased and maintains such insurance.

ITEM 21.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

     (a) The exhibits listed below in the "Index to Exhibits" are part of this
registration statement and are numbered in accordance with Item 601 of
Regulation S-K.

     (b) The following financial statement schedules are filed as part of this
registration statement:

     None

                                       II-2
<PAGE>

ITEM 22.  UNDERTAKINGS

     Each of the undersigned registrants hereby severally undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of such registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

     Each of the undersigned registrants hereby severally undertakes to respond
to requests for information that is incorporated by reference into the
prospectus pursuant to Item 4, 10(b), 11, or 13 of this form, within one
business day of receipt of such request, and to send the incorporated documents
by first class mail or other equally prompt means. This includes information
contained in documents filed subsequent to the effective date of the
registration statement through the date of responding to the request.

     Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of each
registrant pursuant to the foregoing provisions, or otherwise, such registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of such registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, such registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.

     Each of the undersigned registrants severally hereby undertakes to supply
by means of a post-effective amendment all information concerning a transaction,
and the company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.

                                       II-3
<PAGE>

                                   SIGNATURES


     Pursuant to the requirements of the Securities Act of 1933, as amended,
Bottling Group, LLC has duly caused this registration statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the city of Somers,
state of New York, on May 29, 2003.


                                          BOTTLING GROUP, LLC


                                          By: /s/ JOHN T. CAHILL

                                            ------------------------------------
                                              John T. Cahill
                                              Principal Executive Officer and
                                              Managing Director


     Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities set forth opposite their names and on the date indicated above.



<Table>
<Caption>
                    SIGNATURE                                           TITLE
                    ---------                                           -----
<S>    <C>                                           <C>

                      /s/ *                          Principal Executive Officer and Managing
- --------------------------------------------------   Director
                  John T. Cahill

                      /s/ *                          Principal Financial Officer
- --------------------------------------------------
                 Alfred H. Drewes

                      /s/ *                          Principal Accounting Officer
- --------------------------------------------------
                Andrea L. Forster

                      /s/ *                          Managing Director
- --------------------------------------------------
                Matthew M. McKenna


By:               /s/ PAMELA C. MCGUIRE              Managing Director
       -------------------------------------------
                    *Attorney-in-Fact
</Table>


                                       II-4
<PAGE>

                                   SIGNATURES


     Pursuant to the requirements of the Securities Act of 1933, as amended,
PepsiCo, Inc. has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the city of Purchase,
state of New York, on May 29, 2003.


                                          PEPSICO, INC.


                                          By: /s/ THOMAS H. TAMONEY, JR.

                                            ------------------------------------
                                                Thomas H. Tamoney, Jr.
                                             Vice President, Associate General
                                               Counsel and Assistant Secretary

     Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities set forth opposite their names and on the date indicated above.


<Table>
<Caption>
                    SIGNATURE                                           TITLE
                    ---------                                           -----
<S>    <C>                                           <C>

                      /s/ *                          Chairman of the Board and Chief Executive
- --------------------------------------------------   Officer
                Steven S Reinemund

                      /s/ *                          President, Chief Financial Officer and
- --------------------------------------------------   Director
                  Indra K. Nooyi

                      /s/ *                          Senior Vice President and Controller (Chief
- --------------------------------------------------   Accounting Officer)
                Peter A. Bridgman

                      /s/ *                          Director
- --------------------------------------------------
                  John F. Akers

                      /s/ *                          Director
- --------------------------------------------------
                 Robert E. Allen

                      /s/ *                          Director
- --------------------------------------------------
                    Peter Foy

                      /s/ *                          Director
- --------------------------------------------------
                   Ray L. Hunt

                      /s/ *                          Director
- --------------------------------------------------
                Arthur C. Martinez

                      /s/ *                          Director
- --------------------------------------------------
                Franklin D. Raines

                      /s/ *                          Director
- --------------------------------------------------
             Sharon Percy Rockefeller

                      /s/ *                          Director
- --------------------------------------------------
                Franklin A. Thomas

                      /s/ *                          Director
- --------------------------------------------------
                Cynthia M. Trudell
</Table>


                                       II-5
<PAGE>


<Table>
<Caption>
                    SIGNATURE                                           TITLE
                    ---------                                           -----
<S>    <C>                                           <C>

                      /s/ *                          Director
- --------------------------------------------------
               Solomon D. Trujillo

                      /s/ *                          Director
- --------------------------------------------------
                  Daniel Vasella


By:            /s/ THOMAS H. TAMONEY, JR.
       -------------------------------------------
                    *Attorney-in-Fact
</Table>


                                       II-6
<PAGE>

                               INDEX TO EXHIBITS


<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
- -------                           -----------
<C>       <S>
     3.1  Certificate of Formation of Bottling Group, LLC, which is
          incorporated herein by reference to Exhibit 3.4 to Bottling
          Group, LLC's registration statement on Form S-4/A
          (Registration No. 333-80361-01)
     3.2  Amended and Restated Limited Liability Company Agreement of
          Bottling Group, LLC, which is incorporated herein by
          reference to Exhibit 3.5 to Bottling Group, LLC's
          registration statement on Form S-4/A (Registration No.
          333-80361-01)
     3.3  Amendment No. 1 to the Amended and Restated Limited
          Liability Company Agreement of Bottling Group, LLC, dated as
          of January 1, 2002, by and among Pepsi Bottling Holdings,
          Inc., Bottling Group Holdings, Inc. and The Pepsi Bottling
          Group, Inc.*
     3.4  Restated Articles of Incorporation of PepsiCo, Inc., which
          are incorporated herein by reference to Exhibit 4.1 to
          PepsiCo's registration statement on Form S-8 (Registration
          No. 333-66632)
     3.5  By-laws of PepsiCo, Inc., as amended to May 7, 2003
     4.1  Indenture, dated as of November 15, 2002, by and among
          Bottling Group, LLC, as Obligor, and PepsiCo, Inc., as
          Guarantor, and JPMorgan Chase Bank, as Trustee, relating to
          $1,000,000,000 4 5/8% Senior Notes due November 15, 2012*
     4.2  Form of 4 5/8% Senior Notes due November 15, 2012 (included
          as Exhibits A and B to Exhibit 4.1)*
     4.3  Registration Rights Agreement, dated November 7, 2002, by
          and among Bottling Group, LLC, PepsiCo, Inc., Credit Suisse
          First Boston Corporation, Deutsche Bank Securities Inc.,
          Salomon Smith Barney Inc., Banc of America Securities LLC,
          J.P. Morgan Securities Inc. and Lehman Brothers Inc.*
     4.4  Indenture, dated as of February 8, 1999, among Pepsi
          Bottling Holdings, Inc., PepsiCo, Inc. and The Chase
          Manhattan Bank, as trustee, relating to $1,000,000,000
          5 3/8% Senior Notes due 2004 and $1,300,000,000 5 5/8%
          Senior Notes due 2009, which is incorporated herein by
          reference to Exhibit 10.9 to The Pepsi Bottling Group,
          Inc.'s registration statement on Form S-1/A (Registration
          No. 333-70291)
     4.5  First Supplemental Indenture, dated as of February 8, 1999,
          among Pepsi Bottling Holdings, Inc., Bottling LLC, PepsiCo,
          Inc. and The Chase Manhattan Bank, as trustee, supplementing
          the Indenture, dated as of February 8, 1999, among Pepsi
          Bottling Holdings, Inc., PepsiCo, Inc. and The Chase
          Manhattan Bank, as trustee, which is incorporated herein by
          reference to Exhibit 10.10 to The Pepsi Bottling Group,
          Inc.'s registration statement on Form S-1/A (Registration
          No. 333-70291)
     4.6  Indenture, dated as of March 8, 1999, by and among The Pepsi
          Bottling Group, Inc., as obligor, Bottling Group, LLC, as
          guarantor, and The Chase Manhattan Bank, as trustee,
          relating to $1,000,000,000 7% Series B Senior Notes due
          2029, which is incorporated herein by reference to Exhibit
          10.14 to The Pepsi Bottling Group, Inc.'s registration
          statement on Form S-1/A (Registration No. 333-70291)
     4.7  U.S. $250,000,000 5-Year Credit Agreement, dated as of April
          30, 2003 among The Pepsi Bottling Group, Inc., Bottling
          Group, LLC, Citibank, N.A., Bank of America, N.A., Credit
          Suisse First Boston, Cayman Islands Branch, Deutsche Bank AG
          New York Branch, JPMorgan Chase Bank, The Northern Trust
          Company, Lehman Brothers Bank, FSB, Banco Bilbao Vizcaya
          Argentaria, HSBC Bank USA, Fleet National Bank, The Bank of
          New York, State Street Bank and Trust Company, Comerica
          Bank, Wells Fargo Bank, N.A., JPMorgan Chase Bank, as Agent,
          Citigroup Global Markets Inc. and Banc of America Securities
          LLC, as Joint Lead Arrangers and Book Managers and Citibank,
          N.A., Bank of America, N.A., Credit Suisse First Boston, and
          Deutsche Bank Securities Inc. as Syndication Agents
</Table>

<PAGE>


<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
- -------                           -----------
<C>       <S>
     4.8  U.S. $250,000,000 364-Day Credit Agreement, dated as of
          April 30, 2003 among The Pepsi Bottling Group, Inc.,
          Bottling Group, LLC, Citibank, N.A., Bank of America, N.A.,
          Credit Suisse First Boston, Cayman Islands Branch, Deutsche
          Bank AG New York Branch, JPMorgan Chase Bank, The Northern
          Trust Company, Lehman Brothers Bank, FSB, Banco Bilbao
          Vizcaya Argentaria, HSBC Bank USA, Fleet National Bank, The
          Bank of New York, State Street Bank and Trust Company,
          Comerica Bank, Wells Fargo Bank, N.A., JPMorgan Chase Bank,
          as Agent, Citigroup Global Markets Inc. and Banc of America
          Securities LLC, as Joint Lead Arrangers and Book Managers
          and Citibank, N.A., Bank of America, N.A., Credit Suisse
          First Boston, and Deutsche Bank Securities Inc. as
          Syndication Agents
     4.9  PepsiCo, Inc. agrees to furnish to the Securities and
          Exchange Commission, upon request, a copy of any instrument
          defining the rights of holders of long-term debt of PepsiCo,
          Inc. and all of its subsidiaries for which consolidated or
          unconsolidated financial statements are required to be filed
          with the Securities and Exchange Commission
     4.10 Agreement to Tender, dated as of October 4, 2002, among PBG
          Grupo Embotellador Hispano-Mexicano S.L., Bottling Group,
          LLC and PepsiCo, Inc., which is incorporated herein by
          reference to Exhibit (d)(1) to Schedule TO as filed by The
          Pepsi Bottling Group, Inc. with the Securities and Exchange
          Commission on October 7, 2002
     4.11 Agreement to Tender, dated as of October 4, 2002, among PBG
          Grupo Embotellador Hispano-Mexicano S.L., Bottling Group,
          LLC and Enrique C. Molina Sobrino, which is incorporated
          herein by reference to Exhibit (d)(2) to Schedule TO as
          filed by The Pepsi Bottling Group, Inc. with the Securities
          and Exchange Commission on October 7, 2002
     4.12 Escrow Agreement, dated as of October 4, 2002, among PBG
          Grupo Embotellador Hispano-Mexicano S.L., Bottling Group,
          LLC and Enrique C. Molina Sobrino and The Bank of New York,
          which is incorporated herein by reference to Exhibit (d)(3)
          to Schedule TO as filed by The Pepsi Bottling Group, Inc.
          with the Securities and Exchange Commission on October 7,
          2002
     5.1  Opinion of Proskauer Rose LLP as to the legality of the
          securities being registered*
     5.2  Opinion of Davis Polk & Wardwell as to the legality of the
          securities being registered*
     5.3  Opinion of Womble Carlyle Sandridge & Rice, PLLC as to the
          legality of the securities being registered*
    10.1  Form of Master Bottling Agreement, which is incorporated
          herein by reference to Exhibit 10.1 to The Pepsi Bottling
          Group, Inc.'s registration statement on Form S-1
          (Registration No. 333-70291)
    10.2  Form of Master Fountain Syrup Agreement, which is
          incorporated herein by reference to Exhibit 10.2 to The
          Pepsi Bottling Group, Inc.'s registration statement on Form
          S-1 (Registration No. 333-70291)
    10.3  Form of Non-Cola Bottling Agreement, which is incorporated
          herein by reference to Exhibit 10.3 to The Pepsi Bottling
          Group, Inc.'s registration statement on Form S-1
          (Registration No. 333-70291)
    10.4  Form of Shared Services Agreement, which is incorporated
          herein by reference to Exhibit 10.5 to The Pepsi Bottling
          Group, Inc.'s registration statement on Form S-1
          (Registration No. 333-70291)
    10.5  Description of PepsiCo, Inc. Director Stock Plan, which is
          incorporated herein by reference to Post-Effective Amendment
          No. 6 to PepsiCo's registration statement on Form S-8
          (Registration No. 33-22970)
    10.6  PepsiCo, Inc. 1987 Incentive Plan, or the 1987 Plan, as
          amended and restated, effective as of October 1, 1999, which
          is incorporated herein by reference to Exhibit 10.2 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 25, 1999
    10.7  Operating Guideline No. 1 under the 1987 Plan, as amended
          through July 25, 1991, which is incorporated herein by
          reference to Exhibit 10(d) to PepsiCo's Annual Report on
          Form 10-K for the fiscal year ended December 28, 1991
    10.8  Operating Guideline No. 2 under the 1987 Plan and the Plan,
          as amended through January 22, 1987, which is incorporated
          herein by reference to Exhibit 28(b) to PepsiCo's
          registration statement on Form S-8 (Registration No.
          33-19539)
</Table>

<PAGE>


<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
- -------                           -----------
<C>       <S>
    10.9  PepsiCo, Inc. 1994 Long-Term Incentive Plan, as amended and
          restated, effective as of October 1, 1999, which is
          incorporated herein by reference to Exhibit 10.6 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 25, 1999
    10.10 PepsiCo, Inc. Executive Incentive Compensation Plan, which
          is incorporated herein by reference to Exhibit B to
          PepsiCo's Proxy Statement for its 1994 Annual Meeting of
          Shareholders
    10.11 Amended and Restated PepsiCo Executive Income Deferral
          Program, which is incorporated herein by reference to
          Exhibit 10.8 to PepsiCo's Annual Report on Form 10-K for the
          fiscal year ended December 27, 1997
    10.12 Restated PepsiCo Pension Equalization Plan, which is
          incorporated herein by reference to Exhibit 10.1 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 27, 1997
    10.13 Agreement and Plan of Merger, dated as of December 2, 2000,
          among PepsiCo, Inc., BeverageCo, Inc., a wholly owned
          subsidiary of PepsiCo, and The Quaker Oats Company
          (Schedules and Exhibits omitted), which is incorporated
          herein by reference to Exhibit 2.1 to PepsiCo's Current
          Report on Form 8-K filed with the Securities and Exchange
          Commission on December 7, 2000
    10.14 Stock Option Agreement, dated as of December 2, 2000,
          between PepsiCo, Inc. and The Quaker Oats Company, which is
          incorporated herein by reference to Exhibit 2.2 to PepsiCo's
          Current Report on Form 8-K filed with the Securities and
          Exchange Commission on December 7, 2000
    10.15 Employment Agreement, dated as of December 2, 2000, between
          The Quaker Oats Company, PepsiCo, Inc. and Robert S.
          Morrison, which is incorporated herein by reference to
          Exhibit 10.12 to PepsiCo's Annual Report on Form 10-K for
          the fiscal year ended December 29, 2001
    10.16 PepsiCo SharePower Stock Option Plan (as amended and
          restated, effective August 3, 2001), which is incorporated
          herein by reference to Exhibit 10.11 to PepsiCo's Annual
          Report on Form 10-K for the fiscal year ended December 28,
          2002
    10.17 PepsiCo, Inc. 1995 Stock Option Incentive Plan (as amended
          and restated, effective August 2, 2001), which is
          incorporated herein by reference to Exhibit 10.12 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 28, 2002
    10.18 The PepsiCo Share Award Plan (effective May 1, 2002) which
          is incorporated herein by reference to PepsiCo's Form S-8
          (Registration No. 333-87526) filed with the Securities and
          Exchange Commission on May 3, 2002
    10.19 The Quaker Long Term Incentive of 1990, which is
          incorporated herein by reference to Exhibit 10.14 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 28, 2002
    10.20 The Quaker Long Term Incentive of 1999, which is
          incorporated herein by reference to Exhibit 10.15 to
          PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 28, 2002
    10.21 PepsiCo, Inc. 2003 Long-Term Incentive Plan, which is
          incorporated herein by reference to Exhibit C to PepsiCo's
          Proxy Statement on Schedule 14A filed with the Securities
          and Exchange Commission on March 24, 2003
    12.1  Statement re: Bottling Group, LLC Computation of Ratio of
          Earnings to Fixed Charges*
    12.2  Statement re: PepsiCo, Inc. Computation of Ratio of Earnings
          to Fixed Charges, which is incorporated by reference herein
          to PepsiCo's Annual Report on Form 10-K for the fiscal year
          ended December 28, 2002 and Quarterly Report on Form 10-Q
          for the quarter ended March 22, 2003
    12.3  Statement re: Bottling Group, LLC Computation of Ratio of
          Earnings to Fixed Charges for the fiscal year ended December
          28, 2002 and for the quarter ended March 22, 2003
    14    Worldwide Code of Conduct, which is incorporated herein by
          reference to PepsiCo's Annual Report on Form 10-K for the
          fiscal year ended December 28, 2002
    15.1  Letter from KPMG LLP re: Unaudited Interim Financial
          Information for The Pepsi Bottling Group, Inc. and Bottling
          Group, LLC
    15.2  Letter from KPMG LLP re: Unaudited Interim Financial
          Information for PepsiCo, Inc.
</Table>

<PAGE>


<Table>
<Caption>
EXHIBIT
  NO.                             DESCRIPTION
- -------                           -----------
<C>       <S>
    21.1  Subsidiaries of Bottling Group, LLC, which is incorporated
          herein by reference to Exhibit 21 to Bottling Group, LLC's
          Annual Report on Form 10-K for the fiscal year ended
          December 28, 2002
    21.2  Subsidiaries of PepsiCo, Inc. which is incorporated herein
          by reference to Exhibit 21 to PepsiCo's Annual Report on
          Form 10-K for the fiscal year ended December 28, 2002
    23.1  Consent of Proskauer Rose LLP (contained in Exhibit 5.1)*
    23.2  Consent of Davis Polk & Wardwell (contained in Exhibit 5.2)*
    23.3  Consent of Womble Carlyle Sandridge & Rice, PLLC (contained
          in Exhibit 5.3)*
    23.4  Consent of KPMG LLP for Bottling Group, LLC
    23.5  Consent of KPMG LLP for The Pepsi Bottling Group, Inc.
    23.6  Consent of KPMG LLP for PepsiCo, Inc.
    24.1  Power of Attorney -- Bottling Group, LLC (contained on
          signature pages)*
    24.2  Power of Attorney -- PepsiCo, Inc.*
    25.1  Statement of Eligibility of JPMorgan Chase Bank, as Trustee,
          on Form T-1*
    99.1  Form of Letter of Transmittal*
    99.2  Form of Notice of Guaranteed Delivery*
    99.3  Form of Instruction to Registered Holder and/or Book-Entry
          Transfer Participant from Beneficial Owner*
    99.4  Form of Letter to Clients*
    99.5  Form of Letter to Registered Holder(s) and to the Depositary
          Trust Company Participants*
    99.6  Guidelines for Certification of Taxpayer Identification
          Number on Substitute Form W-9*
</Table>


- ---------------


* Previously filed with the Securities and Exchange Commission on December 20,
2002.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3.5
<SEQUENCE>3
<FILENAME>y66832a1exv3w5.txt
<DESCRIPTION>BY-LAWS
<TEXT>
<PAGE>

                                                                     EXHIBIT 3.5

================================================================================

                                  PEPSICO, INC.

                                   ----------

                                     BY-LAWS

                            AS AMENDED TO MAY 7, 2003

================================================================================

<PAGE>

                                                                     EXHIBIT 3.5

                                    ARTICLE I

                                     Offices

      Section 1.1 Principal Office. The principal office of PepsiCo, Inc.
(hereinafter called the "Corporation") in the State of North Carolina shall be
in the City of New Bern, County of Craven.

      Section 1.2 Other Offices. The Corporation may also have an office or
offices at such other place or places, either within or without the State of
North Carolina, as the Board of Directors of the Corporation (hereinafter called
the "Board") may from time to time by resolution determine or as may be
appropriate to the business of the Corporation.

                                   ARTICLE II

                            Meetings of Stockholders

      Section 2.1 Place of Meetings. All meetings of the stockholders of the
Corporation shall be held at the principal office of the Corporation in the
State of North Carolina, or at such other place within or without the State of
North Carolina as may from time to time be fixed by resolution of the Board.

      Section 2.2 Annual Meetings. The annual meeting of the stockholders of the
Corporation for the election of directors and for the transaction of such other
business as may properly come before the meeting shall be held on the first
Wednesday of May in each year (or, if that day shall be a legal holiday under
the laws of the State where such meeting is to be held, then on the next
succeeding business day). For nominations or other proper business to be brought
before an annual meeting by a stockholder, the stockholder must give written
notice thereof to the Secretary of the Corporation, with such notice to be
received at the principal office of the Corporation no less that 90 days prior
to the first anniversary of the preceding year's annual meeting. Such
stockholder notice shall set forth: (A) as to each person whom the stockholder
proposes to nominate for election or reelection as a director all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of directors in an election contest, or is otherwise
required, in each case pursuant to Regulation 14A under the Securities Exchange
Act of 1934, as amended, including such person's written consent to being named
in the proxy statement as a nominee and to serving as a director if elected; (B)
as to any other business that the stockholder proposes to bring before the
meeting, the reasons for conducting such business at the meeting and any
material interest in such business of such stockholder; and (C) the name and
address of such stockholder as it appears on the Corporation's books, and the
number of shares of the Corporation's stock which are owned by such stockholder.

      Section 2.3 Special Meetings. A special meeting of the stockholders of the
Corporation may be called at any time by the Chairman or Vice Chairman of the
Board or

<PAGE>

the Board, and shall be called by the Secretary upon the written request of
stockholders owning a majority of shares of the capital stock of the Corporation
outstanding and entitled to vote at such meeting. Such special meeting shall be
held at such time and at such place within or without the State of North
Carolina as may be fixed by the Chairman or Vice Chairman of the Board, in the
case of meetings called by the Chairman or Vice Chairman of the Board, or by
resolution of the Board, in the case of meetings called by the Board; and any
meeting called at the request of stockholders pursuant hereto shall be held at
the principal office of the Corporation within ninety (90) days from the receipt
by the Secretary of such request. Any request for a special meeting of the
stockholders shall set forth: (A) a statement of the specific proposal to be
brought before the meeting, the reasons for conducting such business at the
meeting, and any material interest in such business of the stockholders
requesting the meeting; (B) the name and address of each such stockholder as it
appears on the Corporation's books; and (C) the number of shares of the
Corporation's stock which are owned by each such stockholder.

      Section 2.4 Notice of Meetings. Except as otherwise prescribed by statute,
the Articles of Incorporation or these By-Laws, notice of each meeting of the
stockholders of the Corporation, whether annual or special, shall be given at
least ten (10) days before the day on which the meeting is to be held to each
stockholder entitled to vote thereat, by mailing a written or printed notice
thereof, postage prepaid, addressed to him at his address as it appears on the
stock ledger of the Corporation or, in the absence of knowledge on the part of
the Corporation of any such address, then at the principal office of the
Corporation in the State of North Carolina. Except as otherwise prescribed by
statute, notice of any adjourned meeting of stockholders need not be given.

      Section 2.5 Quorum, Presiding Officer. Except as otherwise prescribed by
statute, the Articles of Incorporation or these By-Laws, at any meeting of the
stockholders of the Corporation, the presence in person or by proxy of the
holders of record of a majority of the issued and outstanding shares of capital
stock of the Corporation entitled to vote thereat shall constitute a quorum for
the transaction of business. In the absence of a quorum at such meeting or any
adjournment or adjournments thereof, the holders of record of a majority of such
shares so present in person or by proxy and entitled to vote thereat or, in the
absence of all the stockholders, any officer entitled to preside at or act as
Secretary of the meeting, may adjourn the meeting from time to time until a
quorum shall be present. At any such adjourned meeting at which a quorum is
present, any business may be transacted which might have been transacted at the
meeting as originally called. Meetings of the stockholders shall be presided
over by the Chairman or Vice Chairman of the Board, or, if neither is present,
by another officer or director who shall be designated to serve in such event by
the Board. The Secretary of the Corporation, or an Assistant Secretary
designated by the officer presiding at the meeting, shall act as Secretary of
the meeting.

      Section 2.6 Voting, Inspectors of Election. Except as otherwise prescribed
by statute, the Articles of Incorporation or these By-Laws, at any meeting of
the stockholders of the Corporation, each stockholder shall be entitled to one
vote in person or by proxy


                                       2
<PAGE>

for each share of the capital stock of the Corporation registered in the name of
such stockholder on the books of the Corporation on the date fixed pursuant to
Section 8.3 of these By-Laws as the record date for the determination of
stockholders entitled to vote at such meeting. No proxy shall be voted after
eleven (11) months from its date unless said proxy provides for a longer period.
Shares of its own capital stock belonging to the Corporation shall not be voted
either directly or indirectly. At all meetings of the stockholders of the
Corporation, a quorum being present, all matters (except as otherwise expressly
prescribed by statute, the Articles of Incorporation or these By-Laws) shall be
decided by the vote of the holders of a majority of the stock of the
Corporation, present in person or by proxy, and entitled to vote thereat. The
vote for the election of directors, other matters expressly prescribed by
statute, and, upon the direction of the presiding officer of the meeting, the
vote on any other question before the meeting, shall be by ballot. At all
meetings of stockholders, the polls shall be opened and closed, the proxies and
ballots shall be received, taken in charge and examined, and all questions
concerning the qualifications of voters, the validity of proxies and the
acceptance or rejection of proxies and of votes shall be decided by three (3)
inspectors of election. Such inspectors of election, together with one
alternate, to serve in the event of death, inability or refusal by any of said
inspectors of election to serve at the meeting, none of whom need be a
stockholder of the Corporation, shall be appointed by the Board, or, if no such
appointment or appointments shall have been made, then by the presiding officer
at the meeting. If, for any reason, any inspector of election so appointed shall
fail to attend, or refuse or be unable to serve, a substitute shall be appointed
to serve as inspector of election, in his place or stead, by the presiding
officer at the meeting. No director or candidate for the office of director
shall be appointed as an inspector. Each inspector shall take and subscribe an
oath or affirmation to execute faithfully the duties of inspector at such
meeting with strict impartiality and according to the best of his ability. After
the balloting, the inspectors shall make a certificate of the result of the vote
taken.

      Section 2.7 Lists of Stockholders. It shall be the duty of the officer of
the Corporation who shall have charge of the stock ledger of the Corporation,
either directly or through another officer designated by him or through a
transfer agent or transfer clerk appointed by the Board, to prepare and make, at
least ten (10) days before every election of directors, a complete list of
stockholders entitled to vote at said election, arranged in alphabetical order.
Such list shall be open to the examination of any stockholder at the place where
said election is to be held for said ten (10) days, and shall be produced and
kept at the time and place of election, during the whole time thereof, subject
to the inspection of any stockholder who may be present.

                                   ARTICLE III

                               Board of Directors

      Section 3.1 Powers, Number, Term, Election. The property, business and
affairs of the Corporation shall be managed by the Board. The Board shall
consist of fourteen (14) directors, but the number of directors may be
increased, and may be


                                       3
<PAGE>

decreased to any number not less than three (3), by resolution adopted by
three-fourths of the whole Board; provided, however, that the number of
directors which shall constitute the whole Board shall not be reduced to a
number less than the number of directors then in office, unless such reduction
shall become effective only at and after the next ensuing meeting of
stockholders for the election of directors, or upon the resignation of an
incumbent director. At all meetings of the stockholders of the Corporation for
the election of directors at which a quorum shall be present, a majority of the
votes cast shall elect. Each director shall hold office from the time of his
election and qualification until the annual meeting of stockholders next
succeeding his election and until his successor shall have been duly elected and
shall have qualified, or until his death, resignation or removal. No director
need be a stockholder.

      Section 3.2 Place of Meetings. The Board may hold its meetings at such
place or places within or without the State of North Carolina as it may from
time to time by resolution determine, or as shall be specified or fixed in the
respective notices or waivers of notice thereof. Any regular or special meeting
may be held by conference telephone or similar communications equipment so long
as all persons participating in such meeting can hear one another, and
participation in such a telephonic meeting shall constitute presence in person.

      Section 3.3 First Meeting. After each annual election of directors, on the
same day and at the place where such election is held, the newly elected Board
shall meet for the purpose of organization, the election of officers and the
transaction of other business. Notice of such meeting need not be given. Such
meeting may be held at any other time or place which shall be specified in a
notice given as hereinafter provided for special meetings of the Board, or in a
waiver of notice thereof signed by all the directors.

      Section 3.4 Regular Meetings. Regular meetings of the Board may be held at
such time and place and in such manner as the Board may from time to time by
resolution determine. Except as otherwise expressly prescribed by statute, the
Articles of Incorporation or these By-Laws, notice of regular meetings need not
be given.

      Section 3.5 Special Meetings. Special meetings of the Board shall be held
whenever called by the Chairman or Vice Chairman of the Board, or by the
Secretary upon the written request filed with the Secretary by any four (4)
directors. Notice of the time, place and manner of each such special meeting
shall be mailed to each director, at his residence or usual place of business,
not later than the second day before the day on which such meeting is to be
held, or shall be sent addressed to him at such place by telegraph or other
electronic transmission, or shall be delivered personally or by telephone, not
later than six o'clock in the afternoon of the day before the day on which such
meeting is to be held. Except as otherwise prescribed by statute, the Articles
of Incorporation or these By-Laws, and except in the case of a special meeting
of the Board called for the purpose of removing an officer or officers of the
Corporation or the filling of a vacancy or vacancies in the Board or of amending
the By-Laws, notice or waivers of


                                       4
<PAGE>

notice of any meeting of the Board need not set forth the purpose or purposes of
the meeting.

      Section 3.6 Quorum. Except as otherwise prescribed by statute or by these
By-Laws, the presence of a majority of the full Board shall constitute a quorum
for the transaction of business at any meeting, and the act of a majority of the
directors present at a meeting at which a quorum shall be present shall be the
act of the Board. Any meeting of the Board may be adjourned by a majority vote
of the directors present at such meeting. In the absence of a quorum, the
Chairman or Vice Chairman of the Board or a majority of the directors present
may adjourn such meeting until a quorum shall be present. Notice of any
adjourned meeting need not be given. The directors shall act only as a board and
the individual directors shall have no power as such.

      Section 3.7 Indemnification. Unless the Board of Directors shall determine
otherwise, the Corporation shall indemnify, to the full extent permitted by law,
any person who was or is, or who is threatened to be made, a party to an action,
suit or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that he, his testator or intestate, is or was a director,
officer or employee of the Corporation, or is or was serving at the request of
the Corporation as a director, officer or employee of another enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding. Such indemnification may, in the discretion of the
Board, include advances of a director's, officer's or employee's expenses prior
to final disposition of such action, suit or proceeding. The right of
indemnification provided for in this Section 3.7 shall not exclude any rights to
which such persons may otherwise be entitled by contract or as a matter of law.

      Section 3.8 Written Consents. Any action required or permitted to be taken
at any meeting of the Board or of any committee thereof may be taken without a
meeting, if, prior to such action, a written consent thereto is signed by all
members of the Board or of such committee, as the case may be, and such written
consent is filed with the minutes of proceedings of the Board or committee.

                                   ARTICLE IV

                                   Committees

      Section 4.1 Designation, Vacancies, etc. The Board may from time to time
by resolution create committees of directors, officers, employees, or other
persons, with such functions, duties and powers as the Board shall by resolution
prescribe. A majority of all the members of any such committee may determine its
actions and rules or procedure, and fix the time, place and manner of its
meetings, unless the Board shall otherwise provide. The Board shall have power
to change the members of any such committee at any time, to fill vacancies, and
to discharge any such committee, either with or without cause, at any time.


                                       5
<PAGE>

                                    ARTICLE V

                                    Officers

      Section 5.1 Principal Officers. The principal officers of the Corporation
shall be a Chairman of the Board of Directors, a Vice Chairman of the Board of
Directors, both of whom shall be chosen from among the directors, a President,
one or more Vice Presidents, a Secretary, a Treasurer, and a Controller. One
person may hold any two offices. The Board may require any such officer to give
security for the faithful performance of his duties.

      Section 5.2 Election, Term of Office, Qualification. The principal
officers of the Corporation shall be elected annually by the Board and each
shall hold office until his successor shall have been duly elected and shall
have qualified, or until his death, or until he shall resign, or until he shall
have been removed in the manner hereinafter provided.

      Section 5.3 Chairman and Vice Chairman of the Board. The Chairman or the
Vice Chairman of the Board of Directors as shall be determined by the Board of
Directors, shall be chief executive officer of the Corporation and, as such,
shall have supervision of its policies, business, and affairs, and such other
powers and duties as are commonly incident to the office of chief executive
officer. The Chairman of the Board of Directors shall preside at the meetings of
the Board and may call meetings of the Board and of any committee thereof,
whenever he deems it necessary, and he shall call to order and preside at all
meetings of the stockholders of the Corporation. In addition, he shall have such
other powers and duties as the Board shall designate from time to time. The
Chairman of the Board of Directors shall have power to sign all certificates of
stock, bonds, deeds and contracts of the Corporation. The Vice Chairman of the
Board shall, in the absence of the Chairman of the Board, perform all duties of
the Chairman of the Board and any other duties assigned to him or for which he
is designated by the Chairman of the Board. In addition, the Vice Chairman of
the Board shall have such other powers and duties as the Board shall designate
from time to time.

      Section 5.4 Chief Executive Officer. The Chief Executive Officer of the
Corporation shall have supervision of its policies, business, and affairs, and
such other powers and duties as are commonly incident to the office of chief
executive officer.

      Section 5.5 President. The President shall have such powers and duties as
the Chairman of the Board shall designate from time to time. The President shall
have power to sign all certificates of stock, bonds, deeds and contracts of the
Corporation.

      Section 5.6 Vice Presidents. Each Vice President shall have such powers
and perform such duties as the Board or the Chairman of the Board may from time
to time prescribe. The Board may elect or designate one or more of the Vice
Presidents as


                                       6
<PAGE>

Executive Vice Presidents, Senior Vice Presidents or with such other title as
the Board may deem appropriate.

      Section 5.7 The Treasurer. The Treasurer shall keep, deposit, invest and
disburse the funds and securities of the Corporation, shall keep full and
accurate accounts of the receipts and disbursements of the Corporation, shall
maintain insurance coverage on the Corporation's assets, and, in general, shall
perform all the duties incident to the office of Treasurer and such other duties
as may from time to time be assigned to him by the Chairman or Vice Chairman of
the Board, the Chief Executive Officer or the Board.

      Section 5.8 The Secretary. The Secretary shall act as secretary of, and
keep the minutes of, all meetings of the Board and of the stockholders, shall be
custodian of the seal of the Corporation and shall affix and attest the seal to
all documents the execution of which on behalf of the Corporation under its seal
shall have been specifically or generally authorized by the Board, and, in
general, shall perform all the duties incident to the office of Secretary and
such other duties as may from time to time be assigned by the Chairman or Vice
Chairman of the Board, the Chief Executive Officer or the Board.

      Section 5.9 The Controller. The Controller shall be the chief accounting
officer of the Corporation, shall have charge of its accounting department and
shall keep or cause to be kept full and accurate records of the assets,
liabilities, business and transactions of the Corporation.

      Section 5.10 Additional Officers. The Board may elect or appoint such
additional officers as it may deem necessary or advisable, and may delegate the
power to appoint such additional officers to any committee or principal officer.
Such additional officers shall have such powers and duties and shall hold office
for such terms as may be determined by the Board or such committee or officer.

      Section 5.11 Salaries. The Salaries of the officers of the Corporation
shall be fixed from time to time in the manner prescribed by the Board.

                                   ARTICLE VI

                  Removal, Resignations, Vacancies and Salaries

      Section 6.1 Removal of Directors. Any director may be removed at any time,
either with or without cause, by the affirmative vote of the holders of record
of a majority of the stock of the Corporation entitled to vote at a special
meeting of the stockholders called for the purpose, and the vacancy in the Board
caused by any such removal may be filled by the stockholders at such meeting
and, if not filled thereat, the vacancy caused by such removal may be filled by
the directors as provided in Section 6.4 hereof.

      Section 6.2 Removal of Officers. Any officer of the Corporation elected or
appointed by the Board, or appointed by any committee or principal officer of
the


                                       7
<PAGE>

Corporation pursuant to authority delegated by the Board, may be removed at any
time, either with or without cause, by resolution adopted by a majority of the
whole Board at a regular meeting of the Board or at a special meeting thereof
called for such purpose.

      Section 6.3 Resignation. Any director or officer of the Corporation may at
any time resign by giving written notice to the Board, the Chairman of the
Board, the Vice Chairman of the Board, the Chief Executive Officer, or the
Secretary. Any such resignation shall take effect at the time specified therein
or, if no time shall be specified therein, at the time of the receipt thereof,
and unless otherwise specified therein, the acceptance of such resignation shall
not be necessary to make it effective.

      Section 6.4 Vacancies. Any vacancy in the Board caused by death,
resignation, disqualification, an increase in the number of directors, or any
other cause, may be filled by the majority vote of the remaining directors,
though less than a quorum, at any regular meeting of the Board or any special
meeting thereof called for the purpose, or by the stockholders of the
Corporation at the next annual meeting or at any special meeting called for the
purpose, and the directors so chosen shall hold office, subject to the
provisions of these By-Laws, until the next annual meeting of stockholders for
the election of directors and until his successor shall be duly elected and
shall qualify. Any vacancy in any office, caused by death, resignation, removal,
disqualification or any other cause, shall be filled for the unexpired portion
of the term in the manner prescribed in these By-Laws for regular election or
appointment to such office.

      Section 6.5 Compensation. Each director who shall not also be an executive
officer of the Corporation or any of its subsidiary companies and receiving a
regular salary for his services, in consideration of his serving as a director,
shall be entitled to receive from the Corporation such fees for serving as a
director as the Board shall from time to time determine, and each such director,
who shall serve as a member of any committee of the Board, in consideration of
his serving as a member of such committee, shall be entitled to such amount per
annum or such fees for attendance at committee meetings as the Board shall from
time to time determine. Nothing contained in this Section shall preclude any
director from serving the Corporation or its subsidiaries in any other capacity
and receiving compensation therefor.

                                   ARTICLE VII

                Contracts, Loans, Checks, Drafts, Deposits, Etc.

      Section 7.1 Contracts and Loans. Except as authorized pursuant to a
resolution of the Board or these By-Laws, no officer, agent or employee of the
Corporation shall have any power or authority to bind the Corporation by any
contract or engagement, to effect any loan on its behalf, to issue any
negotiable paper in its name, to pledge its credit, to render it pecuniarily
liable for any purpose or for any amount, or to pledge, hypothecate or transfer
any securities or other property of the Corporation as security for any loans or
advances.


                                       8
<PAGE>

      Section 7.2 Checks, Drafts, etc. All checks, drafts, and other instruments
or orders for the payment of monies out of the funds of the Corporation, and all
notes or other evidences of indebtedness, bills of lading, warehouse receipts
and insurance certificates of the Corporation shall be signed on behalf of the
Corporation in such manner as shall from time to time be determined pursuant to
a resolution of the Board. All checks, drafts and other instruments or orders
for the payment of monies to or upon the order of the Corporation may be
endorsed for deposit in such manner as shall be determined pursuant to a
resolution of the Board.

      Section 7.3 Proxies. Unless otherwise provided by resolution of the
Chairman or Vice Chairman of the Board, the Chief Executive Officer, the
President, or any Vice President or Secretary or Assistant Secretary designated
by the Board, may from time to time appoint an attorney or attorneys or agent or
agents of the Corporation to cast, in the name and on behalf of the Corporation,
the votes which the Corporation may be entitled to cast as the holder of stock
or other securities in any other corporation, any of whose stock or other
securities may be held by the Corporation, at meetings of the holders of the
stock or other securities of such other corporation or to consent in writing, in
the name of the Corporation as such holder, to any action by such other
corporation, and may instruct the person or persons so appointed as to the
manner of casting such votes or giving such consent, and may execute or cause to
be executed in the name and on behalf of the Corporation and under its corporate
seal, or otherwise, all such written proxies or other instruments as he may deem
necessary or proper in the premises.

                                  ARTICLES VIII

                             Shares, Dividends, Etc.

      Section 8.1 Certificates. Certificates for shares of the capital stock of
the Corporation shall be in such form as shall be approved by the Board. Each
such certificate shall be signed in the name of the Corporation by the Chairman
of the Board, the Vice Chairman of the Board, the President, or a Vice
President, and the Treasurer or an Assistant Treasurer or the Secretary or an
Assistant Secretary of the Corporation; provided, however, that, where such
certificate is signed (a) by a transfer agent or an assistant transfer agent or
(b) by a transfer clerk acting on behalf of the Corporation, and a registrar,
the signature of any such Chairman of the Board, Vice Chairman of the Board,
Chief Executive Officer, President, Vice President, Treasurer, Assistant
Treasurer, Secretary or Assistant Secretary may be a facsimile. In case any
officer or officers who shall have signed, or whose facsimile signature or
signatures shall have been used on, any such certificate or certificates shall
cease to be such officer or officers, whether because of death, resignation or
otherwise, before such certificate or certificates shall have been delivered by
the Corporation, such certificate or certificates shall be deemed to have been
adopted by the Corporation and to have been issued and delivered as though the
person or persons who signed such certificate or certificates or whose facsimile
signature or signatures were used thereon had not ceased to be such officer or
officers of the


                                       9
<PAGE>

Corporation. Except as otherwise prescribed by statute, the Articles of
Incorporation, or by these By-Laws, the person in whose name shares of stock
shall be registered on the books of the Corporation shall be deemed to be the
owner thereof for all purposes as regards the Corporation.

      Section 8.2 Transfers. The Board may make such rules and regulations as it
may deem expedient concerning the issue, registration and transfer of
certificates representing shares of the capital stock of the Corporation and may
appoint one or more transfer agents or clerks and registrars thereof.

      Section 8.3 Closing of Transfer Books, Record Date. The Board may at any
time by resolution direct the closing of the stock transfer books of the
Corporation for a period of not exceeding fifty (50) days preceding the date of
any meeting of stockholders, or the date for payment of any dividend, or the
date for the allotment of rights or the date when any change or conversion or
exchange of capital stock shall go into effect or for a period of not exceeding
sixty (60) days in connection with obtaining the consent of stockholders for any
purpose; provided, however, that in lieu of closing the stock transfer books as
aforesaid, the Board may fix in advance a date, not exceeding sixty (60) days
preceding the date of any meeting of stockholders, or the date for the payment
of any dividend, or the date for the allotment of rights, or the date when any
change or conversion or exchange of capital stock shall go into effect, or a
date in connection with obtaining such consent, as a record date for the
determination of the stockholders entitled to notice of, and to vote at, any
such meeting and any adjournment thereof, or entitled to receive payment of any
such dividend, or to any such allotment of rights, or to exercise the rights in
respect of any such change, conversion or exchange of capital stock, or to give
such consent, and in such case such stockholders and only such stockholders as
shall be stockholders of record on the date so fixed shall be entitled to such
notice of, and to vote at, such meeting and any adjournment thereof, or to
receive payment of such dividend, or to receive such allotment or rights, or
exercise such rights, or to give such consent, as the case may be,
notwithstanding any transfer of any stock on the books of the Corporation after
any such record date fixed as aforesaid. Except where the stock transfer books
of the Corporation shall have been closed or a date shall have been fixed as a
record date for the determination of the stockholders entitled to vote, as
hereinabove provided, no share of stock shall be voted on at any election of
directors which shall have been transferred on the books of the Corporation
within twenty (20) days next preceding such election of directors.

      Section 8.4 Lost or Destroyed Certificates. In case of loss, theft,
mutilation or destruction of any certificate evidencing shares of the capital
stock of the Corporation, another may be issued in its place upon proof of such
loss, theft, mutilation or destruction and upon the giving of an indemnity or
other undertaking to the Corporation in such form and in such sum as the Board
may direct.


                                       10
<PAGE>

                                   ARTICLE IX

                Seal, Fiscal Year, Waivers of Notice, Amendments

      Section 9.1 Corporate Seal. The seal of the Corporation shall be circular
in form and shall bear the name of the Corporation and the inscription
"Corporate Seal, North Carolina". Said seal may be used by causing it or a
facsimile thereof to be impressed or reproduced or otherwise.

      Section 9.2 Fiscal Year. Each fiscal year of the Corporation shall end on
the last Saturday of December.

      Section 9.3 Waivers of Notice. Anything in these By-Laws to the contrary
notwithstanding, notice of any meeting of the stockholders, the Board, or any
committee constituted by the Board need not be given to any person entitled
thereto, if such notice shall be waived by such person in writing or by
telegraph, cable or wireless before, at or after such meeting, or if such person
shall be present in person, or in the case of a meeting of the stockholders, be
present in person or represented by proxy, at such meeting and without objecting
to such lack of notice.

      Section 9.4 Amendments. These By-Laws may be altered, amended or repealed
or new By-Laws may be made either:

            (a) by the affirmative vote of the holders of record of a majority
      of the outstanding stock of the Corporation entitled to vote thereon, at
      any annual or special meeting of the stockholders, provided that notice of
      the proposed alteration, amendment or repeal or of the proposed new By-Law
      or By-Laws be included in the notice of such meeting or waiver thereof, or

            (b) by the affirmative vote of a majority of the whole Board at any
      regular meeting of the Board, or any special meeting thereof, provided
      that notice of the proposed alteration, amendment or repeal or of the
      proposed new By-Law or By-Laws be included in the notice of such special
      meeting or waiver thereof or all of the directors at the time in office be
      present at such special meeting.

provided, however, that no change of the time or place for the election of
directors shall be made within sixty (60) days next before the day on which such
election is to be held, and that in case of any change of such time or place,
notice thereof shall be given to each stockholder in accordance with Section 2.4
hereof at least twenty (20) days before the election is held.

      By-Laws made or amended by the Board may be altered, amended or repealed
by the stockholders.


                                       11

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.7
<SEQUENCE>4
<FILENAME>y66832a1exv4w7.txt
<DESCRIPTION>5-YEAR CREDIT AGREEMENT
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.7

                                                           EXECUTION COUNTERPART

================================================================================

                                U.S. $250,000,000
                             5-YEAR CREDIT AGREEMENT

                           Dated as of April 30, 2003

                                      among

                         THE PEPSI BOTTLING GROUP, INC.

                               BOTTLING GROUP, LLC

                            THE LENDERS NAMED HEREIN

                              JPMORGAN CHASE BANK,
                                    as Agent,

                        CITIGROUP GLOBAL MARKETS INC. and
                         BANC OF AMERICA SECURITIES LLC,
                           as Joint Lead Arrangers and
                                  Book Managers

                                       and

                                 CITIBANK, N.A.,
                             BANK OF AMERICA, N.A.,
                         CREDIT SUISSE FIRST BOSTON, and
                          DEUTSCHE BANK SECURITIES INC.
                              as Syndication Agents

================================================================================
<PAGE>

                                                                     EXHIBIT 4.7

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                  Page
                                                                                                  ----
<S>                                                                                               <C>
ARTICLE I  DEFINITIONS AND ACCOUNTING .....................................................         1
         SECTION 1.01.  Certain Defined Terms .............................................         1
         SECTION 1.02.  Computation of Time Periods .......................................        12
         SECTION 1.03.  Accounting Terms ..................................................        13
ARTICLE II  AMOUNTS AND TERMS OF THE ADVANCES .............................................        13
         SECTION 2.01.  The Revolving Credit Advances .....................................        13
         SECTION 2.02.  Making the Revolving Credit Advances ..............................        13
         SECTION 2.03.  The Competitive Bid Advances ......................................        15
         SECTION 2.04.  Fees ..............................................................        18
         SECTION 2.05.  Termination, Reduction or Increase of the Commitments .............        19
         SECTION 2.06.  Repayment of Revolving Credit Advances, Evidence of
                 Indebtedness and Extension of Termination Date ...........................        21
         SECTION 2.07.  Interest on Revolving Credit Advances .............................        23
         SECTION 2.08.  Interest Rate Determination .......................................        23
         SECTION 2.09.  Optional Conversion of Revolving Credit Advances ..................        24
         SECTION 2.10.  Optional Prepayments of Revolving Credit Advances .................        25
         SECTION 2.11.  Increased Costs ...................................................        25
         SECTION 2.12.  Illegality ........................................................        26
         SECTION 2.13.  Payments and Computations .........................................        26
         SECTION 2.14.  Taxes .............................................................        27
         SECTION 2.15.  Sharing of Payments, Etc ..........................................        30
         SECTION 2.16.  Use of Proceeds ...................................................        30
         SECTION 2.17.  Borrowings by Borrowing Subsidiaries; Substitution of Borrower ....        30
         SECTION 2.18.  Mitigation Obligations ............................................        31
ARTICLE III  CONDITIONS TO EFFECTIVENESS AND ARTICLE II ...................................        32
         SECTION 3.01.  Conditions Precedent to Effectiveness of Sections 2.01 and 2.03 ...        32
         SECTION 3.02.  Conditions Precedent to Each Revolving Credit Borrowing ...........        34
         SECTION 3.03.  Conditions Precedent to Each Competitive Bid Borrowing ............        34
         SECTION 3.04.  Determinations Under Section 3.01 .................................        35
ARTICLE IV  REPRESENTATIONS AND WARRANTIES OF THE LOAN PARTIES ............................        35
         SECTION 4.01.  Representations and Warranties of the Loan Parties ................        35
ARTICLE V  COVENANTS ......................................................................        36
         SECTION 5.01.  Affirmative Covenants .............................................        36
         SECTION 5.02.  Negative Covenants ................................................        38
         SECTION 5.03.  Financial Covenants ...............................................        39
ARTICLE VI  EVENTS OF DEFAULT .............................................................        40
         SECTION 6.01.  Events of Default .................................................        40
ARTICLE VII  THE AGENT ....................................................................        42
ARTICLE VIII  MISCELLANEOUS ...............................................................        44
         SECTION 8.01.  Amendments, Etc ...................................................        44
         SECTION 8.02.  Notices, Etc ......................................................        44
         SECTION 8.03.  No Waiver; Remedies ...............................................        45
</TABLE>


                                      -i-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                  Page
                                                                                                  ----
<S>                                                                                               <C>
         SECTION 8.04.  Costs and Expenses ................................................        45
         SECTION 8.05.  Right of Set-off ..................................................        46
         SECTION 8.06.  Binding Effect ....................................................        46
         SECTION 8.07.  Assignments and Participations ....................................        46
         SECTION 8.08.  Confidentiality ...................................................        50
         SECTION 8.09.  Governing Law .....................................................        50
         SECTION 8.10.  Execution in Counterparts .........................................        50
         SECTION 8.11.  Jurisdiction, Etc .................................................        50
         SECTION 8.12.  WAIVER OF JURY TRIAL ..............................................        51
ARTICLE IX  COMPANY GUARANTEE .............................................................        51
         SECTION 9.01.  Company Guarantee .................................................        51
ARTICLE X  SUBSIDIARY GUARANTEE ...........................................................        52
         SECTION 10.01.  Subsidiary Guarantee .............................................        53
         SECTION 10.02.  Limitation of Guarantor's Liability ..............................        54
</TABLE>

SCHEDULE 1    - LENDING OFFICES
SCHEDULE 2    - PRICING SCHEDULE

EXHIBIT A-1   - FORM OF NOTICE OF REVOLVING CREDIT BORROWING
EXHIBIT A-2   - FORM OF NOTICE OF COMPETITIVE BID BORROWING
EXHIBIT A-3   - FORM OF EXTENSION AGREEMENT
EXHIBIT B     - FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT C     - FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY
                AND THE GUARANTOR
EXHIBIT D     - FORM OF DESIGNATION LETTER
EXHIBIT E     - FORM OF SUBSTITUTION LETTER
EXHIBIT F     - FORM OF TERMINATION LETTER


                                      -ii-
<PAGE>

                                CREDIT AGREEMENT

                           Dated as of April 30, 2003

      THE PEPSI BOTTLING GROUP, INC., a Delaware corporation (the "Company"),
BOTTLING GROUP, LLC, a Delaware limited liability company (the "Guarantor"), the
banks, financial institutions and other institutional lenders (the "Initial
Lenders") listed on the signature pages hereof, and JPMORGAN CHASE BANK
("JPMorgan"), as administrative agent (in such capacity, the "Agent") for the
Lenders (as hereinafter defined), agree as follows:

                                    ARTICLE I

                           DEFINITIONS AND ACCOUNTING

      SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

            "Advance" means a Revolving Credit Advance or a Competitive Bid
Advance.

            "Affiliate" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 5% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or otherwise.

            "Agent's Account " means the account of the Agent maintained by the
Agent at JPMorgan with its office at 270 Park Avenue, New York, New York 10017.

            "Alternate Covenant Date" means any day on which the Index Debt of
Pepsi shall be rated less than A- by S&P or less than A3 by Moody's.

            "Applicable Facility Fee Rate" means, for any Rating Level Period,
the rate per annum set forth in Schedule 2 opposite the reference to such Rating
Level Period under the heading "Applicable Facility Fee Rate". Each change in
the Applicable Facility Fee Rate resulting from a Rating Level Change shall be
effective on the date of such Rating Level Change.

            "Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of the Base Rate Advance and such
Lender's Eurodollar Lending Office in the case of a Eurodollar Rate Advance and,
in the case of a Competitive Bid

                             5-Year Credit Agreement

<PAGE>
                                      -2-


Advance, the office of such Lender notified by such Lender to the Agent as
Applicable Lending Office with respect to such Competitive Bid Advance.

            "Applicable Margin" means, with respect to any Eurodollar Rate
Advance, for any Rating Level Period, the rate per annum set forth in Schedule 2
opposite the reference to such Rating Level Period under the heading "Applicable
Margin". Each change in the Applicable Margin resulting from a Rating Level
Change shall be effective on the date of such Rating Level Change.

            "Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.

            "Applicable Utilization Fee Rate" means, for any Rating Level
Period, the rate per annum set forth in Schedule 2 opposite the reference to
such Rating Level Period under the heading "Applicable Utilization Fee Rate".
Each change in the Applicable Utilization Fee Rate resulting from a Rating Level
Change shall be effective on the date of such Rating Level Change.

            "Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the Agent, in
substantially the form of Exhibit B hereto.

            "Base Rate" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to the
higher of:

            (a) the rate of interest announced publicly by JPMorgan in New York,
New York, from time to time, as JPMorgan's prime rate; and

            (b) 1/2 of one percent per annum above the Federal Funds Rate.

            "Base Rate Advance" means a Revolving Credit Advance that bears
interest as provided in Section 2.07(a).

            "Borrowers" means, at any time, collectively, the Company unless the
Substitution Date has occurred pursuant to Section 2.17, each Borrowing
Subsidiary and, on and after the Substitution Date has occurred pursuant to
Section 2.17, the Guarantor.

            "Borrowing" means a Revolving Credit Borrowing or a Competitive Bid
Borrowing.

            "Borrowing Subsidiary" means any Subsidiary of the Company, as to
which a Designation Letter has been delivered to the Agent and as to which a
Termination Letter has not been delivered to the Agent in accordance with
Section 2.17.

                             5-Year Credit Agreement

<PAGE>
                                      -3-


            "Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.

            "Change of Control" means (a) the acquisition of ownership, directly
or indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934, and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof) other than
Pepsi, of shares representing more than 25% of the aggregate ordinary voting
power represented by the issued and outstanding capital stock of the Company;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of the Company by Persons who were neither (i) nominated by the
board of directors of the Company nor (ii) appointed by directors so nominated;
or (c) the acquisition of direct or indirect Control of the Company by any
Person or group other than Pepsi.

            "Commitment" has the meaning specified in Section 2.01.

            "Competitive Bid Advance" means an advance by a Lender to a Borrower
as part of a Competitive Bid Borrowing resulting from the auction bidding
procedure described in Section 2.03 and refers to a Fixed Rate Advance or a LIBO
Rate Advance.

            "Competitive Bid Borrowing" means a borrowing consisting of
simultaneous Competitive Bid Advances from each of the Lenders whose offer to
make one or more Competitive Bid Advances as part of such borrowing has been
accepted under the auction bidding procedure described in Section 2.03.

            "Competitive Bid Reduction" has the meaning specified in Section
2.01.

            "Confidential Information" means information that the Company
furnishes to the Agent or any Lender in a writing designated as confidential,
but does not include any such information that is or becomes generally available
to the public or that is or becomes rightfully available to the Agent or such
Lender from a source other than the Company.

            "Consolidated" refers to the consolidation of accounts in accordance
with GAAP. The Company shall cause the Guarantor at all times to remain a
Consolidated Subsidiary.

            "Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus, without duplication and to the extent reflected as a
charge in the statement of such Consolidated Net Income for such period, the sum
of (a) income tax expense, (b) interest expense, amortization or writeoff of
debt discount with respect to Debt (including the Advances), (c) depreciation
and amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any extraordinary expenses or
losses (including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net Income for such period, losses on sales of
assets outside of the ordinary course of business), and (f) any other non-cash
charges, and minus, to the extent included in the statement of such Consolidated
Net Income for such period, the sum of (a) any extraordinary income or gains
(including, whether or not otherwise includable as a separate item in the
statement of such Consolidated

                             5-Year Credit Agreement

<PAGE>
                                      -4-


Net Income for such period, gains on the sales of assets outside of the ordinary
course of business) and (b) any other non-cash income, all as determined on a
Consolidated basis; in each case exclusive of the cumulative effect of foreign
currency gains or losses. For the purposes of calculating Consolidated EBITDA
for any period pursuant to any determination of the Consolidated Leverage Ratio,
if during such period the Company or any Subsidiary, including the Guarantor,
shall have made an acquisition or incurred or assumed (without duplication of
any Debt incurred to refinance such assumed Debt) any Debt, Consolidated EBITDA
for such period shall be calculated after giving pro forma effect thereto as if
such acquisition occurred and such Debt had been incurred or assumed or
refinanced on the first day of such period.

            "Consolidated Leverage Ratio" means, as at the last day of any
Fiscal Quarter, the ratio of (a) Consolidated Total Debt on such day to (b)
Consolidated EBITDA for the four consecutive fiscal quarters then ended (taken
as one accounting period).

            "Consolidated Net Income" means, for any period, the consolidated
net income (or loss) of the Company, its Restricted Subsidiaries and the
Guarantor, determined on a consolidated basis in accordance with GAAP, before
deduction of any minority interests in the Guarantor and excluding the
cumulative effect of any foreign currency gains or losses.

            "Consolidated Net Tangible Assets" means the total assets of the
Company, its Restricted Subsidiaries and the Guarantor (less applicable
depreciation, amortization, and other valuation reserves), except to the extent
resulting from write-ups of capital assets (other than writeups in connection
with accounting for acquisitions, in accordance with GAAP), less all current
liabilities (excluding intercompany liabilities) and all intangible assets of
the Company, its Restricted Subsidiaries and the Guarantor, all as set forth on
the then most recent Consolidated balance sheet of the Company, its Restricted
Subsidiaries and the Guarantor, prepared in accordance with GAAP, but before
deduction of any minority interests in the Guarantor and exclusive of any
foreign currency translation adjustments.

            "Consolidated Net Worth" means, as of any date of determination, all
items which in conformity with GAAP would be included under shareholders' equity
on a Consolidated balance sheet of the Company and its Subsidiaries, including
the Guarantor, at such date plus amounts representing mandatorily redeemable
preferred securities issued by Subsidiaries of the Company, including the
Guarantor, but before deduction of any minority interests in the Guarantor and
exclusive of any foreign currency translation adjustments.

            "Consolidated Total Debt" means, at any date (i) the aggregate
principal amount of all Debt of the Company and its Subsidiaries, including the
Guarantor minus (ii) the aggregate amount (not in excess of $500,000,000) of all
cash and cash equivalents of the Company and its Subsidiaries, in each case at
such date and determined on a Consolidated basis in accordance with GAAP.

            "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.

                             5-Year Credit Agreement

<PAGE>
                                      -5-


            "Convert", "Conversion" and "Converted" each refers to a conversion
of Revolving Credit Advances of one Type into Revolving Credit Advances of the
other Type pursuant to Section 2.08 or 2.09.

            "Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than trade
accounts payable arising in the ordinary course of business), (c) all
obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations (other than trade accounts payable
arising in the ordinary course of business) of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all obligations of such Person as
lessee under leases that have been or should be, in accordance with GAAP,
recorded as capital leases, (f) all Debt of others referred to in clauses (a)
through (c) above or clause (g) below guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or indirectly by such
Person through (i) an agreement (1) to pay or purchase such Debt or to advance
or supply funds for the payment or purchase of such Debt, (2) to purchase, sell
or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such Debt or
to assure the holder of such Debt against loss, (3) to supply funds to or in any
other manner invest in the debtor (including any agreement to pay for property
or services irrespective of whether such property is received or such services
are rendered) or (4) otherwise to assure a creditor against loss, or (ii) a
standby letter of credit and (g) all Debt referred to in clauses (a) through (f)
above secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of such
Debt.

            "Debt to Capitalization Ratio" means at any time the ratio of (x)
Consolidated Total Debt to (y) the sum of (i) Consolidated Total Debt plus (ii)
Consolidated Net Worth.

            "Declining Lender" has the meaning assigned to that term in Section
2.06(c).

            "Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.

            "Designation Letter" has the meaning specified in Section 2.17(a).

            "Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office" opposite its
name on Schedule 1 hereto or in the Assignment and Acceptance pursuant to which
it became a Lender, or such other office of such Lender as such Lender may from
time to time specify to the Company and the Agent.

            "Effective Date" has the meaning specified in Section 3.01.

                             5-Year Credit Agreement

<PAGE>
                                      -6-


            "Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
Lender; (iii) a commercial bank organized under the laws of the United States,
or any State thereof, and having total assets in excess of $15,000,000,000 and a
combined capital and surplus of at least $1,000,000,000; (iv) a savings and loan
association or savings bank organized under the laws of the United States, or
any State thereof, and having total assets in excess of $15,000,000,000 and a
combined capital and surplus of at least $1,000,000,000; (v) a commercial bank
organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development or has concluded special
lending arrangements with the International Monetary Fund associated with its
General Arrangements to Borrow or of the Cayman Islands, or a political
subdivision of any such country, and having total assets in excess of
$l5,000,000,000 and a combined capital and surplus of at least $1,000,000,000 so
long as such bank is acting through a branch or agency located in the United
States or in the country in which it is organized or another country that is
described in this clause (v); (vi) the central bank of any country that is a
member of the Organization for Economic Cooperation and Development; provided,
however, that each Person described in clauses (ii) through (vi) shall have a
short term public debt rating of not less than A by S&P or Moody's or shall be
approved by the Company; and (vii) any other Person approved by the Company,
such approval not to be unreasonably withheld or delayed; provided, however,
that neither the Company nor an Affiliate of the Company shall qualify as an
Eligible Assignee.

            "Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, judgment, decree or
judicial or agency interpretation, policy or guidance relating to the
environment, health, safety or Hazardous Materials.

            "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder.

            "Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule 1 hereto or in the Assignment and Acceptance pursuant to which
it became a Lender (or, if no such office is specified, its Domestic Lending
Office), or such other office of such Lender as such Lender may from time to
time specify to the Company and the Agent.

            "Eurodollar Rate" means, for any Interest Period for each Eurodollar
Rate Advance comprising part of the same Revolving Credit Borrowing, an interest
rate per annum appearing on Page 3750 of the Telerate Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Agent from time to
time for purposes of providing quotations of interest rates applicable to Dollar
deposits in the London interbank market) as of 11:00 A.M. (London time) on the
date two Business Days prior to the first day of such Interest Period as the
rate for Dollar deposits having a term comparable to such Interest Period, or in
the event such offered rate is not available from said Page 3750, the average
(rounded to the nearer whole multiple of 1/16 of 1% per annum, if such average
is not such a multiple) of the rate per annum at which deposits in U.S. dollars
are offered by the principal office of each of the Reference Banks in London,
England to prime banks in the London interbank market at 11:00 A.M. (London
time) two Business Days before the first day of such

                             5-Year Credit Agreement

<PAGE>
                                      -7-


Interest Period in an amount substantially equal to such Reference Bank's
Eurodollar Rate Advance comprising part of such Revolving Credit Borrowing to be
outstanding during such Interest Period and for a period equal to such Interest
Period. If the Eurodollar Rate does not appear on said Page 3750 (or any
successor page), the Eurodollar Rate for any Interest Period for each Eurodollar
Rate Advance comprising part of the same Revolving Credit Borrowing shall be
determined by the Agent on the basis of applicable rates furnished to and
received by the Agent from the Reference Banks two Business Days before the
first day of such Interest Period, subject, however, to the provisions of
Section 2.08.

            "Eurodollar Rate Advance" means a Revolving Credit Advance that
bears interest as provided in Section 2.07(b).

            "Events of Default" has the meaning specified in Section 6.01.

            "Extension Agreement" means an Extension Agreement substantially in
the form contained in Exhibit A-3 hereto.

            "Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.

            "Fiscal Quarter" means a period of 13 or (or 14) weeks treated by
the Company as a fiscal quarter.

            "Fiscal Year" means the period of 52 (or 53) weeks ending on the
last Saturday of any calendar year and treated by the Company as its fiscal
year.

            "Fixed Rate Advances" has the meaning specified in Section 2.03(b).

            "GAAP" means generally accepted accounting principles as in effect
from time to time, applied on a basis consistent (except for changes concurred
in by the Company's independent public accountants) with the most recent audited
Consolidated financial statements of the Company and its Subsidiaries delivered
to the Lenders.

            "Granting Lender" has the meaning specified in Section 8.07(e).

            "Guaranteed Party" has the meaning specified in Section 9.01.

            "Hazardous Materials" means petroleum and petroleum products,
byproducts or breakdown products, radioactive materials, asbestos-containing
materials, radon gas and any other chemicals, materials or substances
designated, classified or regulated as being "hazardous" or "toxic", or words of
similar import, under any federal, state, local or foreign statute, law,
ordi-

                             5-Year Credit Agreement

<PAGE>
                                      -8-


nance, rule, regulation, code, order, judgment, decree or judicial or agency
interpretation, policy or guidance.

            "Index Debt" of any Person means senior, unsecured, long term
indebtedness for borrowed money of such Person that is not guaranteed by any
other Person (other than, in the case of the Company, the Guarantor) or subject
to any other credit enhancement.

            "Information Memorandum" means the information memorandum dated
March 17, 2003 used by the Agent in connection with the syndication of the
Commitments.

            "Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Revolving Credit Borrowing, the period commencing on the date
of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate
Advance into such Eurodollar Rate Advance and ending on the last day of the
period selected by the Company pursuant to the provisions below and, thereafter,
each subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by the Company
pursuant to the provisions below. The duration of each such Interest Period
shall be one, two, three, six or, to the extent available from all the Lenders,
nine or twelve months, as the Company may, upon notice received by the Agent not
later than 11:00 A.M. (New York City time) on the third Business Day prior to
the first day of such Interest Period, select; provided, however, that:

            (1) the Company may not select any Interest Period that ends after
      the Termination Date;

            (2) Interest Periods commencing on the same date for Eurodollar Rate
      Advances comprising part of the same Revolving Credit Borrowing shall be
      of the same duration;

            (3) whenever the last day of any Interest Period would otherwise
      occur on a day other than a Business Day, the last day of such Interest
      Period shall be extended to occur on the next succeeding Business Day,
      provided, however, that, if such extension would cause the last day of
      such Interest Period to occur in the next following calendar month, the
      last day of such Interest Period shall occur on the next preceding
      Business Day; and

            (4) whenever the first day of any Interest Period occurs on a day of
      an initial calendar month for which there is no numerically corresponding
      day in the calendar month that succeeds such initial calendar month by the
      number of months equal to the number of months in such Interest Period,
      such Interest Period shall end on the last Business Day of such succeeding
      calendar month.

            "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.

            "Lenders" means the Initial Lenders and each Person that shall
become a party hereto pursuant to Sections 2.05(c) or 8.07.

            "LIBO Rate Advances" has the meaning specified in Section 2.03(b).

                             5-Year Credit Agreement

<PAGE>
                                      -9-


            "Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor.

            "Loan Documents" means, collectively, this Agreement, each
promissory note issued thereunder, each Designation Letter and each Termination
Letter.

            "Loan Party" has the meaning specified in Section 4.01.

            "Margin Stock" means margin stock within the meaning of Regulation U
of the Board of Governors of the Federal Reserve System.

            "Master Bottling Agreement" means the Master Bottling Agreement
dated March 30, 1999, between the Company and Pepsi or any successor or
replacement agreement that confers substantially the same benefits on the
Company as the Master Bottling Agreement conferred on the date hereof.

            "Material Adverse Change" means any material adverse change in the
financial condition, operations or properties of the Company or the Company and
its Subsidiaries (including the Guarantor) taken as a whole.

            "Material Adverse Effect" means a material adverse effect on (a) the
financial condition, operations or properties of the Company and its
Subsidiaries (including the Guarantor) taken as a whole, (b) the rights and
remedies of the Agent or any Lender under this Agreement or any promissory note
or (c) the ability of the Company to perform its obligations under this
Agreement or any promissory note.

            "Material Subsidiary" means each Subsidiary of the Company which is
a "significant subsidiary" as that term is defined in Rule 1-02(w) of the
Regulation S-X under the Securities Act of 1933, as amended, as such rule is in
effect as of the date hereof.

            "Moody's" means Moody's Investors Service, Inc. and any successor
thereto.

            "Moody's Rating" means, at any time, the rating of the Company's
Index Debt then most recently announced by Moody's.

            "New Lender" means, for purposes of Section 2.05(c), an Eligible
Assignee (which may be a Lender) selected by the Company with (in the case of a
New Lender that is not already a Lender) prior consultation with the Agent.

            "Notice of Competitive Bid Borrowing" has the meaning specified in
Section 2.03(b).

            "Notice of Revolving Credit Borrowing" has the meaning specified in
Section 2.02(a).

                             5-Year Credit Agreement

<PAGE>
                                      -10-


            "Pepsi" means PepsiCo, Inc., a North Carolina corporation.

            "Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.

            "Principal Property" means any single manufacturing or processing
plant, office building, or warehouse owned or leased by the Company, a
Restricted Subsidiary or the Guarantor other than a plant, warehouse, office
building, or portion thereof which, in the opinion of the Company's Board of
Directors, is not of material importance to the business conducted by the
Company, its Restricted Subsidiaries and the Guarantor as an entirety.

            "Rating" means the Moody's Rating or the S&P Rating, as the case may
be.

            "Rating Level Change" means a change in the Moody's Rating or the
S&P Rating that results in a change from one Rating Level Period to another,
which Rating Level Change shall be deemed to take effect on the date on which
the relevant change in rating is first announced by Moody's or S&P.

            "Rating Level Period" means a Rating Level 1 Period, a Rating Level
2 Period, a Rating Level 3 Period, a Rating Level 4 Period or a Rating Level 5
Period; provided that:

            (i)   "Rating Level 1 Period" means a period during which the
                  Moody's Rating is at or above A2 or the S&P Rating is at or
                  above A;

            (ii)  "Rating Level 2 Period" means a period that is not a Rating
                  Level 1 Period, during which the Moody's Rating is at or above
                  A3 or the S&P Rating is at or above A-;

            (iii) "Rating Level 3 Period" means a period that is not a Rating
                  Level 1 Period or a Rating Level 2 Period, during which the
                  Moody's Rating is at or above Baa1 or the S&P Rating is at or
                  above BBB+;

            (iv)  "Rating Level 4 Period" means a period that is not a Rating
                  Level 1 Period, a Rating Level 2 Period or a Rating Level 3
                  Period, during which the Moody's Rating is at or above Baa2 or
                  the S&P Rating is at or above BBB; and

            (v)   "Rating Level 5 Period" means a period that is not a Rating
                  Level 1 Period, a Rating Level 2 Period, a Rating Level 3
                  Period or a Rating Level 4 Period;

and provided, further, that if the Moody's rating and the S&P Rating differ by
more than one Rating Level, then the applicable Rating Level Period shall be one
Rating Level lower than the Rating Level resulting from the application of the
higher of such ratings (for which purpose

                             5-Year Credit Agreement

<PAGE>
                                      -11-


Rating Level 1 is the highest and Rating Level 5 is the lowest); and provided,
further, that any period during which there is no Moody's Rating or there is no
S&P Rating shall be a Rating Level 5 Period.

            "Reference Banks" means JPMorgan, Citibank, N.A. and Bank of
America, N.A. (and any successors thereof).

            "Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.

            "Register" has the meaning specified in Section 8.07(d).

            "Required Lenders" means at any time Lenders owed more than 50% of
the then aggregate unpaid principal amount of the Revolving Credit Advances
(excluding Competitive Bid Advances) owing to Lenders, or, if no such principal
amount is then outstanding, Lenders having more than 50% of the aggregate amount
of the Commitments.

            "Restricted Subsidiary" means at any time any Subsidiary of the
Company except a Subsidiary which is at the time an Unrestricted Subsidiary.

            "Revolving Credit Advance" means an advance by a Lender to a
Borrower as part of a Revolving Credit Borrowing and refers to a Base Rate
Advance or a Eurodollar Rate Advance (each of which shall be a "Type" of
Revolving Credit Advance).

            "Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by each of the
Lenders pursuant to Section 2.01.

            "S&P" means Standard & Poors Rating Services or any successor
thereto.

            "S&P Rating" means, at any time, the rating of the Company's Index
Debt then most recently announced by S&P.

            "SPC" has the meaning specified in Section 8.07(e).

            "Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than 50% of (a) the issued and outstanding capital stock having ordinary voting
power to elect a majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such partnership or
joint venture or (c) the beneficial interest in such trust or estate is at the
time directly or indirectly owned or controlled by such Person, by such Person
and one or more of its other Subsidiaries or by one or more of such Person's
other Subsidiaries.

                             5-Year Credit Agreement

<PAGE>
                                      -12-


            "Substitution Date" has the meaning specified in Section 2.17(c).

            "Substitution Letter" has the meaning specified in Section 2.17(c).

            "Termination Date" means April 30, 2008 or, if earlier, the date of
termination in whole of the Commitments pursuant to Section 2.05(a) or 6.01 or,
in the case of any Lender whose Commitment is extended pursuant to Section
2.06(c), the date to which such Commitment is extended; provided in each case
that if any such date is not a Business Day, the relevant Termination Date of
such Lender shall be the immediately preceding Business Day.

            "Termination Letter" has the meaning specified in Section 2.17(b).

            "364-Day Facility" means the 364-Day Credit Agreement dated as of
April 30, 2003 among the Company, the Guarantor, certain banks, financial
institutions and other institutional lenders, and JPMorgan, as agent, as from
time to time amended.

            "Type" has the meaning specified in the definition of "Revolving
Credit Advance."

            "Unrestricted Subsidiary" means (a) any Subsidiary of the Company
(not at the time designated a Restricted Subsidiary) (i) the major part of whose
business consists of finance, banking, credit, leasing, insurance, financial
services, or other similar operations, or any continuation thereof, (ii)
substantially all the assets of which consist of the capital stock of one or
more such Subsidiaries, or (iii) designated as such by the Company's Board of
Directors and (b) the Guarantor. Any Subsidiary designated as a Restricted
Subsidiary may be designated as an Unrestricted Subsidiary.

            "Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for the election of directors
(or persons performing similar actions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.

      SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".

      SECTION 1.03. Accounting Terms. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations
hereunder shall be made, and all financial statements required to be delivered
hereunder shall be prepared in accordance with GAAP; provided that, if the
Company notifies the Agent that the Company wishes to amend any provisions
hereof to eliminate the effect of any change in GAAP (or if the Agent notifies
the Company that the Required Lenders wish to amend any provision hereof for
such purpose), then such provision shall be applied on the basis of GAAP in
effect immediately

                             5-Year Credit Agreement

<PAGE>
                                      -13-


before the relevant change in GAAP became effective, until either such notice is
withdrawn or such provision is amended in a manner satisfactory to the Company
and the Required Lenders.

                                   ARTICLE II

                        AMOUNTS AND TERMS OF THE ADVANCES

      SECTION 2.01. The Revolving Credit Advances. Each Lender severally agrees,
on the terms and conditions hereinafter set forth, to make Revolving Credit
Advances to the Company and any Borrowing Subsidiary from time to time on any
Business Day during the period from the Effective Date until the Termination
Date in an aggregate amount not to exceed at any time outstanding the amount set
forth opposite such Lender's name on the signature pages hereof or, if such
Lender has entered into any Assignment and Acceptance, set forth for such Lender
in the Register maintained by the Agent pursuant to Section 8.07(d), as such
amount may be reduced pursuant to Section 2.05(a) or increased pursuant to
Section 2.05(c) (such Lender's "Commitment"), provided that the aggregate amount
of the Commitments of the Lenders shall be deemed used from time to time to the
extent of the aggregate amount of the Competitive Bid Advances then outstanding
and such deemed use of the aggregate amount of the Commitments shall be
allocated among the Lenders ratably according to their respective Commitments
(such deemed use of the aggregate amount of the Commitments being a "Competitive
Bid Reduction"). Each Revolving Credit Borrowing shall be in an aggregate amount
of $5,000,000 or an integral multiple of $1,000,000 in excess thereof (or, if
less, (i) an aggregate amount equal to the amount by which the aggregate amount
of a proposed Competitive Bid Borrowing requested by the Company exceeds the
aggregate amount of Competitive Bid Advances offered to be made by the Lenders
and accepted by the Company in respect of such Competitive Bid Borrowing, if
such Competitive Bid Borrowing is made on the same date as such Revolving Credit
Borrowing or (ii) the aggregate amount of the unused Commitments, after giving
effect to any Competitive Bid Reductions then in effect) and shall consist of
Revolving Credit Advances of the same Type made on the same day by the Lenders
ratably according to their respective Commitments. Within the limits of each
Lender's Commitment, each Borrower may borrow under this Section 2.01, prepay
pursuant to Section 2.10 and reborrow under this Section 2.01.

      SECTION 2.02. Making the Revolving Credit Advances.

            (a) Each Revolving Credit Borrowing shall be made on notice, given
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Revolving Credit Borrowing in the case of a
Revolving Credit Borrowing consisting of Eurodollar Rate Advances, or the date
of the proposed Revolving Credit Borrowing in the case of a Revolving Credit
Borrowing consisting of Base Rate Advances, by the Company (on its own behalf
and on behalf of any Borrowing Subsidiary) to the Agent, which shall give to
each Lender prompt notice thereof by telecopier or telex. Each such notice of a
Revolving Credit Borrowing (a "Notice of Revolving Credit Borrowing") shall be
by telecopier or telex, confirmed promptly in writing, in substantially the form
of Exhibit A-1 hereto, specifying therein the requested (i) date of such
Revolving Credit Borrowing, (ii) Type of Advances comprising such Revolving

                              5-Year Credit Agreement

<PAGE>
                                      -14-


Credit Borrowing, (iii) aggregate amount of such Revolving Credit Borrowing,
(iv) in the case of a Revolving Credit Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Revolving Credit Advance and (v)
the name of the relevant Borrower (which shall be the Company or a Borrowing
Subsidiary). Each Lender shall, before 11:00 A.M. (New York City time), in the
case of a Revolving Credit Borrowing consisting of Eurodollar Rate Advances, or
before 1:00 P.M. (New York City time), in the case of a Revolving Credit
Borrowing consisting of Base Rate Advances, on the date of such Revolving Credit
Borrowing, make available for the account of its Applicable Lending Office to
the Agent at the Agent's Account, in same day funds, such Lender's ratable
portion of such Revolving Credit Borrowing. After the Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Agent will make such same day funds available to the relevant Borrower
at such Borrower's account at the Agent's address referred to in Section 8.02.

            (b) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Company may not select Eurodollar Rate Advances for any
Revolving Credit Borrowing if the aggregate amount of such Revolving Credit
Borrowing is less than $10,000,000 or if the obligation of the Lenders to make
Eurodollar Rate Advances shall then be suspended pursuant to Section 2.08 and
(ii) the Eurodollar Rate Advances may not be outstanding as part of more than
six separate Revolving Credit Borrowings.

            (c) Each Notice of Revolving Credit Borrowing shall be irrevocable
and binding on the relevant Borrower. In the case of any Revolving Credit
Borrowing that the related Notice of Revolving Credit Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Company shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Revolving Credit Borrowing for such Revolving Credit Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Revolving Credit
Advance to be made by such Lender as part of such Revolving Credit Borrowing
when such Revolving Credit Advance, as a result of such failure, is not made on
such date.

            (d) Unless the Agent shall have received notice from a Lender prior
to the date of any Revolving Credit Borrowing that such Lender will not make
available to the Agent such Lender's ratable portion of such Revolving Credit
Borrowing, the Agent may assume that such Lender has made such portion available
to the Agent on the date of such Revolving Credit Borrowing in accordance with
subsection (a) of this Section 2.02 and the Agent may, in reliance upon such
assumption, make available to the relevant Borrower on such date a corresponding
amount. If and to the extent that such Lender shall not have so made such
ratable portion available to the Agent, such Lender and such Borrower severally
agree to repay to the Agent forthwith on demand such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to such Borrower until the date such amount is repaid to the Agent, at
(i) in the case of a Borrower, the interest rate applicable at the time to
Revolving Credit Advances comprising such Revolving Credit Borrowing and (ii) in
the case of such Lender, the Federal Funds Rate. If such Lender shall repay to
the Agent such corresponding amount, such amount so repaid shall constitute such
Lender's Revolving Credit

                             5-Year Credit Agreement

<PAGE>
                                      -15-


Advance as part of such Revolving Credit Borrowing for purposes of this
Agreement and shall be made available in same day funds to the relevant
Borrower's account at the Agent's address referred to in Section 8.02.

            (e) The failure of any Lender to make the Revolving Credit Advance
to be made by it as part of any Revolving Credit Borrowing shall not relieve any
other Lender of its obligation, if any, hereunder to make its Revolving Credit
Advance on the date of such Revolving Credit Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the Revolving Credit
Advance to be made by such other Lender on the date of any Revolving Credit
Borrowing.

      SECTION 2.03. The Competitive Bid Advances.

            (a) Each Lender severally agrees that each Borrower may make
Competitive Bid Borrowings under this Section 2.03 from time to time on any
Business Day during the period from the date hereof until the date occurring 7
days prior to the Termination Date in the manner set forth below; provided that,
following the making of each Competitive Bid Borrowing, the aggregate amount of
the Advances then outstanding shall not exceed the aggregate amount of the
Commitments of the Lenders (computed without regard to any Competitive Bid
Reduction).

            (b) The Company (on its own behalf and on behalf of any Borrowing
Subsidiary) may request a Competitive Bid Borrowing under this Section 2.03 by
delivering to the Agent, by telecopier or telex, confirmed promptly in writing,
a notice of a Competitive Bid Borrowing (a "Notice of Competitive Bid
Borrowing"), in substantially the form of Exhibit A-2 hereto, specifying therein
(u) the date of such proposed Competitive Bid Borrowing, (v) the aggregate
amount of such proposed Competitive Bid Borrowing, (w) the maturity date for
repayment of each Competitive Bid Advance to be made as part of such Competitive
Bid Borrowing (which maturity date may not be earlier than the date occurring 7
days after the date of such Competitive Bid Borrowing or later than the
Termination Date), (x) the interest payment date or dates relating thereto, (y)
the name of the Borrower, and (z) any other terms to be applicable to such
Competitive Bid Borrowing, not later than 10:00 A.M. (New York City time) (A) at
least one Business Day prior to the date of the proposed Competitive Bid
Borrowing, if the Company shall specify in the Notice of Competitive Bid
Borrowing that the rates of interest to be offered by the Lenders shall be fixed
rates per annum (the Advances comprising any such Competitive Bid Borrowing
being referred to herein as "Fixed Rate Advances") and (B) at least four
Business Days prior to the date of the proposed Competitive Bid Borrowing, if
the Company shall instead specify in the Notice of Competitive Bid Borrowing
another basis to be used by the Lenders in determining the rates of interest to
be offered by them (the Advances comprising such Competitive Bid Borrowing being
referred to herein as "LIBO Rate Advances"). The Agent shall in turn promptly
notify each Lender of each request for a Competitive Bid Borrowing received by
it from the Company by sending such Lender a copy of the related Notice of
Competitive Bid Borrowing.

            (c) Each Lender may, if, in its sole discretion, it elects to do so,
irrevocably offer to make one or more Competitive Bid Advances to the relevant
Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates
of interest specified by such Lender in its

                             5-Year Credit Agreement

<PAGE>
                                      -16-


sole discretion, by notifying the Agent (which shall give prompt notice thereof
to the Company), before 10:00 A.M. (New York City time) on the date of such
proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing
consisting of Fixed Rate Advances, and three Business Days before the date of
such proposed Competitive Bid Borrowing, in the case of a Competitive Bid
Borrowing consisting of LIBO Rate Advances, of the minimum amount and maximum
amount of each Competitive Bid Advance which such Lender would be willing to
make as part of such proposed Competitive Bid Borrowing (which amounts may,
subject to the proviso to the first sentence of Section 2.03(a), exceed such
Lender's Commitment, if any), the rate or rates of interest therefor and such
Lender's Applicable Lending Office with respect to such Competitive Bid Advance;
provided that if the Agent in its capacity as a Lender shall, in its sole
discretion, elect to make any such offer, it shall notify the Company of such
offer before 9:00 A.M. (New York City time) on the date on which notice of such
election is to be given to the Agent by the other Lenders. If any Lender shall
elect not to make such an offer, such Lender shall so notify the Agent, before
10:00 A.M. (New York City time) on the date on which notice of such election is
to be given to the Agent by the other Lenders, and such Lender shall not be
obligated to, and shall not, make any Competitive Bid Advance as part of such
Competitive Bid Borrowing; provided that the failure by any Lender to give such
notice shall not cause such Lender to be obligated to make any Competitive Bid
Advance as part of such proposed Competitive Bid Borrowing.

            (d) The Company shall, in turn, before 11:00 A.M. (New York City
time) on the date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of Fixed Rate Advances, and before 1:00
P.M. (New York City time) three Business Days before the date of such proposed
Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting
of LIBO Rate Advances, either:

                  (x) cancel such Competitive Bid Borrowing by giving the Agent
            notice to that effect, or

                  (y) accept one or more of the offers made by any Lender or
            Lenders pursuant to paragraph (c) above, by giving notice to the
            Agent of the amount of each Competitive Bid Advance (which amount
            shall be equal to or greater than the minimum amount, and equal to
            or less than the maximum amount, notified to the Company by the
            Agent on behalf of such Lender for such Competitive Bid Advance
            pursuant to paragraph (c) above) to be made by each Lender as part
            of such Competitive Bid Borrowing, and reject any remaining offers
            made by Lenders pursuant to paragraph (c) above by giving the Agent
            notice to that effect. If the Company accepts any offers made by
            Lenders pursuant to paragraph (c) above, such offers shall be
            accepted in the order of the lowest to highest interest rates or, if
            two or more Lenders offer to make Competitive Bid Advances at the
            same interest rate, such offers, if any, shall be accepted in
            proportion to the amount offered by each such Lender at such
            interest rate notwithstanding any minimum specified by such Lender
            in its notice given pursuant to paragraph (c) above. The Company may
            not accept offers in excess of the amount specified in accordance
            with paragraph (a) above.

                             5-Year Credit Agreement

<PAGE>
                                      -17-


            (e) If the Company notifies the Agent that such Competitive Bid
Borrowing is cancelled pursuant to paragraph (d)(x) above, the Agent shall give
prompt notice thereof to the Lenders and such Competitive Bid Borrowing shall
not be made.

            (f) If the Company accepts one or more of the offers made by any
Lender or Lenders pursuant to paragraph (d)(y) above, the Agent shall in turn
promptly notify (A) each Lender that has made an offer as described in paragraph
(c) above, of the date and aggregate amount of such Competitive Bid Borrowing
and whether or not any offer or offers made by such Lender pursuant to paragraph
(c) above have been accepted by the Company, (B) each Lender that is to make a
Competitive Bid Advance as part of such Competitive Bid Borrowing, of the amount
of each Competitive Bid Advance to be made by such Lender as part of such
Competitive Bid Borrowing, and (C) each Lender that is to make a Competitive Bid
Advance as part of such Competitive Bid Borrowing, upon receipt, that the Agent
has received forms of documents appearing to fulfill the applicable conditions
set forth in Article III. Each Lender that is to make a Competitive Bid Advance
as part of such Competitive Bid Borrowing shall, before 12:00 noon (New York
City time) on the date of such Competitive Bid Borrowing specified in the notice
received from the Agent pursuant to clause (A) of the preceding sentence or any
later time when such Lender shall have received notice from the Agent pursuant
to clause (C) of the preceding sentence, make available for the account of its
Applicable Lending Office to the Agent at the Agent's Account, in same day
funds, such Lender's portion of such Competitive Bid Borrowing. Upon fulfillment
of the applicable conditions set forth in Article III and after receipt by the
Agent of such funds, the Agent will make such same day funds available to the
relevant Borrower at such Borrower's account at the Agent's address referred to
in Section 8.02. Promptly after each Competitive Bid Borrowing the Agent will
notify each Lender of the amount of the Competitive Bid Borrowing, the
consequent Competitive Bid Reduction and the dates upon which such Competitive
Bid Reduction commenced and will terminate.

            (g) Each Competitive Bid Borrowing shall be in an aggregate amount
of $5,000,000 or an integral multiple of $1,000,000 in excess thereof and,
following the making of each Competitive Bid Borrowing, the Company shall be in
compliance with the limitation set forth in the proviso to the first sentence of
paragraph (a) above.

            (h) Within the limits and on the conditions set forth in this
Section 2.03, each Borrower may from time to time borrow under this Section
2.03, repay or prepay pursuant to subsection (j) below, and reborrow under this
Section 2.03, provided that a Competitive Bid Borrowing shall not be made within
three Business Days of the date of any other Competitive Bid Borrowing.

            (i) Each Borrower shall repay to the Agent for the account of each
Lender that has made a Competitive Bid Advance to such Borrower, on the maturity
date of such Competitive Bid Advance (such maturity date being that specified by
the Company for repayment of such Competitive Bid Advance in the related Notice
of Competitive Bid Borrowing delivered pursuant to paragraph (b) above and
provided in the promissory note, if any, evidencing such Competitive Bid
Advance), the then unpaid principal amount of such Competitive Bid Advance. No
Borrower shall have any right to prepay any principal amount of any Competitive
Bid Advance unless (x) such Borrower obtains the prior written consent of the

                             5-Year Credit Agreement

<PAGE>
                                      -18-


Lender which made such Competitive Bid Advance, or (y), such prepayment is made
on the terms, specified by the Company for such Competitive Bid Advance in the
related Notice of Competitive Bid Borrowing delivered pursuant to paragraph (b)
above and set forth in the promissory note, if any, evidencing such Competitive
Bid Advance.

            (j) Each Borrower shall pay interest on the unpaid principal amount
of each Competitive Bid Advance to such Borrower from the date of such
Competitive Bid Advance to the date the principal amount of such Competitive Bid
Advance is repaid in full, at the rate of interest for such Competitive Bid
Advance specified by the Lender making such Competitive Bid Advance in its
notice with respect thereto delivered pursuant to paragraph (c) above, payable
on the interest payment date or dates specified by such Borrower for such
Competitive Bid Advance in the related Notice of Competitive Bid Borrowing
delivered pursuant to paragraph (b) above, as provided in the promissory note,
if any, evidencing such Competitive Bid Advance.

            (k) At its option, the Company (on its own behalf and on behalf of
any Borrower) may request a Competitive Bid Borrowing directly from the Lenders;
provided that it follows the procedures set forth in this Section 2.03 and
promptly delivers, by telecopier or telex, a copy of the Notice of Competitive
Bid Borrowing and notice in writing of the results of such request to the Agent.

            (l) The indebtedness of each Borrower resulting from each
Competitive Bid Advance made to such Borrower as part of a Competitive Bid
Borrowing shall, if requested by the applicable Lender, be evidenced by a
separate promissory note of such Borrower payable to the order of the Lender
making such Competitive Bid Advance.

      SECTION 2.04. Fees.

            (a) Facility Fee. The Company agrees to pay to the Agent for the
account of each Lender a facility fee on the amount of such Lender's Commitment
irrespective of usage, from the Effective Date in the case of each Initial
Lender and from the effective date specified in the Assignment and Acceptance
pursuant to which it became a Lender in the case of each other Lender until the
Termination Date (on a daily basis), at the Applicable Facility Fee Rate,
payable in arrears quarterly on the last day of each March, June, September and
December and on the Termination Date, commencing June 30, 2003.

            (b) Agent's Fees. The Company shall pay to the Agent for its own
account such fees as may from time to time be agreed between the Company and the
Agent.

            (c) Utilization Fees. The Company shall pay to the Agent for the
account of each Lender a utilization fee on the aggregate outstanding principal
amount of such Lender's Advances for each day on which the aggregate outstanding
amount of the Advances exceeds 33-1/3% of the aggregate Commitments, from the
Effective Date in the case of each Initial Lender and from the effective date
specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date (on a daily basis),

                             5-Year Credit Agreement

<PAGE>
                                      -19-


at the Applicable Utilization Fee rate, payable on each day on which interest is
payable under Section 2.07, and on the Termination Date.

      SECTION 2.05. Termination, Reduction or Increase of the Commitments.

            (a) The Company shall have the right, upon at least three Business
Days' notice to the Agent, to terminate in whole or reduce ratably in part the
unused portions of the respective Commitments of the Lenders, provided that each
partial reduction shall be in the aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof and provided further that (x) the
aggregate amount of the Commitments of the Lenders shall not be reduced to an
amount that is less than the aggregate principal amount of the Advances then
outstanding, and (y) once terminated, a portion of a Commitment shall not be
reinstated except pursuant to Section 2.05(c).

            (b) If any Lender shall make a demand under Section 2.11 or 2.14 or
if the obligation of any Lender to make Eurodollar Rate Advances shall have been
suspended pursuant to Section 2.12, the Company shall have the right, upon at
least ten Business Days' notice, to terminate in full the Commitment of such
Lender or to demand that such Lender assign to one or more Eligible Assignees
all of its rights and obligations under this Agreement in accordance with
Section 8.07. If the Company shall elect to terminate in full the Commitment of
any Lender pursuant to this Section 2.05(b), the Company shall pay to such
Lender, on the effective date of such Commitment termination, an amount equal to
the aggregate outstanding principal amount of the Advances owing to such Lender,
together with accrued interest thereon to the date of payment of such principal
amount and all other amounts payable to such Lender under this Agreement,
whereupon such Lender shall cease to be a party hereto.

            (c) (i) Not more than once in any calendar year, the Company may
propose to increase the aggregate amount of the Commitments by an aggregate
amount of $25,000,000 or an integral multiple of $1,000,000 in excess thereof (a
"Proposed Aggregate Commitment Increase") in the manner set forth below,
provided that:

            (1) no Default shall have occurred and be continuing either as of
      the date on which the Company shall notify the Agent of its request to
      increase the aggregate amount of the Commitments or as of the related
      Increase Date (as hereinafter defined); and

            (2) after giving effect to any such increase, the aggregate amount
      of the Commitments shall not exceed $500,000,000.

            (ii) The Company may request an increase in the aggregate amount of
the Commitments by delivering to the Agent a notice (an "Increase Notice"; the
date of delivery thereof to the Agent being the "Increase Notice Date")
specifying (1) the Proposed Aggregate Commitment Increase, (2) the proposed date
(the "Increase Date") on which the Commitments would be so increased (which
Increase Date may not be fewer than 30 nor more than 60 days after the Increase
Notice Date) and (3) the New Lenders, if any, to whom the Company desires to
offer the opportunity to commit to all or a portion of the Proposed Aggregate
Commitment Increase.

                             5-Year Credit Agreement

<PAGE>
                                      -20-


The Agent shall in turn promptly notify each Lender of the Company's request by
sending each Lender a copy of such notice.

            (iii) Not later than the date five days after the Increase Notice
Date, the Agent shall notify each New Lender, if any, identified in the related
Increase Notice of the opportunity to commit to all or any portion of the
Proposed Aggregate Commitment Increase. Each such New Lender may irrevocably
commit to all or a portion of the Proposed Aggregate Commitment Increase (such
New Lender's "Proposed New Commitment") by notifying the Agent (which shall give
prompt notice thereof to the Company) before 11:00 A.M. (New York City time) on
the date that is 10 days after the Increase Notice Date; provided that:

            (1) the Proposed New Commitment of each New Lender shall be in an
      amount not less than $25,000,000; and

            (2) each New Lender that submits a Proposed New Commitment shall
      enter into an agreement in form and substance satisfactory to the Company
      and the Agent pursuant to which such New Lender shall undertake a
      Commitment (and, if any such New Lender is already a Lender, its
      Commitment shall be in addition to such Lender's Commitment hereunder on
      such date), and shall pay to the Agent a processing and recordation fee of
      $3,500.

            (iv) If the aggregate Proposed New Commitments of all of the New
Lenders shall be less than the Proposed Aggregate Commitment Increase, then
(unless the Company otherwise requests) the Agent shall, on or prior to the date
that is 15 days after the Increase Notice Date, notify each Lender of the
opportunity to so commit to all or any portion of the Proposed Aggregate
Commitment Increase not committed to by New Lenders pursuant to Section
2.05(c)(iii). Each Lender may, if, in its sole discretion, it elects to do so,
irrevocably offer to commit to all or a portion of such remainder (such Lender's
"Proposed Increased Commitment") by notifying the Agent (which shall give prompt
notice thereof to the Company) no later than 11:00 A.M. (New York City time) on
the date five days before the Increase Date.

            (v) If the aggregate amount of Proposed New Commitments and Proposed
Increased Commitments (such aggregate amount, the "Total Committed Increase")
equals or exceeds $25,000,000, then, subject to the conditions set forth in
Section 2.05(c)(i):

            (1) effective on and as of the Increase Date, the aggregate amount
      of the Commitments shall be increased by the lesser of the proposed
      aggregate Committed Increase and the Total Committed Increase and shall be
      allocated among the New Lenders and the Lenders as provided in Section
      2.05(c)(vi); and

            (2) on the Increase Date, if any Revolving Loans are then
      outstanding, the Company shall borrow Revolving Loans from all or certain
      of the Lenders and/or (subject to compliance by the Company with Section
      8.04(d)) prepay Revolving Loans of all or certain of the Lenders such
      that, after giving effect thereto, the Revolving Loans (including, without
      limitation, the Types and Interest Periods thereof) shall be held by the
      Lend-

                             5-Year Credit Agreement

<PAGE>
                                      -21-


      ers (including for such purposes New Lenders) ratably in accordance with
      their respective Commitments.

If the Total Committed Increase is less than $25,000,000, then the aggregate
amount of the Commitments shall not be changed pursuant to this Section 2.05(c).

            (vi) The Total Committed Increase shall be allocated among New
Lenders having Proposed New Commitments and Lenders having Proposed Increased
Commitments as follows:

            (1) If the Total Committed Increase shall be at least $25,000,000
      and less than or equal to the Proposed Aggregate Commitment Increase, then
      (x) the initial Commitment of each New Lender shall be such New Lender's
      Proposed New Commitment and (y) the Commitment of each Lender shall be
      increased by such Lender's Proposed Increased Commitment.

            (2) If the Total Committed Increase shall be greater than the
      Proposed Aggregate Commitment Increase, then the Total Committed Increase
      shall be allocated:

                        (x) first to New Lenders (to the extent of their
                  respective Proposed New Commitments) in such a manner as the
                  Company shall agree; and

                        (y) then to Lenders on a pro rata basis based on the
                  ratio of each Lender's Proposed Increased Commitment (if any)
                  to the aggregate amount of the Proposed Increased Commitments
                  of all of the Lenders.

            (vii) No increase in the Commitments contemplated hereby shall
become effective until the Agent shall have received (x) promissory notes in
respect of the Revolving Loans payable to each New Lender and each other Lender
whose Commitment is being increased that, in either case, shall have requested
such promissory notes at least two Business Days prior to the Increase Date, and
(y) evidence satisfactory to the Agent (including an update of the opinion of
counsel provided pursuant to Section 3.01(g)(v)) that such increases in the
Commitments, and borrowings thereunder, have been duly authorized.

      SECTION 2.06. Repayment of Revolving Credit Advances, Evidence of
Indebtedness and Extension of Termination Date.

            (a) The Company and each Borrower shall repay to the Agent for the
ratable account of the Lenders on the Termination Date the aggregate principal
amount of the Revolving Credit Advances then outstanding.

            (b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrowers to such
Lender resulting from each Advance made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder. The Agent shall maintain accounts in which it shall record (i) the
amount of each Advance made hereunder, the Type thereof and the Interest Period,
if any, applicable thereto, (ii) the amount of any principal or interest due and
payable or to

                             5-Year Credit Agreement

<PAGE>
                                      -22-


become due and payable from the Borrowers to each Lender hereunder and (iii) the
amount of any sum received by the Agent hereunder for the account of the Lenders
and each Lender's share thereof. The entries made in the accounts maintained
pursuant to this Section shall be prima facie evidence of the existence and
amounts of the obligations recorded therein; provided that the failure of any
Lender or the Agent to maintain such accounts or any error therein shall not in
any manner affect the obligation of any Borrower to repay the Advances in
accordance with the terms of this Agreement. Any Lender may request that
Advances made by it be evidenced by a promissory note. In such event, the
applicable Borrower shall prepare, execute and deliver to such Lender a
promissory note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Agent. Thereafter, the Advances evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 8.07)
be represented by one or more promissory notes in such form payable to the order
of the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).

            (c) The Company may by written notice to the Agent, not more than 90
nor less than 60 days prior to the Termination Date then in effect, request that
the Termination Date then in effect be extended for a further period of one
year. Such request shall be irrevocable and binding upon the Company. The Agent
shall promptly notify each Lender of such request. If a Lender agrees, in its
individual and sole discretion, to so extend its Commitment (an "Extending
Lender"), it will notify the Agent, in writing, of its decision to do so not
more than 30 nor less than 20 days before said date. The Commitment of any
Lender that fails to accept (or fails to respond to) the Company's request for
extension of the Termination Date (a "Declining Lender") shall be terminated on
the Termination Date theretofore in effect (without regard to extension by other
Lenders). The Extending Lenders, or any of them, shall then have the right to
increase their respective Commitments by an aggregate amount up to the amount of
all Declining Lenders' Commitments, and, to the extent of any shortfall, the
Company shall have the right to require any Declining Lender to assign in full
its rights and obligations under this Agreement to an Eligible Assignee
designated by the Company that agrees to accept all of such rights and
obligations (a "Replacement Lender"), provided that (i) such increase and/or
such assignment is otherwise in compliance with Section 8.07, (ii) such
Declining Lender receives payment in full of an amount equal to the principal
amount of all Advances owing to such Declining Lender, together with accrued
interest thereon to the date of such assignment and all other amounts payable to
such Declining Lender under this Agreement and (iii) any such increase shall be
effective on the Termination Date theretofore in effect and any such assignment
shall be effective on the date specified by the Company and agreed to by the
Replacement Lender and the Agent. If (i) Extending Lenders and/or Replacement
Lenders provide Commitments in an aggregate amount equal to 51% of the aggregate
amount of the Commitments outstanding immediately prior to the Termination Date
in effect at the time the Company requests such extension, and (ii) no Default
shall have occurred and be continuing immediately prior to said Termination
Date, the Termination Date shall be extended by one year (except that, if the
date on which the Termination Date is to be extended is not a Business Day, such
Termination Date as so extended shall be the next preceding Business Day) from
the effective date set forth in an Extension Agreement, in substantially the
form in Exhibit A-3 hereto, which has been duly completed and signed by the
Company, the Agent and the Extending Lenders and Replacement Lenders party
thereto. Such Extension Agreement shall be executed and delivered no earlier

                             5-Year Credit Agreement

<PAGE>
                                      -23-


than 30 days prior to the Termination Date then in effect and the effective date
shall be no earlier than 29 days prior to the Termination Date then in effect.
No extension of the Commitments pursuant to this Section 2.06(c) shall be
legally binding on any party hereto unless and until such party executes and
delivers a counterpart of such Extension Agreement.

      SECTION 2.07. Interest on Revolving Credit Advances. Each Borrower shall
pay interest on the unpaid principal amount of each Revolving Credit Advance
made to such Borrower from the date of such Revolving Credit Advance until such
principal amount shall be paid in full, at the following rates per annum:

            (a) Base Rate Advances. During such periods as such Revolving Credit
Advance is a Base Rate Advance, a rate per annum equal at all times to the Base
Rate in effect from time to time, payable in arrears quarterly on the last day
of each March, June, September and December during such periods and on the date
such Base Rate Advance shall be Converted or paid in full.

            (b) Eurodollar Rate Advances. During such periods as such Revolving
Credit Advance is a Eurodollar Rate Advance, a rate per annum equal at all times
during each Interest Period for such Revolving Credit Advance to the sum of (x)
the Eurodollar Rate for such Interest Period for such Revolving Credit Advance
plus (y) the Applicable Margin, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every three months
from the first day of such Interest Period and on the date such Eurodollar Rate
Advance shall be Converted or paid in full.

      SECTION 2.08. Interest Rate Determination.

            (a) If the Eurodollar Rate does not appear on Page 3750 of the
Telerate Service (or any successor page), each Reference Bank agrees to furnish
to the Agent timely information for the purpose of determining each Eurodollar
Rate. If the Eurodollar Rate does not appear on said Page 3750 (or any successor
page), and if any one or more of the Reference Banks shall not furnish such
timely information to the Agent for the purpose of determining any such interest
rate, the Agent shall determine such interest rate on the basis of timely
information furnished by the remaining Reference Banks. The Agent shall give
prompt notice to the Company and the Lenders of the applicable interest rate
determined by the Agent for purposes of Section 2.07, and the rate, if any,
furnished by each Reference Bank for the purpose of determining the interest
rate under Section 2.07(b).

            (b) If, due to a major disruption in the interbank funding market
with respect to any Eurodollar Rate Advances, the Required Lenders notify the
Agent that the Eurodollar Rate for any Interest Period for such Advances will
not adequately reflect the cost to such Required Lenders of making, funding or
maintaining their respective Eurodollar Rate Advances for such Interest Period,
the Agent shall forthwith so notify the Borrower and the Lenders, whereupon (i)
each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance, and (ii)
the obligation of the Lenders to

                             5-Year Credit Agreement

<PAGE>
                                      -24-


make, or to Convert Revolving Credit Advances into, Eurodollar Rate Advances
shall be suspended until the Agent shall notify the Company and the Lenders that
the circumstances causing such suspension no longer exist.

            (c) If the Company shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the Agent will
forthwith so notify the Company and the Lenders and the Company will be deemed
to have selected an Interest Period of one month.

            (d) If the aggregate unpaid principal amount of Eurodollar Rate
Advances comprising any Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $10,000,000, such Advances shall automatically Convert
into Base Rate Advances on the last day of the Interest Period applicable
thereto.

            (e) Upon the occurrence and during the continuance of any Event of
Default, (i) each Eurodollar Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.

            (f) If the Eurodollar Rate does not appear on Page 3750 of the
Telerate Service (or any successor page) and fewer than two Reference Banks
furnish timely information to the Agent for determining the Eurodollar Rate for
any Eurodollar Rate Advances,

            (i) the Agent shall forthwith notify the Company and the Lenders
      that the interest rate cannot be determined for such Eurodollar Rate
      Advances,

            (ii) each such Advance will automatically, on the last day of the
      then existing Interest Period therefor, Convert into a Base Rate Advance
      (or if such Advance is then a Base Rate Advance, will continue as a Base
      Rate Advance), and

            (iii) the obligation of the Lenders to make, or to Convert Revolving
      Credit Advances into, Eurodollar Rate Advances shall be suspended until
      the Agent shall notify the Company and the Lenders that the circumstances
      causing such suspension no longer exist.

      SECTION 2.09. Optional Conversion of Revolving Credit Advances. The
Company may on any Business Day, upon notice given to the Agent not later than
11:00 A.M. (New York City time) on the third Business Day prior to the date of
the proposed Conversion and subject to the provisions of Sections 2.08 and 2.12,
Convert all Revolving Credit Advances of one Type comprising the same Borrowing
into Revolving Credit Advances of the other Type; provided, however, that any
Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made
only on the last day of an Interest Period for such Eurodollar Rate Advances,
any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in
an amount not less than the minimum amount specified in Section 2.02(b) and no
Conversion of any Revolving Credit Advances shall result in more separate
Revolving Credit Borrowings than permitted under

                             5-Year Credit Agreement

<PAGE>
                                      -25-


Section 2.02(b). Each such notice of a Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Revolving
Credit Advances to be Converted, and (iii) if such Conversion is into Eurodollar
Rate Advances, the duration of the initial Interest Period for each such
Advance. Each notice of Conversion shall be irrevocable and binding on the
Company.

      SECTION 2.10. Optional Prepayments of Revolving Credit Advances. The
Company may, upon notice not later than 11:00 A.M. (New York City time) on the
date of such payment, in the case of Base Rate Advances, and two Business Days'
notice, in the case of Eurodollar Rate Advances, to the Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Company shall, prepay the outstanding principal amount of
the Revolving Credit Advances comprising part of the same Revolving Credit
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided, however, that
(x) each partial prepayment shall be in an aggregate principal amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof and (y) in
the event of any such prepayment of a Eurodollar Rate Advance, the Company shall
be obligated to reimburse the Lenders in respect thereof pursuant to Section
8.04(d).

      SECTION 2.11. Increased Costs.

            (a) If, due to either (i) the introduction of or any change in any
law or regulation or in the interpretation or administration of any law or
regulation by any governmental authority charged with the interpretation or
administration thereof or (ii) the compliance with any guideline or request from
any central bank or other governmental authority that would be complied with
generally by similarly situated banks acting reasonably (whether or not having
the force of law), there shall be any increase in the cost to any Lender of
agreeing to make or making, funding or maintaining Eurodollar Rate Advances or
LIBO Rate Advances by an amount deemed by such Lender to be material, then the
Company shall from time to time, upon demand by such Lender (with a copy of such
demand to the Agent), pay to the Agent for the account of such Lender additional
amounts sufficient to compensate such Lender for such increased cost. A
certificate as to the amount of such increased cost, submitted to the Company
and the Agent by such Lender, shall be conclusive and binding for all purposes,
absent manifest error. Notwithstanding the foregoing, no Lender shall be
entitled to request compensation under this paragraph with respect to any
Competitive Bid Advance if the change giving rise to such request was applicable
to such Lender at the time of submission of such Lender's offer to make such
Competitive Bid Advance.

            (b) If, due to either (i) the introduction of or any change in or in
the interpretation of any law or regulation or (ii) compliance with any
guideline or request from any central bank or other governmental or regulatory
authority which becomes effective after the date hereof, there shall be any
increase in the amount of capital required or expected to be maintained by any
Lender or any corporation controlling such Lender and the amount of such capital
is increased by or based upon the existence of such Lender's Advances or
commitment to lend hereunder and other commitments of this type by an amount
deemed by such Lender to be material, then, upon demand by such Lender (with a
copy of such demand to the Agent), the Company shall pay to

                             5-Year Credit Agreement

<PAGE>
                                      -26-


the Agent for the account of such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender or such
corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence
of such Lender's Advances or commitment to lend hereunder. A certificate as to
such amounts submitted to the Company and the Agent by such Lender shall be
conclusive and binding for all purposes as to the calculations therein, absent
manifest error. Such certificate shall be in reasonable detail and shall certify
that the claim for additional amounts referred to therein is generally
consistent with such Lender's treatment of similarly situated customers of such
Lender whose transactions with such Lender are similarly affected by the change
in circumstances giving rise to such payment, but such Lender shall not be
required to disclose any confidential or proprietary information therein.

      SECTION 2.12. Illegality. Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Agent (and provide to the Company an
opinion of counsel to the effect) that the introduction of or any change in or
in the interpretation of any law or regulation makes it unlawful, or any central
bank or other governmental authority asserts that it is unlawful, for such
Lender or its Eurodollar Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or LIBO Rate Advances or to fund or maintain
Eurodollar Rate Advances or LIBO Rate Advances hereunder, (i) each Eurodollar
Rate Advance or LIBO Rate Advance, as the case may be, of such Lender will
automatically, upon such demand, Convert into a Base Rate Advance or an Advance
that bears interest at the rate set forth in Section 2.07(a), as the case may
be, and (ii) the obligation of such Lender to make, or to Convert Revolving
Credit Advances into, Eurodollar Rate Advances shall be suspended until the
Agent shall notify the Company and such Lender that the circumstances causing
such suspension no longer exist and such Lender shall make the Base Rate
Advances in the amount and on the dates that it would have been requested to
make Eurodollar Rate Advances had no such suspension been in effect.

      SECTION 2.13. Payments and Computations.

            (a) Each Borrower shall make each payment hereunder not later than
11:00 A.M. (New York City time) on the day when due in U.S. dollars to the Agent
at the Agent's Account in same day funds. The Agent will promptly thereafter
cause to be distributed like funds relating to the payment of principal or
interest or facility fees or usage fees ratably (other than amounts payable
pursuant to Section 2.03, 2.04(b), 2.05(b), 2.11, 2.14 or 8.04(d)) to the
Lenders for the account of their respective Applicable Lending Offices, and like
funds relating to the payment of any other amount payable to any Lender to such
Lender for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon its acceptance of
an Assignment and Acceptance and recording of the information contained therein
in the Register pursuant to Section 8.07(d), from and after the effective date
specified in such Assignment and Acceptance, the Agent shall make all payments
hereunder in respect of the interest assigned thereby to the Lender assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.

                             5-Year Credit Agreement

<PAGE>
                                      -27-


            (b) All computations of interest based on the Base Rate and of
facility fees and of usage fees shall be made by the Agent on the basis of a
year of 365 or 366 days, as the case may be, and all computations of interest
based on the Eurodollar Rate or the Federal Funds Rate shall be made by the
Agent on the basis of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest or facility fees or usage fees are payable. Each
determination by the Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.

            (c) Whenever any payment hereunder shall be stated to be due on a
day other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or facility fee or usage fee, as the case may
be; provided, however, that, if such extension would cause payment of interest
on or principal of Eurodollar Rate Advances or LIBO Rate Advances to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day.

            (d) Unless the Agent shall have received notice from the Company
prior to the date on which any payment is due to the Lenders hereunder that a
Borrower will not make such payment in full, the Agent may assume that such
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent such Borrower shall not have so made such payment in full to the Agent,
each Lender shall repay to the Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Rate.

      SECTION 2.14. Taxes.

            (a) Each Lender is exempt from any withholding imposed under the
laws of the United States in respect of any fees, interest or other payments to
which it is entitled pursuant to this Agreement or any promissory notes issued
hereunder (the "Income") because (i) the Lender is organized under the laws of
the United States; (ii) the Income is effectively connected with the conduct of
a trade or business within the United States within the meaning of Section 871
of the Internal Revenue Code; or (iii) the Income is eligible for an exemption
by reason of a tax treaty. The Agent is exempt from any withholding tax imposed
under the laws of the United States in respect of the Income because the Agent
is organized under the laws of the United States.

            (b) Each Lender organized under the laws of a jurisdiction outside
the United States (each, a "Foreign Lender") shall, on or prior to the date of
its execution and delivery of this Agreement in the case of each Initial Lender,
and on the date of the Assignment and Acceptance pursuant to which it became a
Lender in the case of each other Foreign Lender and from time to time thereafter
if requested in writing by the Company or the Agent, provide the Agent and the
relevant Borrower with Internal Revenue Service Form W-8BEN or W-8ECI, as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that such Foreign Lender is exempt or entitled to a reduced
rate of United States

                             5-Year Credit Agreement

<PAGE>
                                      -28-


withholding tax on any Income that is the subject of such forms. If the form
provided by a Foreign Lender at the time such Foreign Lender first becomes a
party to this Agreement indicates a United States interest withholding tax rate
in excess of zero, or in excess of the rate applicable to the Foreign Lender
assignor on the date of the Assignment and Acceptance pursuant to which it
became a Foreign Lender, in the case of each other Foreign Lender, withholding
tax at such rate shall be considered excluded from Taxes as defined in Section
2.14(c).

            (c) Based on Section 2.14(a) and (b), any and all payments by any
Borrower hereunder or under any promissory notes issued hereunder shall be made
free and clear of and without deduction for any present United States federal
income withholding taxes imposed on a Foreign Lender under the Internal Revenue
Code (such withholding taxes being hereinafter referred to as "Taxes").

            (d) If, as a result of the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any United States law or any
tax treaty (or in the application or official interpretation of any law or any
tax treaty) that occurs on or after the date a Foreign Lender first becomes a
party to this Agreement (a "Change in Law"), a Foreign Lender cannot comply with
Section 2.14(b) or, if despite such compliance, any Borrower shall be required
to deduct any Taxes from or in respect of any Income, then: (i) the sum payable
to such Foreign Lender shall be increased as may be necessary so that after
making all required deductions for such Taxes (including deductions applicable
to additional sums payable under this Section 2.14) such Foreign Lender receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) such Borrower shall make such deductions and (iii) such Borrower
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law. Notwithstanding the foregoing, each
Borrower shall be entitled to pay any Taxes in any lawful manner so as to reduce
any deductions and such Foreign Lender shall to the extent it is reasonably able
provide any documentation or file any forms as may be required by the Internal
Revenue Service or any other foreign governmental agency. In addition, if any
Foreign Lender or the Agent (in lieu of such Foreign Lender), as the case may
be, is required to pay directly any Taxes as a result of a Change in Law because
a Borrower cannot or does not legally or timely do so, the Company shall
indemnify such Foreign Lender or Agent for payment of such Taxes, without
duplication of, or increase in, the amount of Taxes otherwise due to the Foreign
Lender.

            (e) In addition, the Company agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies (excluding any income or franchise taxes, business taxes or
capital taxes of any nature) that arise from the execution, delivery or
registration of, or otherwise with respect to, this Agreement (hereinafter
referred to as "Other Taxes"). If a Lender is required to pay directly Other
Taxes because a Borrower cannot or does not legally or timely do so, the Company
shall indemnify such Lender for such payment of Other Taxes.

            (f) Within 30 days after the date of any payment of Taxes or foreign
withholding taxes, the Company shall furnish to the Agent, at its address
referred to in Section 8.02, the original or a certified copy of a receipt
evidencing payment thereof. Prior to making any

                             5-Year Credit Agreement

<PAGE>
                                      -29-


payment hereunder by or on behalf of any Borrower through an account or branch
outside the United States or on behalf of any Borrower by a payor that is not a
United States person (a "Foreign Payment"), such Borrower shall determine that
no foreign withholding taxes are payable in respect thereof, and at its expense,
shall furnish, or shall cause such payor to furnish, to the Agent, at such
address, a certificate from each appropriate taxing authority, or an opinion of
counsel acceptable to the Agent, in either case stating that such Foreign
Payment is exempt from or not subject to foreign withholding taxes. Each Lender
shall cooperate with each Borrower's efforts described in this subsection by
providing to the extent reasonably within its means any forms requested by such
Borrower substantiating an exemption from foreign withholding taxes required by
any governmental agency. For purposes of this subsection (f), the terms "United
States" and "United States person" shall have the meaning specified in Section
7701 of the Internal Revenue Code. If, as a result of the enactment,
promulgation, execution or ratification of, or any change in or amendment to,
any applicable foreign law or any tax treaty (or in the application or official
interpretation of any law or any tax treaty) that occurs on or after the date a
tax opinion is rendered pursuant to the terms of this subsection, and which
renders such tax opinion incorrect as to the absence of any foreign withholding
tax (a "Foreign Change in Law"), any Borrower shall be required to deduct any
foreign withholding taxes from or in respect of any Income, then: (i) the sum
payable to the applicable Lender shall be increased as may be necessary so that
after making all required deductions for foreign withholding taxes (including
deductions applicable to additional sums payable under this Section 2.14) such
Lender receives an amount equal to the sum it would have received had no such
deductions been made, (ii) such Borrower shall make such deductions and (iii)
such Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law. Notwithstanding
the foregoing, each Borrower shall be entitled to pay any foreign withholding
taxes in any lawful manner so as to reduce any deductions and such Lender shall
to the extent it is reasonably able provide any documentation or file any forms
as may be required by the Internal Revenue Service or any other foreign
governmental agency. In addition, if any Lender is required to pay directly any
foreign withholding tax in respect of any Foreign Payments made pursuant to this
Agreement because a Borrower cannot or does not legally or timely do so, the
Company shall indemnify such Lender for payment of such tax.

            (g) For any period with respect to which a Lender has failed to
comply with the requirements of subsection (b) or (f) relating to certain forms
intended to reduce withholding taxes (other than if such failure is due to a
Change in Law or a Foreign Change in Law), such Lender shall not be entitled to
indemnification under subsection (d) or (f).

            (h) Upon a Change in Law or the imposition of any foreign
withholding tax in respect of Foreign Payments, a Lender shall, upon the written
request of and at the expense of the Company, use reasonable efforts to change
the jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such taxes that may
thereafter accrue and would not, in the reasonable judgment of such Lender,
cause the imposition on such Lender of any material legal or regulatory burdens.

            (i) Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Company contained in
this Section 2.14 shall

                             5-Year Credit Agreement

<PAGE>
                                      -30-


survive the payment in full of principal and interest hereunder until the
applicable statute of limitations relating to the payment of any Taxes under
Section 2.14(d) has expired.

            (j) Any request by any Lender for payment of any amount under this
Section 2.14 shall be accompanied by a certification that such Lender's claim
for said amount is generally consistent with such Lender's treatment of
similarly situated customers of such Lender whose transactions with such Lender
are similarly affected by the change in circumstances giving rise to such
payment, but such Lender shall not be required to disclose any confidential or
proprietary information therein.

      SECTION 2.15. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Revolving Credit Advances owing to it
(other than pursuant to Section 2.05(b), 2.11, 2.14 or 8.04(d)) in excess of its
ratable share of payments on account of the Revolving Credit Advances obtained
by all the Lenders, such Lender shall forthwith purchase from the other Lenders
such participations in the Revolving Credit Advances owing to them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Lender, such purchase from
each Lender shall be rescinded and such Lender shall repay to the purchasing
Lender the purchase price to the extent of such recovery together with an amount
equal to such Lender's ratable share (according to the proportion of (i) the
amount of such Lender's required repayment to (ii) the total amount so recovered
from the purchasing Lender) of any interest or other amount paid or payable by
the purchasing Lender in respect of the total amount so recovered. Each Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.15 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of setoff) with respect
to such participation as fully as if such Lender were the direct creditor of
such Borrower in the amount of such participation.

      SECTION 2.16. Use of Proceeds. The proceeds of the Advances shall be
available (and the Company agrees that such proceeds shall be used) for general
corporate purposes of the Company and its Subsidiaries, including commercial
paper backstop.

      SECTION 2.17. Borrowings by Borrowing Subsidiaries; Substitution of
Borrower.

            (a) The Company may, at any time or from time to time, designate one
      or more Subsidiaries (including the Guarantor) as Borrowers hereunder by
      furnishing to the Agent a letter (a "Designation Letter") in duplicate, in
      substantially the form of Exhibit D, duly completed and executed by the
      Company and such Subsidiary. Upon any such designation of a Subsidiary,
      such Subsidiary shall be a Borrowing Subsidiary and a Borrower entitled to
      borrow Revolving Credit Advances and Competitive Bid Advances on and
      subject to the terms and conditions of this Agreement.

                             5-Year Credit Agreement

<PAGE>
                                      -31-


            (b) If all principal of and interest on all Advances made to any
Borrowing Subsidiary have been paid in full, the Company may terminate the
status of such Borrowing Subsidiary as a Borrower hereunder by furnishing to the
Agent a letter (a "Termination Letter") in substantially the form of Exhibit F,
duly completed and executed by the Company. Any Termination Letter furnished
hereunder shall be effective upon receipt by the Agent, which shall promptly
notify the Lenders, whereupon the Lenders shall, upon payment in full of all
amounts owing by such Borrower hereunder, promptly deliver to the Company
(through the Agent) the promissory notes, if any, of such former Borrower.
Notwithstanding the foregoing, the delivery of a Termination Letter with respect
to any Borrower shall not terminate (i) any obligation of such Borrower that
remains unpaid at the time of such delivery (including without limitation any
obligation arising thereafter in respect of such Borrower under Section 2.11 or
2.14) or (ii) the obligations of the Company under Article IX with respect to
any such unpaid obligations; provided, that if the status of such Borrowing
Subsidiary has been terminated as aforesaid because the Company has sold or
transferred its interest in such Subsidiary, and the Company so certifies to the
Agent at the time of delivery of such Termination Letter, and subject to payment
of said principal and interest, (i) such Subsidiary shall, automatically upon
the effectiveness of the delivery of such Termination Letter and certification,
cease to have any obligation under this Agreement and (ii) the Company shall
automatically be deemed to have unconditionally assumed, as primary obligor, and
hereby agrees to pay and perform, all of such obligations.

            (c) In addition to the foregoing, the Company may, at any time when
there are no Advances outstanding hereunder and upon not less than 10 Business
Days' notice, irrevocably elect to terminate its right to be a Borrower
hereunder as of the date (which shall be a Business Day) specified in such
Substitution Letter (the "Substitution Date") and designate the Guarantor as a
Borrower hereunder by furnishing to the Agent (x) a letter (a "Substitution
Letter"), in substantially the form of Exhibit E duly completed and executed by
the Company and the Guarantor, (y) a certificate signed by a duly authorized
officer of the Company, and a certificate signed by a duly authorized officer of
the Guarantor, each dated the Substitution Date, stating that:

            (i) the representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects on and as of the
      Substitution Date, as though made on and as of such date, and

            (ii) No event has occurred and is continuing, or would result from
      such designation, that constitutes a Default;

and (z) the Agent shall have received such other corporate documents,
resolutions and legal opinions relating to the foregoing as it, or any Lender
through the Agent, may reasonably request.

      SECTION 2.18. Mitigation Obligations. If any Lender requests compensation
under Section 2.11, or if the obligation of any Lender to make or continue
Advances as, or Con-

                             5-Year Credit Agreement

<PAGE>
                                      -32-


vert Advances into, Eurodollar Rate Advances is suspended pursuant to Section
2.12, then, upon the written request of the Company, such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designations or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 2.11 or would cause such Lender not to be subject to
such suspension, as the case may be, in the future and (ii) would not subject
such Lender to any unreimbursed cost or expense and would not, in the reasonable
judgment of such Lender, cause imposition on such Lender of any material legal
or regulatory burdens or otherwise be disadvantageous to such Lender. The
Company hereby agrees to pay all reasonable costs and expenses incurred by any
Lender in connection with any such designation or assignment.

                                   ARTICLE III

                   CONDITIONS TO EFFECTIVENESS AND ARTICLE II

      SECTION 3.01. Conditions Precedent to Effectiveness of Sections 2.01 and
2.03. Sections 2.01 and 2.03 of this Agreement shall become effective on and as
of the first date (the "Effective Date") on which the following conditions
precedent have been satisfied:

            (a) As of the Effective Date, there shall have occurred no Material
Adverse Change since December 28, 2002 that has not been publicly disclosed.

            (b) As of the Effective Date, there shall exist no action, suit,
investigation, litigation or proceeding affecting the Company, or any of its
Subsidiaries (including the Guarantor) pending or, to the knowledge of the
Company's or the Guarantor's executive officers, threatened before any court,
governmental agency or arbitrator that (i) could be reasonably likely to have a
Material Adverse Effect or (ii) could reasonably be likely to affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.

            (c) As of the Effective Date, nothing shall have come to the
attention of the Lenders during the course of their due diligence investigation
to lead them to believe that the Information Memorandum was or has become
misleading, incorrect or incomplete in any material respect.

            (d) As of the Effective Date, all governmental and third party
consents and approvals necessary in connection with the transactions
contemplated hereby shall have been obtained (without the imposition of any
conditions that are not acceptable to the Lenders) and shall remain in effect.

            (e) As of the Effective Date, the Company shall have paid all
accrued fees and expenses of the Agent and the Lenders (including the accrued
fees and expenses of counsel to the Agent, to the extent invoiced at least one
Business Day prior to the Effective Date).

                             5-Year Credit Agreement

<PAGE>
                                      -33-


            (f) On the Effective Date, the following statements shall be true
and the Agent shall have received for the account of each Lender a certificate
signed by a duly authorized officer of the Company dated the Effective Date,
stating that:

            (i) The representations and warranties contained in Section 4.01 are
      correct in all material aspects on and as of the Effective Date, and

            (ii) No event has occurred and is continuing that constitutes a
      Default.

            (g) The Agent shall have received on or before the Effective Date
the following, each dated such day, in form and substance satisfactory to the
Agent and (except for any notes requested by the Lenders) in sufficient copies
for each Lender:

            (i) To the extent any Lender shall have requested, at least one
      Business day prior to the Effective Date that its Revolving Credit
      Advances be evidenced by a promissory note, a note payable to the order of
      such Lender.

            (ii) Certified copies of the resolutions of the Board of Directors
      of the Company and of the Guarantor approving this Agreement, and of all
      documents evidencing other necessary corporate action and governmental
      approvals, if any, with respect to this Agreement.

            (iii) A certificate of the Secretary or an Assistant Secretary of
      the Company certifying the names and true signatures of the officers of
      the Company authorized to sign this Agreement and the other documents to
      be delivered hereunder.

            (iv) A certificate of the Secretary or an Assistant Secretary of the
      Guarantor certifying the names and true signatures of the officers of the
      Guarantor authorized to sign this Agreement and the other documents to be
      delivered hereunder.

            (v) An opinion of Pamela C. McGuire, Esq., General Counsel of each
      of the Company and the Guarantor, substantially in the form of Exhibit C
      hereto and as to such other matters as any Lender through the Agent may
      reasonably request.

            (vi) A favorable opinion of Milbank, Tweed, Hadley & McCloy LLP,
      special New York counsel for the Agent.

            (vii) Evidence of the termination of the Commitments as defined in
      the $250,000,000 5-Year Credit Agreement dated as of April 22, 1999 among
      the Company, the Guarantor, certain lenders and The Chase Manhattan Bank,
      as Agent and of the payment in full of any and all amounts payable
      thereunder.

            (viii) The Agent shall have received such other approvals, opinions
      or documents as any Lender through the Agent may reasonably request.

                             5-Year Credit Agreement

<PAGE>
                                      -34-


      SECTION 3.02. Conditions Precedent to Each Revolving Credit Borrowing. The
obligation of each Lender to make a Revolving Credit Advance on the occasion of
each Revolving Credit Borrowing shall be subject to the conditions precedent
that the Effective Date shall have occurred and on the date of such Revolving
Credit Borrowing (a) the following statements shall be true (and each of the
giving of the applicable Notice of Revolving Credit Borrowing and the acceptance
by any Borrower of the proceeds of such Revolving Credit Borrowing shall
constitute a representation and warranty by the Company and such Borrower that
on the date of such Borrowing such statements are true):

            (i) The representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects on and as of the date of
      such Revolving Credit Borrowing, before and after giving effect to such
      Revolving Credit Borrowing and to the application of the proceeds
      therefrom, as though made on and as of such date, and

            (ii) No event has occurred and is continuing, or would result from
      such Revolving Credit Borrowing or from the application of the proceeds
      therefrom, that constitutes a Default;

and (b) in the case of the first Borrowing by a Borrowing Subsidiary, the Agent
shall have received such corporate documents, resolutions and legal opinions
relating to such Borrowing Subsidiary as the Agent may reasonably require.

      SECTION 3.03. Conditions Precedent to Each Competitive Bid Borrowing. The
obligation of each Lender that is to make a Competitive Bid Advance on the
occasion of a Competitive Bid Borrowing to make such Competitive Bid Advance as
part of such Competitive Bid Borrowing is subject to the conditions precedent
that (i) the Agent shall have received the written confirmatory Notice of
Competitive Bid Borrowing with respect thereto, and (ii) on the date of such
Competitive Bid Borrowing the following statements shall be true (and each of
the giving of the applicable Notice of Competitive Bid Borrowing and the
acceptance by any Borrower of the proceeds of such Competitive Bid Borrowing
shall constitute a representation and warranty by the Company and such Borrower
that on the date of such Competitive Bid Borrowing such statements are true):

            (a) The representations and warranties contained in Section 4.01
(except the representations set forth in the last sentence of subsection (e)
thereof and in subsection (f) thereof (other than clause (ii) thereof)) are
correct in all material respects on and as of the date of such Competitive Bid
Borrowing, before and after giving effect to such Competitive Bid Borrowing and
to the application of the proceeds therefrom, as though made on and as of such
date; and

            (b) No event has occurred and is continuing, or would result from
such Competitive Bid Borrowing or from the application of the proceeds
therefrom, that constitutes a Default.

                             5-Year Credit Agreement

<PAGE>
                                      -35-


      SECTION 3.04. Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by this Agreement
shall have received notice from such Lender prior to the proposed Effective
Date, as notified by the Company to the Lenders, specifying its objection
thereto. The Agent shall promptly notify the Lenders of the occurrence of the
Effective Date.

                                   ARTICLE IV

               REPRESENTATIONS AND WARRANTIES OF THE LOAN PARTIES

      SECTION 4.01. Representations and Warranties of the Loan Parties. Each of
the Company and the Guarantor (each, a "Loan Party") represents and warrants as
follows:

            (a) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and the Guarantor
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware.

            (b) The execution, delivery and performance by each Loan Party of
this Agreement and the consummation of the transactions contemplated hereby are
within such Loan Party's powers, have been duly authorized by all necessary
corporate or other action, and do not contravene (i) its charter, by-laws or
other organizational documents or (ii) any law or contractual restriction
binding on or materially affecting such Loan Party.

            (c) No authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body or any other
third party is required for the due execution, delivery and performance by
either Loan Party of this Agreement.

            (d) This Agreement has been duly executed and delivered by each Loan
Party. This Agreement is the legal, valid and binding obligation of each Loan
Party enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and equitable principles of general applicability.

            (e) The Consolidated balance sheet of the Company and its
Subsidiaries as at December 28, 2002, and the related Consolidated statements of
operations and cash flows of the Company and its Subsidiaries for the fiscal
year then ended, accompanied by an opinion of KPMG Peat Marwick, independent
public accountants, fairly present the financial condition of the Company as at
such date and the results of the operations of the Company for the period ended
on such date, all in accordance with generally accepted accounting principles
consistently applied. Since December 28, 2002, there has been no Material
Adverse Change that has not been publicly disclosed.

                             5-Year Credit Agreement

<PAGE>
                                      -36-


            (f) There is no pending or threatened action, suit, investigation,
litigation or proceeding affecting either Loan Party before any court,
governmental agency or arbitrator that (i) would be reasonably likely to have a
Material Adverse Effect or (ii) would reasonably be likely to affect the
legality, validity or enforceability of this Agreement or any promissory note
issued under this Agreement, if any, or the consummation of the transactions
contemplated hereby.

            (g) It is not engaged in the business of extending credit for the
purpose of purchasing or carrying Margin Stock and no proceeds of any Advance
will be used to purchase or carry any Margin Stock or to extend credit to others
for the purpose (whether immediate, individual or ultimate) of purchasing or
carrying any Margin Stock, in either case in a manner that would cause the
Advances or any Lender to be in violation of Regulation U.

            (h) Following application of the proceeds of each Advance, not more
than 25 percent of the value of the assets (either of any Borrower only or of
the Company and its Subsidiaries or the Guarantor and its Subsidiaries, in each
case on a Consolidated basis) subject to the provisions of Section 5.02(a) or
(b)(ii) or subject to any restriction contained in any agreement or instrument
between it and any Lender or any Affiliate of any Lender relating to Debt and
within the scope of Section 6.01(d) will be Margin Stock.

            (i) Neither Loan Party is an "investment company", a company
"controlled by", or "promoter" or "principal underwriter" for, an "investment
company", as such terms are defined in the Investment Company Act of 1940, as
amended. Neither the making of any Advances nor the application of the proceeds
or repayment thereof by any Borrower will violate any provision of such Act or
any rule, regulation or order of the Securities and Exchange Commission
thereunder.

                                    ARTICLE V

                                    COVENANTS

      SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, each Loan Party will:

            (a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable laws,
rules, regulations and orders, such compliance to include, without limitation,
compliance with ERISA and Environmental Laws, except where failure so to comply
would not, and would not be reasonably likely to, have a Material Adverse
Effect.

            (b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (i)
all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (ii) all lawful claims that, if unpaid, might by law
become a Lien upon its property; provided, however, that neither Loan Party nor
any of its Subsidiaries shall be required to pay or discharge any such tax,

                             5-Year Credit Agreement

<PAGE>
                                      -37-


assessment, charge or claim that is being contested in good faith and by proper
proceedings and as to which appropriate reserves are being maintained, unless
and until any Lien resulting therefrom attaches to its property and becomes
enforceable against its other creditors and such Lien would be reasonably likely
to have a Material Adverse Effect.

            (c) Preservation of Corporate Existence, Etc. Preserve and maintain,
and cause each of its Material Subsidiaries to preserve and maintain, its
corporate existence, rights (charter and statutory) and franchises; provided,
however, that each Loan Party and its Material Subsidiaries may consummate any
merger or consolidation permitted under Section 5.02(b) and provided further
that neither Loan Party nor any of its Material Subsidiaries shall be required
to preserve any right or franchise if the Board of Directors of such Loan Party
or such Subsidiary shall determine that the preservation thereof is no longer
desirable in the conduct of the business of such Loan Party or such Subsidiary,
as the case may be, and that the loss thereof is not disadvantageous in any
material respect to such Loan Party, such Subsidiary or the Lenders.

            (d) Reporting Requirements. Furnish to the Lenders:

            (i) as soon as available and in any event within 45 days after the
      end of each of the first three Fiscal Quarters of each Fiscal Year of the
      Company, the Consolidated balance sheet of the Company and its
      Subsidiaries as of the end of such quarter and Consolidated statements of
      operations and cash flows of the Company and its Subsidiaries for the
      period commencing at the end of the previous Fiscal Year and ending with
      the end of such Fiscal Quarter, duly certified (subject to year-end audit
      adjustments) by the chief financial officer of the Company as having been
      prepared in accordance with GAAP, it being agreed that delivery of the
      Company's Quarterly Report on Form 10-Q will satisfy this requirement;

            (ii) as soon as available and in any event within 90 days after the
      end of each Fiscal Year of the Company, a copy of the annual audit report
      for such year for the Company and its Subsidiaries, containing the
      Consolidated balance sheet of the Company and its Subsidiaries as of the
      end of such Fiscal Year and Consolidated statements of operations and cash
      flows of the Company and its Subsidiaries for such Fiscal Year, in each
      case accompanied by an opinion by KPMG Peat Marwick or other independent
      public accountants of nationally recognized standing, it being agreed that
      delivery of the Company's Annual Report on Form 10-K will satisfy this
      requirement;

            (iii) as soon as possible and in any event within five days after
      the occurrence of each Default continuing on the date of such statement, a
      statement of the chief financial officer of the Company setting forth
      details of such Default and the action that the Company has taken and
      proposes to take with respect thereto; and

            (iv) promptly after the sending or filing thereof, copies of all
      annual reports and proxy solicitations that the Company sends to any of
      its securityholders, and copies of all reports on Form 8-K that the
      Company or any Subsidiary files with the Securities and Exchange
      Commission.

                             5-Year Credit Agreement

<PAGE>
                                      -38-


      SECTION 5.02. Negative Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, neither Loan Party
will:

            (a) Secured Debt. Create or suffer to exist, or permit any of its
Restricted Subsidiaries or the Guarantor to create or suffer to exist, any Debt
secured by a Lien on any Principal Property or on any shares of stock of or Debt
of any Restricted Subsidiary or the Guarantor unless such Loan Party or such
Restricted Subsidiary secures or causes such Restricted Subsidiary or the
Guarantor to secure the Advances and all other amounts payable under this
Agreement equally and ratably with such secured Debt, so long as such secured
Debt shall be so secured, unless after giving effect thereto the aggregate
amount of all such Debt so secured does not exceed 15% of Consolidated Net
Tangible Assets; provided that the foregoing restriction does not apply to Debt
secured by:

            (i) Liens existing prior to the date hereof;

            (ii) Liens on property of, or on shares of stock of or Debt of, any
      corporation existing at the time such corporation becomes a Restricted
      Subsidiary;

            (iii) Liens in favor of a Loan Party or any Restricted Subsidiary;

            (iv) Liens in favor of any governmental bodies to secure progress or
      advance payments;

            (v) Liens on property, shares of stock or Debt existing at the time
      of acquisition thereof (including acquisition through merger or
      consolidation) or liens securing Debt incurred to finance all or any part
      of the purchase price or cost of construction of property (or additions,
      substantial repairs, alterations or substantial improvements thereto),
      provided that such Lien and the Debt secured thereby are incurred within
      365 days of the later of acquisition or completion of construction (or
      addition, repair, alteration or improvement) and full operation thereof;
      and

            (vi) any extension, renewal or refunding of Debt referred to in the
      foregoing clauses (i) to (v), inclusive.

            (b) Mergers, Etc. (i) Merge or consolidate with or into any
corporation or (ii) sell, lease, transfer or otherwise dispose of all or
substantially all of the assets of the Company and its Subsidiaries, taken as a
whole, unless the Company or the Guarantor would be the acquiring or surviving
party in such transaction and no Event of Default shall have occurred and be
continuing at the time of such proposed transaction or would result therefrom.

            (c) Subsidiary Debt. Permit any Restricted Subsidiary to create,
incur, assume or permit to exist any Debt, except:

            (i) Debt of the Borrowing Subsidiaries, if any, created hereunder
      and under the 364-Day Facility;

                             5-Year Credit Agreement

<PAGE>
                                      -39-


            (ii) Debt existing on the Effective Date;

            (iii) Debt of any Subsidiary to any Loan Party or any other
      Subsidiary;

            (iv) Debt of any Person that becomes a Subsidiary after the date
      hereof; provided that such Debt exists at the time such Person becomes a
      Subsidiary and is not created in contemplation of or in connection with
      such Person becoming a Subsidiary;

            (v) any refinancing, refunding or replacement of any Debt permitted
      under clause (ii) through (iv) above; and

            (vi) other Debt in an aggregate principal amount not exceeding 15%
      of Consolidated Net Tangible Assets, computed as of the last day of the
      then most recently concluded fiscal quarter of the Company, at any time
      outstanding.

            (d) Restrictive Agreements. Neither Loan Party will enter into,
incur or permit to exist any agreement or other arrangement that prohibits or
restricts the ability of any Subsidiary to pay dividends or other distributions
with respect to any shares of its capital stock or to make or repay loans or
advances to, or otherwise transfer assets to the Company; provided that the
foregoing shall not apply to (i) restrictions and conditions imposed by law or
by this Agreement or the 364-Day Facility, (ii) customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder, (iii)
restrictions or conditions imposed by any agreement relating to secured Debt
permitted by this Agreement if such restrictions or conditions apply only to the
property or assets securing such Debt, (iv) customary provisions in leases and
other contracts restricting the assignment thereof, (v) any agreement in effect
on the Effective Date, as any such agreement is in effect on such date, (vi) any
agreement binding upon such Subsidiary prior to the date on which such
Subsidiary was acquired by the Company and outstanding on such date, (vii)
customary net worth and other financial maintenance covenants in an agreement
relating to Debt or other obligations incurred in compliance with this
Agreement, and (viii) any agreement refinancing, renewing or replacing any
agreement or Debt referred to in (i) through (vii) above, provided that the
relevant provisions are no more restrictive than those in the agreement or Debt
being refinanced, renewed or replaced.

            (e) Ownership. In the case of the Company, cease to own, legally and
beneficially, 75% or more of the membership interests in the Guarantor.

      SECTION 5.03. Financial Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, the Company will not:

            (a) Debt to Capitalization Ratio. Permit the Debt to Capitalization
Ratio as at the last day of any Fiscal Quarter that is not an Alternate Covenant
Date to exceed 0.75 to 1.0.

                             5-Year Credit Agreement

<PAGE>
                                      -40-


            (b) Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio as at the last day of any Fiscal Quarter that is an Alternate Covenant
Date to exceed 5.0 to 1.0.

                                   ARTICLE VI

                                EVENTS OF DEFAULT

      SECTION 6.01. Events of Default. If any of the following events ("Events
of Default") shall occur and be continuing:

            (a) Any Borrower shall fail to pay any principal of, or interest on,
any Advance or to make any other payment under this Agreement, in each case
within five days after the same becomes due and payable; or

            (b) Any representation or warranty made by any Loan Party herein or
by any Borrower (or any of its officers) in connection with this Agreement
(including without limitation by any Borrowing Subsidiary pursuant to any
Designation Letter) shall prove to have been incorrect in any material respect
when made; or

            (c) Any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in Section 5.01(d), 5.02 or 5.03, or (ii) any
Loan Party shall fail to perform or observe any other term, covenant or
agreement contained in this Agreement on its part to be performed or observed if
such failure shall remain unremedied for 30 days after written notice thereof
shall have been given to either Loan Party by the Agent or any Lender; or

            (d) Any Loan Party or any of its Subsidiaries shall fail to pay any
principal of or premium or interest on any Debt that is outstanding in a
principal or notional amount of at least $75,000,000 in the aggregate (but
excluding Debt outstanding hereunder) of such Loan Party or such Subsidiary (as
the case may be), when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument relating to such Debt; or any other event shall
occur or condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate the maturity of such Debt or permit (with or without
the giving of notice, the lapse of time or both) the holder or holders of such
Debt or any trustee or agent on its or their behalf to cause any such Debt to
become due prior to its scheduled maturity; or any such Debt shall be declared
to be due and payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or defeased,
or an offer to prepay, redeem, purchase or defease such Debt shall be required
to be made, in each case prior to the stated maturity thereof; or

            (e) Any Loan Party or any of its Subsidiaries shall generally not
pay its debts as such debts become due, or shall admit in writing its inability
to pay its debts generally, or shall make a general assignment for the benefit
of creditors; or any proceeding shall be instituted by or

                             5-Year Credit Agreement

<PAGE>
                                      -41-


against such Loan Party or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding shall
remain undismissed or unstayed for a period of 30 days, or any of the actions
sought in such proceeding (including, without limitation, the entry of an order
for relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or for any substantial part of its property)
shall occur; or such Loan Party of any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e); or

            (f) Any judgment or order for the payment of money in excess of
$75,000,000 shall be rendered against any Loan Party or any of its Material
Subsidiaries and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order or (ii) there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; provided,
however, that any such judgment or order shall not be an Event of Default under
this Section 6.01(f) if and for so long as (i) the amount of such judgment or
order is covered by a valid and binding policy of insurance between the
defendant and the insurer covering payment thereof and (ii) such insurer, which
shall be rated at least "A" by A.M. Best Company, has been notified of, and has
not disputed the claim made for payment of, the amount of such judgment or
order; or

            (g) Any event, action or condition with respect to an employee
benefit plan of the Company subject to Title IV of ERISA results in any penalty
or action pursuant to ERISA that has a material adverse effect on the business
or financial condition of either Loan Party and its Subsidiaries, taken as a
whole; or

            (h) The Master Bottling Agreement ceases to be valid and binding and
in full force and effect; or Pepsi denies that it has any liability or
obligation under the Master Bottling Agreement and Pepsi ceases performance
thereunder; or

            (i) A Change of Control shall occur;

then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Company, declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Company, declare the
Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Company; provided, however, that in the event
of an actual or deemed entry of an order for relief with respect to any Loan
Party or any Borrowing Subsidiary under the Federal Bankruptcy Code, (A) the
obligation

                             5-Year Credit Agreement

<PAGE>
                                      -42-


of each Lender to make Advances shall automatically be terminated and (B) the
Advances, all such interest and all such amounts shall automatically become and
be due and payable, without presentment, protest or any notice of any kind, all
of which are hereby expressly waived by each Loan Party.

                                   ARTICLE VII

                                    THE AGENT

            Each of the Lenders hereby irrevocably appoints the Agent as its
agent and authorizes the Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Agent by the terms hereof, together
with such actions and powers as are reasonably incidental thereto.

            The bank serving as the Agent hereunder shall have the same rights
and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Agent, and such bank and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of business
with the Loan Parties or any Subsidiary or other Affiliate thereof as if it were
not the Agent hereunder.

            The Agent shall not have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing,
(a) the Agent shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) the Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that the Agent is required to exercise in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 8.01), and (c) except
as expressly set forth herein, the Agent shall not have any duty to disclose,
and shall not be liable for the failure to disclose, any information relating to
the Loan Parties or any if their Subsidiaries that is communicated to or
obtained by the bank serving as Agent or any of its Affiliates in any capacity.
The Agent shall not be liable for any action taken or not taken by it with the
consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 8.01) or in the absence of its own gross negligence or
wilful misconduct. The Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof is given to the Agent by a Loan
Party or a Lender, and the Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation made
in or in connection with this Agreement, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Agent.

            The Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other

                             5-Year Credit Agreement

<PAGE>
                                      -43-


writing believed by it to be genuine and to have been signed or sent by the
proper Person. The Agent also may rely upon any statement made to it orally or
by telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Agent may consult with legal
counsel (who may be counsel for any Loan Party), independent accountants and
other experts selected by it, and shall not be liable for any action taken or
not taken by it in accordance with the advice of any such counsel, accountants
or experts.

            The Agent may perform any and all of its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by the
Agent. The Agent and any such sub-agent may perform any and all of its duties
and exercise its rights and powers through their respective Related Parties. The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of the Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as Agent.

            Subject to the appointment and acceptance of a successor Agent as
provided in this paragraph, the Agent may resign at any time by notifying the
Lenders and the Company. Upon any such resignation, the Required Lenders shall
have the right to appoint a successor agent approved by the Company, which
approval will not be unreasonably withheld or delayed; provided that such
approval shall not be required if an Event of Default has occurred and is
continuing. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring Agent
gives notice of its resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent which shall be a commercial bank organized
under the laws of the United States or any State thereof, having a combined
capital and surplus of at least $50,000,000 with an office in New York, New
York, or an Affiliate of any such bank. Upon the acceptance of its appointments
as Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Company to a successor Agent shall be the
same as those payable to its predecessor unless otherwise agreed between the
Company and such successor. After the Agent's resignation hereunder, the
provisions of this Article and Section 8.04 shall continue in effect for the
benefit of such retiring Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Agent.

            Each Lender acknowledges that it has, independently and without
reliance upon the Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.

                             5-Year Credit Agreement

<PAGE>
                                      -44-


                                  ARTICLE VIII

                                  MISCELLANEOUS

      SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement, nor consent to any departure by any Borrower therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Required Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following: (a) except pursuant to
Section 2.05(b), 2.05(c), 2.15 or 2.17, increase the Commitments of the Lenders
or subject the Lenders to any additional obligations, (b) reduce the principal
of, or interest on, the Revolving Credit Advances or any fees or other amounts
payable hereunder, (c) postpone any date fixed for any payment of principal of,
or interest on, the Revolving Credit Advances or any fees or other amounts
payable hereunder, (d) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Revolving Credit Advances, or the
number of Lenders, that shall be required for the Lenders or any of them to take
any action hereunder, (e) release the guarantee as set forth in Section 9.01 or
10.01, or (f) amend this Section 8.01; and provided further that no amendment,
waiver or consent shall, unless in writing and signed by the Agent in addition
to the Lenders required above to take such action, affect the rights or duties
of the Agent under this Agreement.

      SECTION 8.02. Notices, Etc. All notices and other communications provided
for hereunder shall be in writing (including telecopier, telegraphic or telex
communication) and mailed, telecopied, telegraphed, telexed or delivered, if to
the Company, any Borrower or the Guarantor, to the Company at its address at One
Pepsi Way, Somers, New York 10589, Attention: General Counsel, Telecopier No.
(914) 767-1161, with a copy to Secretary, Telecopier No. (914) 767-1161; if to
any Initial Lender, at its Domestic Lending Office specified opposite its name
on Schedule 1 hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assignment and Acceptance pursuant to which it became a Lender;
and if to the Agent, at the Assignment and Acceptance pursuant to which it
became a Lender; and if to the Agent, at JPMorgan Chase Bank, Loan & Agency
Services, 1111 Fannin, Floor 10, Houston, Texas, 77002, Attention of Cherry
Arnaez (Telecopier No. (713) 750-2894), with a copy to JPMorgan Chase Bank, 270
Park Avenue, New York, New York 10017, Attention of Buddy Wuthrich (Telecopier
No. (212) 270-5127); or, as to the Company, any Borrower, the Guarantor or the
Agent, at such other address as shall be designated by such party in a written
notice to the other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to the Company and the
Agent. All such notices and communications shall, when mailed, telecopied,
telegraphed or telexed, be effective when deposited in the mails, telecopied,
delivered to the telegraph company or confirmed by telex answer back,
respectively, except that notices and communications to the Agent pursuant to
Article II, III or VII shall not be effective until received by the Agent.

                             5-Year Credit Agreement

<PAGE>
                                      -45-


      SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender or
the Agent to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.

      SECTION 8.04. Costs and Expenses.

            (a) The Company agrees to pay on demand all costs and expenses of
the Agent as set forth in the fee letter between the Company and the Agent. The
Company further agrees to pay on demand all reasonable costs and expenses of the
Agent and the Lenders, if any (including, without limitation, reasonable counsel
fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement and the other
documents to be delivered hereunder, including, without limitation, reasonable
fees and expenses of counsel for the Agent and each Lender in connection with
the enforcement of rights under this Section 8.04(a).

            (b) The Company agrees to indemnify and hold harmless the Agent and
each Lender and each of their Affiliates and their officers, directors,
employees, agents and advisors (each, an "Indemnified Party") from and against
any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of, or in connection with the
preparation for a defense of, any investigation, litigation or proceeding
arising out of, related to or in connection with this Agreement, any promissory
note issued hereunder, any of the transactions contemplated herein or the actual
or proposed use of the proceeds of the Advances, whether or not such
investigation, litigation or proceeding is brought by any Borrower, the
Guarantor, their directors, shareholders or creditors or an Indemnified Party or
any other Person or any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are consummated, except to
the extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful misconduct.

            (c) To the extent that the Company fails to pay any amount required
to be paid by it to the Agent under paragraph (a) or (b) of this Section 8.04,
each Lender severally agrees to pay to the Agent such Lenders' Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the Agent in
its capacity as such.

            (d) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance or LIBO Rate Advance is made by any Borrower to or for the account
of a Lender other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.08(d) or (e), 2.10
or 2.12, acceleration of the maturity of the Advances

                             5-Year Credit Agreement

<PAGE>
                                      -46-


pursuant to Section 6.01 or for any other reason, the Company shall, upon demand
by such Lender (with a copy of such demand to the Agent), pay to the Agent for
the account of such Lender any amounts required to compensate such Lender for
any additional losses, costs or expenses that it may reasonably incur as a
result of such payment or Conversion, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender to fund or maintain such Advance.

            (e) Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Company contained in
Sections 2.11, 2.14 and 8.04 shall survive the payment in full of principal,
interest and all other amounts payable hereunder.

      SECTION 8.05. Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the Agent to
declare the Advances due and payable pursuant to the provisions of Section 6.01,
each Lender and each of its Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by such Lender or such
Affiliate to or for the credit or the account of any Loan Party or any Borrower
against any and all of the obligations of such Loan Party or such Borrower now
or hereafter existing under this Agreement, whether or not such Lender shall
have made any demand under this Agreement and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Company after any such
set-off and application, provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
and its Affiliates under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) that such
Lender and its Affiliates may have.

      SECTION 8.06. Binding Effect. This Agreement shall become effective (other
than Sections 2.01 and 2.03, which shall only become effective upon satisfaction
of the conditions precedent set forth in Section 3.01) when it shall have been
executed by the Loan Parties and the Agent and when the Agent shall have been
notified by each Initial Lender that such Initial Lender has executed it and
thereafter shall be binding upon and inure to the benefit of the Loan Parties,
each Subsidiary Borrower (if any), the Agent and each Lender and their
respective successors and assigns, except that no Borrower shall have the right
to assign its rights hereunder or any interest herein without the prior written
consent of the Lenders.

      SECTION 8.07. Assignments and Participations.

            (a) Each Lender may, upon ten days' notice to the Agent and with the
consent of the Company (which shall not be unreasonably withheld) and, if
demanded by the Company (following a demand by such Lender pursuant to Section
2.11 or Section 2.14 or a suspension of such Lender's obligation to make or
continue Advances as, or convert Advances into, Eurodollar Rate Advances
pursuant to Section 2.12) upon at least ten days' notice to such Lender and the

                             5-Year Credit Agreement

<PAGE>
                                      -47-


Agent, will assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment and the Revolving Credit Advances owing to it);
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of all rights and obligations under this Agreement (other
than any right to make Competitive Bid Advances or Competitive Bid Advances
owing to it), (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than the lesser of (x)
$25,000,000 and (y) the smallest initial Commitment of any Initial Lender, (iii)
each such assignment shall be to an Eligible Assignee, (iv) each such assignment
made as a result of a demand by the Company pursuant to this Section 8.07(a)
shall be arranged by the Company after consultation with the Agent and shall be
either an assignment of all of the rights and obligations of the assigning
Lender under this Agreement or an assignment of a portion of such rights and
obligations made concurrently with another such assignment or other such
assignments that together cover all of the rights and obligations of the
assigning Lender under this Agreement, (v) no Lender shall be obligated to make
any such assignment as a result of a demand by the Company pursuant to this
Section 8.07(a) unless and until such Lender shall have received one or more
payments from either the Company or one or more Eligible Assignees in an
aggregate amount at least equal to the aggregate outstanding principal amount of
the Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount and all other amounts payable to such
Lender under this Agreement and (vi) the parties to each such assignment shall
execute and deliver to the Agent, for its acceptance and recording in the
Register (as defined in clause (d) below), an Assignment and Acceptance,
together with a processing and recordation fee of $3,500. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, (x) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).

            (b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any
Borrower or the performance or observance by any Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this

                             5-Year Credit Agreement

<PAGE>
                                      -48-


Agreement, together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi)
such assignee appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under this Agreement as
are delegated to the Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all of the obligations that
by the terms of this Agreement are required to be performed by it as a Lender.

            (c) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee representing that it is an Eligible Assignee,
the Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit B hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Company.

            (d) The Agent shall maintain at its address referred to in Section
8.02 a copy of each Assignment and Acceptance delivered to and accepted by it
and a register for the recordation of the names and addresses of the Lenders
and, with respect to Lenders, the Commitment of, and principal amount of the
Advances owing to, each Lender from time to time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and each Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Loan Parties or any Lender at any reasonable time and from time to time upon
reasonable prior notice.

            (e) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (a
"SPC"), identified as such in writing from time to time by the Granting Lender
to the Agent and the Company, the option to provide to the Company all or any
part of any Advance that such Granting Lender would otherwise be obligated to
make to the Company pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPC to make any Advance, (ii) if an SPC
elects not to exercise such option or otherwise fails to provide all or any part
of such Advance, the Granting Lender shall be obligated to make such Advance
pursuant to the terms hereof. The making of an Advance by an SPC hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Advance were made by such Granting Lender. Each party hereto agrees that no
SPC shall be liable for any indemnity or similar payment obligation under this
Agreement (all liability for which shall remain with the Granting Lender). In
furtherance of the foregoing, each party hereto hereby agrees (which agreement
shall survive the termination of this Agreement) that, prior to the date that is
one year and one day after the payment in full of all outstanding commercial
paper or other senior indebtedness of any SPC, it will not institute against, or
join any other person in instituting against, such SPC any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under the
laws

                             5-Year Credit Agreement

<PAGE>
                                      -49-


of the United States or any State thereof. In addition, notwithstanding anything
to the contrary contained in this Section 8.07(e), any SPC may (i) with notice
to, but without the prior written consent of, the Company and the Agent and
without paying any processing fee therefor, assign all or a portion of its
interests in any Advances to the Granting Lender or to any financial
institutions (consented to by the Company and the Agent) providing liquidity
and/or credit support to or for the account of any SPC to support the funding or
maintenance of Advances and (ii) disclose on a confidential basis any non-public
information relating to its Advances to any rating agency, commercial paper
dealer or provider of any surety, guarantee or credit or liquidity enhancement
to such SPC.

            (f) Each Lender may, upon notice to the Agent and the Company, sell
participations to one or more banks or other entities in or to all or a portion
of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment and the Advances owing to it);
provided, however, that (i) such Lender's obligations under this Agreement
(including, without limitation, its Commitment hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Lender shall remain
the holder of any promissory note issued or assigned to it hereunder, (iv) the
Borrowers, the Guarantor, the Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and (v) no participant under any such
participation shall have any right to approve any amendment or waiver of any
provision of this Agreement, or any consent to any departure by any Borrower
therefrom, except to the extent that such amendment, waiver or consent would
reduce the principal of, or interest on, the Advances or any fees or other
amounts payable hereunder, in each case to the extent subject to such
participation, or postpone any date fixed for any payment of principal of, or
interest on, the Advances or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation.

            (g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to any Loan Party or any Borrower furnished
to such Lender by or on behalf of any Loan Party or any Borrower; provided that,
prior to any such disclosure, the assignee or participant or proposed assignee
or participant shall agree to preserve the confidentiality of any Confidential
Information relating to the Loan Parties or the Borrowers received by it from
such Lender.

            (h) Notwithstanding any other provision set forth in this Agreement,
any Lender may at any time create a security interest in all or any portion of
its rights under this Agreement or any promissory note issued to such Lender
hereunder (including, without limitation, the Advances owing to it) in favor of
any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.

                             5-Year Credit Agreement

<PAGE>
                                      -50-


      SECTION 8.08. Confidentiality. Neither the Agent nor any Lender shall
disclose any Confidential Information to any Person without the consent of the
Company, other than (a) to the Agent's or such Lender's Affiliates and their
officers, directors, employees, agents and advisors and to actual or prospective
assignees and participants, and then only on a confidential basis, (b) as
required by any law, rule or regulation or judicial process, (c) to any rating
agency when required by it and (d) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking.
Notwithstanding the foregoing and any other provision herein, the Loan Parties
and any Lender (and each employee, representative or other agent of the Loan
Parties and any Lender) may disclose to any and all Persons, without limitation
of any kind, the U.S. federal income tax treatment and tax structure, if any, of
the transactions contemplated by this Agreement (the "Transactions"), other than
information for which nondisclosure is reasonably necessary in order to comply
with applicable securities laws. For the purposes of this Section 8.08, "tax
structure" is limited to any fact relevant to understanding the U.S. federal
income tax treatment of the Transactions and does not include information
relating to the identity of the Loan Parties.

      SECTION 8.09. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.

      SECTION 8.10. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.

      SECTION 8.11. Jurisdiction, Etc.

            (a) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement in the courts of any jurisdiction.

            (b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this

                             5-Year Credit Agreement

<PAGE>
                                      -51-


Agreement in any New York State or federal court sitting in New York City. Each
of the parties hereto hereby irrevocably waives, to the fullest extent permitted
by law, the defense of an inconvenient forum to the maintenance of such action
or proceeding in any such court.

      SECTION 8.12. WAIVER OF JURY TRIAL. EACH BORROWER, THE GUARANTOR, THE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF THE
AGENT OR ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT THEREOF.

                                   ARTICLE IX

                                COMPANY GUARANTEE

      SECTION 9.01. Company Guarantee. Subject to the provisions of this Article
IX, the Company unconditionally and irrevocably guarantees to each Lender and
the Agent and their respective successors and assigns, that: (i) the principal
of, premium, if any, and interest on the Advances to each Borrowing Subsidiary
and, following the Substitution Date, the Guarantor (each a "Guaranteed Party")
and any promissory notes issued by any Guaranteed Party hereunder will be duly
and punctually paid in full when due, whether at maturity, by acceleration, by
redemption or otherwise, and interest on overdue principal, and premium, if any,
and (to the extent permitted by law) interest on any interest, if any, on the
Advances and all other obligations of the Guaranteed Parties to the Lenders or
the Agent hereunder (including fees and expenses) will be promptly paid in full,
all in accordance with the terms hereof; and (ii) in case of any extension of
time of payment or renewal of any of the Advances to any Guaranteed Party or any
of such other obligations, the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. Failing payment when due of any
amount so guaranteed, or failing performance of any other obligation of the
Guaranteed Parties to the Lenders or the Agent, for whatever reason, the Company
will be obligated to pay, or to perform or to cause the performance of, the same
immediately. An Event of Default under this Agreement shall constitute an event
of default under this Guarantee, and shall entitle the Lenders to accelerate the
obligations of the Company under this Guarantee in the same manner and to the
same extent as the obligations of the Guaranteed Parties.

            The Company hereby agrees that its obligations under this Guarantee
shall be unconditional, irrespective of the validity, regularity or
enforceability of this Agreement, any Designation Letter or the Substitution
Letter, the absence of any action to enforce the same, any waiver or consent by
any Lender or the Agent of this Agreement any Designation Letter or the
Substitution Letter, with respect to any thereof, the entry of any judgment
against any Guaranteed Party, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of the Company. The Company

                             5-Year Credit Agreement

<PAGE>
                                      -52-


hereby waives and relinquishes: (a) any right to require the Agent, the Lenders
or any Guaranteed Party (each, a "Benefitted Party") to proceed against any
Guaranteed Party or any other Person or to proceed against or exhaust any
security held by a Benefitted Party at any time or to pursue any other remedy in
any secured party's power before proceeding against the Company; (b) any defense
that may arise by reason of the incapacity, lack of authority, death or
disability of any other Person or Persons or the failure of a Benefitted Party
to file or enforce a claim against the estate (in administration, bankruptcy or
any other proceeding) of any other Person or Persons; (c) demand, protest and
notice of any kind (except as expressly required by this Agreement), including
but not limited to notice of the existence, creation or incurring of any new or
additional Debt or obligation or of any action or non-action on the part of the
Company, any Benefitted Party, any creditor of the Company or any Guaranteed
Party or on the part of any other Person whomsoever in connection with any
obligations the performance of which are guaranteed under this Guarantee; (d)
any defense based upon an election of remedies by a Benefitted Party, including
but not limited to an election to proceed against the Company or any other
Guaranteed Party for reimbursement; (e) any defense based upon any statute or
rule of law which provides that the obligation of a surety must be neither
larger in amount nor in other respects more burdensome than that of the
principal; (f) any defense arising because of a Benefitted Party's election, in
any proceeding instituted under the Bankruptcy Code, of the application of
Section 1111(b)(2) of the Bankruptcy Code; and (g) any defense based on any
borrowing or grant of a security interest under Section 364 of the Bankruptcy
Code. The Company hereby covenants that this Guarantee will not be discharged
except by payment in full of all principal, premium, if any, and interest on the
Advances made to each Guaranteed Party and all other costs provided for under
this Agreement in respect thereof. This is a Guarantee of payment and not of
collectibility.

            If any Lender or the Agent is required by any court or otherwise to
return to either the Company or any Guaranteed Party, or any trustee or similar
official acting in relation to either the Company or any Guaranteed Party, any
amount paid by the Company or any Guaranteed Party to the Agent or such Lender,
this Guarantee, to the extent theretofore discharged, shall be reinstated in
full force and effect. The Company agrees that it will not be entitled to any
right of subrogation in relation to the Lenders or the Agent in respect of any
obligations guaranteed under this Guarantee until payment in full of all
obligations guaranteed hereby. The Company agrees that, as between it, on the
one hand, and the Lenders and the Agent, on the other hand, (x) the maturity of
the obligations guaranteed under this Guarantee may be accelerated as provided
in Article VI hereof for the purposes hereof, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any acceleration of such
obligations as provided in Article VI hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by such Company for the
purpose of this Guarantee.

                                    ARTICLE X

                              SUBSIDIARY GUARANTEE

                             5-Year Credit Agreement

<PAGE>
                                      -53-


      SECTION 10.01. Subsidiary Guarantee. Subject to the provisions of this
Article X, the Guarantor unconditionally and irrevocably guarantees to each
Lender and the Agent and their respective successors and assigns, that: (i) the
principal of, premium, if any, and interest on the Advances and any promissory
note issued hereunder will be duly and punctually paid in full when due, whether
at maturity, by acceleration, by redemption or otherwise, and interest on
overdue principal, and premium, if any, and (to the extent permitted by law)
interest on any interest, if any, on the Advances, any promissory note issued
hereunder and all other obligations of the Company to the Lenders or the Agent
hereunder (including fees and expenses) will be promptly paid in full, all in
accordance with the terms hereof; and (ii) in case of any extension of time of
payment or renewal of any of the Advances or any of such other obligations, the
same will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise. Failing payment when due of any amount so guaranteed, or failing
performance of any other obligation of the Company to the Lenders or the Agent,
for whatever reason, the Guarantor will be obligated to pay, or to perform or to
cause the performance of, the same immediately. An Event of Default under this
Agreement shall constitute an event of default under this Guarantee, and shall
entitle the Lenders to accelerate the obligations of the Guarantor under this
Guarantee in the same manner and to the same extent as the obligations of the
Company.

            The Guarantor hereby agrees that its obligations under this
Guarantee shall be unconditional, irrespective of the validity, regularity or
enforceability of this Agreement, the absence of any action to enforce the same,
any waiver or consent by any Lender or the Agent of this Agreement with respect
to any thereof, the entry of any judgment against the Company, any action to
enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of the Guarantor. The Guarantor hereby
waives and relinquishes: (a) any right to require the Agent, the Lenders or the
Company (each, a "Benefitted Person") to proceed against the Company or any
other Person or to proceed against or exhaust any security held by a Benefitted
Person at any time or to pursue any other remedy in any secured party's power
before proceeding against the Guarantor; (b) any defense that may arise by
reason of the incapacity, lack of authority, death or disability of any other
Person or Persons or the failure of a Benefitted Person to file or enforce a
claim against the estate (in administration, bankruptcy or any other proceeding)
of any other Person or Persons; (c) demand, protest and notice of any kind
(except as expressly required by this Agreement), including but not limited to
notice of the existence, creation or incurring of any new or additional Debt or
obligation or of any action or non-action on the part of the Guarantor, the
Company, any Benefitted Person, any creditor of the Guarantor, the Company or on
the part of any other Person whomsoever in connection with any obligations the
performance of which are guaranteed under this Guarantee; (d) any defense based
upon an election of remedies by a Benefitted Person, including but not limited
to an election to proceed against the Guarantor for reimbursement; (e) any
defense based upon any statute or rule of law which provides that the obligation
of a surety must be neither larger in amount nor in other respects more
burdensome than that of the principal; (f) any defense arising because of a
Benefitted Person's election, in any proceeding instituted under the Bankruptcy
Code, of the application of Section 1111(b)(2) of the Bankruptcy Code; and (g)
any defense based on any borrowing or grant of a security interest under Section
364 of the Bankruptcy Code. The Guarantor hereby covenants that this Guarantee
will not be discharged except by payment in full

                             5-Year Credit Agreement

<PAGE>
                                      -54-


of all principal, premium, if any, and interest on the Advances and all other
costs provided for under this Agreement. This is a Guarantee of payment and not
of collectibility.

            If any Lender or the Agent is required by any court or otherwise to
return to either the Company or the Guarantor, or any trustee or similar
official acting in relation to either the Company or the Guarantor, any amount
paid by the Company or the Guarantor to the Agent or such Lender, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. The Guarantor agrees that it will not be entitled to any right
of subrogation in relation to the Lenders or the Agent in respect of any
obligations guaranteed under this Guarantee until payment in full of all
obligations guaranteed hereby. The Guarantor agrees that, as between it, on the
one hand, and the Lenders and the Agent, on the other hand, (x) the maturity of
the obligations guaranteed under this Guarantee may be accelerated as provided
in Article VI hereof for the purposes hereof, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any acceleration of such
obligations as provided in Article VI hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by such Guarantor for
the purpose of this Guarantee.

      SECTION 10.02. Limitation of Guarantor's Liability. The Guarantor, and by
its acceptance hereof, each Lender, hereby confirms that it is the intention of
the parties hereto that this Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
State law. To effectuate the foregoing intention, the Lenders and the Guarantor
hereby irrevocably agree that the obligations of the Guarantor under this
Article X shall be limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of the Guarantor, result in the
obligations of the Guarantor under the Guarantee not constituting a fraudulent
transfer or conveyance under federal or state law.

                             5-Year Credit Agreement

<PAGE>

            IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective officers thereunto duly authorized as of the
date first above written.

                                        THE PEPSI BOTTLING GROUP, INC.,
                                        as Borrower

                                        By: ____________________________________
                                            Name:
                                            Title:


                                        BOTTLING GROUP, LLC,
                                        as Guarantor

                                        By: ____________________________________
                                            Name:
                                            Title:


                                        JPMORGAN CHASE BANK,
                                        as Agent

                                        By: ____________________________________
                                            Name:
                                            Title:

                             5-Year Credit Agreement

<PAGE>

<TABLE>
<CAPTION>
COMMITMENT                              INITIAL LENDERS
- ----------                              ---------------
<S>                                     <C>
$25,000,000                             CITIBANK, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             BANK OF AMERICA, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             CREDIT SUISSE FIRST BOSTON,
                                        CAYMAN ISLANDS BRANCH

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             DEUTSCHE BANK AG NEW YORK BRANCH

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                 Initial Lenders

<PAGE>
                                      -2-


<TABLE>
<S>                                     <C>
$25,000,000                             JPMORGAN CHASE BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$20,000,000                             THE NORTHERN TRUST COMPANY

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$20,000,000                             LEHMAN BROTHERS BANK, FSB

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                 Initial Lenders

<PAGE>
                                      -3-


<TABLE>
<S>                                     <C>
$17,500,000                             BANCO BILBAO VIZCAYA ARGENTARIA

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$17,500,000                             HSBC BANK USA

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$12,500,000                             FLEET NATIONAL BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                 Initial Lenders

<PAGE>
                                      -4-


<TABLE>
<S>                                     <C>
$12,500,000                             THE BANK OF NEW YORK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$10,000,000                             STATE STREET BANK AND TRUST COMPANY

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$7,500,000                              COMERICA BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                 Initial Lenders

<PAGE>
                                      -5-


<TABLE>
<S>                                     <C>
$7,500,000                              WELLS FARGO BANK, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

$250,000,000 TOTAL OF THE COMMITMENTS

                                 Initial Lenders

<PAGE>

                                                                      SCHEDULE 1

                                 LENDING OFFICES

<TABLE>
<CAPTION>
Lender                           Domestic Lending Office                   Eurodollar Lending Office
<S>                              <C>                                       <C>
CITIBANK, N.A.                   399 Park Avenue                           399 Park Avenue
                                 New York New York 10043                   New York New York 10043

BANK OF AMERICA, N.A             901 Main Street, 14th Floor               901 Main Street, 14th Floor
                                 Dallas, Texas 75202                       Dallas, Texas 75202

CREDIT SUISSE FIRST              11 Madison Avenue                         Credit Suisse First Boston
BOSTON, CAYMAN ISLANDS           New York, New York, 10010                 Cayman Islands Branch
BRANCH                                                                     c/-11 Madison Avenue
                                                                           New York, New York 10010

DEUTSCHE BANK AG NEW             90 Hudson Street                          90 Hudson Street
YORK BRANCH                      Mailstop JCY05-0511                       Mailstop JCY05-0511
                                 Jersey City, NJ 07302                     Jersey City, NJ 07302

JPMORGAN CHASE BANK              270 Park Avenue                           270 Park Avenue
                                 New York, New York 10017                  New York,  New York 10017

THE NORTHERN TRUST               50 South La Salle Street                  50 South La Salle Street
COMPANY                          Chicago, Illinois 60675                   Chicago, Illinois 60675

LEHMAN BROTHERS BANK, FSB        745 7th Avenue, 16th Floor                745 7th Avenue, 16th Floor
                                 New York, NY  10019                       New York, NY  10019

BANCO BILBAO VIZCAYA             1345 Avenue of the Americas               1345 Avenue of the Americas
ARGENTARIA                       New York, New York 10105                  New York, New York 10105

HSBC BANK USA                    452 Fifth Avenue                          452 Fifth Avenue
                                 New York, New York 10018                  New York, New York 10018

FLEET NATIONAL BANK              One Landmark Sq.                          One Landmark Sq.
                                 Stamford, Connecticut 06904               Stamford, Connecticut 06904

THE BANK OF NEW YORK             One Wall Street                           One Wall Street
                                 New York, New York 10286                  New York, New York 10286

STATE STREET BANK AND            225 Franklin Street                       225 Franklin Street
TRUST COMPANY                    Boston, MA 02110                          Boston, MA 02110

COMERICA BANK                    500 Woodward Avenue, 9th Floor            500 Woodward Avenue, 9th Floor
                                 MC 3279                                   MC 3279
                                 Detroit, Michigan 48275-3279              Detroit, Michigan 48275-3279

WELLS FARGO BANK, N.A.           70 E. 55th Street                         70 E. 55th Street
                                 New York, New York 10022                  New York, New York 10022
</TABLE>

                                   Schedule 1
<PAGE>

                                                                      SCHEDULE 2

                                PRICING SCHEDULE

<TABLE>
<CAPTION>
                                                                                    Applicable
                           Applicable Facility                                   Utilization Fee
Rating Level Period             Fee Rate               Applicable Margin             Rate(1)
- -------------------             --------               -----------------             -------
<S>                        <C>                         <C>                       <C>
         1                         8.0 bps                   27.0 bps                10.0 bps

         2                         9.0 bps                   31.0 bps                10.0 bps

         3                        12.5 bps                   37.5 bps                10.0 bps

         4                        17.5 bps                   45.0 bps                10.0 bps

         5                        25.0 bps                   75.0 bps                25.0 bps
</TABLE>

(1)   Applicable if utilization exceeds 33-1/3% of Commitment amount.

                                   Schedule 2

<PAGE>

                                                                     EXHIBIT A-1

                  FORM OF NOTICE OF REVOLVING CREDIT BORROWING

JPMorgan Chase Bank, as Agent
    for the Lenders parties
    to the 5-Year Credit Agreement
    referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                                          [Date]

Ladies and Gentlemen:

            The undersigned, The Pepsi Bottling Group, Inc. (the "Company"),
refers to the 5-Year Credit Agreement, dated as of April 30, 2003 (as amended or
modified from time to time, the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, Bottling Group,
LLC (the "Guarantor"), certain Lenders parties thereto and JPMorgan Chase Bank,
as administrative agent for said Lenders, and hereby gives you notice,
irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests a Revolving Credit Borrowing under the Credit
Agreement, and in that connection sets forth below the information relating to
such Revolving Credit Borrowing (the "Proposed Revolving Credit Borrowing") as
required by Section 2.02(a) of the Credit Agreement:

      (i) The Business Day of the Proposed Revolving Credit Borrowing is
      __________, ____.

      (ii) The Type of Advances comprising the Proposed Revolving Credit
      Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].

      (iii) The aggregate amount of the Proposed Revolving Credit Borrowing is
      $______.

      (iv) The identity of the Borrower is __________, a ____________
      corporation.

      [(v)] [The initial Interest Period for each Eurodollar Rate Advance made
      as part of the Proposed Revolving Credit Borrowing is ___ month[s].]

                  Form of Notice of Revolving Credit Borrowing

<PAGE>
                                      -2-


            The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed Revolving
Credit Borrowing:

      (A) the representations and warranties contained in Section 4.01 of the
Credit Agreement (except the representations set forth in the last sentence of
subsection (e) thereof and in subsection (f) thereof (other than clause (ii)
thereof)) are correct in all material respects, on and as of the date of the
Proposed Revolving Credit Borrowing, before and after giving effect to the
Proposed Revolving Credit Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date; and

      (B) no event has occurred and is continuing, or would result from such
Proposed Revolving Credit Borrowing or from the application of the proceeds
therefrom, that constitutes a Default.

                                        Very truly yours,

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:

                  Form of Notice of Revolving Credit Borrowing

<PAGE>

                                                                     EXHIBIT A-2

                   FORM OF NOTICE OF COMPETITIVE BID BORROWING

JPMorgan Chase Bank, as Agent
    for the Lenders parties
    to the 5-Year Credit Agreement
    referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                                          [Date]

Ladies and Gentlemen:

            The undersigned, The Pepsi Bottling Group, Inc. (the "Company"),
refers to the 5-Year Credit Agreement, dated as of April 30, 2003 (as amended or
modified from time to time, the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, Bottling Group,
LLC (the "Guarantor"), certain Lenders parties thereto and JPMorgan Chase Bank,
as administrative agent for said Lenders, and hereby gives you notice pursuant
to Section 2.03 of the Credit Agreement that the undersigned hereby requests a
Competitive Bid Borrowing under the Credit Agreement, and in that connection
sets forth the terms on which such Competitive Bid Borrowing (the "Proposed
Competitive Bid Borrowing") is requested to be made:

            (A)      Date of Proposed
                     Competitive Bid Borrowing            ___________________
            (B)      Aggregate Amount of Proposed
                     Competitive Bid Borrowing            ___________________
            (C)      Maturity Date                        ___________________
            (D)      Interest Rate Basis                  ___________________
            (E)      Interest Payment Date(s)             ___________________
            (F)      Identity of Borrower                 ___________________

            The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed
Competitive Bid Borrowing:

                   Form of Notice of Competitive Bid Borrowing

<PAGE>
                                      -2-


            (a) the representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects, on and as of the date of
      the Proposed Competitive Bid Borrowing, before and after giving effect to
      the Proposed Competitive Bid Borrowing and to the application of the
      proceeds therefrom, as though made on and as of such date; and

            (b) no event has occurred and is continuing, or would result from
      the Proposed Competitive Bid Borrowing or from the application of the
      proceeds therefrom, that constitutes a Default.

            The undersigned hereby confirms that the Proposed Competitive Bid
Borrowing is to be made available to it in accordance with Section 2.03(b) of
the Credit Agreement.

                                        Very truly yours,

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:

                   Form of Notice of Competitive Bid Borrowing

<PAGE>

                                                                     EXHIBIT A-3

                           FORM OF EXTENSION AGREEMENT

The Pepsi Bottling Group, Inc.
One Pepsi Way
Somers, New York 10589
Attention: Treasurer

JPMorgan Chase Bank, as Agent
   under the 5-Year Credit Agreement referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                                          [DATE]

Ladies and Gentlemen:

            Each undersigned Lender hereby agrees to extend, effective on
[insert effective date, which shall be no more than 29 days prior to the
existing Termination Date] (the "Extension Date"), the Termination Date under
the 5-Year Credit Agreement dated as of April 30, 2003 (as the same may be
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement") among The Pepsi Bottling Group, Inc., Bottling Group, LLC, the
Lenders and agents party thereto and JPMorgan Chase Bank, as administrative
agent for the Lenders, to __________ [one year from the effective date of this
Extension Agreement]. Terms defined in the Credit Agreement are used herein as
therein defined.

            This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.

                [Remainder of this page intentionally left blank]

                   Form of Notice of Competitive Bid Borrowing

<PAGE>

                                                                       EXHIBIT B

                        FORM OF ASSIGNMENT AND ACCEPTANCE

            Reference is made to the 5-Year Credit Agreement dated as of April
30, 2003 (as amended or modified from time to time, the "Credit Agreement"),
among THE PEPSI BOTTLING GROUP, INC., a Delaware corporation (the "Company"),
Bottling Group, LLC (the "Guarantor"), the Lenders (as defined in the Credit
Agreement) and JPMorgan Chase Bank, as administrative agent for the Lenders (the
"Agent"). Terms defined in the Credit Agreement are used herein with the same
meaning.

            The "Assignor" and the "Assignee" referred to on Schedule 1 hereto
agree as follows:

            (1) The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and to
the Assignor's rights and obligations under the Credit Agreement as of the date
hereof (other than in respect of Competitive Bid Advances) equal to the
percentage interest specified on Schedule 1 hereto of all outstanding rights and
obligations under the Credit Agreement (other than in respect of Competitive Bid
Advances). After giving effect to such sale and assignment, the Assignee's
Commitment and the amount of the Revolving Credit Advances owing to the Assignee
will be as set forth on Schedule 1 hereto.

            (2) The Assignor (i) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto; and (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Company or the performance or observance by the
Company of any of its obligations or the obligations of any Borrower under the
Credit Agreement or any other instrument or document furnished pursuant thereto.

            (3) The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender; and (vi)

                        Form of Assignment and Acceptance

<PAGE>
                                      -2-


attaches any U.S. Internal Revenue Service forms required under Section 2.14 of
the Credit Agreement.

            (4) Following the execution of this Assignment and Acceptance, it
will be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1 hereto.

            (5) Upon such acceptance and recording by the Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.

            (6) Upon such acceptance and recording by the Agent, from and after
the Effective Date, the Agent shall make all payments under the Credit Agreement
in respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and facility fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement for periods prior to the Effective Date
directly between themselves.

            (7) This Assignment and Acceptance shall be governed by, and
construed in accordance with, the law of the State of New York.

            (8) This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.

            IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.

                        Form of Assignment and Acceptance

<PAGE>

                                   Schedule 1
                                       to
                            Assignment and Acceptance

Percentage interest assigned:                                              ___%

Assignee's Commitment:                                              $__________

Aggregate outstanding principal
amount of Revolving Credit Advances assigned:                       $__________

Effective Date(2):                                        _______________, ____

                                        [NAME OF ASSIGNOR], as Assignor

                                        By
                                        Title:

                                        Dated:                         ,


                                        [NAME OF ASSIGNEE], as Assignee

                                        By
                                        Title:

                                        Dated:                         ,

                                        Domestic Lending Office:
                                                [Address]

                                        Eurodollar Lending Office:
                                                [Address]

(2)   This date should be no earlier than five Business Days after the delivery
      of this Assignment and Acceptance to the Agent.

                     Schedule 1 to Assignment and Acceptance

<PAGE>
                                      -2-


Accepted and Approved this
____ day of ________, ____

JPMORGAN CHASE BANK, as Agent

By: ___________________________________
    Name:
    Title:

Approved this ____ day
of ________, ____


THE PEPSI BOTTLING GROUP, INC.

By: ___________________________________
    Name:
    Title:

                     Schedule 1 to Assignment and Acceptance

<PAGE>

                                                                       EXHIBIT C

            FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY AND THE
                                   GUARANTOR

                                                                [Effective Date]

To each of the Lenders parties
to the 5-Year Credit Agreement dated
as of April 30, 2003
among The Pepsi Bottling Group, Inc.,
said Lenders and JPMorgan Chase Bank,
as Agent for said Lenders, and
to JPMorgan Chase Bank, as Agent

                         The Pepsi Bottling Group, Inc.

Ladies and Gentlemen:

            This opinion is furnished to you pursuant to Section 3.01(g)(v) of
the 5-Year Credit Agreement, dated as of April 30, 2003 (the "Credit
Agreement"), among The Pepsi Bottling Group, Inc. (the "Company"), Bottling
Group, LLC, (the "Guarantor"), the Lenders parties thereto and JPMorgan Chase
Bank, as Agent for said Lenders, providing for extensions of credit to be made
by said Lenders to the Company in an aggregate principal amount at any one time
outstanding of up to $250,000,000. Terms defined in the Credit Agreement are
used herein as therein defined.

            I am the General Counsel of the Company and have acted as counsel to
the Company and the Guarantor in connection with the Credit Agreement. In
connection with this opinion, I have examined:

            (1) The Credit Agreement.

            (2) The documents furnished by the Company and the Guarantor
pursuant to subsections 3.01(g)(i)-(iv) of the Credit Agreement.

            (3) The Articles of Incorporation of the Company and all amendments
thereto (the "Charter").

            (4) The by-laws of the Company and all amendments thereto (the
"By-laws").

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>
                                      -2-


            (5) A certificate of the Secretary of State of Delaware, dated
_______________, 2003, attesting to the continued corporate existence and good
standing of the Company in that State.

            (6) The Amended and Restated Limited Liability Company Agreement of
the Guarantor, dated as of March 30, 1999, and all amendments thereto (the "LLC
Agreement").

            (7) The Certificate of Formation of the Guarantor and all amendments
thereto (the "Certificate of Formation").

            (8) A certificate of the Secretary of State of Delaware dated
_________, 2003, attesting to the continued existence and good standing of the
Guarantor in that State.

            (9) Resolutions of the Board of Directors of the Company adopted on
April 26, 1999 and September 5, 2002.

            (10) Resolutions of the Managing Directors of the Guarantor adopted
on June 4, 1999.

            In addition, I have examined the originals, or copies certified or
otherwise identified to my satisfaction, of such other corporate records of the
Company and the Guarantor, certificates of public officials and of officers of
the Company and the Guarantor, and agreements, instruments and other documents,
as I have deemed necessary as a basis for the opinions expressed below. I have
assumed the due execution and delivery, pursuant to due authorization, of the
Credit Agreement by the Initial Lenders and the Agent.

            The opinions expressed below are limited to the law of the State of
New York, the Delaware corporate law, the Federal law of the United States and,
with respect to paragraphs 1 and 2 and clauses (i), (ii) and (iii)(a) of
paragraph 3 only, the Delaware General Corporation Law and the Delaware Limited
Liability Company Act.

            Based upon the foregoing and upon such investigation as I have
deemed necessary and subject to the qualifications set forth herein, I am of the
following opinion:

            (1) The Company is a corporation validly existing and in good
standing under the laws of the State of Delaware.

            (2) The Guarantor is a limited liability company validly existing
and in good standing under the laws of the state of Delaware.

            (3) The execution, delivery and performance by the Company and the
Guarantor of the Credit Agreement (i) are within the Company's corporate, and
the Guarantor's limited liability company, powers, (ii) have been duly
authorized by all necessary corporate, or limited liability company, action, and
(iii) do not contravene (a) the Charter or the Bylaws of the Company or the LLC
Agreement or Certificate of Formation of the Guarantor or (b) to the best

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>
                                      -3-


of my knowledge (1) any United States Federal or New York State law, rule or
regulation applicable to the Company or the Guarantor (including, without
limitation, Regulation X of the Board of Governors of the Federal Reserve
System) or (2) any contractual or legal restriction contained in any material
judgment, decree, mortgage, agreement, indenture or other instrument to which
the Company or the Guarantor is a party. The Credit Agreement has been duly
executed and delivered on behalf of the Company and the Guarantor.

            (4) No authorization, approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body of the State of
New York or the Federal government of the United States is required for the due
execution, delivery and performance by the Company or the Guarantor of the
Credit Agreement.

            (5) The Credit Agreement is a valid and binding obligation of the
Company and the Guarantor enforceable against the Company and the Guarantor in
accordance with its terms.

            (6) To the best of my knowledge and except as disclosed in the
Company's consolidated financial statements, there are no pending or overtly
threatened actions or proceedings against the Company or any of its
Subsidiaries, before any court, governmental agency or arbitrator that purport
to affect the legality, validity, binding effect or enforceability of the Credit
Agreement or that are likely to have a materially adverse effect upon the
financial condition or operations of the Company or any of its Subsidiaries.

The opinions set forth above are subject to the following qualifications:

            (1) My opinion in paragraph 5 above is subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar law
affecting creditors' rights generally.

            (2) My opinion in paragraph 5 above is subject to the effect of
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law).

            (3) I express no opinion as to the effect (if any) of the law of any
jurisdiction (other than the State of New York) wherein any Lender may be
located or wherein enforcement of the Credit Agreement may be sought that limits
the rates of interest that such Lender may charge or collect.

            (4) I express no opinion as to the effect of Section 548 of the
United States Bankruptcy Code or any similar provision of State law.

            In all respects and for all purposes, this opinion is given solely
for the benefit of the Agent and the Lenders and may not be relied upon by any
other person or entity without my prior written consent.

                                        Very truly yours,

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>

                                                                       EXHIBIT D

                           FORM OF DESIGNATION LETTER

                                                 ____________, ____

To JPMorgan Chase Bank
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 5-Year Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 among The Pepsi Bottling Group, Inc. (the
"Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase Bank, as
administrative agent (the "Agent"), and the banks party thereto (the "Initial
Lenders"). Terms defined in the Credit Agreement are used herein as defined
therein.

            The Company hereby designates [______________] (the "Borrowing
Subsidiary"), a Subsidiary of the Company and a corporation duly incorporated
under the laws of [_______________] as a Borrower in accordance with Section
2.17 of the Credit Agreement until such designation is terminated in accordance
with said Section 2.17.

            The Borrowing Subsidiary hereby accepts the above designation and
hereby expressly and unconditionally accepts the obligations of a Borrower under
the Credit Agreement, adheres to the Credit Agreement and agrees and confirms
that, upon your execution and return to the Company of the enclosed copy of this
letter, such Borrowing Subsidiary shall be a Borrower for purposes of the Credit
Agreement and agrees to be bound by and perform and comply with the terms and
provisions of the Credit Agreement applicable to it as if it had originally
executed the Credit Agreement as a Borrower. The Borrowing Subsidiary hereby
authorizes and empowers the Company to act as its representative and
attorney-in-fact for the purposes of signing documents and giving and receiving
notices (including notices of Borrowing under the Credit Agreement) and other
communications in connection with the Credit Agreement and the transactions
contemplated thereby and for the purposes of modifying or amending any provision
of the Credit Agreement and further agrees that the Agent and each Lender may
conclusively rely on the foregoing authorization.

            The Borrowing Subsidiary represents and warrants that each of the
representations and warranties set forth in Section 4.01(a) (as if the reference
therein to Delaware were a reference to its jurisdiction of organization), (b),
(c) and (d) of the Credit Agreement are true as if each reference therein to the
Company were a reference to the Borrowing Subsidiary

                           Form of Designation Letter

<PAGE>
                                      -2-


and as if each reference therein to the Loan Documents were a reference to this
Designation Letter.

            The Borrowing Subsidiary hereby agrees that this Designation Letter
and the Credit Agreement shall be governed by, and construed in accordance with,
the law of the State of New York. The Borrowing Subsidiary hereby submits to the
nonexclusive jurisdiction of any New York state court or Federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Designation Letter, the Credit Agreement or for recognition or enforcement of
any judgment. The Borrowing Subsidiary irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum. The Borrowing Subsidiary further agrees that service of process in any
such action or proceeding brought in New York may be made upon it by service
upon the Borrower at the "Address for Notices" specified below its name on the
signature pages to the Credit Agreement.

            Without limiting the foregoing, the Borrowing Subsidiary joins in
the submission, agreements, waivers and consents in Section 8.11 and 8.12 of the
Credit Agreement.

                                        THE PEPSI BOTTLING GROUP, INC.

                                        By: ____________________________________
                                            Name:
                                            Title:


                                        [NAME OF BORROWING SUBSIDIARY]

                                        By: ____________________________________
                                            Name:
                                            Title:

                           Form of Designation Letter

<PAGE>
                                      -3-


ACCEPTED:

JPMORGAN CHASE BANK,
  as Agent


By: ___________________________________
    Name:
    Title:

                           Form of Designation Letter

<PAGE>

                                                                       EXHIBIT E

                           FORM OF SUBSTITUTION LETTER

                                                 ____________, ____

To JPMorgan Chase Bank
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 5-Year Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 among The Pepsi Bottling Group, Inc. (the
"Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase Bank, as
administrative agent (the "Agent"), and the banks party thereto (the "Initial
Lenders"). Terms defined in the Credit Agreement are used herein as defined
therein.

            The Company hereby elects to terminate its rights as a Borrower
under the Credit Agreement and designates the Guarantor as the exclusive
Borrower thereunder, in accordance with Section 2.17 of the Credit Agreement.

            The Guarantor hereby accepts the above substitution and hereby
expressly and unconditionally accepts the obligations of the Company under the
Credit Agreement, adheres to the Credit Agreement and agrees and confirms that,
as of the date hereof, the Guarantor shall become a Borrower for purposes of the
Credit Agreement and agrees to be bound by and perform and comply with the terms
and provisions of the Credit Agreement applicable to it as if it had originally
executed the Credit Agreement as the Company.

            The Company and the Guarantor hereby represent and warrant to the
Agent and each Lender that, before and after giving effect to this Substitution
Letter, (i) the representations and warranties set forth in Section 4.01 of the
Credit Agreement (except the representations set forth in the last sentence of
subsection (e) thereof and in subsection (f) thereof (other than clause (ii)
thereof)) are true and correct in all material respects on the date hereof and
after giving effect to the substitution contemplated hereby as if made on and as
of the date hereof and (ii) no Default has occurred and is continuing.

            The Company and the Guarantor hereby agree that this Substitution
Letter shall be governed by, and construed in accordance with, the law of the
State of New York. The Company and the Guarantor hereby submit to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York state court sitting in New

                           Form of Substitution Letter

<PAGE>
                                      -2-


York City for the purposes of all legal proceedings arising out of or relating
to this Substitution Letter or the transactions contemplated hereby.

                                        THE PEPSI BOTTLING GROUP, INC.

                                        By:
                                           Name:
                                           Title:


                                        BOTTLING GROUP, LLC

                                        By:
                                           Name:
                                           Title:

                           Form of Substitution Letter

<PAGE>

                                                                       EXHIBIT F

                           FORM OF TERMINATION LETTER

____________, ____

To JPMorgan Chase Bank,
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 5-Year Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 by and among The Pepsi Bottling Group,
Inc. (the "Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase
Bank, as administrative agent, and the banks party thereto. Terms defined in the
Credit Agreement are used herein as defined therein.

            The Company hereby terminates the status as a Borrowing Subsidiary
of [_______________], a corporation incorporated under the laws of
[_______________], in accordance with Section 2.17 of the Credit Agreement,
effective as of the date of receipt of this notice by the Agent. The undersigned
hereby represents and warrants that all principal of and interest on any Advance
of the above-referenced Borrowing Subsidiary and all other amounts payable by
such Borrowing Subsidiary pursuant to the Credit Agreement have been paid in
full on or prior to the date hereof. Notwithstanding the foregoing, this
Termination Letter shall not affect any obligation which by the terms of the
Credit Agreement survives termination thereof

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By: ____________________________________
                                            Name:
                                            Title:

                           Form of Termination Letter


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.8
<SEQUENCE>5
<FILENAME>y66832a1exv4w8.txt
<DESCRIPTION>364-DAY CREDIT AGREEMENT
<TEXT>
<PAGE>

                                                                     EXHIBIT 4.8

                                                           EXECUTION COUNTERPART

================================================================================

                                U.S. $250,000,000
                            364-DAY CREDIT AGREEMENT

                           Dated as of April 30, 2003

                                      among

                         THE PEPSI BOTTLING GROUP, INC.

                               BOTTLING GROUP, LLC

                            THE LENDERS NAMED HEREIN

                              JPMORGAN CHASE BANK,
                                    as Agent,

                        CITIGROUP GLOBAL MARKETS INC. and
                         BANC OF AMERICA SECURITIES LLC,
                           as Joint Lead Arrangers and
                                  Book Managers

                                       and

                                 CITIBANK, N.A.,
                             BANK OF AMERICA, N.A.,
                         CREDIT SUISSE FIRST BOSTON, and
                          DEUTSCHE BANK SECURITIES INC.
                              as Syndication Agents

================================================================================

<PAGE>

                                                                     EXHIBIT 4.8

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                 Page
                                                                                                 ----
<S>                                                                                              <C>
ARTICLE I  DEFINITIONS AND ACCOUNTING ....................................................         1
         SECTION 1.01.  Certain Defined Terms ............................................         1
         SECTION 1.02.  Computation of Time Periods ......................................        13
         SECTION 1.03.  Accounting Terms .................................................        13
ARTICLE II  AMOUNTS AND TERMS OF THE ADVANCES ............................................        13
         SECTION 2.01.  The Revolving Credit Advances ....................................        13
         SECTION 2.02.  Making the Revolving Credit Advances .............................        14
         SECTION 2.03.  The Competitive Bid Advances .....................................        15
         SECTION 2.04.  Fees .............................................................        18
         SECTION 2.05.  Termination, Reduction or Increase of the Commitments ............        19
         SECTION 2.06.  Repayment of Revolving Credit Advances, Evidence of
                 Indebtedness, Extension of Termination Date and Termed Out Loans ........        22
         SECTION 2.07.  Interest on Revolving Credit Advances ............................        24
         SECTION 2.08.  Interest Rate Determination ......................................        24
         SECTION 2.09.  Optional Conversion of Revolving Credit Advances .................        25
         SECTION 2.10.  Optional Prepayments of Revolving Credit Advances ................        26
         SECTION 2.11.  Increased Costs ..................................................        26
         SECTION 2.12.  Illegality .......................................................        27
         SECTION 2.13.  Payments and Computations ........................................        27
         SECTION 2.14.  Taxes ............................................................        28
         SECTION 2.15.  Sharing of Payments, Etc .........................................        31
         SECTION 2.16.  Use of Proceeds ..................................................        31
         SECTION 2.17.  Borrowings by Borrowing Subsidiaries; Substitution of Borrower ...        31
         SECTION 2.18.  Mitigation Obligations ...........................................        32
ARTICLE III  CONDITIONS TO EFFECTIVENESS AND ARTICLE II ..................................        33
         SECTION 3.01.  Conditions Precedent to Effectiveness of Sections 2.01 and 2.03 ..        33
         SECTION 3.02.  Conditions Precedent to Each Revolving Credit Borrowing ..........        35
         SECTION 3.03.  Conditions Precedent to Each Competitive Bid Borrowing ...........        35
         SECTION 3.04.  Determinations Under Section 3.01 ................................        36
ARTICLE IV  REPRESENTATIONS AND WARRANTIES OF THE LOAN PARTIES ...........................        36
         SECTION 4.01.  Representations and Warranties of the Loan Parties ...............        36
ARTICLE V  COVENANTS .....................................................................        37
         SECTION 5.01.  Affirmative Covenants ............................................        37
         SECTION 5.02.  Negative Covenants ...............................................        39
         SECTION 5.03.  Financial Covenants ..............................................        40
ARTICLE VI  EVENTS OF DEFAULT ............................................................        41
         SECTION 6.01.  Events of Default ................................................        41
ARTICLE VII  THE AGENT ...................................................................        43
ARTICLE VIII  MISCELLANEOUS ..............................................................        45
         SECTION 8.01.  Amendments, Etc ..................................................        45
         SECTION 8.02.  Notices, Etc .....................................................        45
         SECTION 8.03.  No Waiver; Remedies ..............................................        46
</TABLE>


                                      -i-
<PAGE>

<TABLE>
<CAPTION>
                                                                                                 Page
                                                                                                 ----
<S>                                                                                              <C>
         SECTION 8.04.  Costs and Expenses ...............................................        46
         SECTION 8.05.  Right of Set-off .................................................        47
         SECTION 8.06.  Binding Effect ...................................................        47
         SECTION 8.07.  Assignments and Participations ...................................        47
         SECTION 8.08.  Confidentiality ..................................................        51
         SECTION 8.09.  Governing Law ....................................................        51
         SECTION 8.10.  Execution in Counterparts ........................................        51
         SECTION 8.11.  Jurisdiction, Etc ................................................        51
         SECTION 8.12.  WAIVER OF JURY TRIAL .............................................        52
ARTICLE IX  COMPANY GUARANTEE ............................................................        52
         SECTION 9.01.  Company Guarantee ................................................        52
ARTICLE X  SUBSIDIARY GUARANTEE ..........................................................        54
         SECTION 10.01.  Subsidiary Guarantee ............................................        54
         SECTION 10.02.  Limitation of Guarantor's Liability .............................        55
</TABLE>

SCHEDULE 1     - LENDING OFFICES
SCHEDULE 2     - PRICING SCHEDULE

EXHIBIT A-1    - FORM OF NOTICE OF REVOLVING CREDIT BORROWING
EXHIBIT A-2    - FORM OF NOTICE OF COMPETITIVE BID BORROWING
EXHIBIT A-3    - FORM OF EXTENSION AGREEMENT
EXHIBIT B      - FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT C      - FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY
                 AND THE GUARANTOR
EXHIBIT D      - FORM OF DESIGNATION LETTER
EXHIBIT E      - FORM OF SUBSTITUTION LETTER
EXHIBIT F      - FORM OF TERMINATION LETTER


                                      -ii-
<PAGE>

                                CREDIT AGREEMENT

                           Dated as of April 30, 2003

            THE PEPSI BOTTLING GROUP, INC., a Delaware corporation (the
"Company"), BOTTLING GROUP, LLC, a Delaware limited liability company (the
"Guarantor"), the banks, financial institutions and other institutional lenders
(the "Initial Lenders") listed on the signature pages hereof, and JPMORGAN CHASE
BANK ("JPMorgan"), as administrative agent (in such capacity, the "Agent") for
the Lenders (as hereinafter defined), agree as follows:

                                    ARTICLE I

                           DEFINITIONS AND ACCOUNTING

      SECTION 1.01. Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

            "Advance" means a Revolving Credit Advance or a Competitive Bid
Advance.

            "Affiliate" means, as to any Person, any other Person that, directly
or indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 5% or more of the Voting Stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of Voting Stock, by contract or otherwise.

            "Agent's Account" means the account of the Agent maintained by the
Agent at JPMorgan with its office at 270 Park Avenue, New York, New York 10017.

            "Alternate Covenant Date" means any day on which the Index Debt of
Pepsi shall be rated less than A- by S&P or less than A3 by Moody's.

            "Applicable Facility Fee Rate" means, for any Rating Level Period,
the rate per annum set forth in Schedule 2 opposite the reference to such Rating
Level Period under the heading "Applicable Facility Fee Rate". Each change in
the Applicable Facility Fee Rate resulting from a Rating Level Change shall be
effective on the date of such Rating Level Change.

            "Applicable Lending Office" means, with respect to each Lender, such
Lender's Domestic Lending Office in the case of the Base Rate Advance and such
Lender's Eurodollar Lending Office in the case of a Eurodollar Rate Advance and,
in the case of a Competitive Bid

                            364-Day Credit Agreement

<PAGE>
                                      -2-


Advance, the office of such Lender notified by such Lender to the Agent as
Applicable Lending Office with respect to such Competitive Bid Advance.

            "Applicable Margin" means, with respect to any Eurodollar Rate
Advance, (i) until but not including the Term Out Date, for any Rating Level
Period, the rate per annum set forth in Schedule 2 opposite the reference to
such Rating Level Period under the heading "Applicable Margin" and (ii) from and
after the Term Out Date, for any Rating Level Period, the rate per annum set
forth in Schedule 2 opposite the reference to such Rating Level Period under the
heading "Term Out Applicable Margin". Each change in the Applicable Margin
resulting from a Rating Level Change shall be effective on the date of such
Rating Level Change.

            "Applicable Percentage" means, with respect to any Lender, the
percentage of the total Commitments represented by such Lender's Commitment. If
the Commitments have terminated or expired, the Applicable Percentages shall be
determined based upon the Commitments most recently in effect, giving effect to
any assignments.

            "Applicable Utilization Fee Rate" means, for any Rating Level
Period, the rate per annum set forth in Schedule 2 opposite the reference to
such Rating Level Period under the heading "Applicable Utilization Fee Rate".
Each change in the Applicable Utilization Fee Rate resulting from a Rating Level
Change shall be effective on the date of such Rating Level Change.

            "Assignment and Acceptance" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the Agent, in
substantially the form of Exhibit B hereto.

            "Base Rate" means a fluctuating interest rate per annum in effect
from time to time, which rate per annum shall at all times be equal to the
higher of:

            (a) the rate of interest announced publicly by JPMorgan in New York,
New York, from time to time, as JPMorgan's prime rate; and

            (b) 1/2 of one percent per annum above the Federal Funds Rate.

            "Base Rate Advance" means a Revolving Credit Advance that bears
interest as provided in Section 2.07(a).

            "Borrowers" means, at any time, collectively, the Company unless the
Substitution Date has occurred pursuant to Section 2.17, each Borrowing
Subsidiary and, on and after the Substitution Date has occurred pursuant to
Section 2.17, the Guarantor.

            "Borrowing" means a Revolving Credit Borrowing or a Competitive Bid
Borrowing.

                            364-Day Credit Agreement

<PAGE>
                                      -3-


            "Borrowing Subsidiary" means any Subsidiary of the Company, as to
which a Designation Letter has been delivered to the Agent and as to which a
Termination Letter has not been delivered to the Agent in accordance with
Section 2.17.

            "Business Day" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings are
carried on in the London interbank market.

            "Change of Control" means (a) the acquisition of ownership, directly
or indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934, and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof) other than
Pepsi, of shares representing more than 25% of the aggregate ordinary voting
power represented by the issued and outstanding capital stock of the Company;
(b) occupation of a majority of the seats (other than vacant seats) on the board
of directors of the Company by Persons who were neither (i) nominated by the
board of directors of the Company nor (ii) appointed by directors so nominated;
or (c) the acquisition of direct or indirect Control of the Company by any
Person or group other than Pepsi.

            "Commitment" has the meaning specified in Section 2.01.

            "Competitive Bid Advance" means an advance by a Lender to a Borrower
as part of a Competitive Bid Borrowing resulting from the auction bidding
procedure described in Section 2.03 and refers to a Fixed Rate Advance or a LIBO
Rate Advance.

            "Competitive Bid Borrowing" means a borrowing consisting of
simultaneous Competitive Bid Advances from each of the Lenders whose offer to
make one or more Competitive Bid Advances as part of such borrowing has been
accepted under the auction bidding procedure described in Section 2.03.

            "Competitive Bid Reduction" has the meaning specified in Section
2.01.

            "Confidential Information" means information that the Company
furnishes to the Agent or any Lender in a writing designated as confidential,
but does not include any such information that is or becomes generally available
to the public or that is or becomes rightfully available to the Agent or such
Lender from a source other than the Company.

            "Consolidated" refers to the consolidation of accounts in accordance
with GAAP. The Company shall cause the Guarantor at all times to remain a
Consolidated Subsidiary.

            "Consolidated EBITDA" means, for any period, Consolidated Net Income
for such period plus, without duplication and to the extent reflected as a
charge in the statement of such Consolidated Net Income for such period, the sum
of (a) income tax expense, (b) interest expense, amortization or writeoff of
debt discount with respect to Debt (including the Advances), (c) depreciation
and amortization expense, (d) amortization of intangibles (including, but not
limited to, goodwill) and organization costs, (e) any extraordinary expenses or
losses (including, whether or not otherwise includable as a separate item in the
statement of such Consolidated Net

                            364-Day Credit Agreement

<PAGE>
                                      -4-


Income for such period, losses on sales of assets outside of the ordinary course
of business), and (f) any other non-cash charges, and minus, to the extent
included in the statement of such Consolidated Net Income for such period, the
sum of (a) any extraordinary income or gains (including, whether or not
otherwise includable as a separate item in the statement of such Consolidated
Net Income for such period, gains on the sales of assets outside of the ordinary
course of business) and (b) any other non-cash income, all as determined on a
Consolidated basis; in each case exclusive of the cumulative effect of foreign
currency gains or losses. For the purposes of calculating Consolidated EBITDA
for any period pursuant to any determination of the Consolidated Leverage Ratio,
if during such period the Company or any Subsidiary, including the Guarantor,
shall have made an acquisition or incurred or assumed (without duplication of
any Debt incurred to refinance such assumed Debt) any Debt, Consolidated EBITDA
for such period shall be calculated after giving pro forma effect thereto as if
such acquisition occurred and such Debt had been incurred or assumed or
refinanced on the first day of such period.

            "Consolidated Leverage Ratio" means, as at the last day of any
Fiscal Quarter, the ratio of (a) Consolidated Total Debt on such day to (b)
Consolidated EBITDA for the four consecutive fiscal quarters then ended (taken
as one accounting period).

            "Consolidated Net Income" means, for any period, the consolidated
net income (or loss) of the Company, its Restricted Subsidiaries and the
Guarantor, determined on a consolidated basis in accordance with GAAP, before
deduction of any minority interests in the Guarantor and excluding the
cumulative effect of any foreign currency gains or losses.

            "Consolidated Net Tangible Assets" means the total assets of the
Company, its Restricted Subsidiaries and the Guarantor (less applicable
depreciation, amortization, and other valuation reserves), except to the extent
resulting from write-ups of capital assets (other than writeups in connection
with accounting for acquisitions, in accordance with GAAP), less all current
liabilities (excluding intercompany liabilities) and all intangible assets of
the Company, its Restricted Subsidiaries and the Guarantor, all as set forth on
the then most recent Consolidated balance sheet of the Company, its Restricted
Subsidiaries and the Guarantor, prepared in accordance with GAAP, but before
deduction of any minority interests in the Guarantor and exclusive of any
foreign currency translation adjustments.

            "Consolidated Net Worth" means, as of any date of determination, all
items which in conformity with GAAP would be included under shareholders' equity
on a Consolidated balance sheet of the Company and its Subsidiaries, including
the Guarantor, at such date plus amounts representing mandatorily redeemable
preferred securities issued by Subsidiaries of the Company, including the
Guarantor, but before deduction of any minority interests in the Guarantor and
exclusive of any foreign currency translation adjustments.

            "Consolidated Total Debt" means, at any date (i) the aggregate
principal amount of all Debt of the Company and its Subsidiaries, including the
Guarantor minus (ii) the aggregate amount (not in excess of $500,000,000) of all
cash and cash equivalents of the Company and its Subsidiaries, in each case at
such date and determined on a Consolidated basis in accordance with GAAP.

                            364-Day Credit Agreement

<PAGE>
                                      -5-


            "Control" means the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of a Person,
whether through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.

            "Convert", "Conversion" and "Converted" each refers to a conversion
of Revolving Credit Advances of one Type into Revolving Credit Advances of the
other Type pursuant to Section 2.08 or 2.09.

            "Debt" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all obligations of such
Person for the deferred purchase price of property or services (other than trade
accounts payable arising in the ordinary course of business), (c) all
obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments, (d) all obligations (other than trade accounts payable
arising in the ordinary course of business) of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (e) all obligations of such Person as
lessee under leases that have been or should be, in accordance with GAAP,
recorded as capital leases, (f) all Debt of others referred to in clauses (a)
through (c) above or clause (g) below guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or indirectly by such
Person through (i) an agreement (1) to pay or purchase such Debt or to advance
or supply funds for the payment or purchase of such Debt, (2) to purchase, sell
or lease (as lessee or lessor) property, or to purchase or sell services,
primarily for the purpose of enabling the debtor to make payment of such Debt or
to assure the holder of such Debt against loss, (3) to supply funds to or in any
other manner invest in the debtor (including any agreement to pay for property
or services irrespective of whether such property is received or such services
are rendered) or (4) otherwise to assure a creditor against loss, or (ii) a
standby letter of credit and (g) all Debt referred to in clauses (a) through (f)
above secured by (or for which the holder of such Debt has an existing right,
contingent or otherwise, to be secured by) any Lien on property (including,
without limitation, accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of such
Debt.

            "Debt to Capitalization Ratio" means at any time the ratio of (x)
Consolidated Total Debt to (y) the sum of (i) Consolidated Total Debt plus (ii)
Consolidated Net Worth.

            "Declining Lender" has the meaning assigned to that term in Section
2.06(c).

            "Default" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be given or
time elapse or both.

            "Designation Letter" has the meaning specified in Section 2.17(a).

            "Domestic Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Domestic Lending Office" opposite its
name on Schedule 1 hereto or in

                            364-Day Credit Agreement

<PAGE>
                                      -6-


the Assignment and Acceptance pursuant to which it became a Lender, or such
other office of such Lender as such Lender may from time to time specify to the
Company and the Agent.

            "Effective Date" has the meaning specified in Section 3.01.

            "Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
Lender; (iii) a commercial bank organized under the laws of the United States,
or any State thereof, and having total assets in excess of $15,000,000,000 and a
combined capital and surplus of at least $1,000,000,000; (iv) a savings and loan
association or savings bank organized under the laws of the United States, or
any State thereof, and having total assets in excess of $15,000,000,000 and a
combined capital and surplus of at least $1,000,000,000; (v) a commercial bank
organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development or has concluded special
lending arrangements with the International Monetary Fund associated with its
General Arrangements to Borrow or of the Cayman Islands, or a political
subdivision of any such country, and having total assets in excess of
$l5,000,000,000 and a combined capital and surplus of at least $1,000,000,000 so
long as such bank is acting through a branch or agency located in the United
States or in the country in which it is organized or another country that is
described in this clause (v); (vi) the central bank of any country that is a
member of the Organization for Economic Cooperation and Development; provided,
however, that each Person described in clauses (ii) through (vi) shall have a
short term public debt rating of not less than A by S&P or Moody's or shall be
approved by the Company; and (vii) any other Person approved by the Company,
such approval not to be unreasonably withheld or delayed; provided, however,
that neither the Company nor an Affiliate of the Company shall qualify as an
Eligible Assignee.

            "Environmental Law" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, judgment, decree or
judicial or agency interpretation, policy or guidance relating to the
environment, health, safety or Hazardous Materials.

            "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations promulgated and rulings issued
thereunder.

            "Eurodollar Lending Office" means, with respect to any Lender, the
office of such Lender specified as its "Eurodollar Lending Office" opposite its
name on Schedule 1 hereto or in the Assignment and Acceptance pursuant to which
it became a Lender (or, if no such office is specified, its Domestic Lending
Office), or such other office of such Lender as such Lender may from time to
time specify to the Company and the Agent.

            "Eurodollar Rate" means, for any Interest Period for each Eurodollar
Rate Advance comprising part of the same Revolving Credit Borrowing, an interest
rate per annum appearing on Page 3750 of the Telerate Service (or on any
successor or substitute page of such Service, or any successor to or substitute
for such Service, providing rate quotations comparable to those currently
provided on such page of such Service, as determined by the Agent from time to
time for purposes of providing quotations of interest rates applicable to Dollar
deposits in the London interbank market) as of 11:00 A.M. (London time) on the
date two Business Days prior to the first day of such Interest Period as the
rate for Dollar deposits having a term comparable to

                            364-Day Credit Agreement

<PAGE>
                                      -7-


such Interest Period, or in the event such offered rate is not available from
said Page 3750, the average (rounded to the nearer whole multiple of 1/16 of 1%
per annum, if such average is not such a multiple) of the rate per annum at
which deposits in U.S. dollars are offered by the principal office of each of
the Reference Banks in London, England to prime banks in the London interbank
market at 11:00 A.M. (London time) two Business Days before the first day of
such Interest Period in an amount substantially equal to such Reference Bank's
Eurodollar Rate Advance comprising part of such Revolving Credit Borrowing to be
outstanding during such Interest Period and for a period equal to such Interest
Period. If the Eurodollar Rate does not appear on said Page 3750 (or any
successor page), the Eurodollar Rate for any Interest Period for each Eurodollar
Rate Advance comprising part of the same Revolving Credit Borrowing shall be
determined by the Agent on the basis of applicable rates furnished to and
received by the Agent from the Reference Banks two Business Days before the
first day of such Interest Period, subject, however, to the provisions of
Section 2.08.

            "Eurodollar Rate Advance" means a Revolving Credit Advance that
bears interest as provided in Section 2.07(b).

            "Events of Default" has the meaning specified in Section 6.01.

            "Extension Agreement" means an Extension Agreement substantially in
the form contained in Exhibit A-3 hereto.

            "Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of
recognized standing selected by it.

            "Fiscal Quarter" means a period of 13 or (or 14) weeks treated by
the Company as a fiscal quarter.

            "Fiscal Year" means the period of 52 (or 53) weeks ending on the
last Saturday of any calendar year and treated by the Company as its fiscal
year.

            "5-Year Facility" means the 5-Year Credit Agreement dated as of
April 30, 2003 among the Company, the Guarantor, certain banks, financial
institutions and other institutional lenders, and JPMorgan, as agent, as from
time to time amended.

            "Fixed Rate Advances" has the meaning specified in Section 2.03(b).

            "GAAP" means generally accepted accounting principles as in effect
from time to time, applied on a basis consistent (except for changes concurred
in by the Company's independent public accountants) with the most recent audited
Consolidated financial statements of the Company and its Subsidiaries delivered
to the Lenders.

                            364-Day Credit Agreement

<PAGE>
                                      -8-


            "Granting Lender" has the meaning specified in Section 8.07(e).

            "Guaranteed Party" has the meaning specified in Section 9.01.

            "Hazardous Materials" means petroleum and petroleum products,
byproducts or breakdown products, radioactive materials, asbestos-containing
materials, radon gas and any other chemicals, materials or substances
designated, classified or regulated as being "hazardous" or "toxic", or words of
similar import, under any federal, state, local or foreign statute, law,
ordinance, rule, regulation, code, order, judgment, decree or judicial or agency
interpretation, policy or guidance.

            "Index Debt" of any Person means senior, unsecured, long term
indebtedness for borrowed money of such Person that is not guaranteed by any
other Person (other than, in the case of the Company, the Guarantor) or subject
to any other credit enhancement.

            "Information Memorandum" means the information memorandum dated
March 17, 2003 used by the Agent in connection with the syndication of the
Commitments.

            "Interest Period" means, for each Eurodollar Rate Advance comprising
part of the same Revolving Credit Borrowing, the period commencing on the date
of such Eurodollar Rate Advance or the date of the Conversion of any Base Rate
Advance into such Eurodollar Rate Advance and ending on the last day of the
period selected by the Company pursuant to the provisions below and, thereafter,
each subsequent period commencing on the last day of the immediately preceding
Interest Period and ending on the last day of the period selected by the Company
pursuant to the provisions below. The duration of each such Interest Period
shall be one, two, three, six or, to the extent available from all the Lenders,
nine months, as the Company may, upon notice received by the Agent not later
than 11:00 A.M. (New York City time) on the third Business Day prior to the
first day of such Interest Period, select; provided, however, that:

            (1) the Company may not select any Interest Period that ends after
      the Termination Date (subject to Section 2.06(d) relating to Termed Out
      Loans);

            (2) Interest Periods commencing on the same date for Eurodollar Rate
      Advances comprising part of the same Revolving Credit Borrowing shall be
      of the same duration;

            (3) whenever the last day of any Interest Period would otherwise
      occur on a day other than a Business Day, the last day of such Interest
      Period shall be extended to occur on the next succeeding Business Day,
      provided, however, that, if such extension would cause the last day of
      such Interest Period to occur in the next following calendar month, the
      last day of such Interest Period shall occur on the next preceding
      Business Day; and

            (4) whenever the first day of any Interest Period occurs on a day of
      an initial calendar month for which there is no numerically corresponding
      day in the calendar month that succeeds such initial calendar month by the
      number of months equal to the

                            364-Day Credit Agreement

<PAGE>
                                      -9-


      number of months in such Interest Period, such Interest Period shall end
      on the last Business Day of such succeeding calendar month.

            "Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.

            "Lenders" means the Initial Lenders and each Person that shall
become a party hereto pursuant to Sections 2.05(c), 2.06(d) or 8.07.

            "LIBO Rate Advances" has the meaning specified in Section 2.03(b).

            "Lien" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor.

            "Loan Documents" means, collectively, this Agreement, each
promissory note issued thereunder, each Designation Letter and each Termination
Letter.

            "Loan Party" has the meaning specified in Section 4.01.

            "Margin Stock" means margin stock within the meaning of Regulation U
of the Board of Governors of the Federal Reserve System.

            "Master Bottling Agreement" means the Master Bottling Agreement
dated March 30, 1999, between the Company and Pepsi or any successor or
replacement agreement that confers substantially the same benefits on the
Company as the Master Bottling Agreement conferred on the date hereof.

            "Material Adverse Change" means any material adverse change in the
financial condition, operations or properties of the Company or the Company and
its Subsidiaries (including the Guarantor) taken as a whole.

            "Material Adverse Effect" means a material adverse effect on (a) the
financial condition, operations or properties of the Company and its
Subsidiaries (including the Guarantor) taken as a whole, (b) the rights and
remedies of the Agent or any Lender under this Agreement or any promissory note
or (c) the ability of the Company to perform its obligations under this
Agreement or any promissory note.

            "Material Subsidiary" means each Subsidiary of the Company which is
a "significant subsidiary" as that term is defined in Rule 1-02(w) of the
Regulation S-X under the Securities Act of 1933, as amended, as such rule is in
effect as of the date hereof.

            "Moody's" means Moody's Investors Service, Inc. and any successor
thereto.

            "Moody's Rating" means, at any time, the rating of the Company's
Index Debt then most recently announced by Moody's.

                            364-Day Credit Agreement

<PAGE>
                                      -10-


            "New Lender" means, for purposes of Section 2.05(c), an Eligible
Assignee (which may be a Lender) selected by the Company with (in the case of a
New Lender that is not already a Lender) prior consultation with the Agent.

            "Notice of Competitive Bid Borrowing" has the meaning specified in
Section 2.03(b).

            "Notice of Revolving Credit Borrowing" has the meaning specified in
Section 2.02(a).

            "Pepsi" means PepsiCo, Inc., a North Carolina corporation.

            "Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.

            "Principal Property" means any single manufacturing or processing
plant, office building, or warehouse owned or leased by the Company, a
Restricted Subsidiary or the Guarantor other than a plant, warehouse, office
building, or portion thereof which, in the opinion of the Company's Board of
Directors, is not of material importance to the business conducted by the
Company, its Restricted Subsidiaries and the Guarantor as an entirety.

            "Rating" means the Moody's Rating or the S&P Rating, as the case may
be.

            "Rating Level Change" means a change in the Moody's Rating or the
S&P Rating that results in a change from one Rating Level Period to another,
which Rating Level Change shall be deemed to take effect on the date on which
the relevant change in rating is first announced by Moody's or S&P.

            "Rating Level Period" means a Rating Level 1 Period, a Rating Level
2 Period, a Rating Level 3 Period, a Rating Level 4 Period or a Rating Level 5
Period; provided that:

            (i)   "Rating Level 1 Period" means a period during which the
                  Moody's Rating is at or above A2 or the S&P Rating is at or
                  above A;

            (ii)  "Rating Level 2 Period" means a period that is not a Rating
                  Level 1 Period, during which the Moody's Rating is at or above
                  A3 or the S&P Rating is at or above A-;

            (iii) "Rating Level 3 Period" means a period that is not a Rating
                  Level 1 Period or a Rating Level 2 Period, during which the
                  Moody's Rating is at or above Baa1 or the S&P Rating is at or
                  above BBB+;

            (iv)  "Rating Level 4 Period" means a period that is not a Rating
                  Level 1 Period, a Rating Level 2 Period or a Rating Level 3
                  Period, during which

                            364-Day Credit Agreement

<PAGE>
                                      -11-


                  the Moody's Rating is at or above Baa2 or the S&P Rating is at
                  or above BBB; and

            (v)   "Rating Level 5 Period" means a period that is not a Rating
                  Level 1 Period, a Rating Level 2 Period, a Rating Level 3
                  Period or a Rating Level 4 Period;

and provided, further, that if the Moody's rating and the S&P Rating differ by
more than one Rating Level, then the applicable Rating Level Period shall be one
Rating Level lower than the Rating Level resulting from the application of the
higher of such ratings (for which purpose Rating Level 1 is the highest and
Rating Level 5 is the lowest); and provided, further, that any period during
which there is no Moody's Rating or there is no S&P Rating shall be a Rating
Level 5 Period.

            "Reference Banks" means JPMorgan, Citibank, N.A. and Bank of
America, N.A. (and any successors thereof).

            "Related Parties" means, with respect to any specified Person, such
Person's Affiliates and the respective directors, officers, employees, agents
and advisors of such Person and such Person's Affiliates.

            "Register" has the meaning specified in Section 8.07(d).

            "Required Lenders" means at any time Lenders owed more than 50% of
the then aggregate unpaid principal amount of the Revolving Credit Advances
(excluding Competitive Bid Advances) owing to Lenders, or, if no such principal
amount is then outstanding, Lenders having more than 50% of the aggregate amount
of the Commitments.

            "Restricted Subsidiary" means at any time any Subsidiary of the
Company except a Subsidiary which is at the time an Unrestricted Subsidiary.

            "Revolving Credit Advance" means an advance by a Lender to a
Borrower as part of a Revolving Credit Borrowing and refers to a Base Rate
Advance or a Eurodollar Rate Advance (each of which shall be a "Type" of
Revolving Credit Advance).

            "Revolving Credit Borrowing" means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by each of the
Lenders pursuant to Section 2.01.

            "S&P" means Standard & Poors Rating Services or any successor
thereto.

            "S&P Rating" means, at any time, the rating of the Company's Index
Debt then most recently announced by S&P.

            "SPC" has the meaning specified in Section 8.07(e).

                            364-Day Credit Agreement

<PAGE>
                                      -12-


            "Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than 50% of (a) the issued and outstanding capital stock having ordinary voting
power to elect a majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other class or classes
of such corporation shall or might have voting power upon the occurrence of any
contingency), (b) the interest in the capital or profits of such partnership or
joint venture or (c) the beneficial interest in such trust or estate is at the
time directly or indirectly owned or controlled by such Person, by such Person
and one or more of its other Subsidiaries or by one or more of such Person's
other Subsidiaries.

            "Substitution Date" has the meaning specified in Section 2.17(c).

            "Substitution Letter" has the meaning specified in Section 2.17(c).

            "Term Out Date" has the meaning assigned to that term in Section
2.06(d).

            "Termed Out Loan" has the meaning assigned to that term in Section
2.06(d).

            "Termination Date" means April 28, 2004 or, if earlier, the date of
termination in whole of the Commitments pursuant to Section 2.05(a) or 6.01 or,
in the case of any Lender whose Commitment is extended pursuant to Section
2.06(c), the date to which such Commitment is extended; provided in each case
that if any such date is not a Business Day, the relevant Termination Date of
such Lender shall be the immediately preceding Business Day.

            "Termination Letter" has the meaning specified in Section 2.17(b).

            "Type" has the meaning specified in the definition of "Revolving
Credit Advance."

            "Unrestricted Subsidiary" means (a) any Subsidiary of the Company
(not at the time designated a Restricted Subsidiary) (i) the major part of whose
business consists of finance, banking, credit, leasing, insurance, financial
services, or other similar operations, or any continuation thereof, (ii)
substantially all the assets of which consist of the capital stock of one or
more such Subsidiaries, or (iii) designated as such by the Company's Board of
Directors and (b) the Guarantor. Any Subsidiary designated as a Restricted
Subsidiary may be designated as an Unrestricted Subsidiary.

            "Voting Stock" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for the election of directors
(or persons performing similar actions) of such Person, even if the right so to
vote has been suspended by the happening of such a contingency.

                            364-Day Credit Agreement

<PAGE>
                                      -13-


      SECTION 1.02. Computation of Time Periods. In this Agreement in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean "to but excluding".

      SECTION 1.03. Accounting Terms. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all accounting determinations
hereunder shall be made, and all financial statements required to be delivered
hereunder shall be prepared in accordance with GAAP; provided that, if the
Company notifies the Agent that the Company wishes to amend any provisions
hereof to eliminate the effect of any change in GAAP (or if the Agent notifies
the Company that the Required Lenders wish to amend any provision hereof for
such purpose), then such provision shall be applied on the basis of GAAP in
effect immediately before the relevant change in GAAP became effective, until
either such notice is withdrawn or such provision is amended in a manner
satisfactory to the Company and the Required Lenders.

                                   ARTICLE II

                        AMOUNTS AND TERMS OF THE ADVANCES

      SECTION 2.01. The Revolving Credit Advances. Each Lender severally agrees,
on the terms and conditions hereinafter set forth, to make Revolving Credit
Advances to the Company and any Borrowing Subsidiary from time to time on any
Business Day during the period from the Effective Date until the Termination
Date in an aggregate amount not to exceed at any time outstanding the amount set
forth opposite such Lender's name on the signature pages hereof or, if such
Lender has entered into any Assignment and Acceptance, set forth for such Lender
in the Register maintained by the Agent pursuant to Section 8.07(d), as such
amount may be reduced pursuant to Section 2.05(a) or increased pursuant to
Section 2.05(c) (such Lender's "Commitment"), provided that the aggregate amount
of the Commitments of the Lenders shall be deemed used from time to time to the
extent of the aggregate amount of the Competitive Bid Advances then outstanding
and such deemed use of the aggregate amount of the Commitments shall be
allocated among the Lenders ratably according to their respective Commitments
(such deemed use of the aggregate amount of the Commitments being a "Competitive
Bid Reduction"). Each Revolving Credit Borrowing shall be in an aggregate amount
of $5,000,000 or an integral multiple of $1,000,000 in excess thereof (or, if
less, (i) an aggregate amount equal to the amount by which the aggregate amount
of a proposed Competitive Bid Borrowing requested by the Company exceeds the
aggregate amount of Competitive Bid Advances offered to be made by the Lenders
and accepted by the Company in respect of such Competitive Bid Borrowing, if
such Competitive Bid Borrowing is made on the same date as such Revolving Credit
Borrowing or (ii) the aggregate amount of the unused Commitments, after giving
effect to any Competitive Bid Reductions then in effect) and shall consist of
Revolving Credit Advances of the same Type made on the same day by the Lenders
ratably according to their respective Commitments. Within the limits of each
Lender's Commitment, each Borrower may borrow under this Section 2.01, prepay
pursuant to Section 2.10 and (other than in the case of a Termed Out Loan)
reborrow under this Section 2.01.

                            364-Day Credit Agreement

<PAGE>
                                      -14-


      SECTION 2.02. Making the Revolving Credit Advances.

            (a) Each Revolving Credit Borrowing shall be made on notice, given
not later than 11:00 A.M. (New York City time) on the third Business Day prior
to the date of the proposed Revolving Credit Borrowing in the case of a
Revolving Credit Borrowing consisting of Eurodollar Rate Advances, or the date
of the proposed Revolving Credit Borrowing in the case of a Revolving Credit
Borrowing consisting of Base Rate Advances, by the Company (on its own behalf
and on behalf of any Borrowing Subsidiary) to the Agent, which shall give to
each Lender prompt notice thereof by telecopier or telex. Each such notice of a
Revolving Credit Borrowing (a "Notice of Revolving Credit Borrowing") shall be
by telecopier or telex, confirmed promptly in writing, in substantially the form
of Exhibit A-1 hereto, specifying therein the requested (i) date of such
Revolving Credit Borrowing, (ii) Type of Advances comprising such Revolving
Credit Borrowing, (iii) aggregate amount of such Revolving Credit Borrowing,
(iv) in the case of a Revolving Credit Borrowing consisting of Eurodollar Rate
Advances, initial Interest Period for each such Revolving Credit Advance and (v)
the name of the relevant Borrower (which shall be the Company or a Borrowing
Subsidiary). Each Lender shall, before 11:00 A.M. (New York City time), in the
case of a Revolving Credit Borrowing consisting of Eurodollar Rate Advances, or
before 1:00 P.M. (New York City time), in the case of a Revolving Credit
Borrowing consisting of Base Rate Advances, on the date of such Revolving Credit
Borrowing, make available for the account of its Applicable Lending Office to
the Agent at the Agent's Account, in same day funds, such Lender's ratable
portion of such Revolving Credit Borrowing. After the Agent's receipt of such
funds and upon fulfillment of the applicable conditions set forth in Article
III, the Agent will make such same day funds available to the relevant Borrower
at such Borrower's account at the Agent's address referred to in Section 8.02.

            (b) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Company may not select Eurodollar Rate Advances for any
Revolving Credit Borrowing if the aggregate amount of such Revolving Credit
Borrowing is less than $10,000,000 or if the obligation of the Lenders to make
Eurodollar Rate Advances shall then be suspended pursuant to Section 2.08 and
(ii) the Eurodollar Rate Advances may not be outstanding as part of more than
six separate Revolving Credit Borrowings.

            (c) Each Notice of Revolving Credit Borrowing shall be irrevocable
and binding on the relevant Borrower. In the case of any Revolving Credit
Borrowing that the related Notice of Revolving Credit Borrowing specifies is to
be comprised of Eurodollar Rate Advances, the Company shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure to fulfill on or before the date specified in such Notice of
Revolving Credit Borrowing for such Revolving Credit Borrowing the applicable
conditions set forth in Article III, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by such Lender to fund the Revolving Credit
Advance to be made by such Lender as part of such Revolving Credit Borrowing
when such Revolving Credit Advance, as a result of such failure, is not made on
such date.

            (d) Unless the Agent shall have received notice from a Lender prior
to the date of any Revolving Credit Borrowing that such Lender will not make
available to the Agent such

                            364-Day Credit Agreement

<PAGE>
                                      -15-


Lender's ratable portion of such Revolving Credit Borrowing, the Agent may
assume that such Lender has made such portion available to the Agent on the date
of such Revolving Credit Borrowing in accordance with subsection (a) of this
Section 2.02 and the Agent may, in reliance upon such assumption, make available
to the relevant Borrower on such date a corresponding amount. If and to the
extent that such Lender shall not have so made such ratable portion available to
the Agent, such Lender and such Borrower severally agree to repay to the Agent
forthwith on demand such corresponding amount together with interest thereon,
for each day from the date such amount is made available to such Borrower until
the date such amount is repaid to the Agent, at (i) in the case of a Borrower,
the interest rate applicable at the time to Revolving Credit Advances comprising
such Revolving Credit Borrowing and (ii) in the case of such Lender, the Federal
Funds Rate. If such Lender shall repay to the Agent such corresponding amount,
such amount so repaid shall constitute such Lender's Revolving Credit Advance as
part of such Revolving Credit Borrowing for purposes of this Agreement and shall
be made available in same day funds to the relevant Borrower's account at the
Agent's address referred to in Section 8.02.

            (e) The failure of any Lender to make the Revolving Credit Advance
to be made by it as part of any Revolving Credit Borrowing shall not relieve any
other Lender of its obligation, if any, hereunder to make its Revolving Credit
Advance on the date of such Revolving Credit Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the Revolving Credit
Advance to be made by such other Lender on the date of any Revolving Credit
Borrowing.

      SECTION 2.03. The Competitive Bid Advances.

            (a) Each Lender severally agrees that each Borrower may make
Competitive Bid Borrowings under this Section 2.03 from time to time on any
Business Day during the period from the date hereof until the date occurring 7
days prior to the Termination Date in the manner set forth below; provided that,
following the making of each Competitive Bid Borrowing, the aggregate amount of
the Advances then outstanding shall not exceed the aggregate amount of the
Commitments of the Lenders (computed without regard to any Competitive Bid
Reduction).

            (b) The Company (on its own behalf and on behalf of any Borrowing
Subsidiary) may request a Competitive Bid Borrowing under this Section 2.03 by
delivering to the Agent, by telecopier or telex, confirmed promptly in writing,
a notice of a Competitive Bid Borrowing (a "Notice of Competitive Bid
Borrowing"), in substantially the form of Exhibit A-2 hereto, specifying therein
(u) the date of such proposed Competitive Bid Borrowing, (v) the aggregate
amount of such proposed Competitive Bid Borrowing, (w) the maturity date for
repayment of each Competitive Bid Advance to be made as part of such Competitive
Bid Borrowing (which maturity date may not be earlier than the date occurring 7
days after the date of such Competitive Bid Borrowing or later than the
Termination Date), (x) the interest payment date or dates relating thereto, (y)
the name of the Borrower, and (z) any other terms to be applicable to such
Competitive Bid Borrowing, not later than 10:00 A.M. (New York City time) (A) at
least one Business Day prior to the date of the proposed Competitive Bid
Borrowing, if the Company shall specify in the Notice of Competitive Bid
Borrowing that the rates of interest to be offered by the Lenders

                            364-Day Credit Agreement

<PAGE>
                                      -16-


shall be fixed rates per annum (the Advances comprising any such Competitive Bid
Borrowing being referred to herein as "Fixed Rate Advances") and (B) at least
four Business Days prior to the date of the proposed Competitive Bid Borrowing,
if the Company shall instead specify in the Notice of Competitive Bid Borrowing
another basis to be used by the Lenders in determining the rates of interest to
be offered by them (the Advances comprising such Competitive Bid Borrowing being
referred to herein as "LIBO Rate Advances"). The Agent shall in turn promptly
notify each Lender of each request for a Competitive Bid Borrowing received by
it from the Company by sending such Lender a copy of the related Notice of
Competitive Bid Borrowing.

            (c) Each Lender may, if, in its sole discretion, it elects to do so,
irrevocably offer to make one or more Competitive Bid Advances to the relevant
Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates
of interest specified by such Lender in its sole discretion, by notifying the
Agent (which shall give prompt notice thereof to the Company), before 10:00 A.M.
(New York City time) on the date of such proposed Competitive Bid Borrowing, in
the case of a Competitive Bid Borrowing consisting of Fixed Rate Advances, and
three Business Days before the date of such proposed Competitive Bid Borrowing,
in the case of a Competitive Bid Borrowing consisting of LIBO Rate Advances, of
the minimum amount and maximum amount of each Competitive Bid Advance which such
Lender would be willing to make as part of such proposed Competitive Bid
Borrowing (which amounts may, subject to the proviso to the first sentence of
Section 2.03(a), exceed such Lender's Commitment, if any), the rate or rates of
interest therefor and such Lender's Applicable Lending Office with respect to
such Competitive Bid Advance; provided that if the Agent in its capacity as a
Lender shall, in its sole discretion, elect to make any such offer, it shall
notify the Company of such offer before 9:00 A.M. (New York City time) on the
date on which notice of such election is to be given to the Agent by the other
Lenders. If any Lender shall elect not to make such an offer, such Lender shall
so notify the Agent, before 10:00 A.M. (New York City time) on the date on which
notice of such election is to be given to the Agent by the other Lenders, and
such Lender shall not be obligated to, and shall not, make any Competitive Bid
Advance as part of such Competitive Bid Borrowing; provided that the failure by
any Lender to give such notice shall not cause such Lender to be obligated to
make any Competitive Bid Advance as part of such proposed Competitive Bid
Borrowing.

            (d) The Company shall, in turn, before 11:00 A.M. (New York City
time) on the date of such proposed Competitive Bid Borrowing, in the case of a
Competitive Bid Borrowing consisting of Fixed Rate Advances, and before 1:00
P.M. (New York City time) three Business Days before the date of such proposed
Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting
of LIBO Rate Advances, either:

                  (x) cancel such Competitive Bid Borrowing by giving the Agent
            notice to that effect, or

                  (y) accept one or more of the offers made by any Lender or
            Lenders pursuant to paragraph (c) above, by giving notice to the
            Agent of the amount of each Competitive Bid Advance (which amount
            shall be equal to or greater than the minimum amount, and equal to
            or less than the maximum amount, notified to the Company by the
            Agent on behalf of such Lender for such Competitive Bid Ad-

                            364-Day Credit Agreement

<PAGE>
                                      -17-


            vance pursuant to paragraph (c) above) to be made by each Lender as
            part of such Competitive Bid Borrowing, and reject any remaining
            offers made by Lenders pursuant to paragraph (c) above by giving the
            Agent notice to that effect. If the Company accepts any offers made
            by Lenders pursuant to paragraph (c) above, such offers shall be
            accepted in the order of the lowest to highest interest rates or, if
            two or more Lenders offer to make Competitive Bid Advances at the
            same interest rate, such offers, if any, shall be accepted in
            proportion to the amount offered by each such Lender at such
            interest rate notwithstanding any minimum specified by such Lender
            in its notice given pursuant to paragraph (c) above. The Company may
            not accept offers in excess of the amount specified in accordance
            with paragraph (a) above.

            (e) If the Company notifies the Agent that such Competitive Bid
Borrowing is cancelled pursuant to paragraph (d)(x) above, the Agent shall give
prompt notice thereof to the Lenders and such Competitive Bid Borrowing shall
not be made.

            (f) If the Company accepts one or more of the offers made by any
Lender or Lenders pursuant to paragraph (d)(y) above, the Agent shall in turn
promptly notify (A) each Lender that has made an offer as described in paragraph
(c) above, of the date and aggregate amount of such Competitive Bid Borrowing
and whether or not any offer or offers made by such Lender pursuant to paragraph
(c) above have been accepted by the Company, (B) each Lender that is to make a
Competitive Bid Advance as part of such Competitive Bid Borrowing, of the amount
of each Competitive Bid Advance to be made by such Lender as part of such
Competitive Bid Borrowing, and (C) each Lender that is to make a Competitive Bid
Advance as part of such Competitive Bid Borrowing, upon receipt, that the Agent
has received forms of documents appearing to fulfill the applicable conditions
set forth in Article III. Each Lender that is to make a Competitive Bid Advance
as part of such Competitive Bid Borrowing shall, before 12:00 noon (New York
City time) on the date of such Competitive Bid Borrowing specified in the notice
received from the Agent pursuant to clause (A) of the preceding sentence or any
later time when such Lender shall have received notice from the Agent pursuant
to clause (C) of the preceding sentence, make available for the account of its
Applicable Lending Office to the Agent at the Agent's Account, in same day
funds, such Lender's portion of such Competitive Bid Borrowing. Upon fulfillment
of the applicable conditions set forth in Article III and after receipt by the
Agent of such funds, the Agent will make such same day funds available to the
relevant Borrower at such Borrower's account at the Agent's address referred to
in Section 8.02. Promptly after each Competitive Bid Borrowing the Agent will
notify each Lender of the amount of the Competitive Bid Borrowing, the
consequent Competitive Bid Reduction and the dates upon which such Competitive
Bid Reduction commenced and will terminate.

            (g) Each Competitive Bid Borrowing shall be in an aggregate amount
of $5,000,000 or an integral multiple of $1,000,000 in excess thereof and,
following the making of each Competitive Bid Borrowing, the Company shall be in
compliance with the limitation set forth in the proviso to the first sentence of
paragraph (a) above.

            (h) Within the limits and on the conditions set forth in this
Section 2.03, each Borrower may from time to time borrow under this Section
2.03, repay or prepay pursuant to

                            364-Day Credit Agreement

<PAGE>
                                      -18-


subsection (j) below, and reborrow under this Section 2.03, provided that a
Competitive Bid Borrowing shall not be made within three Business Days of the
date of any other Competitive Bid Borrowing.

            (i) Each Borrower shall repay to the Agent for the account of each
Lender that has made a Competitive Bid Advance to such Borrower, on the maturity
date of such Competitive Bid Advance (such maturity date being that specified by
the Company for repayment of such Competitive Bid Advance in the related Notice
of Competitive Bid Borrowing delivered pursuant to paragraph (b) above and
provided in the promissory note, if any, evidencing such Competitive Bid
Advance), the then unpaid principal amount of such Competitive Bid Advance. No
Borrower shall have any right to prepay any principal amount of any Competitive
Bid Advance unless (x) such Borrower obtains the prior written consent of the
Lender which made such Competitive Bid Advance, or (y), such prepayment is made
on the terms, specified by the Company for such Competitive Bid Advance in the
related Notice of Competitive Bid Borrowing delivered pursuant to paragraph (b)
above and set forth in the promissory note, if any, evidencing such Competitive
Bid Advance.

            (j) Each Borrower shall pay interest on the unpaid principal amount
of each Competitive Bid Advance to such Borrower from the date of such
Competitive Bid Advance to the date the principal amount of such Competitive Bid
Advance is repaid in full, at the rate of interest for such Competitive Bid
Advance specified by the Lender making such Competitive Bid Advance in its
notice with respect thereto delivered pursuant to paragraph (c) above, payable
on the interest payment date or dates specified by such Borrower for such
Competitive Bid Advance in the related Notice of Competitive Bid Borrowing
delivered pursuant to paragraph (b) above, as provided in the promissory note,
if any, evidencing such Competitive Bid Advance.

            (k) At its option, the Company (on its own behalf and on behalf of
any Borrower) may request a Competitive Bid Borrowing directly from the Lenders;
provided that it follows the procedures set forth in this Section 2.03 and
promptly delivers, by telecopier or telex, a copy of the Notice of Competitive
Bid Borrowing and notice in writing of the results of such request to the Agent.

            (l) The indebtedness of each Borrower resulting from each
Competitive Bid Advance made to such Borrower as part of a Competitive Bid
Borrowing shall, if requested by the applicable Lender, be evidenced by a
separate promissory note of such Borrower payable to the order of the Lender
making such Competitive Bid Advance.

      SECTION 2.04. Fees.

            (a) Facility Fee. The Company agrees to pay to the Agent for the
account of each Lender a facility fee on the amount of such Lender's Commitment
irrespective of usage, from the Effective Date in the case of each Initial
Lender and from the effective date specified in the Assignment and Acceptance
pursuant to which it became a Lender in the case of each other Lender until the
Termination Date (on a daily basis), at the Applicable Facility Fee Rate,
payable

                            364-Day Credit Agreement

<PAGE>
                                      -19-


in arrears quarterly on the last day of each March, June, September and December
and on the Termination Date, commencing June 30, 2003.

            (b) Agent's Fees. The Company shall pay to the Agent for its own
account such fees as may from time to time be agreed between the Company and the
Agent.

            (c) Utilization Fees. The Company shall pay to the Agent for the
account of each Lender a utilization fee on the aggregate outstanding principal
amount of such Lender's Advances for each day on which the aggregate outstanding
amount of the Advances exceeds 33-1/3% of the aggregate Commitments, from the
Effective Date in the case of each Initial Lender and from the effective date
specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date (on a daily basis),
at the Applicable Utilization Fee rate, payable on each day on which interest is
payable under Section 2.07, and on the Termination Date.

      SECTION 2.05. Termination, Reduction or Increase of the Commitments.

            (a) The Company shall have the right, upon at least three Business
Days' notice to the Agent, to terminate in whole or reduce ratably in part the
unused portions of the respective Commitments of the Lenders, provided that each
partial reduction shall be in the aggregate amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof and provided further that (x) the
aggregate amount of the Commitments of the Lenders shall not be reduced to an
amount that is less than the aggregate principal amount of the Advances then
outstanding, and (y) once terminated, a portion of a Commitment shall not be
reinstated except pursuant to Section 2.05(c).

            (b) If any Lender shall make a demand under Section 2.11 or 2.14 or
if the obligation of any Lender to make Eurodollar Rate Advances shall have been
suspended pursuant to Section 2.12, the Company shall have the right, upon at
least ten Business Days' notice, to terminate in full the Commitment of such
Lender or to demand that such Lender assign to one or more Eligible Assignees
all of its rights and obligations under this Agreement in accordance with
Section 8.07. If the Company shall elect to terminate in full the Commitment of
any Lender pursuant to this Section 2.05(b), the Company shall pay to such
Lender, on the effective date of such Commitment termination, an amount equal to
the aggregate outstanding principal amount of the Advances owing to such Lender,
together with accrued interest thereon to the date of payment of such principal
amount and all other amounts payable to such Lender under this Agreement,
whereupon such Lender shall cease to be a party hereto.

            (c) (i) Not more than once in any calendar year, the Company may
propose to increase the aggregate amount of the Commitments by an aggregate
amount of $25,000,000 or an integral multiple of $1,000,000 in excess thereof (a
"Proposed Aggregate Commitment Increase") in the manner set forth below,
provided that:

                            364-Day Credit Agreement

<PAGE>
                                      -20-


            (1) no Default shall have occurred and be continuing either as of
      the date on which the Company shall notify the Agent of its request to
      increase the aggregate amount of the Commitments or as of the related
      Increase Date (as hereinafter defined); and

            (2) after giving effect to any such increase, the aggregate amount
      of the Commitments shall not exceed $500,000,000.

            (ii) The Company may request an increase in the aggregate amount of
the Commitments by delivering to the Agent a notice (an "Increase Notice"; the
date of delivery thereof to the Agent being the "Increase Notice Date")
specifying (1) the Proposed Aggregate Commitment Increase, (2) the proposed date
(the "Increase Date") on which the Commitments would be so increased (which
Increase Date may not be fewer than 30 nor more than 60 days after the Increase
Notice Date) and (3) the New Lenders, if any, to whom the Company desires to
offer the opportunity to commit to all or a portion of the Proposed Aggregate
Commitment Increase. The Agent shall in turn promptly notify each Lender of the
Company's request by sending each Lender a copy of such notice.

            (iii) Not later than the date five days after the Increase Notice
Date, the Agent shall notify each New Lender, if any, identified in the related
Increase Notice of the opportunity to commit to all or any portion of the
Proposed Aggregate Commitment Increase. Each such New Lender may irrevocably
commit to all or a portion of the Proposed Aggregate Commitment Increase (such
New Lender's "Proposed New Commitment") by notifying the Agent (which shall give
prompt notice thereof to the Company) before 11:00 A.M. (New York City time) on
the date that is 10 days after the Increase Notice Date; provided that:

            (1) the Proposed New Commitment of each New Lender shall be in an
      amount not less than $25,000,000; and

            (2) each New Lender that submits a Proposed New Commitment shall
      enter into an agreement in form and substance satisfactory to the Company
      and the Agent pursuant to which such New Lender shall undertake a
      Commitment (and, if any such New Lender is already a Lender, its
      Commitment shall be in addition to such Lender's Commitment hereunder on
      such date), and shall pay to the Agent a processing and recordation fee of
      $3,500.

            (iv) If the aggregate Proposed New Commitments of all of the New
Lenders shall be less than the Proposed Aggregate Commitment Increase, then
(unless the Company otherwise requests) the Agent shall, on or prior to the date
that is 15 days after the Increase Notice Date, notify each Lender of the
opportunity to so commit to all or any portion of the Proposed Aggregate
Commitment Increase not committed to by New Lenders pursuant to Section
2.05(c)(iii). Each Lender may, if, in its sole discretion, it elects to do so,
irrevocably offer to commit to all or a portion of such remainder (such Lender's
"Proposed Increased Commitment") by notifying the Agent (which shall give prompt
notice thereof to the Company) no later than 11:00 A.M. (New York City time) on
the date five days before the Increase Date.

                            364-Day Credit Agreement

<PAGE>
                                      -21-


            (v) If the aggregate amount of Proposed New Commitments and Proposed
Increased Commitments (such aggregate amount, the "Total Committed Increase")
equals or exceeds $25,000,000, then, subject to the conditions set forth in
Section 2.05(c)(i):

            (1) effective on and as of the Increase Date, the aggregate amount
      of the Commitments shall be increased by the lesser of the proposed
      aggregate Committed Increase and the Total Committed Increase and shall be
      allocated among the New Lenders and the Lenders as provided in Section
      2.05(c)(vi); and

            (2) on the Increase Date, if any Revolving Loans are then
      outstanding, the Company shall borrow Revolving Loans from all or certain
      of the Lenders and/or (subject to compliance by the Company with Section
      8.04(d)) prepay Revolving Loans of all or certain of the Lenders such
      that, after giving effect thereto, the Revolving Loans (including, without
      limitation, the Types and Interest Periods thereof) shall be held by the
      Lenders (including for such purposes New Lenders) ratably in accordance
      with their respective Commitments.

If the Total Committed Increase is less than $25,000,000, then the aggregate
amount of the Commitments shall not be changed pursuant to this Section 2.05(c).

            (vi) The Total Committed Increase shall be allocated among New
Lenders having Proposed New Commitments and Lenders having Proposed Increased
Commitments as follows:

            (1) If the Total Committed Increase shall be at least $25,000,000
      and less than or equal to the Proposed Aggregate Commitment Increase, then
      (x) the initial Commitment of each New Lender shall be such New Lender's
      Proposed New Commitment and (y) the Commitment of each Lender shall be
      increased by such Lender's Proposed Increased Commitment.

            (2) If the Total Committed Increase shall be greater than the
      Proposed Aggregate Commitment Increase, then the Total Committed Increase
      shall be allocated:

                        (x) first to New Lenders (to the extent of their
                  respective Proposed New Commitments) in such a manner as the
                  Company shall agree; and

                        (y) then to Lenders on a pro rata basis based on the
                  ratio of each Lender's Proposed Increased Commitment (if any)
                  to the aggregate amount of the Proposed Increased Commitments
                  of all of the Lenders.

            (vii) No increase in the Commitments contemplated hereby shall
become effective until the Agent shall have received (x) promissory notes in
respect of the Revolving Loans payable to each New Lender and each other Lender
whose Commitment is being increased that, in either case, shall have requested
such promissory notes at least two Business Days prior to the Increase Date, and
(y) evidence satisfactory to the Agent (including an update of the opinion of
counsel provided pursuant to Section 3.01(g)(v)) that such increases in the
Commitments, and borrowings thereunder, have been duly authorized.

                            364-Day Credit Agreement

<PAGE>
                                      -22-


      SECTION 2.06. Repayment of Revolving Credit Advances, Evidence of
Indebtedness, Extension of Termination Date and Termed Out Loans.

            (a) The Company and each Borrower shall repay to the Agent for the
ratable account of the Lenders on the Termination Date the aggregate principal
amount of the Revolving Credit Advances then outstanding (subject to Section
2.06(d) relating to Termed Out Loans).

            (b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrowers to such
Lender resulting from each Advance made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder. The Agent shall maintain accounts in which it shall record (i) the
amount of each Advance made hereunder, the Type thereof and the Interest Period,
if any, applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrowers to each Lender hereunder
and (iii) the amount of any sum received by the Agent hereunder for the account
of the Lenders and each Lender's share thereof. The entries made in the accounts
maintained pursuant to this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any Lender or the Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of any Borrower to repay
the Advances in accordance with the terms of this Agreement. Any Lender may
request that Advances made by it be evidenced by a promissory note. In such
event, the applicable Borrower shall prepare, execute and deliver to such Lender
a promissory note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Agent. Thereafter, the Advances evidenced by such promissory note and interest
thereon shall at all times (including after assignment pursuant to Section 8.07)
be represented by one or more promissory notes in such form payable to the order
of the payee named therein (or, if such promissory note is a registered note, to
such payee and its registered assigns).

            (c) The Company may by written notice to the Agent, not more than 45
nor less than 30 days prior to the Termination Date then in effect, request that
the Termination Date then in effect be extended for a further period of 364
days. Such request shall be irrevocable and binding upon the Company. The Agent
shall promptly notify each Lender of such request. If a Lender agrees, in its
individual and sole discretion, to so extend its Commitment (an "Extending
Lender"), it will notify the Agent, in writing, of its decision to do so not
more than 30 nor less than 20 days before said date. The Commitment of any
Lender that fails to accept (or fails to respond to) the Company's request for
extension of the Termination Date (a "Declining Lender") shall be terminated on
the Termination Date theretofore in effect (without regard to extension by other
Lenders). The Extending Lenders, or any of them, shall then have the right to
increase their respective Commitments by an aggregate amount up to the amount of
all Declining Lenders' Commitments, and, to the extent of any shortfall, the
Company shall have the right to require any Declining Lender to assign in full
its rights and obligations under this Agreement to an Eligible Assignee
designated by the Company that agrees to accept all of such rights and
obligations (a "Replacement Lender"), provided that (i) such increase and/or
such assignment is otherwise in compliance with Section 8.07, (ii) such
Declining Lender receives payment in full of an amount equal to the principal
amount of all Advances owing to such Declining Lender,

                            364-Day Credit Agreement

<PAGE>
                                      -23-


together with accrued interest thereon to the date of such assignment and all
other amounts payable to such Declining Lender under this Agreement and (iii)
any such increase shall be effective on the Termination Date theretofore in
effect and any such assignment shall be effective on the date specified by the
Company and agreed to by the Replacement Lender and the Agent. If (i) Extending
Lenders and/or Replacement Lenders provide Commitments in an aggregate amount
equal to 51% of the aggregate amount of the Commitments outstanding immediately
prior to the Termination Date in effect at the time the Company requests such
extension, and (ii) no Default shall have occurred and be continuing immediately
prior to said Termination Date, the Termination Date shall be extended by 364
days (except that, if the date on which the Termination Date is to be extended
is not a Business Day, such Termination Date as so extended shall be the next
preceding Business Day) from the effective date set forth in an Extension
Agreement, in substantially the form in Exhibit A-3 hereto, which has been duly
completed and signed by the Company, the Agent and the Extending Lenders and
Replacement Lenders party thereto. Such Extension Agreement shall be executed
and delivered no earlier than 30 days prior to the Termination Date then in
effect and the effective date shall be no earlier than 29 days prior to the
Termination Date then in effect. No extension of the Commitments pursuant to
this Section 2.06(c) shall be legally binding on any party hereto unless and
until such party executes and delivers a counterpart of such Extension
Agreement.

            (d) The Company may, by written notice to the Agent not later than
the date (the "Notice Date") 10 days prior to the Termination Date then in
effect, elect that all of the Revolving Credit Advances of each Lender to the
Company outstanding as at the close of business New York time on the Termination
Date be converted, effective at such time, to a term loan (each, a "Termed Out
Loan") payable by the Company to such Lender, which term loan shall (i) be in a
principal amount equal to the aggregate outstanding principal amount of the
Revolving Credit Advances of such Lender as at such time, (ii) mature on the
date (the "Term Out Date") that is the date one year after said Termination Date
(or, if said date is not a Business Day, the immediately preceding Business
Day), and the Borrower agrees to repay each such term loan in full on such date,
and (iii) bear interest, until the payment in full thereof, at the rates
provided for in Section 2.07, and (iv) otherwise constitute an "Advance" for all
purposes of this Agreement (including without limitation Articles VI, IX and X);
provided that the election provided for in this paragraph (d) shall not take
effect if, on the Notice Date or on said Termination Date, a Default has
occurred and is continuing; and provided, further, that the election provided
for in this paragraph (d) may be exercised only once. Upon the effectiveness of
the conversion provided for in this paragraph (d), the right of the Company to
borrow under Section 2.01 shall cease to be in effect, and the Company agrees
that it will, forthwith upon the request of any Lender through the Agent, issue
a new promissory note in favor of each such Lender in the amount of the term
loan of such Lender to the Company provided herein, in exchange for the Notes
held by such Lender (which shall be promptly returned to the Company, through
the Agent, marked "cancelled"), which promissory note shall be deemed to be a
"Note" for all purposes of this Agreement (including without limitation Articles
VI, IX and X).

                            364-Day Credit Agreement

<PAGE>
                                      -24-


      SECTION 2.07. Interest on Revolving Credit Advances. Each Borrower shall
pay interest on the unpaid principal amount of each Revolving Credit Advance
made to such Borrower from the date of such Revolving Credit Advance until such
principal amount shall be paid in full, at the following rates per annum:

            (a) Base Rate Advances. During such periods as such Revolving Credit
Advance is a Base Rate Advance, a rate per annum equal at all times to the Base
Rate in effect from time to time, payable in arrears quarterly on the last day
of each March, June, September and December during such periods and on the date
such Base Rate Advance shall be Converted or paid in full.

            (b) Eurodollar Rate Advances. During such periods as such Revolving
Credit Advance is a Eurodollar Rate Advance, a rate per annum equal at all times
during each Interest Period for such Revolving Credit Advance to the sum of (x)
the Eurodollar Rate for such Interest Period for such Revolving Credit Advance
plus (y) the Applicable Margin, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more than three
months, on each day that occurs during such Interest Period every three months
from the first day of such Interest Period and on the date such Eurodollar Rate
Advance shall be Converted or paid in full.

      SECTION 2.08. Interest Rate Determination.

            (a) If the Eurodollar Rate does not appear on Page 3750 of the
Telerate Service (or any successor page), each Reference Bank agrees to furnish
to the Agent timely information for the purpose of determining each Eurodollar
Rate. If the Eurodollar Rate does not appear on said Page 3750 (or any successor
page), and if any one or more of the Reference Banks shall not furnish such
timely information to the Agent for the purpose of determining any such interest
rate, the Agent shall determine such interest rate on the basis of timely
information furnished by the remaining Reference Banks. The Agent shall give
prompt notice to the Company and the Lenders of the applicable interest rate
determined by the Agent for purposes of Section 2.07, and the rate, if any,
furnished by each Reference Bank for the purpose of determining the interest
rate under Section 2.07(b).

            (b) If, due to a major disruption in the interbank funding market
with respect to any Eurodollar Rate Advances, the Required Lenders notify the
Agent that the Eurodollar Rate for any Interest Period for such Advances will
not adequately reflect the cost to such Required Lenders of making, funding or
maintaining their respective Eurodollar Rate Advances for such Interest Period,
the Agent shall forthwith so notify the Borrower and the Lenders, whereupon (i)
each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance, and (ii)
the obligation of the Lenders to make, or to Convert Revolving Credit Advances
into, Eurodollar Rate Advances shall be suspended until the Agent shall notify
the Company and the Lenders that the circumstances causing such suspension no
longer exist.

                            364-Day Credit Agreement

<PAGE>
                                      -25-


            (c) If the Company shall fail to select the duration of any Interest
Period for any Eurodollar Rate Advances in accordance with the provisions
contained in the definition of "Interest Period" in Section 1.01, the Agent will
forthwith so notify the Company and the Lenders and the Company will be deemed
to have selected an Interest Period of one month.

            (d) If the aggregate unpaid principal amount of Eurodollar Rate
Advances comprising any Borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $10,000,000, such Advances shall automatically Convert
into Base Rate Advances on the last day of the Interest Period applicable
thereto.

            (e) Upon the occurrence and during the continuance of any Event of
Default, (i) each Eurodollar Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.

            (f) If the Eurodollar Rate does not appear on Page 3750 of the
Telerate Service (or any successor page) and fewer than two Reference Banks
furnish timely information to the Agent for determining the Eurodollar Rate for
any Eurodollar Rate Advances,

            (i) the Agent shall forthwith notify the Company and the Lenders
      that the interest rate cannot be determined for such Eurodollar Rate
      Advances,

            (ii) each such Advance will automatically, on the last day of the
      then existing Interest Period therefor, Convert into a Base Rate Advance
      (or if such Advance is then a Base Rate Advance, will continue as a Base
      Rate Advance), and

            (iii) the obligation of the Lenders to make, or to Convert Revolving
      Credit Advances into, Eurodollar Rate Advances shall be suspended until
      the Agent shall notify the Company and the Lenders that the circumstances
      causing such suspension no longer exist.

            SECTION 2.09. Optional Conversion of Revolving Credit Advances. The
Company may on any Business Day, upon notice given to the Agent not later than
11:00 A.M. (New York City time) on the third Business Day prior to the date of
the proposed Conversion and subject to the provisions of Sections 2.08 and 2.12,
Convert all Revolving Credit Advances of one Type comprising the same Borrowing
into Revolving Credit Advances of the other Type; provided, however, that any
Conversion of Eurodollar Rate Advances into Base Rate Advances shall be made
only on the last day of an Interest Period for such Eurodollar Rate Advances,
any Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in
an amount not less than the minimum amount specified in Section 2.02(b) and no
Conversion of any Revolving Credit Advances shall result in more separate
Revolving Credit Borrowings than permitted under Section 2.02(b). Each such
notice of a Conversion shall, within the restrictions specified above, specify
(i) the date of such Conversion, (ii) the Revolving Credit Advances to be
Converted, and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest

                            364-Day Credit Agreement

<PAGE>
                                      -26-


Period for each such Advance. Each notice of Conversion shall be irrevocable and
binding on the Company.

      SECTION 2.10. Optional Prepayments of Revolving Credit Advances. The
Company may, upon notice not later than 11:00 A.M. (New York City time) on the
date of such payment, in the case of Base Rate Advances, and two Business Days'
notice, in the case of Eurodollar Rate Advances, to the Agent stating the
proposed date and aggregate principal amount of the prepayment, and if such
notice is given the Company shall, prepay the outstanding principal amount of
the Revolving Credit Advances comprising part of the same Revolving Credit
Borrowing in whole or ratably in part, together with accrued interest to the
date of such prepayment on the principal amount prepaid; provided, however, that
(x) each partial prepayment shall be in an aggregate principal amount of
$5,000,000 or an integral multiple of $1,000,000 in excess thereof and (y) in
the event of any such prepayment of a Eurodollar Rate Advance, the Company shall
be obligated to reimburse the Lenders in respect thereof pursuant to Section
8.04(d).

      SECTION 2.11. Increased Costs.

            (a) If, due to either (i) the introduction of or any change in any
law or regulation or in the interpretation or administration of any law or
regulation by any governmental authority charged with the interpretation or
administration thereof or (ii) the compliance with any guideline or request from
any central bank or other governmental authority that would be complied with
generally by similarly situated banks acting reasonably (whether or not having
the force of law), there shall be any increase in the cost to any Lender of
agreeing to make or making, funding or maintaining Eurodollar Rate Advances or
LIBO Rate Advances by an amount deemed by such Lender to be material, then the
Company shall from time to time, upon demand by such Lender (with a copy of such
demand to the Agent), pay to the Agent for the account of such Lender additional
amounts sufficient to compensate such Lender for such increased cost. A
certificate as to the amount of such increased cost, submitted to the Company
and the Agent by such Lender, shall be conclusive and binding for all purposes,
absent manifest error. Notwithstanding the foregoing, no Lender shall be
entitled to request compensation under this paragraph with respect to any
Competitive Bid Advance if the change giving rise to such request was applicable
to such Lender at the time of submission of such Lender's offer to make such
Competitive Bid Advance.

            (b) If, due to either (i) the introduction of or any change in or in
the interpretation of any law or regulation or (ii) compliance with any
guideline or request from any central bank or other governmental or regulatory
authority which becomes effective after the date hereof, there shall be any
increase in the amount of capital required or expected to be maintained by any
Lender or any corporation controlling such Lender and the amount of such capital
is increased by or based upon the existence of such Lender's Advances or
commitment to lend hereunder and other commitments of this type by an amount
deemed by such Lender to be material, then, upon demand by such Lender (with a
copy of such demand to the Agent), the Company shall pay to the Agent for the
account of such Lender, from time to time as specified by such Lender,
additional amounts sufficient to compensate such Lender or such corporation in
the light of such circumstances, to the extent that such Lender reasonably
determines such increase in capital to

                            364-Day Credit Agreement

<PAGE>
                                      -27-


be allocable to the existence of such Lender's Advances or commitment to lend
hereunder. A certificate as to such amounts submitted to the Company and the
Agent by such Lender shall be conclusive and binding for all purposes as to the
calculations therein, absent manifest error. Such certificate shall be in
reasonable detail and shall certify that the claim for additional amounts
referred to therein is generally consistent with such Lender's treatment of
similarly situated customers of such Lender whose transactions with such Lender
are similarly affected by the change in circumstances giving rise to such
payment, but such Lender shall not be required to disclose any confidential or
proprietary information therein.

      SECTION 2.12. Illegality. Notwithstanding any other provision of this
Agreement, if any Lender shall notify the Agent (and provide to the Company an
opinion of counsel to the effect) that the introduction of or any change in or
in the interpretation of any law or regulation makes it unlawful, or any central
bank or other governmental authority asserts that it is unlawful, for such
Lender or its Eurodollar Lending Office to perform its obligations hereunder to
make Eurodollar Rate Advances or LIBO Rate Advances or to fund or maintain
Eurodollar Rate Advances or LIBO Rate Advances hereunder, (i) each Eurodollar
Rate Advance or LIBO Rate Advance, as the case may be, of such Lender will
automatically, upon such demand, Convert into a Base Rate Advance or an Advance
that bears interest at the rate set forth in Section 2.07(a), as the case may
be, and (ii) the obligation of such Lender to make, or to Convert Revolving
Credit Advances into, Eurodollar Rate Advances shall be suspended until the
Agent shall notify the Company and such Lender that the circumstances causing
such suspension no longer exist and such Lender shall make the Base Rate
Advances in the amount and on the dates that it would have been requested to
make Eurodollar Rate Advances had no such suspension been in effect.

      SECTION 2.13. Payments and Computations.

            (a) Each Borrower shall make each payment hereunder not later than
11:00 A.M. (New York City time) on the day when due in U.S. dollars to the Agent
at the Agent's Account in same day funds. The Agent will promptly thereafter
cause to be distributed like funds relating to the payment of principal or
interest or facility fees or usage fees ratably (other than amounts payable
pursuant to Section 2.03, 2.04(b), 2.05(b), 2.11, 2.14 or 8.04(d)) to the
Lenders for the account of their respective Applicable Lending Offices, and like
funds relating to the payment of any other amount payable to any Lender to such
Lender for the account of its Applicable Lending Office, in each case to be
applied in accordance with the terms of this Agreement. Upon its acceptance of
an Assignment and Acceptance and recording of the information contained therein
in the Register pursuant to Section 8.07(d), from and after the effective date
specified in such Assignment and Acceptance, the Agent shall make all payments
hereunder in respect of the interest assigned thereby to the Lender assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.

            (b) All computations of interest based on the Base Rate and of
facility fees and of usage fees shall be made by the Agent on the basis of a
year of 365 or 366 days, as the case may be, and all computations of interest
based on the Eurodollar Rate or the Federal Funds Rate shall

                            364-Day Credit Agreement

<PAGE>
                                      -28-


be made by the Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or facility fees or usage fees
are payable. Each determination by the Agent of an interest rate hereunder shall
be conclusive and binding for all purposes, absent manifest error.

            (c) Whenever any payment hereunder shall be stated to be due on a
day other than a Business Day, such payment shall be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of payment of interest or facility fee or usage fee, as the case may
be; provided, however, that, if such extension would cause payment of interest
on or principal of Eurodollar Rate Advances or LIBO Rate Advances to be made in
the next following calendar month, such payment shall be made on the next
preceding Business Day.

            (d) Unless the Agent shall have received notice from the Company
prior to the date on which any payment is due to the Lenders hereunder that a
Borrower will not make such payment in full, the Agent may assume that such
Borrower has made such payment in full to the Agent on such date and the Agent
may, in reliance upon such assumption, cause to be distributed to each Lender on
such due date an amount equal to the amount then due such Lender. If and to the
extent such Borrower shall not have so made such payment in full to the Agent,
each Lender shall repay to the Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such
amount is distributed to such Lender until the date such Lender repays such
amount to the Agent, at the Federal Funds Rate.

      SECTION 2.14. Taxes.

            (a) Each Lender is exempt from any withholding imposed under the
laws of the United States in respect of any fees, interest or other payments to
which it is entitled pursuant to this Agreement or any promissory notes issued
hereunder (the "Income") because (i) the Lender is organized under the laws of
the United States; (ii) the Income is effectively connected with the conduct of
a trade or business within the United States within the meaning of Section 871
of the Internal Revenue Code; or (iii) the Income is eligible for an exemption
by reason of a tax treaty. The Agent is exempt from any withholding tax imposed
under the laws of the United States in respect of the Income because the Agent
is organized under the laws of the United States.

            (b) Each Lender organized under the laws of a jurisdiction outside
the United States (each, a "Foreign Lender") shall, on or prior to the date of
its execution and delivery of this Agreement in the case of each Initial Lender,
and on the date of the Assignment and Acceptance pursuant to which it became a
Lender in the case of each other Foreign Lender and from time to time thereafter
if requested in writing by the Company or the Agent, provide the Agent and the
relevant Borrower with Internal Revenue Service Form W-8BEN or W-8ECI, as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that such Foreign Lender is exempt or entitled to a reduced
rate of United States withholding tax on any Income that is the subject of such
forms. If the form provided by a Foreign Lender at the time such Foreign Lender
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, or in excess of the rate

                            364-Day Credit Agreement

<PAGE>
                                      -29-


applicable to the Foreign Lender assignor on the date of the Assignment and
Acceptance pursuant to which it became a Foreign Lender, in the case of each
other Foreign Lender, withholding tax at such rate shall be considered excluded
from Taxes as defined in Section 2.14(c).

            (c) Based on Section 2.14(a) and (b), any and all payments by any
Borrower hereunder or under any promissory notes issued hereunder shall be made
free and clear of and without deduction for any present United States federal
income withholding taxes imposed on a Foreign Lender under the Internal Revenue
Code (such withholding taxes being hereinafter referred to as "Taxes").

            (d) If, as a result of the enactment, promulgation, execution or
ratification of, or any change in or amendment to, any United States law or any
tax treaty (or in the application or official interpretation of any law or any
tax treaty) that occurs on or after the date a Foreign Lender first becomes a
party to this Agreement (a "Change in Law"), a Foreign Lender cannot comply with
Section 2.14(b) or, if despite such compliance, any Borrower shall be required
to deduct any Taxes from or in respect of any Income, then: (i) the sum payable
to such Foreign Lender shall be increased as may be necessary so that after
making all required deductions for such Taxes (including deductions applicable
to additional sums payable under this Section 2.14) such Foreign Lender receives
an amount equal to the sum it would have received had no such deductions been
made, (ii) such Borrower shall make such deductions and (iii) such Borrower
shall pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law. Notwithstanding the foregoing, each
Borrower shall be entitled to pay any Taxes in any lawful manner so as to reduce
any deductions and such Foreign Lender shall to the extent it is reasonably able
provide any documentation or file any forms as may be required by the Internal
Revenue Service or any other foreign governmental agency. In addition, if any
Foreign Lender or the Agent (in lieu of such Foreign Lender), as the case may
be, is required to pay directly any Taxes as a result of a Change in Law because
a Borrower cannot or does not legally or timely do so, the Company shall
indemnify such Foreign Lender or Agent for payment of such Taxes, without
duplication of, or increase in, the amount of Taxes otherwise due to the Foreign
Lender.

            (e) In addition, the Company agrees to pay any present or future
stamp or documentary taxes or any other excise or property taxes, charges or
similar levies (excluding any income or franchise taxes, business taxes or
capital taxes of any nature) that arise from the execution, delivery or
registration of, or otherwise with respect to, this Agreement (hereinafter
referred to as "Other Taxes"). If a Lender is required to pay directly Other
Taxes because a Borrower cannot or does not legally or timely do so, the Company
shall indemnify such Lender for such payment of Other Taxes.

            (f) Within 30 days after the date of any payment of Taxes or foreign
withholding taxes, the Company shall furnish to the Agent, at its address
referred to in Section 8.02, the original or a certified copy of a receipt
evidencing payment thereof. Prior to making any payment hereunder by or on
behalf of any Borrower through an account or branch outside the United States or
on behalf of any Borrower by a payor that is not a United States person (a
"Foreign Payment"), such Borrower shall determine that no foreign withholding
taxes are payable in

                            364-Day Credit Agreement

<PAGE>
                                      -30-


respect thereof, and at its expense, shall furnish, or shall cause such payor to
furnish, to the Agent, at such address, a certificate from each appropriate
taxing authority, or an opinion of counsel acceptable to the Agent, in either
case stating that such Foreign Payment is exempt from or not subject to foreign
withholding taxes. Each Lender shall cooperate with each Borrower's efforts
described in this subsection by providing to the extent reasonably within its
means any forms requested by such Borrower substantiating an exemption from
foreign withholding taxes required by any governmental agency. For purposes of
this subsection (f), the terms "United States" and "United States person" shall
have the meaning specified in Section 7701 of the Internal Revenue Code. If, as
a result of the enactment, promulgation, execution or ratification of, or any
change in or amendment to, any applicable foreign law or any tax treaty (or in
the application or official interpretation of any law or any tax treaty) that
occurs on or after the date a tax opinion is rendered pursuant to the terms of
this subsection, and which renders such tax opinion incorrect as to the absence
of any foreign withholding tax (a "Foreign Change in Law"), any Borrower shall
be required to deduct any foreign withholding taxes from or in respect of any
Income, then: (i) the sum payable to the applicable Lender shall be increased as
may be necessary so that after making all required deductions for foreign
withholding taxes (including deductions applicable to additional sums payable
under this Section 2.14) such Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) such Borrower shall
make such deductions and (iii) such Borrower shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable law. Notwithstanding the foregoing, each Borrower shall be entitled
to pay any foreign withholding taxes in any lawful manner so as to reduce any
deductions and such Lender shall to the extent it is reasonably able provide any
documentation or file any forms as may be required by the Internal Revenue
Service or any other foreign governmental agency. In addition, if any Lender is
required to pay directly any foreign withholding tax in respect of any Foreign
Payments made pursuant to this Agreement because a Borrower cannot or does not
legally or timely do so, the Company shall indemnify such Lender for payment of
such tax.

            (g) For any period with respect to which a Lender has failed to
comply with the requirements of subsection (b) or (f) relating to certain forms
intended to reduce withholding taxes (other than if such failure is due to a
Change in Law or a Foreign Change in Law), such Lender shall not be entitled to
indemnification under subsection (d) or (f).

            (h) Upon a Change in Law or the imposition of any foreign
withholding tax in respect of Foreign Payments, a Lender shall, upon the written
request of and at the expense of the Company, use reasonable efforts to change
the jurisdiction of its Applicable Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such taxes that may
thereafter accrue and would not, in the reasonable judgment of such Lender,
cause the imposition on such Lender of any material legal or regulatory burdens.

            (i) Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Company contained in
this Section 2.14 shall survive the payment in full of principal and interest
hereunder until the applicable statute of limitations relating to the payment of
any Taxes under Section 2.14(d) has expired.

                            364-Day Credit Agreement

<PAGE>
                                      -31-


            (j) Any request by any Lender for payment of any amount under this
Section 2.14 shall be accompanied by a certification that such Lender's claim
for said amount is generally consistent with such Lender's treatment of
similarly situated customers of such Lender whose transactions with such Lender
are similarly affected by the change in circumstances giving rise to such
payment, but such Lender shall not be required to disclose any confidential or
proprietary information therein.

      SECTION 2.15. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) on account of the Revolving Credit Advances owing to it
(other than pursuant to Section 2.05(b), 2.11, 2.14 or 8.04(d)) in excess of its
ratable share of payments on account of the Revolving Credit Advances obtained
by all the Lenders, such Lender shall forthwith purchase from the other Lenders
such participations in the Revolving Credit Advances owing to them as shall be
necessary to cause such purchasing Lender to share the excess payment ratably
with each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from such purchasing Lender, such purchase from
each Lender shall be rescinded and such Lender shall repay to the purchasing
Lender the purchase price to the extent of such recovery together with an amount
equal to such Lender's ratable share (according to the proportion of (i) the
amount of such Lender's required repayment to (ii) the total amount so recovered
from the purchasing Lender) of any interest or other amount paid or payable by
the purchasing Lender in respect of the total amount so recovered. Each Borrower
agrees that any Lender so purchasing a participation from another Lender
pursuant to this Section 2.15 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of setoff) with respect
to such participation as fully as if such Lender were the direct creditor of
such Borrower in the amount of such participation.

      SECTION 2.16. Use of Proceeds. The proceeds of the Advances shall be
available (and the Company agrees that such proceeds shall be used) for general
corporate purposes of the Company and its Subsidiaries, including commercial
paper backstop.

      SECTION 2.17. Borrowings by Borrowing Subsidiaries; Substitution of
Borrower.

            (a) The Company may, at any time or from time to time, designate one
or more Subsidiaries (including the Guarantor) as Borrowers hereunder by
furnishing to the Agent a letter (a "Designation Letter") in duplicate, in
substantially the form of Exhibit D, duly completed and executed by the Company
and such Subsidiary. Upon any such designation of a Subsidiary, such Subsidiary
shall be a Borrowing Subsidiary and a Borrower entitled to borrow Revolving
Credit Advances and Competitive Bid Advances on and subject to the terms and
conditions of this Agreement.

            (b) If all principal of and interest on all Advances made to any
Borrowing Subsidiary have been paid in full, the Company may terminate the
status of such Borrowing Subsidiary as a Borrower hereunder by furnishing to the
Agent a letter (a "Termination

                            364-Day Credit Agreement

<PAGE>
                                      -32-


Letter") in substantially the form of Exhibit F, duly completed and executed by
the Company. Any Termination Letter furnished hereunder shall be effective upon
receipt by the Agent, which shall promptly notify the Lenders, whereupon the
Lenders shall, upon payment in full of all amounts owing by such Borrower
hereunder, promptly deliver to the Company (through the Agent) the promissory
notes, if any, of such former Borrower. Notwithstanding the foregoing, the
delivery of a Termination Letter with respect to any Borrower shall not
terminate (i) any obligation of such Borrower that remains unpaid at the time of
such delivery (including without limitation any obligation arising thereafter in
respect of such Borrower under Section 2.11 or 2.14) or (ii) the obligations of
the Company under Article IX with respect to any such unpaid obligations;
provided, that if the status of such Borrowing Subsidiary has been terminated as
aforesaid because the Company has sold or transferred its interest in such
Subsidiary, and the Company so certifies to the Agent at the time of delivery of
such Termination Letter, and subject to payment of said principal and interest,
(i) such Subsidiary shall, automatically upon the effectiveness of the delivery
of such Termination Letter and certification, cease to have any obligation under
this Agreement and (ii) the Company shall automatically be deemed to have
unconditionally assumed, as primary obligor, and hereby agrees to pay and
perform, all of such obligations.

            (c) In addition to the foregoing, the Company may, at any time when
there are no Advances outstanding hereunder and upon not less than 10 Business
Days' notice, irrevocably elect to terminate its right to be a Borrower
hereunder as of the date (which shall be a Business Day) specified in such
Substitution Letter (the "Substitution Date") and designate the Guarantor as a
Borrower hereunder by furnishing to the Agent (x) a letter (a "Substitution
Letter"), in substantially the form of Exhibit E duly completed and executed by
the Company and the Guarantor, (y) a certificate signed by a duly authorized
officer of the Company, and a certificate signed by a duly authorized officer of
the Guarantor, each dated the Substitution Date, stating that:

            (i) the representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects on and as of the
      Substitution Date, as though made on and as of such date, and

            (ii) No event has occurred and is continuing, or would result from
      such designation, that constitutes a Default;

and (z) the Agent shall have received such other corporate documents,
resolutions and legal opinions relating to the foregoing as it, or any Lender
through the Agent, may reasonably request.

            SECTION 2.18. Mitigation Obligations. If any Lender requests
compensation under Section 2.11, or if the obligation of any Lender to make or
continue Advances as, or Convert Advances into, Eurodollar Rate Advances is
suspended pursuant to Section 2.12, then, upon the written request of the
Company, such Lender shall use reasonable efforts to designate a different
lending office for funding or booking its Loans hereunder or to assign its
rights and

                            364-Day Credit Agreement

<PAGE>
                                      -33-


obligations hereunder to another of its offices, branches or affiliates, if, in
the judgment of such Lender, such designations or assignment (i) would eliminate
or reduce amounts payable pursuant to Section 2.11 or would cause such Lender
not to be subject to such suspension, as the case may be, in the future and (ii)
would not subject such Lender to any unreimbursed cost or expense and would not,
in the reasonable judgment of such Lender, cause imposition on such Lender of
any material legal or regulatory burdens or otherwise be disadvantageous to such
Lender. The Company hereby agrees to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

                                   ARTICLE III

                   CONDITIONS TO EFFECTIVENESS AND ARTICLE II

      SECTION 3.01. Conditions Precedent to Effectiveness of Sections 2.01 and
2.03. Sections 2.01 and 2.03 of this Agreement shall become effective on and as
of the first date (the "Effective Date") on which the following conditions
precedent have been satisfied:

            (a) As of the Effective Date, there shall have occurred no Material
Adverse Change since December 28, 2002 that has not been publicly disclosed.

            (b) As of the Effective Date, there shall exist no action, suit,
investigation, litigation or proceeding affecting the Company, or any of its
Subsidiaries (including the Guarantor) pending or, to the knowledge of the
Company's or the Guarantor's executive officers, threatened before any court,
governmental agency or arbitrator that (i) could be reasonably likely to have a
Material Adverse Effect or (ii) could reasonably be likely to affect the
legality, validity or enforceability of this Agreement or the consummation of
the transactions contemplated hereby.

            (c) As of the Effective Date, nothing shall have come to the
attention of the Lenders during the course of their due diligence investigation
to lead them to believe that the Information Memorandum was or has become
misleading, incorrect or incomplete in any material respect.

            (d) As of the Effective Date, all governmental and third party
consents and approvals necessary in connection with the transactions
contemplated hereby shall have been obtained (without the imposition of any
conditions that are not acceptable to the Lenders) and shall remain in effect.

            (e) As of the Effective Date, the Company shall have paid all
accrued fees and expenses of the Agent and the Lenders (including the accrued
fees and expenses of counsel to the Agent, to the extent invoiced at least one
Business Day prior to the Effective Date).

            (f) On the Effective Date, the following statements shall be true
and the Agent shall have received for the account of each Lender a certificate
signed by a duly authorized officer of the Company dated the Effective Date,
stating that:

                            364-Day Credit Agreement

<PAGE>
                                      -34-


            (i) The representations and warranties contained in Section 4.01 are
      correct in all material aspects on and as of the Effective Date, and

            (ii) No event has occurred and is continuing that constitutes a
      Default.

            (g) The Agent shall have received on or before the Effective Date
the following, each dated such day, in form and substance satisfactory to the
Agent and (except for any notes requested by the Lenders) in sufficient copies
for each Lender:

            (i) To the extent any Lender shall have requested, at least one
      Business day prior to the Effective Date that its Revolving Credit
      Advances be evidenced by a promissory note, a note payable to the order of
      such Lender.

            (ii) Certified copies of the resolutions of the Board of Directors
      of the Company and of the Guarantor approving this Agreement, and of all
      documents evidencing other necessary corporate action and governmental
      approvals, if any, with respect to this Agreement.

            (iii) A certificate of the Secretary or an Assistant Secretary of
      the Company certifying the names and true signatures of the officers of
      the Company authorized to sign this Agreement and the other documents to
      be delivered hereunder.

            (iv) A certificate of the Secretary or an Assistant Secretary of the
      Guarantor certifying the names and true signatures of the officers of the
      Guarantor authorized to sign this Agreement and the other documents to be
      delivered hereunder.

            (v) An opinion of Pamela C. McGuire, Esq., General Counsel of each
      of the Company and the Guarantor, substantially in the form of Exhibit C
      hereto and as to such other matters as any Lender through the Agent may
      reasonably request.

            (vi) A favorable opinion of Milbank, Tweed, Hadley & McCloy LLP,
      special New York counsel for the Agent.

            (vii) Evidence of the termination of the Commitments as defined in
      the $250,000,000 364-Day Second Amended and Restated Credit Agreement
      dated as of May 1, 2002 among the Company, the Guarantor, certain lenders
      and JP Morgan Chase Bank, as Agent (as amended and restated) and of the
      payment in full of any and all amounts payable thereunder.

            (viii) The Agent shall have received such other approvals, opinions
      or documents as any Lender through the Agent may reasonably request.

                            364-Day Credit Agreement

<PAGE>
                                      -35-


      SECTION 3.02. Conditions Precedent to Each Revolving Credit Borrowing. The
obligation of each Lender to make a Revolving Credit Advance on the occasion of
each Revolving Credit Borrowing shall be subject to the conditions precedent
that the Effective Date shall have occurred and on the date of such Revolving
Credit Borrowing (a) the following statements shall be true (and each of the
giving of the applicable Notice of Revolving Credit Borrowing and the acceptance
by any Borrower of the proceeds of such Revolving Credit Borrowing shall
constitute a representation and warranty by the Company and such Borrower that
on the date of such Borrowing such statements are true):

            (i) The representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects on and as of the date of
      such Revolving Credit Borrowing, before and after giving effect to such
      Revolving Credit Borrowing and to the application of the proceeds
      therefrom, as though made on and as of such date, and

            (ii) No event has occurred and is continuing, or would result from
      such Revolving Credit Borrowing or from the application of the proceeds
      therefrom, that constitutes a Default;

and (b) in the case of the first Borrowing by a Borrowing Subsidiary, the Agent
shall have received such corporate documents, resolutions and legal opinions
relating to such Borrowing Subsidiary as the Agent may reasonably require.

      SECTION 3.03. Conditions Precedent to Each Competitive Bid Borrowing. The
obligation of each Lender that is to make a Competitive Bid Advance on the
occasion of a Competitive Bid Borrowing to make such Competitive Bid Advance as
part of such Competitive Bid Borrowing is subject to the conditions precedent
that (i) the Agent shall have received the written confirmatory Notice of
Competitive Bid Borrowing with respect thereto, and (ii) on the date of such
Competitive Bid Borrowing the following statements shall be true (and each of
the giving of the applicable Notice of Competitive Bid Borrowing and the
acceptance by any Borrower of the proceeds of such Competitive Bid Borrowing
shall constitute a representation and warranty by the Company and such Borrower
that on the date of such Competitive Bid Borrowing such statements are true):

            (a) The representations and warranties contained in Section 4.01
(except the representations set forth in the last sentence of subsection (e)
thereof and in subsection (f) thereof (other than clause (ii) thereof)) are
correct in all material respects on and as of the date of such Competitive Bid
Borrowing, before and after giving effect to such Competitive Bid Borrowing and
to the application of the proceeds therefrom, as though made on and as of such
date; and

            (b) No event has occurred and is continuing, or would result from
such Competitive Bid Borrowing or from the application of the proceeds
therefrom, that constitutes a Default.

                            364-Day Credit Agreement

<PAGE>
                                      -36-


      SECTION 3.04. Determinations Under Section 3.01. For purposes of
determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by this Agreement
shall have received notice from such Lender prior to the proposed Effective
Date, as notified by the Company to the Lenders, specifying its objection
thereto. The Agent shall promptly notify the Lenders of the occurrence of the
Effective Date.

                                   ARTICLE IV

               REPRESENTATIONS AND WARRANTIES OF THE LOAN PARTIES

      SECTION 4.01. Representations and Warranties of the Loan Parties. Each of
the Company and the Guarantor (each, a "Loan Party") represents and warrants as
follows:

            (a) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and the Guarantor
is a limited liability company duly organized, validly existing and in good
standing under the laws of the State of Delaware.

            (b) The execution, delivery and performance by each Loan Party of
this Agreement and the consummation of the transactions contemplated hereby are
within such Loan Party's powers, have been duly authorized by all necessary
corporate or other action, and do not contravene (i) its charter, by-laws or
other organizational documents or (ii) any law or contractual restriction
binding on or materially affecting such Loan Party.

            (c) No authorization or approval or other action by, and no notice
to or filing with, any governmental authority or regulatory body or any other
third party is required for the due execution, delivery and performance by
either Loan Party of this Agreement.

            (d) This Agreement has been duly executed and delivered by each Loan
Party. This Agreement is the legal, valid and binding obligation of each Loan
Party enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and equitable principles of general applicability.

            (e) The Consolidated balance sheet of the Company and its
Subsidiaries as at December 28, 2002, and the related Consolidated statements of
operations and cash flows of the Company and its Subsidiaries for the fiscal
year then ended, accompanied by an opinion of KPMG Peat Marwick, independent
public accountants, fairly present the financial condition of the Company as at
such date and the results of the operations of the Company for the period ended
on such date, all in accordance with generally accepted accounting principles
consistently applied. Since December 28, 2002, there has been no Material
Adverse Change that has not been publicly disclosed.

                            364-Day Credit Agreement

<PAGE>
                                      -37-


            (f) There is no pending or threatened action, suit, investigation,
litigation or proceeding affecting either Loan Party before any court,
governmental agency or arbitrator that (i) would be reasonably likely to have a
Material Adverse Effect or (ii) would reasonably be likely to affect the
legality, validity or enforceability of this Agreement or any promissory note
issued under this Agreement, if any, or the consummation of the transactions
contemplated hereby.

            (g) It is not engaged in the business of extending credit for the
purpose of purchasing or carrying Margin Stock and no proceeds of any Advance
will be used to purchase or carry any Margin Stock or to extend credit to others
for the purpose (whether immediate, individual or ultimate) of purchasing or
carrying any Margin Stock, in either case in a manner that would cause the
Advances or any Lender to be in violation of Regulation U.

            (h) Following application of the proceeds of each Advance, not more
than 25 percent of the value of the assets (either of any Borrower only or of
the Company and its Subsidiaries or the Guarantor and its Subsidiaries, in each
case on a Consolidated basis) subject to the provisions of Section 5.02(a) or
(b)(ii) or subject to any restriction contained in any agreement or instrument
between it and any Lender or any Affiliate of any Lender relating to Debt and
within the scope of Section 6.01(d) will be Margin Stock.

            (i) Neither Loan Party is an "investment company", a company
"controlled by", or "promoter" or "principal underwriter" for, an "investment
company", as such terms are defined in the Investment Company Act of 1940, as
amended. Neither the making of any Advances nor the application of the proceeds
or repayment thereof by any Borrower will violate any provision of such Act or
any rule, regulation or order of the Securities and Exchange Commission
thereunder.

                                    ARTICLE V

                                    COVENANTS

      SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, each Loan Party will:

            (a) Compliance with Laws, Etc. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable laws,
rules, regulations and orders, such compliance to include, without limitation,
compliance with ERISA and Environmental Laws, except where failure so to comply
would not, and would not be reasonably likely to, have a Material Adverse
Effect.

            (b) Payment of Taxes, Etc. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (i)
all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (ii) all lawful claims that, if unpaid, might by law
become a Lien upon its property; provided, however, that neither Loan Party nor
any of its Subsidiaries shall be required to pay or discharge any such tax,

                            364-Day Credit Agreement

<PAGE>
                                      -38-


assessment, charge or claim that is being contested in good faith and by proper
proceedings and as to which appropriate reserves are being maintained, unless
and until any Lien resulting therefrom attaches to its property and becomes
enforceable against its other creditors and such Lien would be reasonably likely
to have a Material Adverse Effect.

            (c) Preservation of Corporate Existence, Etc. Preserve and maintain,
and cause each of its Material Subsidiaries to preserve and maintain, its
corporate existence, rights (charter and statutory) and franchises; provided,
however, that each Loan Party and its Material Subsidiaries may consummate any
merger or consolidation permitted under Section 5.02(b) and provided further
that neither Loan Party nor any of its Material Subsidiaries shall be required
to preserve any right or franchise if the Board of Directors of such Loan Party
or such Subsidiary shall determine that the preservation thereof is no longer
desirable in the conduct of the business of such Loan Party or such Subsidiary,
as the case may be, and that the loss thereof is not disadvantageous in any
material respect to such Loan Party, such Subsidiary or the Lenders.

            (d) Reporting Requirements. Furnish to the Lenders:

            (i) as soon as available and in any event within 45 days after the
      end of each of the first three Fiscal Quarters of each Fiscal Year of the
      Company, the Consolidated balance sheet of the Company and its
      Subsidiaries as of the end of such quarter and Consolidated statements of
      operations and cash flows of the Company and its Subsidiaries for the
      period commencing at the end of the previous Fiscal Year and ending with
      the end of such Fiscal Quarter, duly certified (subject to year-end audit
      adjustments) by the chief financial officer of the Company as having been
      prepared in accordance with GAAP, it being agreed that delivery of the
      Company's Quarterly Report on Form 10-Q will satisfy this requirement;

            (ii) as soon as available and in any event within 90 days after the
      end of each Fiscal Year of the Company, a copy of the annual audit report
      for such year for the Company and its Subsidiaries, containing the
      Consolidated balance sheet of the Company and its Subsidiaries as of the
      end of such Fiscal Year and Consolidated statements of operations and cash
      flows of the Company and its Subsidiaries for such Fiscal Year, in each
      case accompanied by an opinion by KPMG Peat Marwick or other independent
      public accountants of nationally recognized standing, it being agreed that
      delivery of the Company's Annual Report on Form 10-K will satisfy this
      requirement;

            (iii) as soon as possible and in any event within five days after
      the occurrence of each Default continuing on the date of such statement, a
      statement of the chief financial officer of the Company setting forth
      details of such Default and the action that the Company has taken and
      proposes to take with respect thereto; and

            (iv) promptly after the sending or filing thereof, copies of all
      annual reports and proxy solicitations that the Company sends to any of
      its securityholders, and copies of all reports on Form 8-K that the
      Company or any Subsidiary files with the Securities and Exchange
      Commission.

                            364-Day Credit Agreement

<PAGE>
                                      -39-


      SECTION 5.02. Negative Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, neither Loan Party
will:

            (a) Secured Debt. Create or suffer to exist, or permit any of its
Restricted Subsidiaries or the Guarantor to create or suffer to exist, any Debt
secured by a Lien on any Principal Property or on any shares of stock of or Debt
of any Restricted Subsidiary or the Guarantor unless such Loan Party or such
Restricted Subsidiary secures or causes such Restricted Subsidiary or the
Guarantor to secure the Advances and all other amounts payable under this
Agreement equally and ratably with such secured Debt, so long as such secured
Debt shall be so secured, unless after giving effect thereto the aggregate
amount of all such Debt so secured does not exceed 15% of Consolidated Net
Tangible Assets; provided that the foregoing restriction does not apply to Debt
secured by:

            (i) Liens existing prior to the date hereof;

            (ii) Liens on property of, or on shares of stock of or Debt of, any
      corporation existing at the time such corporation becomes a Restricted
      Subsidiary;

            (iii) Liens in favor of a Loan Party or any Restricted Subsidiary;

            (iv) Liens in favor of any governmental bodies to secure progress or
      advance payments;

            (v) Liens on property, shares of stock or Debt existing at the time
      of acquisition thereof (including acquisition through merger or
      consolidation) or liens securing Debt incurred to finance all or any part
      of the purchase price or cost of construction of property (or additions,
      substantial repairs, alterations or substantial improvements thereto),
      provided that such Lien and the Debt secured thereby are incurred within
      365 days of the later of acquisition or completion of construction (or
      addition, repair, alteration or improvement) and full operation thereof;
      and

            (vi) any extension, renewal or refunding of Debt referred to in the
      foregoing clauses (i) to (v), inclusive.

            (b) Mergers, Etc. (i) Merge or consolidate with or into any
corporation or (ii) sell, lease, transfer or otherwise dispose of all or
substantially all of the assets of the Company and its Subsidiaries, taken as a
whole, unless the Company or the Guarantor would be the acquiring or surviving
party in such transaction and no Event of Default shall have occurred and be
continuing at the time of such proposed transaction or would result therefrom.

            (c) Subsidiary Debt. Permit any Restricted Subsidiary to create,
incur, assume or permit to exist any Debt, except:

            (i) Debt of the Borrowing Subsidiaries, if any, created hereunder
      and under the 5-Year Facility;

                            364-Day Credit Agreement

<PAGE>
                                      -40-


            (ii) Debt existing on the Effective Date;

            (iii) Debt of any Subsidiary to any Loan Party or any other
      Subsidiary;

            (iv) Debt of any Person that becomes a Subsidiary after the date
      hereof; provided that such Debt exists at the time such Person becomes a
      Subsidiary and is not created in contemplation of or in connection with
      such Person becoming a Subsidiary;

            (v) any refinancing, refunding or replacement of any Debt permitted
      under clause (ii) through (iv) above; and

            (vi) other Debt in an aggregate principal amount not exceeding 15%
      of Consolidated Net Tangible Assets, computed as of the last day of the
      then most recently concluded fiscal quarter of the Company, at any time
      outstanding.

            (d) Restrictive Agreements. Neither Loan Party will enter into,
incur or permit to exist any agreement or other arrangement that prohibits or
restricts the ability of any Subsidiary to pay dividends or other distributions
with respect to any shares of its capital stock or to make or repay loans or
advances to, or otherwise transfer assets to the Company; provided that the
foregoing shall not apply to (i) restrictions and conditions imposed by law or
by this Agreement or the 5-Year Facility, (ii) customary restrictions and
conditions contained in agreements relating to the sale of a Subsidiary pending
such sale, provided such restrictions and conditions apply only to the
Subsidiary that is to be sold and such sale is permitted hereunder, (iii)
restrictions or conditions imposed by any agreement relating to secured Debt
permitted by this Agreement if such restrictions or conditions apply only to the
property or assets securing such Debt, (iv) customary provisions in leases and
other contracts restricting the assignment thereof, (v) any agreement in effect
on the Effective Date, as any such agreement is in effect on such date, (vi) any
agreement binding upon such Subsidiary prior to the date on which such
Subsidiary was acquired by the Company and outstanding on such date, (vii)
customary net worth and other financial maintenance covenants in an agreement
relating to Debt or other obligations incurred in compliance with this
Agreement, and (viii) any agreement refinancing, renewing or replacing any
agreement or Debt referred to in (i) through (vii) above, provided that the
relevant provisions are no more restrictive than those in the agreement or Debt
being refinanced, renewed or replaced.

            (e) Ownership. In the case of the Company, cease to own, legally and
beneficially, 75% or more of the membership interests in the Guarantor.

      SECTION 5.03. Financial Covenants. So long as any Advance shall remain
unpaid or any Lender shall have any Commitment hereunder, the Company will not:

            (a) Debt to Capitalization Ratio. Permit the Debt to Capitalization
Ratio as at the last day of any Fiscal Quarter that is not an Alternate Covenant
Date to exceed 0.75 to 1.0.

                            364-Day Credit Agreement

<PAGE>
                                      -41-


            (b) Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio as at the last day of any Fiscal Quarter that is an Alternate Covenant
Date to exceed 5.0 to 1.0.

                                   ARTICLE VI

                                EVENTS OF DEFAULT

      SECTION 6.01. Events of Default. If any of the following events ("Events
of Default") shall occur and be continuing:

            (a) Any Borrower shall fail to pay any principal of, or interest on,
any Advance or to make any other payment under this Agreement, in each case
within five days after the same becomes due and payable; or

            (b) Any representation or warranty made by any Loan Party herein or
by any Borrower (or any of its officers) in connection with this Agreement
(including without limitation by any Borrowing Subsidiary pursuant to any
Designation Letter) shall prove to have been incorrect in any material respect
when made; or

            (c) Any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in Section 5.01(d), 5.02 or 5.03, or (ii) any
Loan Party shall fail to perform or observe any other term, covenant or
agreement contained in this Agreement on its part to be performed or observed if
such failure shall remain unremedied for 30 days after written notice thereof
shall have been given to either Loan Party by the Agent or any Lender; or

            (d) Any Loan Party or any of its Subsidiaries shall fail to pay any
principal of or premium or interest on any Debt that is outstanding in a
principal or notional amount of at least $75,000,000 in the aggregate (but
excluding Debt outstanding hereunder) of such Loan Party or such Subsidiary (as
the case may be), when the same becomes due and payable (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise), and such
failure shall continue after the applicable grace period, if any, specified in
the agreement or instrument relating to such Debt; or any other event shall
occur or condition shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event or
condition is to accelerate the maturity of such Debt or permit (with or without
the giving of notice, the lapse of time or both) the holder or holders of such
Debt or any trustee or agent on its or their behalf to cause any such Debt to
become due prior to its scheduled maturity; or any such Debt shall be declared
to be due and payable, or required to be prepaid or redeemed (other than by a
regularly scheduled required prepayment or redemption), purchased or defeased,
or an offer to prepay, redeem, purchase or defease such Debt shall be required
to be made, in each case prior to the stated maturity thereof; or

            (e) Any Loan Party or any of its Subsidiaries shall generally not
pay its debts as such debts become due, or shall admit in writing its inability
to pay its debts generally, or shall make a general assignment for the benefit
of creditors; or any proceeding shall be instituted by or

                            364-Day Credit Agreement

<PAGE>
                                      -42-


against such Loan Party or any of its Subsidiaries seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under any law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding
instituted against it (but not instituted by it), either such proceeding shall
remain undismissed or unstayed for a period of 30 days, or any of the actions
sought in such proceeding (including, without limitation, the entry of an order
for relief against, or the appointment of a receiver, trustee, custodian or
other similar official for, it or for any substantial part of its property)
shall occur; or such Loan Party of any of its Subsidiaries shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e); or

            (f) Any judgment or order for the payment of money in excess of
$75,000,000 shall be rendered against any Loan Party or any of its Material
Subsidiaries and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order or (ii) there shall be any period of 10
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; provided,
however, that any such judgment or order shall not be an Event of Default under
this Section 6.01(f) if and for so long as (i) the amount of such judgment or
order is covered by a valid and binding policy of insurance between the
defendant and the insurer covering payment thereof and (ii) such insurer, which
shall be rated at least "A" by A.M. Best Company, has been notified of, and has
not disputed the claim made for payment of, the amount of such judgment or
order; or

            (g) Any event, action or condition with respect to an employee
benefit plan of the Company subject to Title IV of ERISA results in any penalty
or action pursuant to ERISA that has a material adverse effect on the business
or financial condition of either Loan Party and its Subsidiaries, taken as a
whole; or

            (h) The Master Bottling Agreement ceases to be valid and binding and
in full force and effect; or Pepsi denies that it has any liability or
obligation under the Master Bottling Agreement and Pepsi ceases performance
thereunder; or

            (i) A Change of Control shall occur;

then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Company, declare the
obligation of each Lender to make Advances to be terminated, whereupon the same
shall forthwith terminate, and (ii) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Company, declare the
Advances, all interest thereon and all other amounts payable under this
Agreement to be forthwith due and payable, whereupon the Advances, all such
interest and all such amounts shall become and be forthwith due and payable,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived by the Company; provided, however, that in the event
of an actual or deemed entry of an order for relief with respect to any Loan
Party or any Borrowing Subsidiary under the Federal Bankruptcy Code, (A) the
obligation

                            364-Day Credit Agreement

<PAGE>
                                      -43-


of each Lender to make Advances shall automatically be terminated and (B) the
Advances, all such interest and all such amounts shall automatically become and
be due and payable, without presentment, protest or any notice of any kind, all
of which are hereby expressly waived by each Loan Party.

                                   ARTICLE VII

                                    THE AGENT

            Each of the Lenders hereby irrevocably appoints the Agent as its
agent and authorizes the Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Agent by the terms hereof, together
with such actions and powers as are reasonably incidental thereto.

            The bank serving as the Agent hereunder shall have the same rights
and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Agent, and such bank and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of business
with the Loan Parties or any Subsidiary or other Affiliate thereof as if it were
not the Agent hereunder.

            The Agent shall not have any duties or obligations except those
expressly set forth herein. Without limiting the generality of the foregoing,
(a) the Agent shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing, (b) the Agent
shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby that the Agent is required to exercise in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 8.01), and (c) except
as expressly set forth herein, the Agent shall not have any duty to disclose,
and shall not be liable for the failure to disclose, any information relating to
the Loan Parties or any if their Subsidiaries that is communicated to or
obtained by the bank serving as Agent or any of its Affiliates in any capacity.
The Agent shall not be liable for any action taken or not taken by it with the
consent or at the request of the Required Lenders (or such other number or
percentage of the Lenders as shall be necessary under the circumstances as
provided in Section 8.01) or in the absence of its own gross negligence or
wilful misconduct. The Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof is given to the Agent by a Loan
Party or a Lender, and the Agent shall not be responsible for or have any duty
to ascertain or inquire into (i) any statement, warranty or representation made
in or in connection with this Agreement, (ii) the contents of any certificate,
report or other document delivered hereunder or in connection herewith, (iii)
the performance or observance of any of the covenants, agreements or other terms
or conditions set forth herein, (iv) the validity, enforceability, effectiveness
or genuineness of this Agreement or any other agreement, instrument or document,
or (v) the satisfaction of any condition set forth in Article III or elsewhere
herein, other than to confirm receipt of items expressly required to be
delivered to the Agent.

            The Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other

                            364-Day Credit Agreement

<PAGE>
                                      -44-


writing believed by it to be genuine and to have been signed or sent by the
proper Person. The Agent also may rely upon any statement made to it orally or
by telephone and believed by it to be made by the proper Person, and shall not
incur any liability for relying thereon. The Agent may consult with legal
counsel (who may be counsel for any Loan Party), independent accountants and
other experts selected by it, and shall not be liable for any action taken or
not taken by it in accordance with the advice of any such counsel, accountants
or experts.

            The Agent may perform any and all of its duties and exercise its
rights and powers by or through any one or more sub-agents appointed by the
Agent. The Agent and any such sub-agent may perform any and all of its duties
and exercise its rights and powers through their respective Related Parties. The
exculpatory provisions of the preceding paragraphs shall apply to any such
sub-agent and to the Related Parties of the Agent and any such sub-agent, and
shall apply to their respective activities in connection with the syndication of
the credit facilities provided for herein as well as activities as Agent.

            Subject to the appointment and acceptance of a successor Agent as
provided in this paragraph, the Agent may resign at any time by notifying the
Lenders and the Company. Upon any such resignation, the Required Lenders shall
have the right to appoint a successor agent approved by the Company, which
approval will not be unreasonably withheld or delayed; provided that such
approval shall not be required if an Event of Default has occurred and is
continuing. If no successor shall have been so appointed by the Required Lenders
and shall have accepted such appointment within 30 days after the retiring Agent
gives notice of its resignation, then the retiring Agent may, on behalf of the
Lenders, appoint a successor Agent which shall be a commercial bank organized
under the laws of the United States or any State thereof, having a combined
capital and surplus of at least $50,000,000 with an office in New York, New
York, or an Affiliate of any such bank. Upon the acceptance of its appointments
as Agent hereunder by a successor, such successor shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Company to a successor Agent shall be the
same as those payable to its predecessor unless otherwise agreed between the
Company and such successor. After the Agent's resignation hereunder, the
provisions of this Article and Section 8.04 shall continue in effect for the
benefit of such retiring Agent, its sub-agents and their respective Related
Parties in respect of any actions taken or omitted to be taken by any of them
while it was acting as Agent.

            Each Lender acknowledges that it has, independently and without
reliance upon the Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Lender also acknowledges that it
will, independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it shall from time to time deem
appropriate, continue to make its own decisions in taking or not taking action
under or based upon this Agreement, any related agreement or any document
furnished hereunder or thereunder.

                            364-Day Credit Agreement

<PAGE>
                                      -45-


                                  ARTICLE VIII

                                  MISCELLANEOUS

      SECTION 8.01. Amendments, Etc. No amendment or waiver of any provision of
this Agreement, nor consent to any departure by any Borrower therefrom, shall in
any event be effective unless the same shall be in writing and signed by the
Required Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all the Lenders, do any of the following: (a) except pursuant to
Section 2.05(b), 2.05(c), 2.15 or 2.17, increase the Commitments of the Lenders
or subject the Lenders to any additional obligations, (b) reduce the principal
of, or interest on, the Revolving Credit Advances or any fees or other amounts
payable hereunder, (c) postpone any date fixed for any payment of principal of,
or interest on, the Revolving Credit Advances or any fees or other amounts
payable hereunder, (d) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Revolving Credit Advances, or the
number of Lenders, that shall be required for the Lenders or any of them to take
any action hereunder, (e) release the guarantee as set forth in Section 9.01 or
10.01, or (f) amend this Section 8.01; and provided further that no amendment,
waiver or consent shall, unless in writing and signed by the Agent in addition
to the Lenders required above to take such action, affect the rights or duties
of the Agent under this Agreement.

      SECTION 8.02. Notices, Etc. All notices and other communications provided
for hereunder shall be in writing (including telecopier, telegraphic or telex
communication) and mailed, telecopied, telegraphed, telexed or delivered, if to
the Company, any Borrower or the Guarantor, to the Company at its address at One
Pepsi Way, Somers, New York 10589, Attention: General Counsel, Telecopier No.
(914) 767-1161, with a copy to Secretary, Telecopier No. (914) 767-1161; if to
any Initial Lender, at its Domestic Lending Office specified opposite its name
on Schedule 1 hereto; if to any other Lender, at its Domestic Lending Office
specified in the Assignment and Acceptance pursuant to which it became a Lender;
and if to the Agent, at the Assignment and Acceptance pursuant to which it
became a Lender; and if to the Agent, at JPMorgan Chase Bank, Loan & Agency
Services, 1111 Fannin, Floor 10, Houston, Texas, 77002, Attention of Cherry
Arnaez (Telecopier No. (713) 750-2894), with a copy to JPMorgan Chase Bank, 270
Park Avenue, New York, New York 10017, Attention of Buddy Wuthrich (Telecopier
No. (212) 270-5127); or, as to the Company, any Borrower, the Guarantor or the
Agent, at such other address as shall be designated by such party in a written
notice to the other parties and, as to each other party, at such other address
as shall be designated by such party in a written notice to the Company and the
Agent. All such notices and communications shall, when mailed, telecopied,
telegraphed or telexed, be effective when deposited in the mails, telecopied,
delivered to the telegraph company or confirmed by telex answer back,
respectively, except that notices and communications to the Agent pursuant to
Article II, III or VII shall not be effective until received by the Agent.

                            364-Day Credit Agreement

<PAGE>
                                      -46-


      SECTION 8.03. No Waiver; Remedies. No failure on the part of any Lender or
the Agent to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right preclude any other or further exercise thereof or the exercise of any
other right. The remedies herein provided are cumulative and not exclusive of
any remedies provided by law.

      SECTION 8.04. Costs and Expenses.

            (a) The Company agrees to pay on demand all costs and expenses of
the Agent as set forth in the fee letter between the Company and the Agent. The
Company further agrees to pay on demand all reasonable costs and expenses of the
Agent and the Lenders, if any (including, without limitation, reasonable counsel
fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement and the other
documents to be delivered hereunder, including, without limitation, reasonable
fees and expenses of counsel for the Agent and each Lender in connection with
the enforcement of rights under this Section 8.04(a).

            (b) The Company agrees to indemnify and hold harmless the Agent and
each Lender and each of their Affiliates and their officers, directors,
employees, agents and advisors (each, an "Indemnified Party") from and against
any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of, or in connection with the
preparation for a defense of, any investigation, litigation or proceeding
arising out of, related to or in connection with this Agreement, any promissory
note issued hereunder, any of the transactions contemplated herein or the actual
or proposed use of the proceeds of the Advances, whether or not such
investigation, litigation or proceeding is brought by any Borrower, the
Guarantor, their directors, shareholders or creditors or an Indemnified Party or
any other Person or any Indemnified Party is otherwise a party thereto and
whether or not the transactions contemplated hereby are consummated, except to
the extent such claim, damage, loss, liability or expense is found in a final,
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's gross negligence or willful misconduct.

            (c) To the extent that the Company fails to pay any amount required
to be paid by it to the Agent under paragraph (a) or (b) of this Section 8.04,
each Lender severally agrees to pay to the Agent such Lenders' Applicable
Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the Agent in
its capacity as such.

            (d) If any payment of principal of, or Conversion of, any Eurodollar
Rate Advance or LIBO Rate Advance is made by any Borrower to or for the account
of a Lender other than on the last day of the Interest Period for such Advance,
as a result of a payment or Conversion pursuant to Section 2.08(d) or (e), 2.10
or 2.12, acceleration of the maturity of the Advances

                            364-Day Credit Agreement

<PAGE>
                                      -47-


pursuant to Section 6.01 or for any other reason, the Company shall, upon demand
by such Lender (with a copy of such demand to the Agent), pay to the Agent for
the account of such Lender any amounts required to compensate such Lender for
any additional losses, costs or expenses that it may reasonably incur as a
result of such payment or Conversion, including, without limitation, any loss,
cost or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by any Lender to fund or maintain such Advance.

            (e) Without prejudice to the survival of any other agreement of any
Borrower hereunder, the agreements and obligations of the Company contained in
Sections 2.11, 2.14 and 8.04 shall survive the payment in full of principal,
interest and all other amounts payable hereunder.

      SECTION 8.05. Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default and (ii) the making of the request or the
granting of the consent specified by Section 6.01 to authorize the Agent to
declare the Advances due and payable pursuant to the provisions of Section 6.01,
each Lender and each of its Affiliates is hereby authorized at any time and from
time to time, to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held and other indebtedness at any time owing by such Lender or such
Affiliate to or for the credit or the account of any Loan Party or any Borrower
against any and all of the obligations of such Loan Party or such Borrower now
or hereafter existing under this Agreement, whether or not such Lender shall
have made any demand under this Agreement and although such obligations may be
unmatured. Each Lender agrees promptly to notify the Company after any such
set-off and application, provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender
and its Affiliates under this Section are in addition to other rights and
remedies (including, without limitation, other rights of set-off) that such
Lender and its Affiliates may have.

      SECTION 8.06. Binding Effect. This Agreement shall become effective (other
than Sections 2.01 and 2.03, which shall only become effective upon satisfaction
of the conditions precedent set forth in Section 3.01) when it shall have been
executed by the Loan Parties and the Agent and when the Agent shall have been
notified by each Initial Lender that such Initial Lender has executed it and
thereafter shall be binding upon and inure to the benefit of the Loan Parties,
each Subsidiary Borrower (if any), the Agent and each Lender and their
respective successors and assigns, except that no Borrower shall have the right
to assign its rights hereunder or any interest herein without the prior written
consent of the Lenders.

      SECTION 8.07. Assignments and Participations.

            (a) Each Lender may, upon ten days' notice to the Agent and with the
consent of the Company (which shall not be unreasonably withheld) and, if
demanded by the Company (following a demand by such Lender pursuant to Section
2.11 or Section 2.14 or a suspension of such Lender's obligation to make or
continue Advances as, or convert Advances into, Eurodollar Rate Advances
pursuant to Section 2.12) upon at least ten days' notice to such Lender and the

                            364-Day Credit Agreement

<PAGE>
                                      -48-


Agent, will assign to one or more Persons all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment and the Revolving Credit Advances owing to it);
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of all rights and obligations under this Agreement (other
than any right to make Competitive Bid Advances or Competitive Bid Advances
owing to it), (ii) except in the case of an assignment to a Person that,
immediately prior to such assignment, was a Lender or an assignment of all of a
Lender's rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than the lesser of (x)
$25,000,000 and (y) the smallest initial Commitment of any Initial Lender, (iii)
each such assignment shall be to an Eligible Assignee, (iv) each such assignment
made as a result of a demand by the Company pursuant to this Section 8.07(a)
shall be arranged by the Company after consultation with the Agent and shall be
either an assignment of all of the rights and obligations of the assigning
Lender under this Agreement or an assignment of a portion of such rights and
obligations made concurrently with another such assignment or other such
assignments that together cover all of the rights and obligations of the
assigning Lender under this Agreement, (v) no Lender shall be obligated to make
any such assignment as a result of a demand by the Company pursuant to this
Section 8.07(a) unless and until such Lender shall have received one or more
payments from either the Company or one or more Eligible Assignees in an
aggregate amount at least equal to the aggregate outstanding principal amount of
the Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount and all other amounts payable to such
Lender under this Agreement and (vi) the parties to each such assignment shall
execute and deliver to the Agent, for its acceptance and recording in the
Register (as defined in clause (d) below), an Assignment and Acceptance,
together with a processing and recordation fee of $3,500. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in each Assignment and Acceptance, (x) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).

            (b) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of any
Borrower or the performance or observance by any Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this

                            364-Day Credit Agreement

<PAGE>
                                      -49-


Agreement, together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such assigning Lender or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement; (v) such assignee confirms that it is an Eligible Assignee; (vi)
such assignee appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers and discretion under this Agreement as
are delegated to the Agent by the terms hereof, together with such powers and
discretion as are reasonably incidental thereto; and (vii) such assignee agrees
that it will perform in accordance with their terms all of the obligations that
by the terms of this Agreement are required to be performed by it as a Lender.

            (c) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee representing that it is an Eligible Assignee,
the Agent shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit B hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Company.

            (d) The Agent shall maintain at its address referred to in Section
8.02 a copy of each Assignment and Acceptance delivered to and accepted by it
and a register for the recordation of the names and addresses of the Lenders
and, with respect to Lenders, the Commitment of, and principal amount of the
Advances owing to, each Lender from time to time (the "Register"). The entries
in the Register shall be conclusive and binding for all purposes, absent
manifest error, and each Borrower, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Loan Parties or any Lender at any reasonable time and from time to time upon
reasonable prior notice.

            (e) Notwithstanding anything to the contrary contained herein, any
Lender (a "Granting Lender") may grant to a special purpose funding vehicle (a
"SPC"), identified as such in writing from time to time by the Granting Lender
to the Agent and the Company, the option to provide to the Company all or any
part of any Advance that such Granting Lender would otherwise be obligated to
make to the Company pursuant to this Agreement; provided that (i) nothing herein
shall constitute a commitment by any SPC to make any Advance, (ii) if an SPC
elects not to exercise such option or otherwise fails to provide all or any part
of such Advance, the Granting Lender shall be obligated to make such Advance
pursuant to the terms hereof. The making of an Advance by an SPC hereunder shall
utilize the Commitment of the Granting Lender to the same extent, and as if,
such Advance were made by such Granting Lender. Each party hereto agrees that no
SPC shall be liable for any indemnity or similar payment obligation under this
Agreement (all liability for which shall remain with the Granting Lender). In
furtherance of the foregoing, each party hereto hereby agrees (which agreement
shall survive the termination of this Agreement) that, prior to the date that is
one year and one day after the payment in full of all outstanding commercial
paper or other senior indebtedness of any SPC, it will not institute against, or
join any other person in instituting against, such SPC any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under the
laws

                            364-Day Credit Agreement

<PAGE>
                                      -50-


of the United States or any State thereof. In addition, notwithstanding anything
to the contrary contained in this Section 8.07(e), any SPC may (i) with notice
to, but without the prior written consent of, the Company and the Agent and
without paying any processing fee therefor, assign all or a portion of its
interests in any Advances to the Granting Lender or to any financial
institutions (consented to by the Company and the Agent) providing liquidity
and/or credit support to or for the account of any SPC to support the funding or
maintenance of Advances and (ii) disclose on a confidential basis any non-public
information relating to its Advances to any rating agency, commercial paper
dealer or provider of any surety, guarantee or credit or liquidity enhancement
to such SPC.

            (f) Each Lender may, upon notice to the Agent and the Company, sell
participations to one or more banks or other entities in or to all or a portion
of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment and the Advances owing to it);
provided, however, that (i) such Lender's obligations under this Agreement
(including, without limitation, its Commitment hereunder) shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations, (iii) such Lender shall remain
the holder of any promissory note issued or assigned to it hereunder, (iv) the
Borrowers, the Guarantor, the Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement and (v) no participant under any such
participation shall have any right to approve any amendment or waiver of any
provision of this Agreement, or any consent to any departure by any Borrower
therefrom, except to the extent that such amendment, waiver or consent would
reduce the principal of, or interest on, the Advances or any fees or other
amounts payable hereunder, in each case to the extent subject to such
participation, or postpone any date fixed for any payment of principal of, or
interest on, the Advances or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation.

            (g) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to any Loan Party or any Borrower furnished
to such Lender by or on behalf of any Loan Party or any Borrower; provided that,
prior to any such disclosure, the assignee or participant or proposed assignee
or participant shall agree to preserve the confidentiality of any Confidential
Information relating to the Loan Parties or the Borrowers received by it from
such Lender.

            (h) Notwithstanding any other provision set forth in this Agreement,
any Lender may at any time create a security interest in all or any portion of
its rights under this Agreement or any promissory note issued to such Lender
hereunder (including, without limitation, the Advances owing to it) in favor of
any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.

                            364-Day Credit Agreement

<PAGE>
                                      -51-


      SECTION 8.08. Confidentiality. Neither the Agent nor any Lender shall
disclose any Confidential Information to any Person without the consent of the
Company, other than (a) to the Agent's or such Lender's Affiliates and their
officers, directors, employees, agents and advisors and to actual or prospective
assignees and participants, and then only on a confidential basis, (b) as
required by any law, rule or regulation or judicial process, (c) to any rating
agency when required by it and (d) as requested or required by any state,
federal or foreign authority or examiner regulating banks or banking.
Notwithstanding the foregoing and any other provision herein, the Loan Parties
and any Lender (and each employee, representative or other agent of the Loan
Parties and any Lender) may disclose to any and all Persons, without limitation
of any kind, the U.S. federal income tax treatment and tax structure, if any, of
the transactions contemplated by this Agreement (the "Transactions"), other than
information for which nondisclosure is reasonably necessary in order to comply
with applicable securities laws. For the purposes of this Section 8.08, "tax
structure" is limited to any fact relevant to understanding the U.S. federal
income tax treatment of the Transactions and does not include information
relating to the identity of the Loan Parties.

      SECTION 8.09. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.

      SECTION 8.10. Execution in Counterparts. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed counterpart of
this Agreement.

      SECTION 8.11. Jurisdiction, Etc.

            (a) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement, or for
recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement in the courts of any jurisdiction.

                            364-Day Credit Agreement

<PAGE>
                                      -52-


            (b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement in any New
York State or federal court sitting in New York City. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

      SECTION 8.12. WAIVER OF JURY TRIAL. EACH BORROWER, THE GUARANTOR, THE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF THE
AGENT OR ANY LENDER IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR
ENFORCEMENT THEREOF.

                                   ARTICLE IX

                                COMPANY GUARANTEE

      SECTION 9.01. Company Guarantee. Subject to the provisions of this Article
IX, the Company unconditionally and irrevocably guarantees to each Lender and
the Agent and their respective successors and assigns, that: (i) the principal
of, premium, if any, and interest on the Advances to each Borrowing Subsidiary
and, following the Substitution Date, the Guarantor (each a "Guaranteed Party")
and any promissory notes issued by any Guaranteed Party hereunder will be duly
and punctually paid in full when due, whether at maturity, by acceleration, by
redemption or otherwise, and interest on overdue principal, and premium, if any,
and (to the extent permitted by law) interest on any interest, if any, on the
Advances and all other obligations of the Guaranteed Parties to the Lenders or
the Agent hereunder (including fees and expenses) will be promptly paid in full,
all in accordance with the terms hereof; and (ii) in case of any extension of
time of payment or renewal of any of the Advances to any Guaranteed Party or any
of such other obligations, the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise. Failing payment when due of any
amount so guaranteed, or failing performance of any other obligation of the
Guaranteed Parties to the Lenders or the Agent, for whatever reason, the Company
will be obligated to pay, or to perform or to cause the performance of, the same
immediately. An Event of Default under this Agreement shall constitute an event
of default under this Guarantee, and shall entitle the Lenders to accelerate the
obligations of the Company under this Guarantee in the same manner and to the
same extent as the obligations of the Guaranteed Parties.

            The Company hereby agrees that its obligations under this Guarantee
shall be unconditional, irrespective of the validity, regularity or
enforceability of this Agreement, any Designation Letter or the Substitution
Letter, the absence of any action to enforce the same, any waiver or consent by
any Lender or the Agent of this Agreement any Designation Letter or the

                            364-Day Credit Agreement

<PAGE>
                                      -53-


Substitution Letter, with respect to any thereof, the entry of any judgment
against any Guaranteed Party, any action to enforce the same or any other
circumstance which might otherwise constitute a legal or equitable discharge or
defense of the Company. The Company hereby waives and relinquishes: (a) any
right to require the Agent, the Lenders or any Guaranteed Party (each, a
"Benefitted Party") to proceed against any Guaranteed Party or any other Person
or to proceed against or exhaust any security held by a Benefitted Party at any
time or to pursue any other remedy in any secured party's power before
proceeding against the Company; (b) any defense that may arise by reason of the
incapacity, lack of authority, death or disability of any other Person or
Persons or the failure of a Benefitted Party to file or enforce a claim against
the estate (in administration, bankruptcy or any other proceeding) of any other
Person or Persons; (c) demand, protest and notice of any kind (except as
expressly required by this Agreement), including but not limited to notice of
the existence, creation or incurring of any new or additional Debt or obligation
or of any action or non-action on the part of the Company, any Benefitted Party,
any creditor of the Company or any Guaranteed Party or on the part of any other
Person whomsoever in connection with any obligations the performance of which
are guaranteed under this Guarantee; (d) any defense based upon an election of
remedies by a Benefitted Party, including but not limited to an election to
proceed against the Company or any other Guaranteed Party for reimbursement; (e)
any defense based upon any statute or rule of law which provides that the
obligation of a surety must be neither larger in amount nor in other respects
more burdensome than that of the principal; (f) any defense arising because of a
Benefitted Party's election, in any proceeding instituted under the Bankruptcy
Code, of the application of Section 1111(b)(2) of the Bankruptcy Code; and (g)
any defense based on any borrowing or grant of a security interest under Section
364 of the Bankruptcy Code. The Company hereby covenants that this Guarantee
will not be discharged except by payment in full of all principal, premium, if
any, and interest on the Advances made to each Guaranteed Party and all other
costs provided for under this Agreement in respect thereof. This is a Guarantee
of payment and not of collectibility.

            If any Lender or the Agent is required by any court or otherwise to
return to either the Company or any Guaranteed Party, or any trustee or similar
official acting in relation to either the Company or any Guaranteed Party, any
amount paid by the Company or any Guaranteed Party to the Agent or such Lender,
this Guarantee, to the extent theretofore discharged, shall be reinstated in
full force and effect. The Company agrees that it will not be entitled to any
right of subrogation in relation to the Lenders or the Agent in respect of any
obligations guaranteed under this Guarantee until payment in full of all
obligations guaranteed hereby. The Company agrees that, as between it, on the
one hand, and the Lenders and the Agent, on the other hand, (x) the maturity of
the obligations guaranteed under this Guarantee may be accelerated as provided
in Article VI hereof for the purposes hereof, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any acceleration of such
obligations as provided in Article VI hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by such Company for the
purpose of this Guarantee.

                            364-Day Credit Agreement

<PAGE>
                                      -54-


                                    ARTICLE X

                              SUBSIDIARY GUARANTEE

      SECTION 10.01. Subsidiary Guarantee. Subject to the provisions of this
Article X, the Guarantor unconditionally and irrevocably guarantees to each
Lender and the Agent and their respective successors and assigns, that: (i) the
principal of, premium, if any, and interest on the Advances and any promissory
note issued hereunder will be duly and punctually paid in full when due, whether
at maturity, by acceleration, by redemption or otherwise, and interest on
overdue principal, and premium, if any, and (to the extent permitted by law)
interest on any interest, if any, on the Advances, any promissory note issued
hereunder and all other obligations of the Company to the Lenders or the Agent
hereunder (including fees and expenses) will be promptly paid in full, all in
accordance with the terms hereof; and (ii) in case of any extension of time of
payment or renewal of any of the Advances or any of such other obligations, the
same will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise. Failing payment when due of any amount so guaranteed, or failing
performance of any other obligation of the Company to the Lenders or the Agent,
for whatever reason, the Guarantor will be obligated to pay, or to perform or to
cause the performance of, the same immediately. An Event of Default under this
Agreement shall constitute an event of default under this Guarantee, and shall
entitle the Lenders to accelerate the obligations of the Guarantor under this
Guarantee in the same manner and to the same extent as the obligations of the
Company.

            The Guarantor hereby agrees that its obligations under this
Guarantee shall be unconditional, irrespective of the validity, regularity or
enforceability of this Agreement, the absence of any action to enforce the same,
any waiver or consent by any Lender or the Agent of this Agreement with respect
to any thereof, the entry of any judgment against the Company, any action to
enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of the Guarantor. The Guarantor hereby
waives and relinquishes: (a) any right to require the Agent, the Lenders or the
Company (each, a "Benefitted Person") to proceed against the Company or any
other Person or to proceed against or exhaust any security held by a Benefitted
Person at any time or to pursue any other remedy in any secured party's power
before proceeding against the Guarantor; (b) any defense that may arise by
reason of the incapacity, lack of authority, death or disability of any other
Person or Persons or the failure of a Benefitted Person to file or enforce a
claim against the estate (in administration, bankruptcy or any other proceeding)
of any other Person or Persons; (c) demand, protest and notice of any kind
(except as expressly required by this Agreement), including but not limited to
notice of the existence, creation or incurring of any new or additional Debt or
obligation or of any action or non-action on the part of the Guarantor, the
Company, any Benefitted Person, any creditor of the Guarantor, the Company or on
the part of any other Person whomsoever in connection with any obligations the
performance of which are guaranteed under this Guarantee; (d) any defense based
upon an election of remedies by a Benefitted Person, including but not limited
to an election to proceed against the Guarantor for reimbursement; (e) any
defense based upon any statute or rule of law which provides that the obligation
of a surety must be neither larger in amount nor in other respects more
burdensome than that of the principal; (f) any defense arising because of a
Benefitted Person's election, in any proceeding instituted under the Bankruptcy
Code, of the

                            364-Day Credit Agreement

<PAGE>
                                      -55-


application of Section 1111(b)(2) of the Bankruptcy Code; and (g) any defense
based on any borrowing or grant of a security interest under Section 364 of the
Bankruptcy Code. The Guarantor hereby covenants that this Guarantee will not be
discharged except by payment in full of all principal, premium, if any, and
interest on the Advances and all other costs provided for under this Agreement.
This is a Guarantee of payment and not of collectibility.

            If any Lender or the Agent is required by any court or otherwise to
return to either the Company or the Guarantor, or any trustee or similar
official acting in relation to either the Company or the Guarantor, any amount
paid by the Company or the Guarantor to the Agent or such Lender, this
Guarantee, to the extent theretofore discharged, shall be reinstated in full
force and effect. The Guarantor agrees that it will not be entitled to any right
of subrogation in relation to the Lenders or the Agent in respect of any
obligations guaranteed under this Guarantee until payment in full of all
obligations guaranteed hereby. The Guarantor agrees that, as between it, on the
one hand, and the Lenders and the Agent, on the other hand, (x) the maturity of
the obligations guaranteed under this Guarantee may be accelerated as provided
in Article VI hereof for the purposes hereof, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (y) in the event of any acceleration of such
obligations as provided in Article VI hereof, such obligations (whether or not
due and payable) shall forthwith become due and payable by such Guarantor for
the purpose of this Guarantee.

      SECTION 10.02. Limitation of Guarantor's Liability. The Guarantor, and by
its acceptance hereof, each Lender, hereby confirms that it is the intention of
the parties hereto that this Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or
State law. To effectuate the foregoing intention, the Lenders and the Guarantor
hereby irrevocably agree that the obligations of the Guarantor under this
Article X shall be limited to the maximum amount as will, after giving effect to
all other contingent and fixed liabilities of the Guarantor, result in the
obligations of the Guarantor under the Guarantee not constituting a fraudulent
transfer or conveyance under federal or state law.

                            364-Day Credit Agreement

<PAGE>

      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first above written.

                                        THE PEPSI BOTTLING GROUP, INC.,
                                        as Borrower

                                        By:_____________________________________
                                           Name:
                                           Title:


                                        BOTTLING GROUP, LLC,
                                        as Guarantor

                                        By:_____________________________________
                                           Name:
                                           Title:


                                        JPMORGAN CHASE BANK,
                                        as Agent

                                        By:_____________________________________
                                           Name:
                                           Title:

                            364-Day Credit Agreement

<PAGE>

<TABLE>
<CAPTION>
COMMITMENT                              INITIAL LENDERS
- ----------                              ---------------
<S>                                     <C>
$25,000,000                             CITIBANK, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             BANK OF AMERICA, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             CREDIT SUISSE FIRST BOSTON,
                                        CAYMAN ISLANDS BRANCH

                                        By:_____________________________________
                                          Name:
                                          Title:


$25,000,000                             DEUTSCHE BANK AG NEW YORK BRANCH

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                Initial Lenders

<PAGE>
                                      -2-


<TABLE>
<S>                                     <C>
$25,000,000                             JPMORGAN CHASE BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$20,000,000                             THE NORTHERN TRUST COMPANY

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$20,000,000                             LEHMAN BROTHERS BANK, FSB

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                Initial Lenders

<PAGE>
                                      -3-


<TABLE>
<S>                                     <C>
$17,500,000                             BANCO BILBAO VIZCAYA ARGENTARIA

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$17,500,000                             HSBC BANK USA

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$12,500,000                             FLEET NATIONAL BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                Initial Lenders

<PAGE>
                                      -4-


<TABLE>
<S>                                     <C>
$12,500,000                             THE BANK OF NEW YORK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$10,000,000                             STATE STREET BANK AND TRUST COMPANY

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:


$7,500,000                              COMERICA BANK

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

                                Initial Lenders

<PAGE>
                                      -5-


<TABLE>
<S>                                     <C>
$7,500,000                              WELLS FARGO BANK, N.A.

                                        By:_____________________________________
                                          Name:
                                          Title:

                                        By:_____________________________________
                                          Name:
                                          Title:
</TABLE>

$250,000,000 TOTAL OF THE COMMITMENTS

                                Initial Lenders

<PAGE>

                                                                      SCHEDULE 1

                                 LENDING OFFICES

<TABLE>
<CAPTION>
Lender                           Domestic Lending Office                   Eurodollar Lending Office
<S>                              <C>                                       <C>
CITIBANK, N.A.                   399 Park Avenue                           399 Park Avenue
                                 New York New York 10043                   New York New York 10043

BANK OF AMERICA, N.A             901 Main Street, 14th Floor               901 Main Street, 14th Floor
                                 Dallas, Texas 75202                       Dallas, Texas 75202

CREDIT SUISSE  FIRST             11 Madison Avenue                         Credit Suisse First Boston
BOSTON, CAYMAN ISLANDS           New York, New York, 10010                 Cayman Islands Branch
BRANCH                                                                     c/-11 Madison Avenue
                                                                           New York, New York 10010

DEUTSCHE BANK AG NEW             90 Hudson Street                          90 Hudson Street
YORK BRANCH                      Mailstop JCY05-0511                       Mailstop JCY05-0511
                                 Jersey City, NJ 07302                     Jersey City, NJ 07302

JPMORGAN CHASE BANK              270 Park Avenue                           270 Park Avenue
                                 New York, New York 10017                  New York,  New York 10017

THE NORTHERN TRUST               50 South La Salle Street                  50 South La Salle Street
COMPANY                          Chicago, Illinois 60675                   Chicago, Illinois 60675

LEHMAN BROTHERS BANK, FSB        745 7th Avenue, 16th Floor                745 7th Avenue, 16th Floor
                                 New York, NY  10019                       New York, NY  10019

BANCO BILBAO VIZCAYA             1345 Avenue of the Americas               1345 Avenue of the Americas
ARGENTARIA                       New York, New York 10105                  New York, New York 10105

HSBC BANK USA                    452 Fifth Avenue                          452 Fifth Avenue
                                 New York, New York 10018                  New York, New York 10018

FLEET NATIONAL BANK              One Landmark Sq.                          One Landmark Sq.
                                 Stamford, Connecticut 06904               Stamford, Connecticut 06904

THE BANK OF NEW YORK             One Wall Street                           One Wall Street
                                 New York, New York 10286                  New York, New York 10286

STATE STREET BANK AND            225 Franklin Street                       225 Franklin Street
TRUST COMPANY                    Boston, MA 02110                          Boston, MA 02110

COMERICA BANK                    500 Woodward Avenue, 9th Floor            500 Woodward Avenue, 9th Floor
                                 MC 3279                                   MC 3279
                                 Detroit, Michigan 48275-3279              Detroit, Michigan 48275-3279

WELLS FARGO BANK, N.A.           70 E. 55th Street                         70 E. 55th Street
                                 New York, New York 10022                  New York, New York 10022
</TABLE>

                                   Schedule 1

<PAGE>

                                                                      SCHEDULE 2

                                PRICING SCHEDULE

<TABLE>
<CAPTION>
                                                                                     Term Out             Applicable
                           Applicable Facility                                      Applicable          Utilization Fee
Rating Level Period             Fee Rate               Applicable Margin              Margin                Rate(1)
- -------------------             --------               -----------------              ------                -------
<S>                        <C>                         <C>                          <C>                 <C>
         1                         6.0 bps                   29.0 bps                70.0 bps               10.0 bps

         2                         7.0 bps                   33.0 bps                75.0 bps               10.0 bps

         3                        10.0 bps                   40.0 bps                85.0 bps               10.0 bps

         4                        15.0 bps                   47.5 bps                97.5 bps               10.0 bps

         5                        20.0 bps                   80.0 bps               150.0 bps               25.0 bps
</TABLE>

- ----------
(1)   Applicable if utilization exceeds 33-1/3% of Commitment amount.

                                   Schedule 2

<PAGE>

                                                                     EXHIBIT A-1

                  FORM OF NOTICE OF REVOLVING CREDIT BORROWING

JPMorgan Chase Bank, as Agent
   for the Lenders parties
   to the 364-Day Credit Agreement
   referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                             [Date]

Ladies and Gentlemen:

            The undersigned, The Pepsi Bottling Group, Inc. (the "Company"),
refers to the 364-Day Credit Agreement, dated as of April 30, 2003 (as amended
or modified from time to time, the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, Bottling Group,
LLC (the "Guarantor"), certain Lenders parties thereto and JPMorgan Chase Bank,
as administrative agent for said Lenders, and hereby gives you notice,
irrevocably, pursuant to Section 2.02 of the Credit Agreement that the
undersigned hereby requests a Revolving Credit Borrowing under the Credit
Agreement, and in that connection sets forth below the information relating to
such Revolving Credit Borrowing (the "Proposed Revolving Credit Borrowing") as
required by Section 2.02(a) of the Credit Agreement:

      (i) The Business Day of the Proposed Revolving Credit Borrowing is
      __________, ____.

      (ii) The Type of Advances comprising the Proposed Revolving Credit
      Borrowing is [Base Rate Advances] [Eurodollar Rate Advances].

      (iii) The aggregate amount of the Proposed Revolving Credit Borrowing is
      $______.

      (iv) The identity of the Borrower is __________, a ____________
      corporation.

      [(v)] [The initial Interest Period for each Eurodollar Rate Advance made
      as part of the Proposed Revolving Credit Borrowing is ___ month[s].]

                  Form of Notice of Revolving Credit Borrowing

<PAGE>
                                      -2-


            The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed Revolving
Credit Borrowing:

      (A) the representations and warranties contained in Section 4.01 of the
Credit Agreement (except the representations set forth in the last sentence of
subsection (e) thereof and in subsection (f) thereof (other than clause (ii)
thereof)) are correct in all material respects, on and as of the date of the
Proposed Revolving Credit Borrowing, before and after giving effect to the
Proposed Revolving Credit Borrowing and to the application of the proceeds
therefrom, as though made on and as of such date; and

      (B) no event has occurred and is continuing, or would result from such
Proposed Revolving Credit Borrowing or from the application of the proceeds
therefrom, that constitutes a Default.

                                        Very truly yours,

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:

                  Form of Notice of Revolving Credit Borrowing

<PAGE>

                                                                     EXHIBIT A-2

                   FORM OF NOTICE OF COMPETITIVE BID BORROWING

JPMorgan Chase Bank, as Agent
   for the Lenders parties
   to the 364-Day Credit Agreement
   referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                             [Date]

Ladies and Gentlemen:

            The undersigned, The Pepsi Bottling Group, Inc. (the "Company"),
refers to the 364-Day Credit Agreement, dated as of April 30, 2003 (as amended
or modified from time to time, the "Credit Agreement", the terms defined therein
being used herein as therein defined), among the undersigned, Bottling Group,
LLC (the "Guarantor"), certain Lenders parties thereto and JPMorgan Chase Bank,
as administrative agent for said Lenders, and hereby gives you notice pursuant
to Section 2.03 of the Credit Agreement that the undersigned hereby requests a
Competitive Bid Borrowing under the Credit Agreement, and in that connection
sets forth the terms on which such Competitive Bid Borrowing (the "Proposed
Competitive Bid Borrowing") is requested to be made:

            (A)      Date of Proposed
                     Competitive Bid Borrowing               ___________________
            (B)      Aggregate Amount of Proposed
                     Competitive Bid Borrowing               ___________________
            (C)      Maturity Date                           ___________________
            (D)      Interest Rate Basis                     ___________________
            (E)      Interest Payment Date(s)                ___________________
            (F)      Identity of Borrower                    ___________________

            The undersigned hereby certifies that the following statements are
true on the date hereof, and will be true on the date of the Proposed
Competitive Bid Borrowing:

                   Form of Notice of Competitive Bid Borrowing

<PAGE>
                                      -2-


            (a) the representations and warranties contained in Section 4.01
      (except the representations set forth in the last sentence of subsection
      (e) thereof and in subsection (f) thereof (other than clause (ii)
      thereof)) are correct in all material respects, on and as of the date of
      the Proposed Competitive Bid Borrowing, before and after giving effect to
      the Proposed Competitive Bid Borrowing and to the application of the
      proceeds therefrom, as though made on and as of such date; and

            (b) no event has occurred and is continuing, or would result from
      the Proposed Competitive Bid Borrowing or from the application of the
      proceeds therefrom, that constitutes a Default.

            The undersigned hereby confirms that the Proposed Competitive Bid
Borrowing is to be made available to it in accordance with Section 2.03(b) of
the Credit Agreement.

                                        Very truly yours,

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By:_____________________________________
                                           Name:
                                           Title:

                   Form of Notice of Competitive Bid Borrowing

<PAGE>

                                                                     EXHIBIT A-3

                           FORM OF EXTENSION AGREEMENT

The Pepsi Bottling Group, Inc.
One Pepsi Way
Somers, New York 10589
Attention: Treasurer

JPMorgan Chase Bank, as Agent
  under the 364-Day Credit Agreement referred to below
Loan & Agency Services
1111 Fannin, Floor 10
Houston, TX 77002
Attention: Cherry Arnaez

With a copy to:
270 Park Avenue
New York, NY 10017
Attention: Buddy Wuthrich

                                                             [DATE]

Ladies and Gentlemen:

            Each undersigned Lender hereby agrees to extend, effective on
[insert effective date, which shall be no more than 29 days prior to the
existing Termination Date] (the "Extension Date"), the Termination Date under
the 364-Day Credit Agreement dated as of April 30, 2003 (as the same may be
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement") among The Pepsi Bottling Group, Inc., Bottling Group, LLC, the
Lenders and agents party thereto and JPMorgan Chase Bank, as administrative
agent for the Lenders, to __________ [364 days from the effective date of this
Extension Agreement]. Terms defined in the Credit Agreement are used herein as
therein defined.

            This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument.

                [Remainder of this page intentionally left blank]

                           Form of Extension Agreement

<PAGE>

                                                                       EXHIBIT B

                        FORM OF ASSIGNMENT AND ACCEPTANCE

            Reference is made to the 364-Day Credit Agreement dated as of April
30, 2003 (as amended or modified from time to time, the "Credit Agreement"),
among THE PEPSI BOTTLING GROUP, INC., a Delaware corporation (the "Company"),
Bottling Group, LLC (the "Guarantor"), the Lenders (as defined in the Credit
Agreement) and JPMorgan Chase Bank, as administrative agent for the Lenders (the
"Agent"). Terms defined in the Credit Agreement are used herein with the same
meaning.

            The "Assignor" and the "Assignee" referred to on Schedule 1 hereto
agree as follows:

            (1) The Assignor hereby sells and assigns to the Assignee, and the
Assignee hereby purchases and assumes from the Assignor, an interest in and to
the Assignor's rights and obligations under the Credit Agreement as of the date
hereof (other than in respect of Competitive Bid Advances) equal to the
percentage interest specified on Schedule 1 hereto of all outstanding rights and
obligations under the Credit Agreement (other than in respect of Competitive Bid
Advances). After giving effect to such sale and assignment, the Assignee's
Commitment and the amount of the Revolving Credit Advances owing to the Assignee
will be as set forth on Schedule 1 hereto.

            (2) The Assignor (i) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto; and (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Company or the performance or observance by the
Company of any of its obligations or the obligations of any Borrower under the
Credit Agreement or any other instrument or document furnished pursuant thereto.

            (3) The Assignee (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred to
in Section 4.01 thereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor or any other Lender and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv)
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under the Credit Agreement as are
delegated to the Agent by the terms thereof, together with such powers and
discretion as are reasonably incidental thereto; (v) agrees that it will perform
in accordance with their terms all of the obligations that by the terms of the
Credit Agreement are required to be performed by it as a Lender; and (vi)

                        Form of Assignment and Acceptance

<PAGE>
                                      -2-


attaches any U.S. Internal Revenue Service forms required under Section 2.14 of
the Credit Agreement.

            (4) Following the execution of this Assignment and Acceptance, it
will be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1 hereto.

            (5) Upon such acceptance and recording by the Agent, as of the
Effective Date, (i) the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and (ii) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its rights and be
released from its obligations under the Credit Agreement.

            (6) Upon such acceptance and recording by the Agent, from and after
the Effective Date, the Agent shall make all payments under the Credit Agreement
in respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and facility fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement for periods prior to the Effective Date
directly between themselves.

            (7) This Assignment and Acceptance shall be governed by, and
construed in accordance with, the law of the State of New York.

            (8) This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.

            IN WITNESS WHEREOF, the Assignor and the Assignee have caused
Schedule 1 to this Assignment and Acceptance to be executed by their officers
thereunto duly authorized as of the date specified thereon.

<PAGE>

                                   Schedule 1
                                       to
                            Assignment and Acceptance

Percentage interest assigned:                                              ___%

Assignee's Commitment:                                              $__________

Aggregate outstanding principal
amount of Revolving Credit Advances assigned:                       $__________

Effective Date(2):                                           ____________, ____

                                        [NAME OF ASSIGNOR], as Assignor

                                        By
                                        Title:

                                        Dated:                         ,


                                        [NAME OF ASSIGNEE], as Assignee

                                        By
                                        Title:

                                        Dated:                         ,

                                        Domestic Lending Office:
                                                [Address]

                                        Eurodollar Lending Office:
                                                [Address]

- ----------
(2)   This date should be no earlier than five Business Days after the delivery
      of this Assignment and Acceptance to the Agent.

                    Schedule 1 to Assignment and Acceptance

<PAGE>
                                      -2-


Accepted and Approved this
____ day of ________, ____

JPMORGAN CHASE BANK, as Agent

By: ___________________________________
    Name:
    Title:

Approved this ____ day
of ________, ____


THE PEPSI BOTTLING GROUP, INC.

By: ___________________________________
    Name:
    Title:

                    Schedule 1 to Assignment and Acceptance

<PAGE>

                                                                       EXHIBIT C

            FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY AND THE
                                   GUARANTOR

                                                                [Effective Date]

To each of the Lenders parties
to the 364-Day Credit Agreement dated
as of April 30, 2003
among The Pepsi Bottling Group, Inc.,
said Lenders and JPMorgan Chase Bank,
as Agent for said Lenders, and
to JPMorgan Chase Bank, as Agent

                         The Pepsi Bottling Group, Inc.

Ladies and Gentlemen:

            This opinion is furnished to you pursuant to Section 3.01(g)(v) of
the 364-Day Credit Agreement, dated as of April 30, 2003 (the "Credit
Agreement"), among The Pepsi Bottling Group, Inc. (the "Company"), Bottling
Group, LLC, (the "Guarantor"), the Lenders parties thereto and JPMorgan Chase
Bank, as Agent for said Lenders, providing for extensions of credit to be made
by said Lenders to the Company in an aggregate principal amount at any one time
outstanding of up to $250,000,000. Terms defined in the Credit Agreement are
used herein as therein defined.

            I am the General Counsel of the Company and have acted as counsel to
the Company and the Guarantor in connection with the Credit Agreement. In
connection with this opinion, I have examined:

            (1) The Credit Agreement.

            (2) The documents furnished by the Company and the Guarantor
pursuant to subsections 3.01(g)(i)-(iv) of the Credit Agreement.

            (3) The Articles of Incorporation of the Company and all amendments
thereto (the "Charter").

            (4) The by-laws of the Company and all amendments thereto (the
"By-laws").

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>
                                      -2-


            (5) A certificate of the Secretary of State of Delaware, dated
_______________, 2003, attesting to the continued corporate existence and good
standing of the Company in that State.

            (6) The Amended and Restated Limited Liability Company Agreement of
the Guarantor, dated as of March 30, 1999, and all amendments thereto (the "LLC
Agreement").

            (7) The Certificate of Formation of the Guarantor and all amendments
thereto (the "Certificate of Formation").

            (8) A certificate of the Secretary of State of Delaware dated
_________, 2003, attesting to the continued existence and good standing of the
Guarantor in that State.

            (9) Resolutions of the Board of Directors of the Company adopted on
April 26, 1999 and September 5, 2002.

            (10) Resolutions of the Managing Directors of the Guarantor adopted
on June 4, 1999.

            In addition, I have examined the originals, or copies certified or
otherwise identified to my satisfaction, of such other corporate records of the
Company and the Guarantor, certificates of public officials and of officers of
the Company and the Guarantor, and agreements, instruments and other documents,
as I have deemed necessary as a basis for the opinions expressed below. I have
assumed the due execution and delivery, pursuant to due authorization, of the
Credit Agreement by the Initial Lenders and the Agent.

            The opinions expressed below are limited to the law of the State of
New York, the Delaware corporate law, the Federal law of the United States and,
with respect to paragraphs 1 and 2 and clauses (i), (ii) and (iii)(a) of
paragraph 3 only, the Delaware General Corporation Law and the Delaware Limited
Liability Company Act.

            Based upon the foregoing and upon such investigation as I have
deemed necessary and subject to the qualifications set forth herein, I am of the
following opinion:

            (1) The Company is a corporation validly existing and in good
standing under the laws of the State of Delaware.

            (2) The Guarantor is a limited liability company validly existing
and in good standing under the laws of the state of Delaware.

            (3) The execution, delivery and performance by the Company and the
Guarantor of the Credit Agreement (i) are within the Company's corporate, and
the Guarantor's limited liability company, powers, (ii) have been duly
authorized by all necessary corporate, or limited liability company, action, and
(iii) do not contravene (a) the Charter or the Bylaws of the Company or the LLC
Agreement or Certificate of Formation of the Guarantor or (b) to the best

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>
                                      -3-


of my knowledge (1) any United States Federal or New York State law, rule or
regulation applicable to the Company or the Guarantor (including, without
limitation, Regulation X of the Board of Governors of the Federal Reserve
System) or (2) any contractual or legal restriction contained in any material
judgment, decree, mortgage, agreement, indenture or other instrument to which
the Company or the Guarantor is a party. The Credit Agreement has been duly
executed and delivered on behalf of the Company and the Guarantor.

            (4) No authorization, approval or other action by, and no notice to
or filing with, any governmental authority or regulatory body of the State of
New York or the Federal government of the United States is required for the due
execution, delivery and performance by the Company or the Guarantor of the
Credit Agreement.

            (5) The Credit Agreement is a valid and binding obligation of the
Company and the Guarantor enforceable against the Company and the Guarantor in
accordance with its terms.

            (6) To the best of my knowledge and except as disclosed in the
Company's consolidated financial statements, there are no pending or overtly
threatened actions or proceedings against the Company or any of its
Subsidiaries, before any court, governmental agency or arbitrator that purport
to affect the legality, validity, binding effect or enforceability of the Credit
Agreement or that are likely to have a materially adverse effect upon the
financial condition or operations of the Company or any of its Subsidiaries.

The opinions set forth above are subject to the following qualifications:

            (1) My opinion in paragraph 5 above is subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar law
affecting creditors' rights generally.

            (2) My opinion in paragraph 5 above is subject to the effect of
general principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law).

            (3) I express no opinion as to the effect (if any) of the law of any
jurisdiction (other than the State of New York) wherein any Lender may be
located or wherein enforcement of the Credit Agreement may be sought that limits
the rates of interest that such Lender may charge or collect.

            (4) I express no opinion as to the effect of Section 548 of the
United States Bankruptcy Code or any similar provision of State law.

            In all respects and for all purposes, this opinion is given solely
for the benefit of the Agent and the Lenders and may not be relied upon by any
other person or entity without my prior written consent.

                                        Very truly yours,

          Form of Opinion of Counsel for the Company and the Guarantor

<PAGE>

                                                                       EXHIBIT D

                           FORM OF DESIGNATION LETTER

                                              ____________, ____

To JPMorgan Chase Bank
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 364-Day Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 among The Pepsi Bottling Group, Inc. (the
"Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase Bank, as
administrative agent (the "Agent"), and the banks party thereto (the "Initial
Lenders"). Terms defined in the Credit Agreement are used herein as defined
therein.

            The Company hereby designates [______________] (the "Borrowing
Subsidiary"), a Subsidiary of the Company and a corporation duly incorporated
under the laws of [_______________] as a Borrower in accordance with Section
2.17 of the Credit Agreement until such designation is terminated in accordance
with said Section 2.17.

            The Borrowing Subsidiary hereby accepts the above designation and
hereby expressly and unconditionally accepts the obligations of a Borrower under
the Credit Agreement, adheres to the Credit Agreement and agrees and confirms
that, upon your execution and return to the Company of the enclosed copy of this
letter, such Borrowing Subsidiary shall be a Borrower for purposes of the Credit
Agreement and agrees to be bound by and perform and comply with the terms and
provisions of the Credit Agreement applicable to it as if it had originally
executed the Credit Agreement as a Borrower. The Borrowing Subsidiary hereby
authorizes and empowers the Company to act as its representative and
attorney-in-fact for the purposes of signing documents and giving and receiving
notices (including notices of Borrowing under the Credit Agreement) and other
communications in connection with the Credit Agreement and the transactions
contemplated thereby and for the purposes of modifying or amending any provision
of the Credit Agreement and further agrees that the Agent and each Lender may
conclusively rely on the foregoing authorization.

            The Borrowing Subsidiary represents and warrants that each of the
representations and warranties set forth in Section 4.01(a) (as if the reference
therein to Delaware were a reference to its jurisdiction of organization), (b),
(c) and (d) of the Credit Agreement are true as if each reference therein to the
Company were a reference to the Borrowing Subsidiary

                           Form of Designation Letter

<PAGE>
                                      -2-


and as if each reference therein to the Loan Documents were a reference to this
Designation Letter.

            The Borrowing Subsidiary hereby agrees that this Designation Letter
and the Credit Agreement shall be governed by, and construed in accordance with,
the law of the State of New York. The Borrowing Subsidiary hereby submits to the
nonexclusive jurisdiction of any New York state court or Federal court of the
United States of America sitting in New York City, and any appellate court from
any thereof, in any action or proceeding arising out of or relating to this
Designation Letter, the Credit Agreement or for recognition or enforcement of
any judgment. The Borrowing Subsidiary irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of the venue of any such proceeding brought in such a court and any claim that
any such proceeding brought in such a court has been brought in an inconvenient
forum. The Borrowing Subsidiary further agrees that service of process in any
such action or proceeding brought in New York may be made upon it by service
upon the Borrower at the "Address for Notices" specified below its name on the
signature pages to the Credit Agreement.

            Without limiting the foregoing, the Borrowing Subsidiary joins in
the submission, agreements, waivers and consents in Section 8.11 and 8.12 of the
Credit Agreement.

                                        THE PEPSI BOTTLING GROUP, INC.

                                        By: ____________________________________
                                            Name:
                                            Title:


                                        [NAME OF BORROWING SUBSIDIARY]

                                        By: ____________________________________
                                            Name:
                                            Title:

                           Form of Designation Letter

<PAGE>
                                      -3-


ACCEPTED:

JPMORGAN CHASE BANK,
  as Agent


By: ___________________________________
    Name:
    Title:

                           Form of Designation Letter

<PAGE>

                                                                       EXHIBIT E

                           FORM OF SUBSTITUTION LETTER

                                              ____________, ____

To JPMorgan Chase Bank
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 364-Day Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 among The Pepsi Bottling Group, Inc. (the
"Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase Bank, as
administrative agent (the "Agent"), and the banks party thereto (the "Initial
Lenders"). Terms defined in the Credit Agreement are used herein as defined
therein.

            The Company hereby elects to terminate its rights as a Borrower
under the Credit Agreement and designates the Guarantor as the exclusive
Borrower thereunder, in accordance with Section 2.17 of the Credit Agreement.

            The Guarantor hereby accepts the above substitution and hereby
expressly and unconditionally accepts the obligations of the Company under the
Credit Agreement, adheres to the Credit Agreement and agrees and confirms that,
as of the date hereof, the Guarantor shall become a Borrower for purposes of the
Credit Agreement and agrees to be bound by and perform and comply with the terms
and provisions of the Credit Agreement applicable to it as if it had originally
executed the Credit Agreement as the Company.

            The Company and the Guarantor hereby represent and warrant to the
Agent and each Lender that, before and after giving effect to this Substitution
Letter, (i) the representations and warranties set forth in Section 4.01 of the
Credit Agreement (except the representations set forth in the last sentence of
subsection (e) thereof and in subsection (f) thereof (other than clause (ii)
thereof)) are true and correct in all material respects on the date hereof and
after giving effect to the substitution contemplated hereby as if made on and as
of the date hereof and (ii) no Default has occurred and is continuing.

            The Company and the Guarantor hereby agree that this Substitution
Letter shall be governed by, and construed in accordance with, the law of the
State of New York. The Company and the Guarantor hereby submit to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York state court sitting in New

                           Form of Substitution Letter

<PAGE>
                                      -2-


York City for the purposes of all legal proceedings arising out of or relating
to this Substitution Letter or the transactions contemplated hereby.

                                        THE PEPSI BOTTLING GROUP, INC.

                                        By:
                                           Name:
                                           Title:


                                        BOTTLING GROUP, LLC

                                        By:
                                           Name:
                                           Title:

                           Form of Substitution Letter

<PAGE>

                                                                       EXHIBIT F

                           FORM OF TERMINATION LETTER

____________, ____

To JPMorgan Chase Bank,
  as Agent

Attention: Cherry Arnaez

Ladies and Gentlemen:

            We make reference to the 364-Day Credit Agreement (as amended,
supplemented and otherwise modified and in effect from time to time, the "Credit
Agreement") dated as of April 30, 2003 by and among The Pepsi Bottling Group,
Inc. (the "Company"), Bottling Group, LLC (the "Guarantor"), JPMorgan Chase
Bank, as administrative agent, and the banks party thereto. Terms defined in the
Credit Agreement are used herein as defined therein.

            The Company hereby terminates the status as a Borrowing Subsidiary
of [_______________], a corporation incorporated under the laws of
[_______________], in accordance with Section 2.17 of the Credit Agreement,
effective as of the date of receipt of this notice by the Agent. The undersigned
hereby represents and warrants that all principal of and interest on any Advance
of the above-referenced Borrowing Subsidiary and all other amounts payable by
such Borrowing Subsidiary pursuant to the Credit Agreement have been paid in
full on or prior to the date hereof. Notwithstanding the foregoing, this
Termination Letter shall not affect any obligation which by the terms of the
Credit Agreement survives termination thereof

                                        THE PEPSI BOTTLING GROUP, INC.


                                        By: ____________________________________
                                            Name:
                                            Title:

                           Form of Termination Letter


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12.3
<SEQUENCE>6
<FILENAME>y66832a1exv12w3.txt
<DESCRIPTION>RATIO EARNINGS TO FIXED CHARGES
<TEXT>
<PAGE>
                                                                    EXHIBIT 12.3


RATIO OF EARNINGS TO FIXED CHARGES We have calculated our ratio of earnings to
fixed charges in the following table by dividing earnings by fixed charges. For
this purpose, earnings are before taxes and minority interest, plus fixed
charges (excluding capitalized interest) and losses recognized from equity
investments, reduced by undistributed income from equity investments. Fixed
charges include interest expense, capitalized interest and one-third of net rent
which is the portion of the rent deemed representative of the interest factor.

<TABLE>
<CAPTION>
                                                                            FISCAL YEAR                           12 WEEKS ENDED
                                                     -------------------------------------------------------    -------------------
                                                     DEC. 26,    DEC. 25,    DEC. 30,   DEC. 29,    DEC. 28,    MAR. 23,   MAR. 22,
                                                       1998        1999        2000       2001        2002        2002       2003
                                                     --------    --------    --------   --------    --------    --------   --------
<S>                                                  <C>         <C>         <C>        <C>         <C>         <C>        <C>
NET INCOME (LOSS) BEFORE TAXES AND MINORITY
       INTEREST                                       $ (128)      $ 282       $ 501      $ 600       $ 792       $ 112       $ 84

Undistributed (income) loss from equity
       investments                                         5           -           -          -           -           -          -
Fixed charges excluding capitalize  interest             181         158         150        145         152          34         43
                                                     --------    --------    --------   --------    --------    --------   --------
EARNINGS AS ADJUSTED                                  $   58       $ 440       $ 651      $ 745       $ 944       $ 146      $ 127
                                                     ========    ========    ========   ========    ========    ========   ========

FIXED CHARGES:

       Interest expense                               $  166       $ 140       $ 136      $ 132       $ 131        $ 30       $ 38
       Capital interest                                    1           1           1          1           -           -          -
       Interest portion of rental expense                 15          18          14         13          21           4          5
                                                     --------    --------    --------   --------    --------    --------   --------

TOTAL FIXED CHARGES                                   $  182       $ 159       $ 151      $ 146       $ 152        $ 34      $  43
                                                     ========    ========    ========   ========    ========    ========   ========

RATIO OF EARNINGS TO FIXED CHARGES                      (A)         2.76        4.31       5.09        6.21        4.30       2.95
</TABLE>

(A)   As a result of the losses incurred in the fiscal year ended December 26,
      1998 we were unable to fully cover the indicated fixed charges. Earnings
      did not cover fixed charges by $124 million in 1998.

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-15.1
<SEQUENCE>7
<FILENAME>y66832a1exv15w1.txt
<DESCRIPTION>LETTER FROM KPMG LLP
<TEXT>
<PAGE>
                                                                    EXHIBIT 15.1

May 28, 2003



The Pepsi Bottling Group, Inc. and
Bottling Group, LLC
One Pepsi Way
Somers, NY 10589


Re:  Amendment No. 1 to Registration Statement No. 333-102035 on Form S-4


With respect to the subject registration statement, we acknowledge our awareness
of the incorporation by reference therein of our reports dated April 22, 2003
related to our reviews of interim financial information.

Pursuant to Rule 436 under the Securities Act of 1933 (the Act), such reports
are not considered part of a registration statement prepared or certified by an
accountant, or reports prepared or certified by an accountant within the meaning
of Sections 7 and 11 of the Act.

/s/ KPMG LLP

New York, New York

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-15.2
<SEQUENCE>8
<FILENAME>y66832a1exv15w2.txt
<DESCRIPTION>LETTER FROM KPMG LLP
<TEXT>
<PAGE>
                                                                  EXHIBIT 15.2


                           ACCOUNTANTS' ACKNOWLEDGMENT

May 28, 2003


PepsiCo, Inc.
Purchase, New York

Re:  Amendment No. 1 to Registration Statement on Form S-4, File No.
333-102035-01

With respect to the subject registration statement, we acknowledge our awareness
of the incorporation by reference therein of our report dated April 17, 2003
related to our review of interim financial information.

Pursuant to Rule 436 under the Securities Act of 1933 (the Act), such report is
not considered part of a registration statement prepared or certified by an
accountant, or a report prepared or certified by an accountant within the
meaning of Sections 7 and 11 of the Act.

                                    Very truly yours,

                                    /s/ KPMG LLP



New York, New York


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.4
<SEQUENCE>9
<FILENAME>y66832a1exv23w4.txt
<DESCRIPTION>CONSENT OF KPMG LLP
<TEXT>
<PAGE>
                                                                    EXHIBIT 23.4

                          Independent Auditors' Consent

The Owners of
Bottling Group, LLC:

We consent to the incorporation by reference of our reports dated January 28,
2003, with respect to the consolidated balance sheets of Bottling Group, LLC as
of December 28, 2002 and December 29, 2001, and the related consolidated
statements of operations, cash flows and changes in owners' equity for each of
the fiscal years in the three-year period ended December 28, 2002, and the
related financial statement schedule, which reports are included in the December
28, 2002, annual report on Form 10-K of Bottling Group, LLC. Our report refers
to the Company's adoption of FASB No. 142, "Goodwill and Other Intangible
Assets," as of December 30, 2001.

We also consent to the reference to our firm under the heading "Independent
Accountants" in the prospectus.

                                                  /s/ KPMG LLP

New York, New York
May 28, 2003

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.5
<SEQUENCE>10
<FILENAME>y66832a1exv23w5.txt
<DESCRIPTION>CONSENT OF KPMG LLP
<TEXT>
<PAGE>
                                                                    EXHIBIT 23.5

                          Independent Auditors' Consent

The Board of Directors and Shareholders
The Pepsi Bottling Group, Inc.:

We consent to the incorporation by reference of our report dated January 28,
2003, with respect to the consolidated balance sheets of The Pepsi Bottling
Group, Inc. as of December 28, 2002 and December 29, 2001, and the related
consolidated statements of operations, cash flows and changes in shareholders'
equity for each of the fiscal years in the three-year period ended December 28,
2002, which report is included in the December 28, 2002, annual report on Form
10-K of Bottling Group, LLC. Our report refers to the Company's adoption of FASB
No. 142, "Goodwill and Other Intangible Assets," as of December 30, 2001.

                                                     /s/ KPMG LLP

New York, New York
May 28, 2003

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.6
<SEQUENCE>11
<FILENAME>y66832a1exv23w6.txt
<DESCRIPTION>CONSENT OF KPMG LLP
<TEXT>
<PAGE>
                                                                  EXHIBIT 23.6


                               CONSENT OF KPMG LLP


We consent to the use of our audit report dated February 6, 2003, with respect
to the Consolidated Balance Sheets of PepsiCo, Inc. and Subsidiaries as of
December 28, 2002 and December 29, 2001, and the related Consolidated Statements
of Income, Cash Flows and Common Shareholders' Equity for each of the years in
the three-year period ended December 28, 2002, incorporated herein by reference
and to the reference to our firm under the heading "Independent Accountants" in
the prospectus.

                                    /s/ KPMG LLP

New York, New York
May 28, 2003

</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
