Keurig Dr Pepper (KDP) 10-K risk factor changes: FY2020 vs FY2019

Optimizing our operations [added: following the DPS Merger] may be more difficult, costly or time-consuming than [removed: expected] [added: expected,] and the anticipated benefits and cost savings of the DPS Merger may not be realized.

[removed: If we experience difficulties in this process, the] [added: The] anticipated benefits of the DPS Merger may not be realized fully or at all, or may take longer to realize than [removed: expected, which could have an adverse effect on us for an undetermined period after completion of the DPS Merger.][added: expected.]

The [removed: industries] [added: industry] in which we operate [removed: are] [added: is] highly competitive and [removed: continue] [added: continues] to evolve in response to changing consumer preferences.

[removed: Within the LRB category, we] [added: We] also compete with a number of smaller brands and a variety of smaller, regional and private label [removed: manufacturers, such as Refresco Group.][added: manufacturers.]

Continued acceptance of Keurig [removed: brewing systems] [added: brewers] and sales of K-Cup pods to an increasing installed customer base are significant factors in our Coffee Systems' growth plans.

Any substantial or sustained decline in the sale of Keurig [removed: brewing systems,] [added: brewers,] failure to continue to reduce the cost of Keurig [removed: brewing systems,] [added: brewers,] or substantial or sustained decline in the sales of K-Cup pods could materially and adversely affect our business.

Keurig [removed: brewing systems] [added: brewers] compete against all sellers and types of coffeemakers.

If we do not succeed in continuing to reduce the costs of manufacturing Keurig [removed: brewing systems] [added: brewers] or differentiating Keurig [removed: brewing systems] [added: brewers] from our competitors in the coffeemaker category, based on technology, quality of products, desired brands or otherwise, or our competitors adopt their respective strategies, our competitive position may be weakened.

We may not effectively respond to changing consumer [removed: preferences, trends, health concerns] [added: preferences] and [removed: other factors,] [added: shopping behavior,] which could impact our financial results.

Consumers’ preferences [removed: can change] [added: continually evolve] due to a variety of factors, including [removed: the age and ethnic] [added: changing] demographics of the population, social trends, changes in consumer [removed: lifestyles,] [added: lifestyles and consumption patterns, concerns or perceptions regarding the health effects of products, concerns regarding the location of origin or source of ingredients and products, changes in consumers' spending habits,] negative publicity, [removed: competitive product and pricing pressures,] economic downturn or other factors.

For example, [removed: in the LRB industry,] consumers are increasingly concerned about health and wellness, focusing on the caloric intake associated with regular CSDs, the use of artificial sweeteners in diet CSDs, and the use of natural, organic or simple ingredients in [removed: LRB products.][added: beverages.]

If we do not effectively anticipate [added: and respond to] these trends and changing consumer beverage [removed: preferences and quickly develop new products or partner with a current or new brand partner in that category in response,] [added: preferences,] our sales [added: and growth] could suffer.

If we are unable to [added: recruit,] retain and motivate the senior management team and other key personnel sufficiently to support the projected growth and initiatives of our business, our business and financial performance may be adversely affected.

Accordingly, the success of our business depends in part on our ability to maintain good relationships with key retail [removed: customers, such as Walmart and Costco, key e-commerce retailers such as Amazon.com, and grocery] customers.

Some of these [removed: bottlers, such as PepsiCo,] [added: bottlers] are also our [added: direct] competitors, or also bottle and distribute [removed: a competitor’s products, such as PepsiCo and Coca-Cola affiliated bottlers.][added: products for our competitors.]

They may devote more resources to other [removed: products] [added: products, prioritize their own products,] or take other actions detrimental to our brands.

We may need to increase support for our brands in their territories [added: to protect our route to market] and may not be able to pass price increases through to them.

Failure to maintain strategic relationships with [removed: well-recognized brands/brand] [added: brand] owners and private label brands could adversely impact our future growth and [removed: business.][added: business, potentially resulting in the termination of those agreements.]

If we are unable to provide an appropriate mix of incentives to our strategic partners through a combination of premium performance and service, pricing, and marketing and advertising support, or if these strategic partners are not satisfied with our brand innovation and technological or other development efforts, they may take [removed: actions,] [added: actions that adversely impact us,] including entering into agreements with competing pod contract manufacturers or vertically integrating to manufacture their own K-Cup pods.

Increasing competition among K-Cup pod manufacturers and [removed: the move] [added: moving] to vertical integration may result in price compression, which could have an adverse effect on our gross margins.

The loss of strategic partners could also adversely impact our future profitability and growth, awareness of Keurig [removed: brewing systems,] [added: brewers,] our ability to attract additional branded or private label parties to do business with us or our ability to attract new consumers to buy Keurig [removed: brewing systems.][added: brewers.]

We are subject to a risk of our [removed: allied] [added: partner] brands terminating their agreements with us, which could negatively affect our business and financial performance.

Within each distribution agreement, we have certain protections in case the [removed: allied] [added: partner] brands terminate their agreements, [removed: including] [added: such as] a one-time termination payment.

Violations of these laws or regulations in the [removed: manufacture,] [added: manufacturing,] safety, sourcing, labeling, storing, transportation, advertising, distribution and sale of our products could damage our reputation and/or result in criminal, civil or administrative actions with substantial financial penalties and operational limitations.

Substantial disruption [removed: to production] at our manufacturing and distribution facilities could occur.

A disruption [removed: in production] at our [removed: beverage concentrates] manufacturing [removed: facility, which manufactures almost all of our concentrates, or at our other facilities,] [added: and distribution facilities] could have a material adverse effect on our business.

In addition, a disruption could occur at [removed: any of our other] [added: the] facilities [removed: or those] of our suppliers, bottlers, contract manufacturers or distributors.

[removed: These] [added: Our] raw materials are sourced from industries characterized by a limited supply [removed: base] [added: base,] and their cost can fluctuate substantially.

Under many of our supply arrangements, the price we pay for raw materials fluctuates along with certain changes in underlying commodities [removed: costs, such as aluminum in the case of cans, natural gas in the case of glass bottles, resin in the case of PET bottles and caps, corn in the case of sweeteners and pulp in the case of paperboard packaging.][added: costs.]

We purchase, roast and sell high-quality whole bean [removed: Arabica] coffee and related coffee products.

The [removed: Arabica coffee] [added: quality] of the [removed: quality] [added: coffee] we seek tends to trade on a negotiated basis at a premium above the “C” price of coffee.

Increases in the “C” coffee commodity price [removed: do] increase the price of high-quality [removed: Arabica] coffee and also [removed: impacts] [added: impact] our ability to enter into fixed-price purchase commitments.

The supply and price of [removed: coffee] [added: crop commodities] we [removed: purchase] [added: purchase, such as coffee, apples, and corn,] can also be affected by multiple factors in the producing countries, including weather, natural disasters, crop disease (such as coffee rust), general cost increases in farm inputs and costs of production, inventory levels and political and economic conditions, as well as the actions of certain organizations and associations that have historically attempted to influence prices of [removed: green coffee] [added: various commodities] through agreements establishing export quotas or by restricting [removed: coffee] supplies.

Speculative trading in [removed: coffee] commodities can also influence [removed: coffee] prices.

If we are unable to purchase sufficient quantities of [removed: green coffee] [added: our commodities] due to any of the factors described herein or a worldwide or regional shortage, we may not be able to fulfill the demand for our [removed: coffee,] [added: products,] which could have an adverse impact on our business and financial results.

We also have a limited number of suppliers for certain strategic raw materials critical [removed: for the manufacture of K-Cup pods and the processing of certain key ingredients in] [added: to] our [removed: K-Cup pods, particularly for cups and filter paper.][added: operations.]

In addition, in order to ensure a continuous supply of high-quality raw [removed: materials] [added: materials,] some of our inventory purchase obligations include long-term purchase commitments for certain strategic raw [removed: materials critical for the manufacture of K-Cup pods and appliances.][added: materials.]

Furthermore, we may incur unforeseen liabilities and obligations in connection with any [removed: of our completed acquisitions and any future acquisitions,] [added: such transaction,] including in connection with the integration or management of the acquired businesses or brands and may encounter unexpected difficulties and costs in integrating them into our operating and internal control structures.

The success of our business depends in part on our ability to maintain consumer confidence in the safety and quality of all of our products, including beverage products and our [removed: brewing systems.][added: brewers.]

[removed: In connection with the DPS Merger, we incurred] [added: We have] significant [removed: additional] indebtedness, which could adversely affect us, including decreasing our business flexibility and increasing our interest expense.

RISKS RELATED TO OUR OPERATIONS

Widespread health developments and economic uncertainty resulting from the ongoing COVID-19 pandemic, could materially and adversely affect our business, financial condition and results of operations.

Our business has been, and may continue to be, adversely impacted by the response to the ongoing COVID-19 pandemic in countries where we operate or our customers and suppliers are located, due to recommendations or mandates from governmental authorities to close businesses, limit travel, avoid large gatherings or self-quarantine, as well as temporary closures or decreased operations of the facilities of our customers, distributors or suppliers.

These impacts include, but are not limited to:

- Significant reductions in demand or significant volatility in demand for one or more of our products, as a result of, among other things: the temporary inability of consumers to purchase our products due to illness, quarantine or other restrictions, store closures, or financial hardship, shifts in demand away from one or more of our higher priced products to lower priced products, or stockpiling or similar activity, reduced options for marketing and promotion of products or other restrictions in connection with the COVID-19 pandemic; if prolonged, such impacts could further increase the difficulty of operating our business during the pandemic, including accurately planning and forecasting customer demand;

- Inability to meet our consumers' and customers’ needs and achieve cost targets due to disruptions in our manufacturing and supply arrangements caused by the loss or disruption of essential manufacturing and supply elements, such as raw materials or purchased finished goods, logistics, reduction or loss of workforce due to the insufficiency or failure of our safety protocols, or other manufacturing and distribution capability;

- Failure of third parties, including those located in international locations, on which we rely, including our suppliers, bottlers, distributors, contract manufacturers, third-party service providers, contractors, commercial banks and external business partners, to meet their obligations to us or to timely meet those obligations, or significant disruptions in their ability to do so, which may be caused by their own financial or operational difficulties; or

- Significant changes in the conditions in markets in which we manufacture, sell or distribute our products, including quarantines, governmental or regulatory actions, closures or other restrictions that limit or close our operating and manufacturing facilities, restrict our employees’ ability to perform necessary business functions, restrict or prevent consumers from having access to our products, or otherwise prevent our third-party bottlers, distributors, partners, suppliers, or customers from sufficiently staffing operations, including operations necessary for the production, distribution, sale, and support of our products.

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All of these impacts could place limitations on our ability to execute on our business plan and materially and adversely affect our business, financial condition and results of operations.

We continue to monitor the situation, have actively implemented policies and procedures to address the situation, and as the pandemic continues to further unfold, we may adjust our current policies and procedures as regulations or governmental orders are implemented or more information and guidance become available.

The impact of COVID-19 may also exacerbate other risks discussed in Item 1A of our Annual Report, any of which could have a material effect on us.

This situation is changing rapidly and additional impacts may arise that we are not aware of currently.

Some of our competitors, such as Coca-Cola, PepsiCo, The Kraft Heinz Company and Nestlé S.A., are multinational corporations with significant financial resources.

Our sales may be negatively affected by numerous factors including our inability to maintain or increase prices, our inability to effectively promote our products, ineffective advertising and marketing campaigns, new entrants into the market, the decision of wholesalers, retailers or consumers to purchase competitors' products instead of ours, and increased marketing costs and in-store placement and slotting fees due to our competitors' willingness to spend aggressively.

Competitive pressures may also cause us to reduce prices we charge customers or may restrict our ability to increase such prices.

In addition, the rapid growth of e-commerce may create additional consumer price deflation by, among other things, facilitating comparison shopping, and could potentially threaten the value of some of our legacy route-to-market strategies and thus negatively affect revenues.

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In addition, consumer shopping behavior is rapidly evolving due to both changes in travel, vacation and leisure activity patterns and the acceleration of e-commerce and other methods of purchasing products.

If we are unable to meet the consumer where and when they desire their products or if we are unable to respond to changes in distribution channels (including e-commerce), our financial results could be adversely impacted.

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If we do not innovate rapidly and successfully to respond to shifting consumer demands, our business may suffer.

Achieving growth depends on our successful development, introduction and marketing of innovative new products and line extensions.

There are inherent risks associated with new product or packaging introductions, including uncertainties about trade and consumer acceptance or potential impacts on our existing product offerings.

We may be required to increase expenditures for new product development.

Successful innovation depends on our ability to correctly anticipate customer and consumer acceptance, to obtain, protect, and maintain necessary intellectual property rights, and to avoid infringing upon the intellectual property rights of others.

We must also be able to respond successfully to technological advances by and intellectual property rights of our competitors, and failure to do so could compromise our competitive position and impact our product sales, financial condition, and operating results.

From time to time, we expect to acquire businesses or brands, invest in emerging companies and/or form joint ventures, and enter into various licensing and distribution agreements to expand our product portfolio.

We have programs to invest and upgrade our manufacturing, distribution and other facilities, including expansive investments in new manufacturing facilities in Spartanburg, South Carolina; Newbridge, Ireland; and Allentown, Pennsylvania.

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RISKS RELATED TO OUR FINANCIAL PERFORMANCE

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We continue to optimize our operations as One KDP, which is a complex, costly and time-consuming process.

RISKS RELATING TO OUR RELATIONSHIPS WITH THIRD PARTIES

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In our Coffee Systems segment, we have entered into strategic relationships for the manufacturing, distribution, and sale of K-Cup pods with partner customers, as well as with retailers for their private label brands.

In our Packaged Beverages segment, we have entered into strategic relationships for the manufacture and/or distribution of products from partner brand owners in emerging or fast-growing segments in which we may not currently have a brand presence.

We no longer meet the requirements to be a “controlled company” within the meaning of the rules of Nasdaq and the rules of the SEC.

However, even though we are no longer a "controlled company," we will continue to qualify for, and may rely upon, exemptions from certain corporate governance requirements that would otherwise provide protection to stockholders of other companies during a one-year transition period.

On August 19, 2020, Maple Holdings B.V., an affiliate of JAB, completed the sale of 45 million shares of KDP stock in a public secondary offering.

RISKS RELATING TO US FOLLOWING THE DPS MERGER

Prior to the DPS Merger, DPS and Keurig operated independently.

During 2019, we significantly completed the integration of these legacy companies into KDP.

The success of the DPS Merger, including anticipated benefits and cost savings, depends, in part, on our ability to optimize our operations.

The optimization of our operations following the DPS Merger is a complex, costly and time-consuming process which began in July 2018 upon the closing of the DPS Merger and remains ongoing.

The unaudited historical pro forma combined financial statements are presented for illustrative purposes only and our actual financial condition and results of operations following the DPS Merger may differ materially.

The unaudited historical pro forma combined financial statements are presented for illustrative purposes only; are based on various adjustments, assumptions and preliminary estimates; and may not be an indication of our financial condition or results of operations for several reasons.

Our actual financial condition and results of operations following the completion of the integration of the businesses may not be consistent with, or evident from, these unaudited historical pro forma combined financial statements.

In addition, the assumptions used in preparing the unaudited historical pro forma combined financial statements may not be realized, and other factors may affect our financial condition or results of operations.

Any potential decline in our financial condition or results of operations may cause significant variations in the unaudited historical pro forma financial statements and our stock price.

RISKS RELATING TO OUR BUSINESS

Competition is generally based upon brand recognition and perception, taste, quality, price, availability, product selection, performance and convenience.

Brand recognition and perception may be impacted by the effectiveness of our advertising campaigns and marketing programs, as well as our use of social media and online ratings and reviews of its products, including our appliances.

In addition, our success in maintaining, extending and expanding our brands' image will depend on our ability to adapt to a rapidly changing media environment, including an increasing reliance on social media and online dissemination of advertising campaigns and marketing programs.

Within the LRB category, we compete with multinational corporations with significant financial resources.

Our two largest competitors in the LRB category are Coca-Cola and PepsiCo, each of which has a significantly higher share of the U.S. LRB category than us.

We also compete in the LRB category against other large companies, including Nestlé and Kraft Heinz.

For the year ended December 31, 2019, revenue from K-Cup pods represented approximately 80% of the net sales of the Coffee Systems segment.

If we are unable to compete effectively against our competitors, our sales, volume, growth and overall financial results could be negatively affected.

A key component of our growth strategy is continuing to develop, partner with or acquire products to cater to the next wave of consumer preferences, including NCBs and other growing beverage categories.

Developing and launching new products can be risky and expensive.

If we are not successful in timely responding to changing markets and consumer preferences, and/or some of our competitors are better able to respond to these changes, our business and financial performance will be negatively affected.

We have entered into strategic relationships for the manufacturing, distribution, and sale of K-Cup pods with well-regarded beverage companies such as Starbucks Corporation, Dunkin’ Brands Group, Inc., The J.M. Smucker Company, Kraft Heinz, Newman’s Own Organics, McDonald's, Peet’s Coffee & Tea, and Tim Hortons, as well as with retailers such as Costco, The Kroger Co. and Walmart for their private label brands.

Our agreements with our allied brands could be terminated.

Approximately 95% of our 2019 Packaged Beverages net sales come from the manufacturing and distribution of our own brands and the manufacturing of certain private label beverages, with the remaining from the distribution of allied brands, which include, but are not limited to, Vita Coco coconut water, evian water, Neuro drinks, High Brew RTD Coffee, Forto Coffee shots, A Shoc energy drinks, Peet's RTD Coffee and Runa energy drinks.

The principal raw materials we use in our cold business include PET bottles and caps, aluminum cans and ends, sweeteners, paper products, fruit, glass bottles and enclosures, juices, teas, and water.

We expect to acquire businesses or brands to expand our product portfolio and distribution rights and may invest in new business strategies and/or joint ventures.

The amount of cash required to pay interest on our increased indebtedness levels following completion of the DPS Merger, and thus the demands on our cash resources, is greater than the amount of cash flows required to service DPS’s and Maple’s respective indebtedness prior to the DPS Merger.

If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

For additional information about these intangible assets, see "Critical Accounting Estimates — Goodwill and Other Indefinite-Lived Intangible Assets" in Item 7 and Note 3 and Note 5 to our Audited Consolidated Financial Statements included in Item 8, "Financial Statements and Supplementary Data," in this Annual Report on Form 10-K.

We rely on independent certification for a number of products.

Loss of certification within our supply chain or as related to manufacturing processes could harm our business.

We rely on independent certification, such as certifications of products as “organic” or “responsibly sourced,” to differentiate some products from others.

We must comply with the requirements of independent organizations or certification authorities in order to label our products as certified.

The loss of any independent certifications could adversely affect our marketplace position, which could harm our business.

In addition, we rely on a limited number of key suppliers and distribution and fulfillment partners for material aspects of our business.

We have programs of investment and upgrading in our manufacturing, distribution and other facilities.

Due to the seasonality of many of our products and other factors, our operating results are subject to fluctuations.

Historically, we have experienced increased consumer retail and e-commerce sales of the Keurig brewing systems in the second half of the year due to the holiday season.

If sales of Keurig brewing systems during the holiday season do not meet expectations, sales of our K-Cup pods throughout the year will be negatively impacted.

*This section of this Annual Report on Form 10-K generally discusses the years [removed: ended* *December] [added: ended December] 31, [added: 2020 and] 2019 and [removed: 2018* *and] year-over-year comparisons between the years [removed: ended* *December] [added: ended December] 31, [removed: 2019] [added: 2020] and [removed: 2018.][added: 2019.]

Discussions of the periods prior to the year [removed: ended* *December] [added: ended December] 31, [removed: 2018* *that] [added: 2019 that] are not included in this Annual Report on Form 10-K are found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of our Annual Report on Form 10-K for the year [removed: ended* *December] [added: ended December] 31, [removed: 2018.*][added: 2019 and the discussion therein for the year ended December 31, 2019 compared to the year ended December 31, 2018 is incorporated by reference into this Annual Report.*]

[removed: See Note 1 and] [added: Refer to] Note [removed: 3] [added: 4] of the Notes to our [removed: Audited] Consolidated Financial Statements for further information [removed: related to] [added: regarding] the [removed: DPS Merger.][added: impairment analysis.]

KDP is a leading beverage company in North America, with a diverse portfolio of flavored (non-cola) CSDs, NCBs, including water (enhanced and flavored), ready-to-drink tea and coffee, juice, juice drinks, mixers and specialty coffee, and is a leading producer of innovative single serve [removed: brewing systems.][added: brewers.]

KDP offers more than 125 owned, [removed: licensed, partner] [added: licensed] and [removed: allied] [added: partner] brands, including the top ten best-selling coffee brands and Dr Pepper as a leading flavored CSD in the U.S. according to IRi, available nearly everywhere people shop and consume beverages.

KDP markets and sells its products to retailers, including supermarkets, mass merchandisers, club stores, pure-play e-commerce retailers, and office superstores; to restaurants, hotel chains, office product and coffee distributors, and partner brand owners; and directly to consumers through its [removed: websites.][added: website.]

Some of these items, such as [removed: increased health consciousness and] [added: the ongoing outbreak of COVID-19,] changes in consumer preferences and [removed: economic factors,] [added: macroeconomic changes,] have previously created and may continue [removed: in the future] to create category headwinds for a number of our products.

As of December 31, [removed: 2019,] [added: 2020,] we report our business in four operating segments:

[removed: | • |] [added: -] The Coffee Systems segment reflects sales in the U.S. and Canada of the manufacture and distribution of finished goods relating to the Company's single-serve [removed: brewing system,] [added: brewers,] K-Cup pods and other coffee products. [removed: |]

[removed: | • |] [added: -] The Packaged Beverages segment reflects sales in the U.S. and Canada from the manufacture and distribution of finished beverages and other products, including sales of the Company's own brands and third-party brands, through our DSD and WD systems. [removed: |]

[removed: | • |] [added: -] The Beverage Concentrates segment reflects sales of the Company's branded concentrates and syrup to third-party bottlers, primarily in the U.S. and Canada. [removed: Most of the brands in this segment are CSDs. |]

[removed: | • |] [added: -] The Latin America Beverages segment reflects sales in Mexico, the Caribbean, and other international markets from the manufacture and distribution of concentrates, syrup and finished beverages. [removed: |]

In our Beverage Concentrates segment, we measure our sales volume as concentrate case [removed: sales.][added: sales for concentrates sold by us to our bottlers and distributors.]

[removed: The unit] [added: A concentrate case is the amount] of [removed: measurement for] concentrate [added: needed to make one] case [removed: sales equals] [added: of] 288 fluid ounces of finished beverage, the equivalent of 24 twelve ounce servings.

[removed: In order to derive the adjusted financial information for] [added: For] the [removed: year] [added: years] ended December 31, [added: 2020 and] 2019, we [removed: adjusted] [added: define our Adjusted non-GAAP financial measures as] certain financial statement captions and metrics [added: adjusted] for certain items affecting comparability.

[removed: 2019] Financial Overview

The following table details our net income and diluted EPS for the years ended December 31, [removed: 2019] [added: 2020] and [removed: 2018:][added: 2019:]

| | [added: | |] For the Year Ended December 31, | | | | | | | | [added: | | | |] Dollar | | | | [added: | |] Percent | | [added: |]

| (in millions, except per share data) | [removed: 2019] | | [added: 2020] | | [removed: 2018] | | | | [added: 2019 | | | | | |] Change | | | | [added: | |] Change | | [added: |]

| Net income attributable to KDP | [added: | |] $ | [removed: 1,254] [added: 1,325] | | | [added: | |] $ | [removed: 586] [added: 1,254] | | | [added: | |] $ | [removed: 668] [added: 71] | | | [removed: 114.0] | [added: | 5.7 | |] % |

| Adjusted diluted EPS | [removed: 1.22] | | [added: 1.40] | | [removed: 1.04] | | | | [added: 1.22 | | | | | |] 0.18 | | | | [removed: 17.3] | [added: | 14.8 | |] % |

[added: *Diluted EPS.*] Diluted EPS increased [removed: 66.0%] [added: 5.7%] to [removed: $0.88] [added: $0.93 per diluted share] as compared to [removed: $0.53] [added: $0.88] in the prior year.

[added: *Adjusted Net Income Attributable to KDP.*] Adjusted net income increased [removed: $269 million, or 18.4%,] [added: 15.1%] to [removed: $1,727 million,] [added: $1,988 million for the year ended December 31, 2020 as] compared to [removed: Adjusted pro forma net income of $1,458] [added: $1,727] million in the prior year.

[added: *Adjusted Diluted EPS.*] Adjusted diluted EPS increased [removed: 17.3%] [added: 14.8%] to [removed: $1.22,] [added: $1.40 per diluted share] as compared to [removed: Adjusted pro form] [added: $1.22 per] diluted [removed: EPS of $1.04] [added: share] in the prior year.

During the year ended December 31, [removed: 2019,] [added: 2020,] we made net repayments of [removed: approximately $1,286] [added: $951] million related to our [removed: senior notes,] [added: Notes,] our [removed: term loans,] [added: 2019 KDP Term Loan,] and [added: our] commercial paper notes.

| [removed: • |] [added: For] the [removed: year ended] [added: Year Ended] December 31, [removed: 2019, and] [added: 2019] | [added: | | | | | | | | | | | | | | | | |]

We eliminate from our financial results all intercompany transactions between entities included in our consolidated financial statements and the intercompany transactions with our [removed: investments in unconsolidated affiliates.][added: equity method investees.]

References in the financial tables to percentage changes that are not meaningful are denoted by [removed: "NM."][added: "NM".]

The following table sets forth our consolidated results of operations for the years ended December 31, [removed: 2019] [added: 2020] and [removed: 2018:][added: 2019:]

| | [added: | |] For the Year Ended December 31, | | | | | | | | [added: | | | |] Dollar | | | | [added: | |] Percentage | | [added: |]

| (in millions, except per share amounts) | [removed: 2019] | | [added: 2020] | | [removed: 2018] | | | | [added: 2019 | | | | | |] Change | | | | [added: | |] Change | | [added: |]

| Net sales | [removed: $] | [removed: 11,120] | [added: $] | [added: 11,618] | [removed: $] | [removed: 7,442] | | | $ | [removed: 3,678 | | | 49.4] [added: 11,120] | [removed: %] |

| Selling, general and administrative expenses | [removed: 3,962] | | [added: 3,978] | | [removed: 2,635] | | | | [removed: 1,327] [added: 3,962] | | | | [removed: 50.4] | | [added: 16 | | | | | | 0.4 | | |]

| Other operating [removed: expense (income),] [added: (income) expense,] net | [removed: 2] | | [added: (39)] | | [removed: 10] | | | | [removed: (8] [added: 2] | | [removed: )] | | [added: | | (41) | | | | | |] NM | | [added: |]

| Income from operations | [removed: 2,378] | | [removed: | | 1,237 |] [added: $] | [added: 2,480] | | [removed: 1,141] | | | [added: $] | [removed: 92.2] [added: 2,378] | |

| Loss on early extinguishment of debt | [removed: 11] | | [added: —] | | [removed: 13] | | | | [removed: (2] [added: —] | | [removed: )] | | [removed: (15.4] | [removed: )] | [added: (4) | | | | | | | | | | | | 4 | | | | | | 1 | | | | | | | | | | | | 3 | | | | | | | | | | | | — | | |]

| Other expense (income), net | [removed: 19] | | [added: 17] | | [removed: (19] | | [removed: )] | | [removed: 38] [added: 19] | | | | [removed: NM] | | [added: (2) | | | | | | (10.5) | | |]

| Income before provision [removed: (benefit)] for income taxes | [removed: 1,694] | | [added: 1,753] | | [removed: 791] | | | | [removed: 903] [added: 1,694] | | | | [removed: 114.2] | | [added: 59 | | | | | | 3.5 | | |]

| Provision [removed: (benefit)] for income taxes | [removed: 440] | | [added: 428] | | [removed: 202] | | | | [removed: 238] [added: 440] | | | | [removed: 117.8] | | [added: (12) | | | | | | (2.7) | | |]

| Less: Net income attributable to [removed: employee redeemable] non-controlling interest [removed: and mezzanine equity awards] | [removed: —] | | [added: —] | | [removed: 3] | | | | [removed: (3] [added: —] | | [removed: )] | | [removed: (100.0] | [removed: )] | [added: — | | | | | | NM | | |]

Most of the brands in this segment are CSDs.

USE OF NON-GAAP FINANCIAL MEASURES

Non-GAAP financial measures are provided in addition to U.S. GAAP measures, including adjusted income from operations, adjusted net income and adjusted diluted earnings per share.

See *Non-GAAP Financial Measures* for more information, including reconciliations to the corresponding U.S. GAAP measures.

Refer to Item 1A, "Risk Factors", combined with the *Uncertainties and Trends Affecting Liquidity* section below, for more information about the risks and uncertainties we face.

COVID-19 Pandemic Disclosures

Our first priority, always, is to keep our employees safe and healthy.

We have taken extraordinary precautions to do this and to provide the support our employees and their families may need during this unprecedented time.

We continue to deliver for our customers and consumers, working hard to fulfill strong demand.

We are finding innovative ways to quickly adapt to changes in shopping behaviors, with the vast majority of North America impacted by a mix of occupancy limitations, stay-at-home or shelter-in-place orders, and closures of non-essential businesses.

We are also focused on providing for our communities by supporting frontline healthcare workers who are fighting this crisis day in and day out.

We don’t make masks or medical equipment at our Company, but we do make beverages and, through our *Fueling The Frontline* program, we donated Keurig brewers, coffee and other beverages to hospitals in need, as our way to say thank you for the unwavering commitment and courage of the entire medical community.

The COVID-19 pandemic has had divergent impacts within our business.

For example, we experienced a significant increase in demand and consumption of our products in our at-home business caused in part by changing consumer habits in response to COVID-19, contributing to increases in net sales.

At the same time, we experienced significant declines in net sales in our away-from-home business due to office closures and the slowdown of hospitality and fountain foodservice as a result of shelter-in-place guidelines and restaurant capacity limits.

In the future, the economic effects of the COVID-19 pandemic, including higher levels of unemployment, lower wages or a recessionary environment, may result in reduced demand for our products.

It could also lead to volatility in demand due to government actions, such as shelter-in-place notices, in response to increases in reported cases and hospitalizations in certain regions.

These government actions could impact consumers' movements and access to our products.

While we believe that there will continue to be strong long-term demand for our products, the timing and extent of economic recovery, and the uncertainties in short-term demand trends, make it difficult to predict the overall effects of the COVID-19 pandemic on our business.

We expect that there will be heightened volatility in net sales during and subsequent to the duration of the pandemic that may impact interim periods.

Our ability to continue to operate without any significant negative impacts will in part depend on our ability to protect our critical frontline employees and our supply chain.

As food and agriculture is deemed part of the critical infrastructure by the Department of Homeland Security, our frontline employees have been identified as critical workers in maintaining the U.S. food and beverage supply.

As a result, we have strived to follow recommended actions of government and health authorities to protect our employees, with particular measures in place for those working in our manufacturing and distribution facilities, which also included temporary incentive pay programs and benefits.

We intend to continue to work with government authorities and implement our employee safety measures; however, disruptions to our supply chain, measures taken to protect employees, increased absenteeism or other local effects of the COVID-19 pandemic have impacted and could continue to impact our operations.

For our corporate employees, we do not believe that the remote work environment has had any significant impact on our internal controls over financial reporting.

With the health and safety of our employees remaining our top priority, we are diligently working on plans to safely bring our employees back to office locations with enhanced safety and health protocols.

We do not believe these plans will impact our near-term liquidity needs.

The COVID-19 pandemic has not materially impacted our liquidity position.

We continue to generate operating cash flows to meet our short-term liquidity needs, and we expect to maintain access to the capital markets enabled by our debt ratings.

Refer to *Uncertainties and Trends Affecting Liquidity* within the *Liquidity and Capital Resources* section below for more information.

Impact of COVID-19 on our Financial Statements

The impact of COVID-19 on our net sales performance presented both headwinds and tailwinds across the business and within the segments, requiring strong portfolio, package and channel mix management to optimize overall performance.

The diversity of the Company’s broad portfolio and extensive route to market network enabled us to successfully navigate these mix impacts posed by the COVID-19 pandemic to drive overall performance.

- Coffee Systems experienced growth in K-Cup coffee pods for at-home consumption and strong double-digit growth in brewers, which more than offset the significant decline in away-from-home consumption due to weaknesses in the office coffee channel, as many companies shifted to a work-from-home model during 2020.

Sales in the e-commerce channel were very strong, as consumers shifted purchases to the online channel, including at the Keurig.com retail site.

- Packaged Beverages experienced a net benefit from strong in-market execution, driven by net sales and market share growth in the majority of the segment's beverage portfolio.

Performance in large-format channels continued to be strong across multi-pack and take-home packages, which was partially offset by softness in the convenience and gas channels due to decreased consumer mobility.

- Beverage Concentrates experienced a significant decline in net sales due to the fountain foodservice component of the business, which services restaurants and hospitality, as a result of the impact of shutdowns and reductions in occupant capacity, which improved throughout the year, reflecting a modest reopening of quick-serve and other fast-casual restaurants.

- Latin America Beverages experienced limited growth in sales volumes, driven by reduced consumer mobility and tourism in Mexico.

The current environment has increased operating costs, requiring us to take deliberate action.

DR PEPPER SNAPPLE GROUP, INC. MERGER

On January 29, 2018, DPS entered into a Merger Agreement by and among DPS, Maple and Merger Sub, whereby Merger Sub would be merged with and into Maple, with Maple surviving the DPS Merger as a wholly-owned subsidiary of DPS.

The DPS Merger was consummated on July 9, 2018, at which time DPS changed its name to "Keurig Dr Pepper Inc.".

Maple owns Keurig, a leader in specialty coffee and innovative single serve brewing systems.

The combined businesses created KDP, a new beverage company of scale with a portfolio of iconic consumer brands and expanded distribution capability to reach virtually every point-of-sale in North America.

Refer to Item 1A, *Risk Factors*, of this Annual Report on Form 10-K for information about risks and uncertainties facing us.

We expect net sales growth for the year ending December 31, 2020 to accelerate to 3.0% to 4.0%, versus our merger target of 2.0% to 3.0%.

This momentum is expected to be fueled by investments we are planning across the business, including in the areas of innovation, new partnerships, in-store execution, marketing and research and development.

Adjusted diluted EPS growth for the year ending December 31, 2020 is expected to be in the range of 13% to 15%, or $1.38 to $1.40 per diluted share, reflecting the opportunities we are pursuing and the investments it is planning to make to drive accelerated top-line growth.

Over the three-year period ending December 31, 2021, we continue to expect to deliver Adjusted diluted EPS growth in the range of 15% to 17%, in line with our merger target.

Supporting this guidance are the following expectations:

| | |

| --- | --- |

| • | Merger synergies of $200 million for the year ending December 31, 2020, consistent with our long-term merger target for $200 million per year over the 2019-2021 period. |

| • | Adjusted interest expense is expected to be in the range of $530 million to $545 million, reflecting ongoing deleveraging and some benefit from unwinding interest rate swap contracts. |

| • | The Adjusted effective tax rate is expected to be in the range of 24.5% to 25.0%. |

| • | Diluted weighted average shares outstanding are estimated to be approximately 1,425 million. |

| • | Management leverage ratio is expected to be in the range of 3.5x to 3.8x as of December 31, 2020. |

SEASONALITY

The beverage market is subject to some seasonal variations.

Our cold beverage sales are generally higher during the warmer months, while hot beverage sales are generally higher during the cooler months.

Overall beverage sales can also be influenced by the timing of holidays and weather fluctuations.

Sales of brewing systems and related accessories are generally higher during the second half of the year due to the holiday shopping season.

Concentrate case sales represent units of measurement for concentrates sold by us to our bottlers and distributors.

A concentrate case is the amount of concentrate needed to make one case of 288 fluid ounces of finished beverage.

Our net sales in our concentrate businesses are based on our sales of concentrate cases.

COMPARABLE RESULTS OF OPERATIONS

As a result of the DPS Merger, in order for management to discuss our historical results on a comparable basis, we prepared unaudited pro forma condensed combined financial information to illustrate the estimated effects of the DPS Merger, which was consummated on July 9, 2018, based on the historical results of operations of DPS and Maple.

See *Supplemental Unaudited Pro Forma Condensed Combined Financial Information* section at the end of Management's Discussion and Analysis for further information on the assumptions used in the preparation of the financial information.

Furthermore, management believes that there are certain non-GAAP financial measures that allow management to evaluate our results, trends and ongoing performance on a comparable basis.

For the year ended December 31, 2018, we adjusted certain financial statement captions and metrics prepared on a pro forma basis for certain items affecting comparability.

See *Non-GAAP Financial Measures* for further information on the certain items affecting comparability used in the preparation of the financial information.

Presentation of these adjusted financial statement captions and metrics in the tables below compare adjusted financial information for the year ended December 31, 2019 to adjusted pro forma financial information for the year ended December 31, 2018 to provide more meaningful comparisons between years as a result of the DPS Merger.

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Adjusted net income | 1,727 | | | | 1,458 | | | | 269 | | | | 18.4 | % |

| Diluted EPS | 0.88 | | | | 0.53 | | | | 0.35 | | | | 66.0 | % |

Net income attributable to KDP increased $668 million to $1,254 million for the year ended December 31, 2019, compared to $586 million for the year ended December 31, 2018, primarily driven by the incremental impact in the current year of the DPS Merger completed in 2018, including the favorable comparison to the $158 million of transaction costs and the $131 million impact of the inventory step-up associated with the DPS Merger recorded in the year ended December 31, 2018.

This change primarily reflected the growth in Adjusted income from operations, lower adjusted interest expense, driven by deleveraging and the benefit of unwinding several interest rate swap contracts, and a lower effective tax rate due to the TCJA.

Additionally, Adjusted net income was impacted by the year ago comparison of the non-operating benefits of a cash distribution from BodyArmor in connection with our unit-holder interest and a gain on our prior equity interest in Core as a result of the Core Acquisition and an increase in our share of losses from our investments in unconsolidated affiliates driven by Bedford.

Our primary exposure to foreign exchange rates is the Canadian [removed: dollar and] [added: dollar, the] Mexican peso [added: and the Euro] against the U.S. dollar.

As of December 31, [removed: 2019,] [added: 2020,] the impact to our income from operations of a 10% change (up or down) in exchange rates is estimated to be an increase or decrease of approximately [removed: $30] [added: $38] million on an annual basis.

As of December 31, [removed: 2019,] [added: 2020,] we had derivative contracts outstanding with a notional value of [removed: $523] [added: $809] million maturing at various dates through September [removed: 1,] [added: 25,] 2024.

As of December 31, [removed: 2019,] [added: 2020,] the carrying value of our fixed-rate debt, excluding [removed: capital] lease obligations, was [removed: $11,802] [added: $13,065] million and our variable-rate debt was [removed: $2,618] [added: $423] million, inclusive of commercial paper.

[removed: Additionally, as] [added: As] of December 31, [removed: 2019, the total notional value of receive-fixed, pay-variable interest rate swaps was $50 million and] [added: 2020,] the total notional value of [added: our] receive-variable, pay-fixed interest rate swaps was [removed: $575] [added: $450] million.

[removed: The following table is an estimate of the impact to our interest expense based] [added: Based] upon our variable rate debt and [removed: derivative instruments and] the fair value of the interest rate swaps that could result from hypothetical interest rate changes during the term of the financial instruments, [added: there was no interest rate risk associated with our debt balances] based on debt levels as of December 31, [removed: 2019:][added: 2020.]

The fair market value of these contracts as of December 31, [removed: 2019] [added: 2020] was a net [removed: liability] [added: asset] of [removed: $20] [added: $50] million.

As of December 31, [removed: 2019,] [added: 2020,] the impact of a 10% change (up or down) in market prices for these commodities where the risk of movements has not been hedged is estimated to have a [removed: $25] [added: $15] million impact to our income from operations for the year ended December 31, [removed: 2020.][added: 2021.]

Refer to Note 8 of the Notes to our Consolidated Financial Statements for further information about our derivative instruments.

COMMODITY RISK

As of December 31, 2020, we had derivative contracts outstanding with a notional value of $450 million maturing at various dates through January 1, 2024.

| | | |

| --- | --- | --- |

| Hypothetical Change in Interest Rates(1) | | Annual Impact to Interest Expense |

| 1-percent decrease | | $21 million decrease |

| 1-percent increase | | $21 million increase |

| | |

| --- | --- |

| (1) | We pay an average floating rate, which fluctuates periodically, based on LIBOR and a credit spread, as a result of certain derivative instruments and variable rate debt instruments. See Notes 9 and 10 of the Notes to our Consolidated Financial Statements for further information. |

Commodity Risks

KDP offers more than 125 owned, [removed: licensed, partner] [added: licensed] and [removed: allied] [added: partner] brands, including the top ten best-selling coffee brands and Dr Pepper as a leading flavored CSD in the U.S. according to IRi, available nearly everywhere people shop and consume beverages.

We have [removed: more than 25,500] [added: nearly 27,000] employees, primarily located in North America.

[removed: HISTORY] [added: SEASONALITY] OF OUR BUSINESS

[removed: DPS] [added: KDP] was [added: created through the combination of the business operations of Keurig, a leading producer of innovative single serve brewing systems and specialty coffee in the U.S. and Canada, and DPS, a company] built over time through a series of strategic acquisitions that brought together iconic beverage brands in North America [removed: within Cadbury, building on the Schweppes business by adding brands] such as Dr Pepper, Snapple, 7UP, Canada Dry, Mott's, A&W and the Peñafiel business in Mexico.

Refer to Note [removed: 3] [added: 5] of the Notes to our [removed: Audited] Consolidated Financial Statements for further information related to the DPS Merger.

We have a [removed: family] [added: portfolio] of brands with the ability to satisfy every consumer need, anytime and anywhere – hot or cold, at home or on-the-go, at work or at play.

The following presents highlights of our major owned and licensed brands as of December 31, [removed: 2019:][added: 2020:]

| Category | [added: | |] Major Brands | [added: | |] North America Market Position | [added: | |]

| CSDs | [added: | |] Dr Pepper | [added: | |] #1 in its flavor category and #2 overall flavored CSD in the U.S. | [added: | |]

| | [added: | |] Canada Dry | [added: | |] #1 ginger ale in the U.S. and Canada | [added: | |]

| | [added: | |] Squirt | [added: | |] #1 grapefruit CSD in the U.S. and a leading grapefruit CSD in Mexico | [added: | |]

| | [added: | |] Peñafiel | [added: | |] #1 carbonated mineral water in Mexico | [added: | |]

| | [added: | |] Sunkist soda | [added: | |] #1 orange flavored CSD in the U.S. | [added: | |]

| | [added: | |] Crush | [added: | |] #3 orange flavored CSD in the U.S. | [added: | |]

| | [added: | |] 7UP | [added: | |] #2 lemon-lime CSD in the U.S. | [added: | |]

| | [added: | |] A&W | [added: | |] #1 root beer in the U.S. | [added: | |]

| | [added: | |] Schweppes | [added: | |] #2 ginger ale in the U.S. and Canada | [added: | |]

| NCBs | [added: | |] Snapple | [added: | |] #2 premium shelf stable ready-to-drink tea in the U.S. | [added: | |]

| | [added: | |] Hawaiian Punch | [added: | |] A leading branded shelf-stable fruit punch in the U.S. | [added: | |]

| | [added: | |] Mott's | [added: | |] #1 branded multi-serve apple juice and apple sauce in the U.S. | [added: | |]

| | [added: | |] Clamato | [added: | |] A leading spicy tomato juice in the U.S., Canada and Mexico | [added: | |]

| | [added: | |] Bai | [added: | |] #3 enhanced water in the U.S. | [added: | |]

| | [added: | |] Core | [added: | |] A rapidly growing water brand in the U.S. | [added: | |]

| Single Serve Coffee | [added: | |] Green Mountain | [added: | |] #2 K-cup pod in the U.S. | [added: | |]

| | [added: | |] The Original Donut Shop | [added: | |] #5 K-cup pod in the U.S. | [added: | |]

| | [added: | |] Van Houtte | [added: | |] #2 K-cup pod in Canada | [added: | |]

| Single Serve [removed: Brewing Systems] [added: Brewers] | [added: | |] Keurig | [added: | |] #1 single serve [removed: brewing system] [added: brewer] in the U.S. and Canada | [added: | |]

All information regarding our brand market positions in the U.S. is based on retail market dollars in [removed: 2019.][added: 2020.]

In addition to our major brands above, we also own regional and smaller niche brands, such as [removed: Sun Drop,] Big [removed: Red] [added: Red, Sun Drop] and Vernors.

According to IRi, we had a [removed: 22.7%] [added: 23.8%] share of the U.S. CSD market in [removed: 2019] [added: 2020] (measured by retail sales), an increase of [removed: 60] [added: 110] bps versus [removed: 2018.][added: 2019.]

In the NCB market segment in the U.S., we participate primarily in the [removed: water,] [added: premium water category,] including enhanced and flavored water, ready-to-drink tea, juice, juice drinks, and mixer categories.

Our Keurig single serve [removed: brewing systems] [added: brewers] are aimed at changing the way consumers prepare and enjoy coffee and other beverages both at home and away from home in places such as offices, restaurants, cafeterias, convenience stores and hotels.

We create value by developing and selling our Keurig single serve [removed: brewing system] [added: brewers] and by expanding Keurig [removed: system] [added: brewer] household adoption, which increased [removed: 7%] [added: nearly 10%] for the year ended December 31, [removed: 2019] [added: 2020] to approximately [removed: 30] [added: 33] million U.S. households, based on third party survey data and our [added: own] estimates.

Expansion of Keurig system household adoption enables sales of specialty coffee and a variety of other specialty beverages in K-Cup pods (including hot and iced teas, hot cocoa and other beverages) for use with Keurig [removed: brewing systems.][added: brewers.]

We, together with our partners, are able to bring consumers high-quality coffee and other beverage experiences from the brands they love, all through the one-touch simplicity and convenience of Keurig [removed: brewing systems.][added: brewers.]

We currently offer a portfolio of more than 125 owned, licensed, partner and private label brands, including the top ten best-selling coffee brands in the U.S. based on [removed: IRi, as part of the Keurig brewing system.][added: IRi.]

We actively manage transportation of our products using our fleet (owned and leased) of approximately [removed: 6,000] [added: 6,100] vehicles in the U.S. and 1,700 in Mexico, as well as third party logistics providers.

We have a robust innovation program, which is designed to meet consumers' changing flavor and beverage preferences and to grow the number of households using our single serve [removed: brewing systems.][added: brewers.]

We have cultivated relationships with leading beverage brands to create long-term partnerships that enable us and our partners to benefit equitably in future value creation, and where appropriate, we bring these partner [removed: and allied] brands into our owned portfolio through acquisitions.

We continually evaluate making investments in companies that fill in whitespace in our [removed: portfolio with a pre-negotiated formula to acquire these unconsolidated affiliates at certain milestones.][added: portfolio.]

Today, we trade on Nasdaq under the symbol KDP, and we are a member of the Nasdaq 100 Index.

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PRODUCT INNOVATION

We are focused on a robust innovation pipeline within our portfolio of products to build household penetration of our business.

We regularly launch new brewers with new features and benefits, technological advances, and changes in aesthetics and sustainability to provide a variety of options to suit individual consumer preferences.

We also continuously innovate and renovate our portfolio of K-cup pods, CSDs and NCBs to provide an expansive array of flavors.

During 2020, we introduced the K-Supreme and the K-Supreme Plus brewers, which include multi-stream technology to provide the consumer better extraction compared to previous models, while adding new controls for temperature and strength.

We also launched a limited-edition brewer designed by Jonathan Adler.

We achieved our longstanding commitment to make all of the K-Cup pods that we produce recyclable, as the pods are now made from polypropylene #5 plastic.

We launched a line of K-Cup pods to provide one-step lattes with our Original Donut Shop Vanilla and Mocha lattes.

Within our CSD portfolio, we launched Dr Pepper & Cream Soda, which was the best-selling CSD innovation in 2020 according to IRi, and Canada Dry Bold.

Within our NCB portfolio, we launched Zambia Bing Cherry and Blackberry Lemonade, two new flavors for Bai, and Snapple’s Mystery Flavor as a limited time offer.

We have also begun the rollout of new PET bottles made from 100% recycled PET for Snapple and Core.

Generally, we are able to sell these brands to our away from home channel participants and end-use consumers.

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We are expanding our manufacturing capabilities to include a concentrate manufacturing facility in Ireland in 2021.

Our Beverage Concentrates brands are sold by our bottlers through all major retail channels.

These bottlers may be affiliated with Coca-Cola, with PepsiCo, or may be independent.

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OUR MATERIAL RESOURCES

The availability, quality and costs of many of these materials have fluctuated, and may continue to fluctuate, over time.

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During 2020, 82% of our purchases of green coffee were responsibly sourced through third party sourcing programs, and by the end of 2020, all coffee contracted to be received going forward is 100% responsibly sourced.

These purchases include a corresponding premium to recognize the effort required to achieve the sustainability standard and are traceable back to the exporter mill, farm or group of farms.

Trademarks and Patents

Licensing Arrangements

We license various trade names from our partners in order to manufacture K-Cup pods.

Although these licenses vary in length and other terms, they generally are long-term, cover the entire U.S. and/or Canada and generally include an upfront payment to the partner in order to use their trade names to manufacture and/or distribute the K-Cup pods.

For CSDs and NCBs in emerging and fast growing categories where we may not currently have a brand presence, we license various trademarks from third party partners, which generally allow us to manufacture and distribute certain products or brands throughout the U.S., Canada or Mexico.

Although these licenses vary in length and other terms, they generally are long-term, cover the entire U.S. and/or Canada and Mexico, and generally require a payment from the partner if the licensing agreement is terminated.

In some instances, we make investments in these companies, which may include a path to acquire the company after a period of time based on a pre-determined formula.

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OUR HUMAN CAPITAL RESOURCES

Our Employees

In the U.S., we have approximately 21,500 employees, of which approximately 4,500 employees are covered by union collective bargaining agreements.

Keurig Green Mountain, Inc.

Maple is a holding company that conducts substantially all of its business through Keurig, a leading producer of innovative single serve brewing systems and specialty coffee in the U.S. and Canada.

Green Mountain Coffee Roasters, Inc. was incorporated in July 1993 and acquired Keurig, Inc. in June 2006 to form Keurig.

In December 2015, JAB formed an indirect wholly-owned subsidiary, Maple Holdings Acquisition Corp. In February 2016, Maple was formed by JAB.

In March 2016, Maple, through Maple Holdings Acquisition Corp., completed the Keurig Acquisition.

Dr Pepper Snapple Group, Inc.

DPS was incorporated in Delaware on October 24, 2007.

In 2008, Cadbury contributed its beverage subsidiaries in the U.S., Canada, Mexico and the Caribbean to DPS.

The DPS Merger

On January 29, 2018, DPS, Maple and Merger Sub entered into the DPS Merger Agreement, whereby Merger Sub would be merged with and into Maple, with Maple surviving the merger as a wholly-owned subsidiary of DPS.

Through the DPS Merger, we have brought together two iconic companies to create a unified business with a fresh approach to the beverage industry and the size and scale to achieve things not possible separately.

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| --- | --- | --- |

We have also begun to distribute certain products in other international jurisdictions through various third party bottlers and distributors.

We also offer traditional whole bean and ground coffee in other package types, including bags, fractional packages and cans.

Our brewing systems are aimed at changing the way consumers prepare and enjoy coffee and other beverages, both at home and away from home in places such as offices, restaurants, cafeterias, convenience stores and hotels.

We develop and sell a variety of Keurig brewers, brewer accessories and other coffee-related equipment.

In addition to coffee, we produce and sell a variety of other specialty beverages in K-Cup pods (including hot and iced teas, hot cocoa and other beverages) for use with Keurig brewing systems.

Our Packaged Beverages products are manufactured in multiple facilities across the U.S. and are sold or distributed to retailers and their warehouses by our own distribution network or by third party distributors.

Our Beverage Concentrates brands are sold by our bottlers through all major retail channels including supermarkets, fountains, mass merchandisers, club stores, vending machines, convenience stores, gas stations, small groceries, drug chains and dollar stores.

In 2019, the PepsiCo affiliated and Coca-Cola affiliated bottler systems were the Beverage Concentrates segment's largest customers.

Unlike the majority of our other CSD brands, approximately 53% of Dr Pepper, Schweppes, and Crush finished good volumes in the U.S. and Canada are distributed through either the PepsiCo affiliated or Coca-Cola affiliated bottler systems.

In Mexico, we manufacture and distribute our products through our bottling operations and third party bottlers and distributors.

We sell our finished beverages through all major Mexican retail channels, including small outlets, supermarkets, hypermarkets, convenience stores and on-premise channels.

In the Caribbean, we distribute our products through third party bottlers and distributors.

In 2010, we completed the licensing of certain brands to PepsiCo and Coca-Cola.

The agreements have an initial period of 20 years with automatic 20\-year renewal periods and require PepsiCo, Coca-Cola and certain Coca-Cola affiliated bottlers to meet certain performance conditions.

ALLIED BRANDS

These partnerships allow us to rapidly participate in growth in emerging and fast growing categories where we do not currently have a brand presence.

We sometimes make an investment in each company.

| | |

| --- | --- |

These ingredients and packaging costs can fluctuate substantially and comprise approximately 59% of our cost of sales.

In 2019, 65% of our purchases of green coffee were responsibly sourced through third party sourcing programs, which include a corresponding premium to the base commodity price.

We are committed to achieving 100% responsible sourcing by the end of 2020.

In addition, 97% of our green coffee purchases were traceable back to the exporter mill, group or farm.

SEASONALITY

We maintain environmental, health and safety policies and a quality, environmental, health and safety program designed to ensure compliance with applicable laws and regulations.

The cost of such compliance measures does not have a material financial impact on our operations.

In addition to our low calorie and portion control options for our full calorie beverages we also have a robust portfolio of zero, low and mid calorie beverage brands.

Refer to Note [removed: 17] [added: 16] of the Notes to our [removed: Audited] Consolidated Financial Statements related to commitments and contingencies, which is incorporated herein by reference.

The complaint [removed: asserts] [added: asserted] claims for breach of contract and promissory estoppel against BodyArmor and [removed: asserts] [added: asserted] a claim for tortious interference against Mr. Repole, in each case in connection with BodyArmor's attempted early termination of the distribution contract between BodyArmor and ABC.

The complaint seeks monetary [added: damages relating to lost distribution revenues, disgorgement of profits, liquidated and punitive] damages, attorneys' fees and costs.

ABC intends to [added: continue to] vigorously prosecute the action.

ABC filed an amended complaint which added Coca-Cola as a defendant to the suit and asserted a claim for tortious interference against Coca-Cola.

In December 2020, the court dismissed the individual claim against Mr. Repole, but ABC's claims against BodyArmor and Coca-Cola continue.

Fact and expert discovery in the case is ongoing and a trial date has been set for November 2021.

The court has rejected BodyArmor's motion to dismiss our lawsuit.

FOR THE FISCAL YEAR [removed: ENDED DECEMBER] [added: ENDED December] 31, [removed: 2019][added: 2020]

COMMISSION FILE [removed: NUMBER 001-33829][added: NUMBER 001-33829]

[removed: ][added: ]

| | [added: | |] Keurig Dr Pepper Inc. | | | | [added: | | | | | | | |]

| | [added: | |] *(Exact name of registrant as specified in its charter)* | | | | [added: | | | | | | | |]

| Delaware | | [added: | | | |] 98-0517725 | | [added: | | | |]

| *(State or other jurisdiction of incorporation or organization)* | | [added: | | | |] *(I.R.S. employer identification number)* | | [added: | | | |]

| | [added: | |] 53 South Avenue | | | [added: | | | | | |]

| | [added: | |] Burlington, | [added: | |] Massachusetts | | [added: | | | |]

| | [added: | |] 01803 | | | [added: | | | | | |]

| *(Address of principal executive offices)* | | | | [added: | | | | | | | |]

| *(Registrant's telephone number, including area code)* | | | | [added: | | | | | | | |]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of [removed: 1934).][added: 1934).Yes ☐ No ☒]

| Title of each class | | [added: | | | |] Trading Symbol | | [added: | | | |] Name of each exchange on which registered | [added: | |]

| [removed: Common stock] [added: NYSE] | | [removed: KDP] | | [added: | |] New York Stock Exchange | [added: | |]

As of June 30, [removed: 2019,] [added: 2020,] the last business day of the registrant's most recently completed second fiscal quarter, the aggregate market value of the registrant's common equity held by non-affiliates of the registrant [removed: (assuming for these purposes, but without conceding, that all] [added: (treating directors,] executive officers and [removed: directors as] [added: beneficial owners] of [removed: that date are "affiliates"] [added: 10% or more] of the [removed: registrant)] [added: registrant’s common stock outstanding as of that date, for this purpose, as affiliates)] was approximately [removed: $40.7] [added: $13.7] billion (based on the closing sales price of the registrant's common stock on that [removed: date as reported on the New York Stock Exchange).][added: date).]

As of February [removed: 26, 2020,] [added: 23, 2021,] there were [removed: 1,406,986,313] [added: 1,407,267,272] shares of the registrant's common stock, par value $0.01 per share, outstanding.

Portions of the registrant's definitive proxy statement to be filed with the Securities and Exchange Commission in connection with the registrant's Annual Meeting of Stockholders [removed: or on an amendment on Form 10–K/A] are incorporated by reference in Part III.

[removed: KEURIG DR PEPPER INC.][added: | 2019 Incentive Plan | | | | | | Keurig Dr Pepper Inc. Omnibus Incentive Plan of 2019 | | |]

FOR THE YEAR ENDED DECEMBER 31, [removed: 2019][added: 2020]

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| [Item [removed: 4](#s03324B11629E53668014E58005A376C3)] [added: 4](#i4e002ac394c34074b07ec2df1e1fbbfe_31)] | [added: | |] [Mine Safety [removed: Disclosures](#s03324B11629E53668014E58005A376C3)] [added: Disclosures](#i4e002ac394c34074b07ec2df1e1fbbfe_31)] | [removed: [21](#s03324B11629E53668014E58005A376C3)] | [added: | [21](#i4e002ac394c34074b07ec2df1e1fbbfe_31) | | |]

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| [Item [removed: 7](#s4E909C9CC27652C19E148BE7AB4D328A)] [added: 7](#i4e002ac394c34074b07ec2df1e1fbbfe_43)] | [added: | |] [Management's Discussion and Analysis of Financial Condition and Results of [removed: Operations](#s4E909C9CC27652C19E148BE7AB4D328A)] [added: Operations](#i4e002ac394c34074b07ec2df1e1fbbfe_43)] | [removed: [25](#s4E909C9CC27652C19E148BE7AB4D328A)] | [added: | [23](#i4e002ac394c34074b07ec2df1e1fbbfe_43) | | |]

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| | [removed: PART III] | | [added: [PART III](#i4e002ac394c34074b07ec2df1e1fbbfe_289) | | | | | |]

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| Term | | [added: | | | |] Definition | [added: | |]

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | |

| | | | (781) | | | 418-7000 | | | | | |

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Common stock | | | | | | KDP | | | | | | The Nasdaq Stock Market LLC | | |

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | [PART I](#i4e002ac394c34074b07ec2df1e1fbbfe_13) | | | | | |

| | | | | | | | | |

| | | | [PART II](#i4e002ac394c34074b07ec2df1e1fbbfe_34) | | | | | |

| Item 6 | | | \[Removed and Reserved\] | | | | | |

| [Item 9B](#i4e002ac394c34074b07ec2df1e1fbbfe_286) | | | [Other Information](#i4e002ac394c34074b07ec2df1e1fbbfe_286) | | | [103](#i4e002ac394c34074b07ec2df1e1fbbfe_286) | | |

| | | | | | | | | |

| [Item 11](#i4e002ac394c34074b07ec2df1e1fbbfe_289) | | | [Executive Compensation](#i4e002ac394c34074b07ec2df1e1fbbfe_289) | | | [103](#i4e002ac394c34074b07ec2df1e1fbbfe_289) | | |

| | | | | | | | | |

| | | | [PART IV](#i4e002ac394c34074b07ec2df1e1fbbfe_292) | | | | | |

FOR THE YEAR ENDED DECEMBER 31, 2020

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| 2020 364-Day Credit Agreement | | | | | | The Company's $1,500 million credit agreement, which was entered into on April 12, 2020 and replaced the 2019 364-Day Credit Agreement | | |

| A Shoc | | | | | | Adrenaline Shoc, an equity method investment of KDP and a brand of energy drinks | | |

| Bedford | | | | | | Bedford Systems, LLC, an equity method investment of KDP and the maker of Drinkworks | | |

| DPS Merger | | | | | | The combination of the business operations of Keurig and DPS that was consummated on July 9, 2018 through a reverse merger transaction, whereby a wholly-owned special purpose merger subsidiary of DPS merged with and into the direct parent of Keurig | | |

| DSD | | | | | | Direct Store Delivery, the reporting unit whereby finished beverages are delivered directly to retailers | | |

FOR THE YEAR ENDED DECEMBER 31, 2020

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| LifeFuels | | | | | | LifeFuels, Inc., an equity method investment | | |

| Nasdaq | | | | | | The Nasdaq Stock Market LLC | | |

| Peet's | | | | | | Peet's Coffee & Tea, Inc. | | |

| PET | | | | | | Polyethylene terephthalate, which is used to make the Company's plastic bottles | | |

| PSU | | | | | | Performance stock unit | | |

| Veyron SPE | | | | | | Veyron NE Beverage Licensing LLC | | |

| WD | | | | | | Warehouse Direct, the reporting unit whereby finished beverages are shipped to retailer warehouses, and then delivered by the retailer through its own delivery system to its stores | | |

[Table of Content](#i4e002ac394c34074b07ec2df1e1fbbfe_7)[s](#i4e002ac394c34074b07ec2df1e1fbbfe_7)

FORM 10-K

| | | | | |

| --- | --- | --- | --- | --- |

| | | | |

| --- | --- | --- | --- |

| | (802) | 244-5621 | |

Yes ☐ No ☒

| | | |

| --- | --- | --- |

| | [PART I](#sB50C56898D075B849DB79591F1FC9735) | |

| | [PART II](#s64F8600FD0655A9F847D54248B7349DE) | |

| [Item 6](#s1A9FD6A5C1365E1187960067C0B2E328) | [Selected Financial Data](#s1A9FD6A5C1365E1187960067C0B2E328) | [24](#s1A9FD6A5C1365E1187960067C0B2E328) |

| [Item 9B](#sEA8C051342095959825DB1CE75751E74) | [Other Information](#sEA8C051342095959825DB1CE75751E74) | [113](#sEA8C051342095959825DB1CE75751E74) |

| [Item 11](#s15E840D4C6F8524FA21B6AD6AE95F87E) | [Executive Compensation](#s15E840D4C6F8524FA21B6AD6AE95F87E) | [113](#s15E840D4C6F8524FA21B6AD6AE95F87E) |

| | [PART IV](#s0CC2671E8DE45CA5BD8905FA44714F06) | |

| 2019 Incentive Plan | | Keurig Dr Pepper Inc. Omnibus Incentive Plan of 2019 |

| 2019 KDP Term Loan Agreement | | The agreement executed on February 8, 2019 between KDP and the Term Loan Lenders in order to refinance the 2018 KDP Term Loan with the 2019 KDP Term Loan. |

| A Shoc | | Adrenaline Shoc |

| ASC 840 | | Accounting Standards Codification Topic 840, *Leases* (Old Leasing Standard) |

| ASC 842 | | Accounting Standards Codification Topic 842, *Leases* (New Leasing Standard) |

| Bedford | | Bedford Systems, LLC |

| Big Red Acquisition Agreement | | The agreement and plan of merger between KDP and Big Red, whereby KDP agreed to acquire Big Red |

| Cadbury | | Cadbury Schweppes plc |

| Core Acquisition Agreement | | The definitive agreement between KDP and Core, whereby KDP agreed to acquire Core |

| DPS Merger | | The acquisition of DPS by Maple, whereby Merger Sub merged with and into Maple, with Maple surviving the merger as a wholly-owned subsidiary of DPS as of the Merger Date. |

| DPS Merger Agreement | | The Agreement and Plan of Merger by and among DPS, Maple and Merger Sub to effect the DPS Merger |

| DSD | | Direct Store Delivery |

| E&P | | Earnings and profits determined under U.S. income tax principles |

| EOP | | Keurig Green Mountain, Inc. Executive Ownership Plan |

| Fiscal 2017 | | Fiscal year ended September 30, 2017 |

| IRC | | The Internal Revenue Code of 1986, as amended |

| KDP | | Keurig Dr Pepper Inc. |

| Keurig Acquisition | | The acquisition of Keurig and its subsidiaries in March 2016 by Maple |

| Kraft Heinz | | The Kraft Heinz Company |

| Legacy Stock Awards | | Collectively, the DPS stock option awards, RSUs and PSUs which were unvested prior to the DPS Merger |

| LRB | | Liquid Refreshment Beverage |

| LTIP | | Keurig Green Mountain, Inc. Long Term Incentive Plan |

| Maple | | Maple Parent Holdings Corp. |

| Merger Sub | | Salt Merger Sub, Inc. |

| Mondelēz | | Mondelēz International, Inc. |

We have two corporate headquarters, located in Burlington, Massachusetts and Plano, [removed: Texas.][added: Texas, both of which are leased.]

The following table summarizes our principal manufacturing plants and principal warehouse and distribution facilities by geography and reportable segment as of December 31, [removed: 2019:][added: 2020:]

| | [added: | |] Beverage Concentrates | | | | | | [added: | | | | | |] Packaged Beverages | | | | | | [added: | | | | | |] Latin America Beverages | | | | | | [added: | | | | | |] Coffee Systems | | | | | | [added: | | | | | |] Total | | | | | [added: | | | |]

| | [added: | |] Owned | | | [added: | | |] Leased | | | [added: | | |] Owned | | | [added: | | |] Leased | | | [added: | | |] Owned | | | [added: | | |] Leased | | | [added: | | |] Owned | | | [added: | | |] Leased | | | [added: | | |] Owned | | | [added: | | |] Leased | | [added: |]

| United States | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Production [removed: facilities] [added: facilities(1)] | [added: | |] 1 | | | [added: | | |] — | | | [removed: 9] | | | 8 | | | [added: | | | 10 | | | | | |] — | | | [added: | | |] — | | | [removed: 3] | | | [removed: 3] [added: 2] | | | [removed: 13] | | | [added: 4 | | | | | |] 11 | | [added: | | | | 14 | | |]

| Warehouse and distribution facilities | [added: | |] — | | | [added: | | |] — | | | [removed: 32] | | | [added: 29 | | | | | |] 62 | | | [added: | | |] — | | | [added: | | |] — | | | [added: | | |] — | | | [removed: 6] | | | [removed: 32] [added: 4] | | | [removed: 68] | | [added: | 29 | | | | | | 66 | | |]

| International | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | [added: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |]

| Production [removed: facilities] [added: facilities(2)] | [added: | |] — | | | [added: | | |] — | | | [added: | | |] — | | | [added: | | |] — | | | [added: | | |] 3 | | | [added: | | |] — | | | [removed: 4] | | | [removed: 1] [added: 3] | | | [removed: 7] | | | [removed: 1] [added: —] | | [added: | | | | 6 | | | | | | — | | |]

| Warehouse and distribution facilities | [added: | |] — | | | [added: | | |] — | | | [added: | | |] — | | | [added: | | |] — | | | [added: | | |] 5 | | | [removed: 26] | | | [added: 27 | | | | | |] 2 | | | [removed: 24] | | | [added: 33 | | | | | |] 7 | | | [removed: 50] | | [added: | 60 | | |]

We periodically review our space requirements, and we look to consolidate and dispose or sublet facilities we no longer need as [removed: and when] appropriate.

Our Plano headquarters will move to Frisco, Texas in 2021.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total | | | 1 | | | | | | — | | | | | | 37 | | | | | | 72 | | | | | | 8 | | | | | | 27 | | | | | | 7 | | | | | | 41 | | | | | | 53 | | | | | | 140 | | |

(1)Our manufacturing facility in Spartanburg, South Carolina, is excluded from the above table as it is currently under construction and not operational.

We expect this facility to be operational during 2021.

(2)Our manufacturing facility in Newbridge, Ireland, is excluded from the above table as it is currently under construction and not operational.

We expect this facility to be operational during 2021.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total | 1 | | | — | | | 41 | | | 70 | | | 8 | | | 26 | | | 9 | | | 34 | | | 59 | | | 130 | |

[removed: Since] [added: From] July 9, 2018, [added: through September 18, 2020,] our common stock [removed: has been] [added: was] listed and traded on the NYSE under the ticker symbol "KDP".

Prior to [removed: July 9, 2018 and] the closing of the DPS Merger, our common stock was listed and traded on the NYSE under the ticker symbol "DPS".

As of December 31, [removed: 2019,] [added: 2020,] there were [removed: 10,729] [added: 10,375] stockholders of record of our common stock.

The following performance graph compares the cumulative total returns of DPS through July 9, 2018 and KDP from July 10, 2018 through December 31, [removed: 2019] [added: 2020] with the cumulative total returns of the S&P 500 Index and the S&P Food and Beverage Select Industry Index.

The graph assumes that $100 was invested on December 31, [removed: 2014,] [added: 2015,] with dividends reinvested quarterly.

[removed: ][added: ]

Effective September 21, 2020, our common stock was listed and began trading on Nasdaq's Global Select Market under the ticker symbol "KDP".

KDP's Board has declared a regular quarterly cash dividend and expects to continue to pay such dividends on a quarterly basis.

The information that will be included under the principal heading "Equity Compensation Plan Information" in our definitive Proxy Statement to be filed with the SEC is incorporated herein by reference.

DIVIDEND INFORMATION

During the year ended December 31, 2019, our Board declared aggregate dividends of $0.60 per share on outstanding common stock.

During 2018, our Board established a regular quarterly dividend program and declared aggregate dividends of $0.30 per share on outstanding common stock from the period commencing upon the closing of the DPS Merger on July 9, 2018 through December 31, 2018.

Additionally, the Company declared and paid $23 million in dividends during the period commencing January 1, 2018 through July 8, 2018 (prior to the DPS Merger).

The following table presents selected historical financial data for the successor periods consisting of the years ended December 31, 2019 and 2018, three months ended December 31, 2017, fiscal year ended September 30, 2017 and the period from December 4, 2015 through September 24, 2016, as well as the predecessor periods of September 27, 2015 through March 2, 2016 and the fiscal year ended September 26, 2015.

These periods have been derived from our Audited Consolidated Financial Statements.

You should read this information along with the information included in Item 7, *Management's Discussion and Analysis of Financial Condition and Results of Operations*, and our Audited Consolidated Financial Statements and the related Notes thereto included elsewhere in this Annual Report on Form 10-K.

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| | Successor | | | | | | | | | | | | | | | | | | | | Predecessor | | | | | | |

| (in millions, except per share data) | Year Ended December 31, 2019 | | | | Year Ended December 31, 2018 | | | | Transition 2017 | | | | Fiscal 2017 | | | | December 4, 2015 through September 24, 2016 | | | | September 27, 2015 through March 2, 2016 | | | | Fiscal Year Ended September 26, 2015 | | |

| Statements of Income Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Net sales | $ | 11,120 | | | $ | 7,442 | | | $ | 1,170 | | | $ | 4,269 | | | $ | 2,293 | | | $ | 2,025 | | | $ | 4,520 | |

| Gross profit | 6,342 | | | | 3,882 | | | | 527 | | | | 2,044 | | | | 1,073 | | | | 800 | | | | 1,608 | | |

| Income from operations | 2,378 | | | | 1,237 | | | | 229 | | | | 897 | | | | 393 | | | | 147 | | | | 765 | | |

| Net income(1) | 1,254 | | | | 589 | | | | 619 | | | | 383 | | | | 109 | | | | 100 | | | | 499 | | |

| Basic EPS(2) | $ | 0.89 | | | $ | 0.54 | | | $ | 0.77 | | | $ | 0.48 | | | $ | 0.19 | | | $ | 0.66 | | | $ | 3.17 | |

| Diluted EPS(2) | 0.88 | | | | 0.53 | | | | 0.77 | | | | 0.47 | | | | 0.18 | | | | 0.66 | | | | 3.14 | | |

| Dividends declared per share(3) | 0.60 | | | | 0.30 | | | | — | | | | — | | | | — | | | | 0.33 | | | | 1.15 | | |

| Statements of Cash Flows Data: | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Cash provided by (used in): | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Operating activities | $ | 2,474 | | | $ | 1,613 | | | $ | 385 | | | $ | 1,749 | | | $ | 280 | | | $ | 837 | | | $ | 755 | |

| Investing activities | (150 | | ) | | (19,131 | | ) | | (18 | | ) | | 180 | | | | (13,772 | | ) | | (75 | | ) | | (498 | | ) |

| Financing activities | (2,364 | | ) | | 17,577 | | | | (620 | | ) | | (2,026 | | ) | | 13,937 | | | | (647 | | ) | | (972 | | ) |

| | |

| --- | --- |

| (1) | For Transition 2017, net income and basic and diluted earnings per share were impacted by the initial impact of the TCJA. Refer to Note 7 of the Notes to our Audited Consolidated Financial Statements for further information. |

| (2) | The weighted average number of shares of common stock outstanding used in the calculation of EPS during the year ended December 31, 2018 was impacted by the issuance of KDP common stock and the shares retained by the DPS stockholders. Refer to the Consolidated Statements of Changes in Stockholders' Equity and Note 1 of the Notes to our Audited Consolidated Financial Statements for further information. Additionally, EPS for periods owned by the predecessor were computed under the predecessor's ownership structure and were not adjusted as a result of the DPS Merger. |

| (3) | During the periods of Transition 2017, Fiscal 2017 and the Successor period of December 4, 2015 through September 24, 2016, the Company did not declare dividends on a per share basis, as Maple was a privately-held company. The Company declared and paid dividends of $10 million, $54 million and $10 million in the respective periods. Additionally, during the year ended December 31, 2018, prior to the DPS Merger, the Company declared and paid $23 million in dividends. |

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| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | Successor | | | | | | | | | | | | | | | | | | | | Predecessor | | |

| | December 31, | | | | | | | | | | | | September 30, 2017 | | | | September 24, 2016 | | | | September 26, 2015 | | |

| (in millions) | 2019 | | | | 2018 | | | | 2017 | | | | | | | | | | | | | | |

| Balance Sheet Data: | | | | | | | | | | | | | | | | | | | | | | | |

| Goodwill and other intangible assets, net | $ | 44,289 | | | $ | 43,978 | | | $ | 13,653 | | | $ | 13,691 | | | $ | 14,060 | | | $ | 1,171 | |

| Total assets | 49,518 | | | | 48,918 | | | | 15,744 | | | | 16,107 | | | | 16,609 | | | | 4,002 | | |

| Short-term borrowings and current portion of long-term obligations | 1,593 | | | | 1,458 | | | | 219 | | | | 219 | | | | 186 | | | | — | | |

| Structured payables | 321 | | | | 526 | | | | — | | | | — | | | | — | | | | — | | |

| Long-term obligations | 12,827 | | | | 14,201 | | | | 4,879 | | | | 5,475 | | | | 7,322 | | | | 331 | | |

| Total stockholders’ equity | 23,257 | | | | 22,533 | | | | 7,398 | | | | 6,828 | | | | 6,510 | | | | 2,709 | | |

| | | [added: | | | |] Page Number | [added: | |]

| [Reports of Independent Registered Accounting [removed: Firm](#sCC24FDCF4F005CEA9C97947FD395BE33)] [added: Firm](#i4e002ac394c34074b07ec2df1e1fbbfe_145)] | | [removed: [50](#sCC24FDCF4F005CEA9C97947FD395BE33)] | [added: | | | [48](#i4e002ac394c34074b07ec2df1e1fbbfe_145) | | |]

[removed: | [Consolidated Statements of Income](#s0E3F3445B19A5B9D9EE7B41824224A4E) | | [53](#s0E3F3445B19A5B9D9EE7B41824224A4E) |][added: CONSOLIDATED STATEMENTS OF INCOME]

[removed: | [Consolidated Statements of Comprehensive Income](#s4AF18716F64F56CE89021FD3D5C5D9C0) | | [54](#s4AF18716F64F56CE89021FD3D5C5D9C0) |][added: CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME]

| [Consolidated Balance [removed: Sheets](#sD8A284555CB855C89BA16429B3A64CCE)] [added: Sheets](#i4e002ac394c34074b07ec2df1e1fbbfe_157)] | | [removed: [55](#sD8A284555CB855C89BA16429B3A64CCE)] | [added: | | | [53](#i4e002ac394c34074b07ec2df1e1fbbfe_157) | | |]

[removed: | [Consolidated Statements of Cash Flows](#s436D2567B424584DAC00E07AE787A1D9) | | [56](#s436D2567B424584DAC00E07AE787A1D9) |][added: CONSOLIDATED STATEMENTS OF CASH FLOWS]

| [Consolidated Statements of Changes in Stockholders' [removed: Equity](#s267EA8062AA05A2A84A9FF79860C63A9)] [added: Equity](#i4e002ac394c34074b07ec2df1e1fbbfe_166)] | | [removed: [58](#s267EA8062AA05A2A84A9FF79860C63A9)] | [added: | | | [56](#i4e002ac394c34074b07ec2df1e1fbbfe_166) | | |]

| [Notes to [removed: Audited] Consolidated Financial [removed: Statements](#s76675DC9C5CB5A2099E6B8CF960A17DE)] [added: Statements](#i4e002ac394c34074b07ec2df1e1fbbfe_169)] | | [removed: [59](#s76675DC9C5CB5A2099E6B8CF960A17DE)] | [added: | | | [57](#i4e002ac394c34074b07ec2df1e1fbbfe_169) | | |]

[removed: | [1.] Business and Basis of [removed: Presentation](#sFDC54B5B136E5D2FB49DC1AF97FBB5F2) | | [59](#sFDC54B5B136E5D2FB49DC1AF97FBB5F2) |][added: Presentation]

[removed: | [2.] Significant Accounting [removed: Policies](#s367B8CDFC8625A17A23411873A528F5F) | | [60](#s367B8CDFC8625A17A23411873A528F5F) |][added: Policies]

| [removed: [3.] [added: [5.] Acquisitions and Investments in Unconsolidated [removed: Subsidiaries](#sFA29719F885A52D181019E2D4ACB08D3)] [added: Subsidiaries](#i4e002ac394c34074b07ec2df1e1fbbfe_181)] | | [removed: [69](#sFA29719F885A52D181019E2D4ACB08D3)] | [added: | | | [73](#i4e002ac394c34074b07ec2df1e1fbbfe_181) | | |]

[removed: | [4. Leases](#s69E158C925265DD1B6A682FEA51685AD) | | [74](#s69E158C925265DD1B6A682FEA51685AD) |][added: Leases]

[removed: | [5.] Goodwill and Other Intangible [removed: Assets](#sC5F1E6DB765059D48F383A9ED31F1D86) | | [76](#sC5F1E6DB765059D48F383A9ED31F1D86) |][added: Assets]

[removed: | [6. Integration and] Restructuring [removed: Costs](#s5C08B92E2F2552FEBB1E78440963BEA5) | | [77](#s5C08B92E2F2552FEBB1E78440963BEA5) |][added: and Integration Costs]

[removed: | [7.] Income [removed: Taxes](#sCD067ADE496E5C4EBFA209BFEEA84627) | | [79](#sCD067ADE496E5C4EBFA209BFEEA84627) |][added: Taxes]

[removed: | [8.] Employee Benefit [removed: Plans](#s48A30D47C80A5CE3B42187B175E07BFB) | | [81](#s48A30D47C80A5CE3B42187B175E07BFB) |][added: Plans]

[removed: | [9. Long-Term] [added: Long-term] Obligations and Borrowing [removed: Arrangements](#s41B7FC6989D55872BF976524507BAD47) | | [87](#s41B7FC6989D55872BF976524507BAD47) |][added: Arrangements]

[removed: | [11.] Earnings [removed: per Share](#s6D5674477ABA51408E39F0AB91DF130D) | | [93](#s6D5674477ABA51408E39F0AB91DF130D) |][added: Per Share]

| [removed: [12. Stock-Based Compensation](#s9698DA10034D5C6B9B9DA08F4D94B33A)] [added: Stock-based compensation] | | [removed: [93](#s9698DA10034D5C6B9B9DA08F4D94B33A)] | [added: — | | | | | | — | | | | | | 20 | | | | | | — | | | | | | — | | | | | | 20 | | | | | | — | | | | | | 20 | | |]

[removed: | [13.] Accumulated Other Comprehensive [removed: (Loss) Income](#sD238D192ED9854BF882BF5E6176162DA) | | [95](#sD238D192ED9854BF882BF5E6176162DA) |][added: Income (Loss)]

[removed: | [14.] Property, Plant and [removed: Equipment](#sAC08C086088E563CA0A1C5B0C528B3F4) | | [95](#sAC08C086088E563CA0A1C5B0C528B3F4) |][added: Equipment]

[removed: | [15.] Other Financial [removed: Information](#s97083D67C4235C4183AC7545972D4FC1) | | [96](#s97083D67C4235C4183AC7545972D4FC1) |][added: Information]

| [removed: [16.] Non-controlling [removed: Interest](#sFE6FB23F12BD5C3E802F1E7D6F51941D)] [added: interest] | | [removed: [97](#sFE6FB23F12BD5C3E802F1E7D6F51941D)] | [added: 1 | | | | | | — | | |]

| [removed: [17.] Commitments and [removed: Contingencies](#s895DD74DAE315C76B2D8FC001973C396)] [added: contingencies] | | [removed: [98](#s895DD74DAE315C76B2D8FC001973C396)] | [added: | | | | | | | | |]

[removed: | [18.] Related [removed: Parties](#s4F4A8FC4CEBC5FCAB81A165BCF70BBAC) | | [100](#s4F4A8FC4CEBC5FCAB81A165BCF70BBAC) |][added: Parties]

[removed: | [20.] Revenue [removed: Recognition](#s565CF715AD4654F69C5F1DDA25C66D71) | | [103](#s565CF715AD4654F69C5F1DDA25C66D71) |][added: Recognition]

[removed: | [22.] Unaudited Quarterly Financial [removed: Information](#s86750EF254F756778715310EDE03C06C) | | [111](#s86750EF254F756778715310EDE03C06C) |][added: Information]

To the stockholders and [added: the] Board of Directors of

We have audited the accompanying consolidated balance sheets of Keurig Dr Pepper Inc. and subsidiaries (the "Company") as of December 31, [removed: 2019 and 2018,] [added: 2020] and [added: 2019,] the related consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows for each of the [removed: two years in the period ended December 31, 2019, the] three [removed: months] [added: years] ended December 31, [removed: 2017,] [added: 2020, 2019] and [removed: the fiscal year ended September 30, 2017,] [added: 2018,] and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2019] [added: 2020] and [removed: 2018,] [added: 2019,] and the results of its operations and its cash flows for each of the [removed: two] [added: three] years in the period ended December 31, [removed: 2019, the three months ended December 31, 2017, and the fiscal year ended September 30, 2017,] [added: 2020,] in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2019,] [added: 2020,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 27, 2020,] [added: 25, 2021,] expressed an unqualified opinion on the Company's internal control over financial reporting.

Indefinite-Lived Intangible Assets Valuation - [added: Certain Brand Assets -] Refer to [removed: Notes 2, 3 and 5 to] [added: Notes 2 and 4 to] the financial [removed: statements.][added: statements]

The Company’s [removed: impairment consideration] [added: evaluation] of [removed: indefinite-lived] [added: the] brand [removed: intangible assets] [added: asset’s for impairment] involves the comparison of the [removed: asset’s] fair value [added: of each brand asset] to [removed: its] [added: its’] carrying value.

[removed: The] [added: Management estimates the] fair value [added: of the brand assets annually as of October 1, 2020, using a multi-period excess earnings method, which is a specific discounted cash flow method.The fair value] determination of these assets requires management to make significant estimates and assumptions related to revenue growth projections, discount rates, and operating margins.

[removed: A] [added: Given the significant judgments made by management to estimate the fair value of certain brand assets, a] high degree of auditor judgment and an increased extent of effort were required to perform audit procedures that evaluated the reasonableness of management’s estimates and assumptions.

Our audit procedures related to the underlying business and valuation assumptions for [removed: indefinite-lived] [added: certain] brand [removed: intangible] assets included the following, among others:

[removed: | • | We tested the effectiveness of controls over the Company’s indefinite-lived brand intangible asset impairment review process.] This included controls over management’s review of the revenue growth rates, operating margins, and discount rates used in the valuation models. [removed: |]

[removed: | • |] [added: -] We performed risk assessment procedures [removed: for indefinite-lived brand intangible assets,] and for [removed: brands] [added: certain brand assets] with a higher risk of [removed: impairment and certain other brands,] [added: impairment,] we evaluated the reasonableness of management’s ability to forecast revenue growth and operating margins by comparing the forecasts to: [removed: |]

[removed: | ◦ | Underlying] [added: –Underlying] analysis of business strategies and growth plans. [removed: |]

[removed: | • |] [added: -] With the assistance of our fair value specialists, we evaluated the reasonableness of the valuation [removed: methodology,] [added: methodology] and [added: discount rates, including testing] the [removed: reasonableness] [added: mathematical accuracy] of the [removed: discount rates used by the Company in their model by developing] [added: calculation, and developed] a range of independent estimates [removed: for the discount rates] and [removed: comparing them] [added: compared those] to the discount rates selected by management. [removed: |]

| [Consolidated Statements of Cash Flows](#i4e002ac394c34074b07ec2df1e1fbbfe_163) | | | | | | [54](#i4e002ac394c34074b07ec2df1e1fbbfe_163) | | |

| [8. Derivatives](#i4e002ac394c34074b07ec2df1e1fbbfe_214) | | | | | | [81](#i4e002ac394c34074b07ec2df1e1fbbfe_214) | | |

| [9. Leases](#i4e002ac394c34074b07ec2df1e1fbbfe_187) | | | | | | [84](#i4e002ac394c34074b07ec2df1e1fbbfe_187) | | |

| [11. Earnings per Share](#i4e002ac394c34074b07ec2df1e1fbbfe_217) | | | | | | [90](#i4e002ac394c34074b07ec2df1e1fbbfe_217) | | |

| [17. Related Parties](#i4e002ac394c34074b07ec2df1e1fbbfe_247) | | | | | | [98](#i4e002ac394c34074b07ec2df1e1fbbfe_247) | | |

| [18. Segments](#i4e002ac394c34074b07ec2df1e1fbbfe_250) | | | | | | [99](#i4e002ac394c34074b07ec2df1e1fbbfe_250) | | |

| [19. Revenue Recognition](#i4e002ac394c34074b07ec2df1e1fbbfe_256) | | | | | | [101](#i4e002ac394c34074b07ec2df1e1fbbfe_256) | | |

As discussed in Notes 2 and 4, the Company has indefinite-lived brand intangible assets (“brand assets”).

Changes in these assumptions could have a significant impact on the fair value of certain indefinite-lived brand intangible assets (“certain brand assets”) that have a lower headroom percentage, the amount of any impairment, or both.

During the year ended December 31, 2020, the Company recognized impairment of $67 million for the Bai brand, as the fair value of the brand was lower than its carrying value.

- We tested the effectiveness of controls over the Company’s indefinite-lived brand intangible asset impairment review process.

–Historical revenue and operating margins.

–Internal communication to senior management.

–Forecasted information in industry reports.

–Historical and forecasted peer data.

- We considered the impact of changes in management's forecast from the October 1, 2020 annual assessment date to December 31, 2020.

To the stockholders and the Board of Directors of

February 25, 2021

| Impairment of intangible assets | | | 67 | | | | | | — | | | | | | — | | |

| Impairment of investments and note receivable | | | 102 | | | | | | — | | | | | | — | | |

| Total equity | | | 23,830 | | | | | | 23,257 | | |

| Impairment of intangible assets | | | 67 | | | | | | — | | | | | | — | | |

| Impairment on investments and note receivable of unconsolidated affiliates | | | 102 | | | | | | — | | | | | | — | | |

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| [10. Derivatives](#sBD89DF25B79650EEA97AA35E40EBE32D) | | [90](#sBD89DF25B79650EEA97AA35E40EBE32D) |

| [19. Segments](#s3369EDDB319E5B84A66852AB816F4E87) | | [101](#s3369EDDB319E5B84A66852AB816F4E87) |

| [21. Guarantor and Non-Guarantor Financial Information](#s901FAAEAE62D5A30BBDEBF4741578D0E) | | [103](#s901FAAEAE62D5A30BBDEBF4741578D0E) |

| [23. Subsequent Events](#s1F68A25356A55D2F88C6E27B9B164A41) | | [112](#s1F68A25356A55D2F88C6E27B9B164A41) |

Change in Accounting Principle

As discussed in Note 2 to the financial statements, effective January 1, 2019, the Company adopted the Financial Accounting Standards Board’s new standard related to leases using the modified retrospective approach.

As discussed in Note 3, the Company completed the Keurig Dr Pepper (KDP) merger of Maple and Dr Pepper Snapple Group, Inc. (DPS) on July 9, 2018.

The purchase price ($22,482 million) was allocated to the assets acquired and liabilities assumed of DPS based on their respective fair values, including indefinite-lived brand intangible assets of $19,556 million.

We identified the Company’s impairment evaluations for DPS indefinite-lived brand intangible assets as a critical audit matter because of the recent acquisition and valuation of these assets.

| | |

| --- | --- |

| ◦ | Historical revenue and operating margins for each indefinite-lived brand intangible asset. |

| ◦ | Internal communication to senior management and the Board of Directors. |

| ◦ | Forecasted information included in the Company’s original deal model. |

| ◦ | Forecasted information included in the Company’s press releases, as well as in analyst and industry reports for the Company and its peer companies. |

February 27, 2020

KEURIG DR PEPPER INC.

| | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Foreign currency translation adjustments attributable to non-controlling interest | — | | | | — | | | | — | | | | (1 | | ) |

CONSOLIDATED BALANCE SHEETS

| | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- |

(continued)

| Cross currency swap | — | | | | — | | | | — | | | | (87 | | ) |

| | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Balance as of September 24, 2016 | 790.5 | | | $ | 8 | | | $ | 6,377 | | | $ | 99 | | | $ | 26 | | | $ | 6,510 | |

| Balance as of September 30, 2017 | 790.5 | | | $ | 8 | | | $ | 6,377 | | | $ | 337 | | | $ | 106 | | | $ | 6,828 | |

| Adjustment of non-controlling interests to fair value | — | | | — | | | | — | | | | (25 | | ) | | — | | | | (25 | | ) |

| Dividends declared | — | | | — | | | | — | | | | (10 | | ) | | — | | | | (10 | | ) |

| Adjustment of non-controlling interests to fair value | — | | | — | | | | — | | | | (16 | | ) | | — | | | | (16 | | ) |

| Dividends declared | — | | | — | | | | — | | | | (441 | | ) | | — | | | | (441 | | ) |

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ORGANIZATION

On January 29, 2018, DPS entered into the DPS Merger Agreement by and among DPS, Maple, and Merger Sub.

The DPS Merger was consummated on July 9, 2018, at which time DPS changed its name to "Keurig Dr Pepper Inc.".

On July 9, 2018, upon the consummation of the DPS Merger, as a result of the DPS Merger being accounted for as a reverse merger with Maple as the accounting acquirer, the Board approved a change in KDP’s fiscal year end from the last Saturday in September to December 31, which was DPS’s fiscal year end prior to the consummation of the DPS Merger, and Maple’s fiscal year end changed from the last Saturday in September to the last Saturday in December to closely align Maple’s fiscal year with that of the Company’s.

As required by Rules 13a-15(b) and 15d-15(b) under the Exchange Act, management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of December 31, [removed: 2019,] [added: 2020,] and has concluded that our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

Based on the criteria for effective internal control over financial reporting established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission, management concluded that the internal control over financial reporting was effective as of December 31, [removed: 2019.][added: 2020.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2019] [added: 2020] has been audited by Deloitte & Touche LLP, our independent registered public accounting firm, as stated in their attestation report, which is included in Item 8, “Financial Statements and Supplementary Data,” of this Annual Report on Form 10-K.

As of December 31, [removed: 2019,] [added: 2020,] management has concluded that there have been no changes in our internal [removed: controls] [added: control] over financial reporting that occurred during our fourth quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Information required to be set forth hereunder has been omitted and will be incorporated by reference, when filed, from our Proxy Statement.

Information not disclosed below that is required with respect to directors, executive officers and corporate governance is incorporated herein by reference, when filed, from our Proxy Statement.

[removed: | • |] [added: -] Consolidated Statements of Comprehensive Income for the [removed: Periods |][added: years ended December 31, 2020, 2019 and 2018.]

[removed: | • |] [added: -] Consolidated Balance Sheets as of December 31, [removed: 2019] [added: 2020] and [removed: 2018 |][added: 2019.]

[removed: | • |] [added: -] Consolidated Statements of Cash Flows for the [removed: Periods |][added: years ended December 31, 2020, 2019 and 2018.]

[removed: | • |] [added: -] Consolidated Statements of Changes in Stockholders' Equity for the [removed: Periods |][added: years ended December 31, 2020, 2019 and 2018.]

[removed: | • |] [added: -] Notes to Consolidated Financial Statements for the [removed: Periods] [added: years ended December 31, 2020, 2019] and [added: 2018 and] as of December 31, [removed: 2019] [added: 2020] and [removed: 2018. |][added: 2019.]

| [2.1](http://www.sec.gov/Archives/edgar/data/1418135/000110465916158940/a16-22114_1ex2d1.htm) | [added: | |] Agreement and Plan of Merger, dated as of November 21, 2016, by and among Bai Brands LLC, Dr Pepper Snapple Group, Inc., Superfruit Merger Sub, LLC and Fortis Advisors LLC, (filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K (filed on November 23, 2016) and incorporated herein by reference). | [added: | |]

| [2.2](http://www.sec.gov/Archives/edgar/data/1418135/000110465917005365/a17-3493_1ex2d2.htm) | [added: | |] Amendment No. 1, dated as of January 31, 2017, to the Agreement and Plan of Merger, dated as of November 21, 2016, by and among Bai Brands LLC, Dr Pepper Snapple Group, Inc., Superfruit Merger Sub, LLC and Fortis Advisors LLC, (filed as Exhibit 2.2 to the Company’s Current Report on Form 8-K (filed on January 31, 2017) and incorporated herein by reference). | [added: | |]

| [2.3](http://www.sec.gov/Archives/edgar/data/1418135/000110465918005202/a18-3957_1ex2d1.htm) | [added: | |] Agreement and Plan of Merger, dated as of January 29, 2018, by and among Dr Pepper Snapple Group, Inc., Maple Parent Holdings Corp. and Salt Merger Sub, Inc. (filed as Exhibit 2.1 to the Company's Current Report on Form 8-K (filed on January 31, 2018) and incorporated herein by reference). | [added: | |]

| [3.1](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005530/y57446exv3w1.htm) | [added: | |] Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed on May 12, 2008) and incorporated herein by reference). | [added: | |]

| [3.2](http://www.sec.gov/Archives/edgar/data/1418135/000141813512000028/dps-ex32_2012630.htm) | [added: | |] Certificate of Amendment to Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of May 17, 2012 (filed as Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q (filed July 26, 2012) and incorporated herein by reference). | [added: | |]

| [3.3](http://www.sec.gov/Archives/edgar/data/1418135/000129993316002518/exhibit1.htm) | [added: | |] Certificate of Second Amendment to Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of May 19, 2016 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed May 20, 2016) and incorporated herein by reference). | [added: | |]

| [3.4](http://www.sec.gov/Archives/edgar/data/1418135/000110465918044357/a18-16509_3ex3d1.htm) | [added: | |] Certificate of Third Amendment to the Amended and Restated Certificate of Incorporation of Dr Pepper Snapple Group, Inc. effective as of July 9, 2018 (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K (filed July 9, 2018) and [removed: incorporate] [added: incorporated] herein by reference). | [added: | |]

| [3.5](http://www.sec.gov/Archives/edgar/data/1418135/000110465918044357/a18-16509_3ex3d2.htm) | [added: | |] Amended and Restated By-Laws of Keurig Dr Pepper Inc. effective as of July 9, 2018 (filed as Exhibit 3.2 to the Company's Current Report on Form 8-K (filed July 9, 2018) and incorporated herein by reference. | [added: | |]

| [4.1](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005005/y56861exv4w1.htm) | [added: | |] Indenture, dated April 30, 2008, between Dr Pepper Snapple Group, Inc. and Wells Fargo Bank, N.A. (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on May 1, 2008) and incorporated herein by reference). | [added: | |]

| [4.2](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005005/y56861exv4w1.htm) | [added: | |] Form of 7.45% Senior Notes due 2038 (filed as Exhibit 4.4 to the Company's Current Report on Form 8-K (filed on May 1, 2008) and incorporated herein by reference). | [added: | |]

| [4.3](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005005/y56861exv4w5.htm) | [added: | |] Registration Rights Agreement, dated April 30, 2008, between Dr Pepper Snapple Group, Inc., J.P. Morgan Securities Inc., Banc of America Securities LLC, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated, UBS Securities LLC, BNP Paribas Securities Corp., Mitsubishi UFJ Securities International plc, Scotia Capital (USA) Inc., SunTrust Robinson Humphrey, Inc., Wachovia Capital Markets, LLC and TD Securities (USA) LLC (filed as Exhibit 4.5 to the Company's Current Report on Form 8-K (filed on May 1, 2008) and incorporated herein by reference). | [added: | |]

| [4.4](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005530/y57446exv4w2.htm) | [added: | |] Registration Rights Agreement Joinder, dated May 7, 2008, by the subsidiary guarantors named therein (filed as Exhibit 4.2 to the Company's Current Report on Form 8-K (filed on May 12, 2008) and incorporated herein by reference). | [added: | |]

| [4.5](http://www.sec.gov/Archives/edgar/data/1418135/000095012308005530/y57446exv4w1.htm) | [added: | |] Supplemental Indenture, dated May 7, 2008, among Dr Pepper Snapple Group, Inc., the subsidiary guarantors named therein and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on May 12, 2008) and incorporated herein by reference). | [added: | |]

| [4.6](http://www.sec.gov/Archives/edgar/data/1418135/000095013409006140/d66682exv4w8.htm) | [added: | |] Second Supplemental Indenture dated March 17, 2009, to be effective as of December 31, 2008, among Splash Transport, Inc., as a subsidiary guarantor, Dr Pepper Snapple Group, Inc., and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.8 to the Company's Annual Report on Form 10-K (filed on March 26, 2009) and incorporated herein by reference). | [added: | |]

| [4.7](http://www.sec.gov/Archives/edgar/data/1418135/000095012309058290/d69848exv4w9.htm) | [added: | |] Third Supplemental Indenture, dated October 19, 2009, among 234DP Aviation, LLC, as a subsidiary guarantor; Dr Pepper Snapple Group, Inc., and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.9 to the Company's Quarterly Report on Form 10-Q (filed November 5, 2009) and incorporated herein by reference). | [added: | |]

| [4.8](http://www.sec.gov/Archives/edgar/data/1418135/000110465917006174/a17-3651_1ex4d1.htm) | [added: | |] Fourth Supplemental Indenture, dated as of January 31, 2017, among Bai Brands LLC, a New Jersey limited liability company, 184 Innovations Inc., a Delaware corporation (each as a new subsidiary guarantors under the Indenture dated April 30, 2008 (as referenced in Item 4.1 in this Exhibit Index), Dr Pepper Snapple Group, Inc., each other then-existing Guarantor under the Indenture and Wells Fargo, National Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed February 2, 2017) and incorporated herein by reference). | [added: | |]

| [4.9](http://www.sec.gov/Archives/edgar/data/1418135/000095012309072823/d70522exv4w1.htm) | [added: | |] Indenture, dated as of December 15, 2009, between Dr Pepper Snapple Group, Inc. and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on December 23, 2009) and incorporated herein by reference). | [added: | |]

| [removed: [4.10](http://www.sec.gov/Archives/edgar/data/1418135/000095012311002074/d78800exv4w1.htm)] [added: [4.10](http://www.sec.gov/Archives/edgar/data/1418135/000110465911064294/a11-29914_1ex4d1.htm)] | [removed: Second] [added: | | Third] Supplemental Indenture, dated as of [removed: January 11,] [added: November 15,] 2011, among Dr Pepper Snapple Group, Inc., the guarantors party thereto and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on [removed: January 11,] [added: November 15,] 2011) and incorporated herein by reference). | [added: | |]

| [removed: [4.11](http://www.sec.gov/Archives/edgar/data/1418135/000110465911064294/a11-29914_1ex4d1.htm)] [added: [4.14](http://www.sec.gov/Archives/edgar/data/1418135/000141813515000043/ex41fifthindenture.htm)] | [removed: Third] [added: | | Fifth] Supplemental Indenture, dated as of November [removed: 15, 2011,] [added: 9, 2015,] among Dr Pepper Snapple Group, Inc., the guarantors party thereto and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on November [removed: 15, 2011)] [added: 10, 2015)] and incorporated herein by reference). | [added: | |]

| [removed: [4.12](http://www.sec.gov/Archives/edgar/data/1418135/000110465911064294/a11-29914_1ex4d2.htm)] [added: [4.11](http://www.sec.gov/Archives/edgar/data/1418135/000110465911064294/a11-29914_1ex4d3.htm)] | [removed: 2.60%] [added: | | 3.20%] Senior Note due [removed: 2019] [added: 2021] (in global form), dated November 15, 2011, in the principal amount of $250 million (filed as Exhibit [removed: 4.2] [added: 4.3] to the Company's Current Report on Form 8-K (filed on November 15, 2011) and incorporated herein by reference). | [added: | |]

| [removed: [4.13](http://www.sec.gov/Archives/edgar/data/1418135/000110465911064294/a11-29914_1ex4d3.htm)] [added: [4.13](http://www.sec.gov/Archives/edgar/data/1418135/000141813512000051/ex-43xdpsx2022globalnote.htm)] | [removed: 3.20%] [added: | | 2.70%] Senior Note due [removed: 2021] [added: 2022] (in global form), dated November [removed: 15, 2011,] [added: 20, 2012,] in the principal amount of $250 million (filed as Exhibit 4.3 to the Company's Current Report on Form 8-K (filed on November [removed: 15, 2011)] [added: 20, 2012)] and incorporated herein by reference). | [added: | |]

| [removed: [4.14](http://www.sec.gov/Archives/edgar/data/1418135/000141813512000051/fourthsupplementalindenture.htm)] [added: [4.17](http://www.sec.gov/Archives/edgar/data/1418135/000141813516000079/ex41sixthindenture.htm)] | [removed: Fourth] [added: | | Sixth] Supplemental Indenture, dated as of [removed: November 20, 2012,] [added: September 16, 2016,] among Dr Pepper Snapple Group, Inc., the guarantors party thereto and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on [removed: November 20, 2012)] [added: September 16, 2016)] and incorporated herein by reference). | [added: | |]

| [removed: [4.15](http://www.sec.gov/Archives/edgar/data/1418135/000141813512000051/ex-42xdpsx2020globalnote.htm)] [added: [4.15](http://www.sec.gov/Archives/edgar/data/1418135/000141813515000043/ex42formof2025notes.htm)] | [removed: 2.00%] [added: | | 3.40%] Senior Note due [removed: 2020] [added: 2025] (in global form), dated November [removed: 20, 2012,] [added: 9, 2015,] in the principal amount of [removed: $250 million] [added: $500,000,000] (filed as Exhibit 4.2 to the Company's Current Report on Form 8-K (filed on November [removed: 20, 2012)] [added: 10, 2015)] and incorporated herein by reference). | [added: | |]

| [removed: [4.16](http://www.sec.gov/Archives/edgar/data/1418135/000141813512000051/ex-43xdpsx2022globalnote.htm)] [added: [4.16](http://www.sec.gov/Archives/edgar/data/1418135/000141813515000043/ex43formof2045notes.htm)] | [removed: 2.70%] [added: | | 4.50%] Senior Note due [removed: 2022] [added: 2045] (in global form), dated November [removed: 20, 2012,] [added: 9, 2015,] in the principal amount of [removed: $250 million] [added: $250,000,000] (filed as Exhibit 4.3 to the Company's Current Report on Form 8-K (filed on November [removed: 20, 2012)] [added: 10, 2015)] and incorporated herein by reference). | [added: | |]

| [removed: [4.17](http://www.sec.gov/Archives/edgar/data/1418135/000141813515000043/ex41fifthindenture.htm)] [added: [4.19](http://www.sec.gov/Archives/edgar/data/1418135/000141813516000103/ex41seventhindenture.htm)] | [removed: Fifth] [added: | | Seventh] Supplemental Indenture, dated as of [removed: November 9, 2015,] [added: December 14, 2016,] among Dr Pepper Snapple Group, Inc., the guarantors party thereto and Wells Fargo Bank, N.A., as trustee (filed as Exhibit 4.1 to the Company's Current Report on Form 8-K (filed on [removed: November 10, 2015)] [added: December 14, 2016)] and incorporated herein by reference). | [added: | |]