Yum! Brands (YUM) 10-K risk factor changes: FY2022 vs FY2021

Any of the following risk factors, either by itself or together with other risk factors, could materially adversely affect our business, [added: growth prospects,] results of operations, cash flows and/or financial condition.

*The [removed: novel] coronavirus (COVID-19) global pandemic has had, and may continue to have, an adverse effect on our [removed: business] [added: business, growth prospects] and results of operations.*

Developments related to [removed: COVID-19, which was declared a] [added: the COVID-19] global pandemic [removed: by the World Health Organization in March 2020,] have [removed: adversely impacted,] [added: had,] and may continue to [removed: adversely impact] [added: have, adverse impacts on] our [removed: business] [added: business, growth prospects] and results of operations.

We are unable to fully predict the impact that COVID-19 will have on our and our [added: Concepts’] franchisees’ operations going forward due to various uncertainties, including the severity and duration of the [removed: pandemic,] [added: pandemic and future outbreaks of COVID-19,] the timing, [removed: availability] [added: availability,] acceptance and effectiveness [added: of medical treatments and vaccines, the spread of potentially more contagious and/or virulent forms of COVID-19, and actions that may be taken by governmental authorities.]

Moreover, if [added: negative macroeconomic] conditions [removed: related to the COVID-19 pandemic] result in significant disruptions to capital and financial markets, or negatively impact our credit ratings, our cost of borrowing, our ability to access capital on favorable terms and our overall liquidity and capital structure could be adversely impacted.

*Food safety and food- or beverage-borne illness concerns may have an adverse effect on our [removed: business.*][added: business and/or our growth prospects.*]

[removed: Food-borne illnesses,] [added: Food or beverage-borne illnesses (that can be caused by food-borne pathogens] such as E. coli, Listeria, Salmonella, Cyclospora and [removed: Trichinosis,] [added: Trichinosis)] and food safety [removed: issues, such] [added: issues (such] as food tampering, contamination [removed: (including] [added: including] with respect to allergens) [removed: and adulteration] or [removed: food- or beverage-borne illness, occur or] [added: adulteration have occurred and] may occur within our system from time to time.

Any report [removed: or publicity] linking [removed: us] [added: our] or [removed: one of] our Concepts’ [added: franchisees’] restaurants, [added: our suppliers] or [added: distributors or otherwise involving the types of products used at our restaurants, or] linking our [removed: competitors] [added: competitors, suppliers, distributors] or the retail food industry generally, to instances of food- or beverage-borne illness or food safety [removed: issues,] [added: issues or substances having perceived health or environmental risks] could [added: result in adverse publicity and otherwise] adversely affect us and possibly lead to product liability claims, litigation, governmental investigations or [removed: actions,] [added: actions] and damages.

Moreover, the reliance of our Concepts’ restaurants on third-party food suppliers and distributors and increasing reliance on food delivery aggregators increases the risk that food- or beverage-borne illness incidents and food safety issues could be caused by factors outside of our [removed: direct] control.

If a customer [removed: of one of our Concepts’ restaurants becomes] [added: is believed to have become] ill from food or beverage-borne illnesses or as a result of food safety issues, [added: steps will be taken that could include] restaurants in our system [removed: may be] [added: being] temporarily closed, which could disrupt our operations and [removed: materially and] adversely affect our [removed: business.][added: business and/or our growth prospects.]

The occurrence of [removed: food or beverage-borne illnesses] [added: food-borne pathogens in restaurant products] or food safety issues could also adversely affect the price and availability of affected ingredients, which could result in disruptions in our supply chain and/or lower margins for us and our Concepts’ franchisees.

*Our business [added: and/or growth prospects] may be adversely affected by catastrophic or unforeseen events, such as future health epidemics or pandemics, natural disasters, and events that lead to avoidance of public places or restrictions on public gatherings.*

Our business [added: and/or growth prospects] could be [removed: materially and] adversely impacted by various future occurrences (which may be beyond our control), including future health epidemics or pandemics, natural disasters, geopolitical events, [added: acts of war,] terrorism, political, financial or social instability, boycotts, social or civil unrest, workplace violence, or other events that lead to avoidance of public places or restrictions on public gatherings such as in our and our [removed: Concepts'] [added: Concepts’] restaurants.

[removed: For example, the outbreak of a] widespread future health epidemic or pandemic, [removed: including an outbreak arising from various strains of avian flu or swine flu, such as H1N1,] particularly if located in regions [removed: from which] [added: where] we derive [removed: a] significant [removed: amount of] revenue or profit could [removed: materially and] adversely affect our [removed: business.][added: business and/or growth prospects.]

In addition, our operations could be disrupted if any of our [removed: employees] or [removed: employees of] our business [removed: partners] [added: partner employees] were suspected of having the avian flu or swine flu, or other illnesses such as hepatitis A or norovirus, since this could require us or our business partners to quarantine some or all of such employees or [removed: disinfect] [added: close] our restaurant facilities.

Public concern over avian flu [removed: generally] may cause fear about the consumption of chicken, eggs and other products derived from poultry, which could cause customers to consume less poultry and related products, which would adversely affect us [removed: as the result of the fact that] [added: given] poultry is [removed: a menu offering for] [added: offered at] our Concepts’ restaurants.

Furthermore, other viruses may be transmitted through human contact, and the risk [added: or perceived risk] of contracting viruses could cause employees or guests to avoid gathering in [removed: public places,] [added: public,] which could adversely affect restaurant guest traffic or the ability to adequately staff restaurants.

We could also be adversely affected if government authorities impose mandatory [removed: closures, seek] [added: or] voluntary closures, impose restrictions on operations of restaurants, or restrict the import or export of products, or if suppliers issue mass recalls of products.

[removed: In addition, our] [added: Our] long-term growth depends on maintaining the pace of our [removed: net system] [added: new] unit growth rate through our Concepts’ franchisees.

We have limited control over how our Concepts’ franchisees’ businesses are run, and their inability to operate successfully could adversely affect our operating results through decreased [removed: fees paid to us for] royalties, advertising funds contributions, and [added: fees paid to us for] other discrete services we may provide to our [removed: Concept’s] [added: Concepts’] franchisees (*e.g.* management of e-commerce platforms).

Our control is further limited [removed: in markets] where we utilize master franchise arrangements, which require us to rely on our master franchisees to [removed: monitor and] enforce sub-franchisee compliance with our operating standards.

If a significant franchisee of [removed: one of] our Concepts becomes, or a significant number of our Concepts’ franchisees in the aggregate become, financially distressed [removed: (which has occurred with certain of] our [removed: franchisees as the result of the COVID-19 pandemic), our] operating results could be impacted through reduced or delayed fee payments that cause us to record bad debt expense, reduced advertising fund contributions, and reduced new unit development.

In addition, we are secondarily liable on certain [removed: of our] Concepts’ franchisees’ restaurant lease agreements, including lease agreements that we have guaranteed or assigned to franchisees [removed: in connection with] [added: and our operating results and/or growth prospects could be impacted by any increased rent obligations to] the [removed: refranchising of certain Company-owned restaurants.][added: extent such franchisees default on these lease agreements.]

Our success also depends on [removed: the willingness and ability of] [added: whether] our Concepts’ franchisees [removed: to] implement marketing programs and major initiatives such as restaurant remodels or equipment or technology upgrades, which may require financial investment by such franchisees.

Our Concepts may be unable to successfully implement strategies that we believe are necessary for further growth if [removed: their] [added: our Concepts’] franchisees do not participate, which [removed: in turn] may harm [removed: the] [added: our] growth prospects and financial [removed: condition of the Company.][added: condition.]

Additionally, the failure of our Concepts’ franchisees to focus on key elements of restaurant operations, such as compliance with our operating standards addressing quality, service and cleanliness (even if such failures do not [removed: rise to the level of breaching] [added: breach] the [removed: related] franchise documents), may be attributed by guests to our Concepts’ [removed: entire] brand and could [removed: have a negative] [added: negatively] impact [removed: on] our [removed: business.][added: business and/or our growth prospects.]

Moreover, franchisee noncompliance with [removed: the terms and conditions of] our franchise agreements may reduce the overall [added: customer perception and] goodwill of our Concepts’ brands, [removed: whether through the failure] [added: including by failing] to meet health and safety standards [removed: (including with respect to] [added: (e.g.,] additional sanitation protocols and guidelines [removed: in connection with] [added: connected to] the COVID-19 pandemic), [added: to] engage in quality control or maintain product consistency, or [added: to comply with cybersecurity requirements, or] through the participation in improper [removed: or objectionable] business practices.

In connection with the spin-off of our China business in 2016 into an independent publicly-traded company (the “Separation” or “Yum China spin-off”), we entered into a Master License Agreement [added: (“MLA”)] pursuant to which Yum China is the exclusive licensee of the KFC, Taco Bell and Pizza Hut Concepts and their related marks and other intellectual property rights for restaurant services in mainland China.

Any failure to realize the expected benefits of such franchise [removed: relationships] [added: relationships, including with Yum China,] may adversely impact our [removed: business and operating results.]

*We may not achieve our target [added: restaurant] development [removed: goals, including as the result of the COVID-19 pandemic,] [added: goal] and new restaurants may not be profitable.*

Effectively managing growth can be challenging, particularly as we expand into new [removed: markets internationally,] [added: markets,] and we cannot guarantee that we, or our Concepts’ franchisees, including Yum China, will be able to achieve our expansion goals or that new restaurants will be operated profitably, consistent with results of existing restaurants or [removed: consistent] with our or our [added: Concepts’] franchisees’ expectations.

Other risks that could impact our ability to [removed: increase the number of our] [added: open new] restaurants include [removed: prevailing] economic conditions and trade or economic policies or sanctions, our ability to attract new franchisees, construction and development costs of new restaurants, and our, or our Concepts’ franchisees’, ability to obtain suitable restaurant locations, negotiate acceptable lease or purchase terms for the locations, [removed: access capital on favorable terms,] obtain required permits and approvals in a timely manner, [removed: hire and] [added: hire,] train [added: and retain] qualified management teams and restaurant crews, and meet construction schedules.

Expansion [removed: into markets] could also be affected by our Concepts’ franchisees’ willingness to invest capital or ability to obtain financing to construct and open new restaurants.

In addition, [removed: the development of new restaurants] [added: expansion] could impact the sales of our Concepts’ existing restaurants nearby.

*We may not realize the anticipated benefits from past or potential future acquisitions, investments or other strategic [removed: transactions.*][added: transactions, or our portfolio business model.*]

From time to time we [removed: evaluate] [added: have completed,] and [added: we] may [added: evaluate and continue to] complete mergers, acquisitions, divestitures, joint ventures, strategic partnerships, minority investments [removed: (which may include] [added: (including] minority investments in third parties, such [removed: as] [added: as,] franchisees or master franchisees) and other strategic transactions, including our acquisition of [removed: Dragontail Systems Limited completed in September 2021, and our acquisition of] The Habit Restaurants, Inc. completed in March 2020.

- expenses, delays or difficulties in integrating acquired companies, joint [removed: venture operations,] [added: ventures,] strategic partnerships or investments into our organization, including the failure to realize expected synergies and/or the inability to retain key personnel;

- the possibility that we have acquired substantial contingent or unanticipated liabilities in connection with acquisitions or other strategic transactions; [removed: and]

Past and potential future strategic transactions may not ultimately create value for us and may harm our reputation and [removed: materially] adversely affect our business, [added: growth prospects,] financial condition and results of operations.

In addition, we account for certain investments, including [removed: our investment] [added: minority investments] in [added: certain franchisees such as] Devyani International [removed: Limited (“Devyani”),] [added: Limited,] on a mark-to-market basis and, as a result, changes in the fair value of these investments impact our reported results.

As a result of the pandemic, governmental authorities implemented measures to reduce the spread of COVID-19, some of which remain in place today.

These measures have included, and in some instances continue to include restrictions on travel outside the home and limitations on business and other activities as well as encouraging social distancing.

As a result of the pandemic, we and our Concepts’ franchisees have experienced store closures and reduced store-level operations, including reduced operating hours and dining room closures.

The impact on our sales in each of our markets has been dependent on the timing, severity and duration of the outbreak, measures implemented by government authorities as well as our reliance on dine-in sales in the market.

During 2022, COVID-19 outbreaks and resulting government restrictions limiting mobility continued to impact sales in certain key markets such as China.

In addition, the health and environmental risks of certain ubiquitous substances (including per-and polyfluoroalkyl substances (PFAS)) commonly found in packaging have been the subject of increased regulatory scrutiny and lawsuits against other restaurant companies.

For example, the outbreak of a

business, growth prospects and operating results.

- the possibility that our Concepts and potential future acquisitions have divergent interests; and

- the possibility that our interests and strategic direction do not align with those of acquired companies or other parties that maintain an interest in our investments.

Disputes over the proper interpretation of the MLA have arisen in the past and may arise from time to time in the future.

Following the Russian invasion of Ukraine in early 2022, we suspended all investment and restaurant development in Russia as well as the operations of all company-owned KFC restaurants in Russia.

During the second quarter of 2022, we transferred ownership of the Pizza Hut Russia business to a local operator who has initiated the process of re-branding locations to a non-YUM concept.

Moreover, in October 2022, we entered into a sale and purchase agreement to transfer ownership of our KFC restaurants, operating systems and master franchise rights, including the network of franchised restaurants in Russia, to a local operator who will be responsible for re-branding locations to a non-YUM concept.

Completion of this transaction is subject to regulatory and governmental approvals in Russia, as well as other conditions.

There can be no guarantee that our efforts to transfer ownership or re-brand will be successful, and any transfer or re-brand, or failure to transfer or re-brand, could result in damage to our and our Concepts’ brand reputations.

We are unable to predict the

full impact of the Russian invasion of Ukraine, associated sanctions, macroeconomic impacts and geopolitical instability, and the possibility of broadened military conflict, may have on us.

Our business relies heavily on computer systems, hardware, software, technology infrastructure and online websites, platforms and networks (collectively, “IT Systems”) to support both internal and external, including franchisee-related, operations.

We own and manage some of these IT Systems but also rely on third parties for a range of IT Systems and related products and services.

We experience cyber-attacks and security incidents from time to time and we may experience such attacks and incidents in the future.

Despite the security measures that we and many third parties have implemented, our IT Systems may be disrupted or damaged and our Confidential Information may be compromised, corrupted, lost or stolen.

The number and frequency of cyber-attacks and other security incidents may escalate.

In addition, advanced new attacks against IT Systems and devices by potential malicious attackers, including nation-state actors, state-sanctioned groups, advanced persistent threats, and known and unknown ransomware groups, increase the risk of cybersecurity incidents, including ransomware, malware and phishing attacks.

On January 18, 2023, we announced a ransomware attack that impacted certain IT Systems which resulted in the closure of fewer than 300 restaurants in one market for one day, temporarily disrupted certain of our affected systems and resulted in data being taken from our network.

We have incurred, and may continue to incur, certain expenses related to this attack, including expenses to respond to, remediate and investigate this matter.

We remain subject to risks and uncertainties as a result of the incident, including as a result of the data that was taken from the Company’s network.

Other adversarial cyber actions that may occur, such as credential stuffing or distributed denial-of-service attacks, may affect consumer confidence, our ability to provide digital commerce platforms, or lead to regulatory actions or litigation.

If our IT Systems, or those of businesses with which we interact are

There is no assurance that any remedial actions will meaningfully limit the success of future attempts to breach our IT Systems, particularly because malicious actors are increasingly sophisticated and utilizing tools and techniques specifically designed to circumvent security measures, avoid detection and obfuscate forensic evidence, which means we may be unable to identify, investigate or remediate effectively or in a timely manner.

For example, we are subject to numerous global laws including but not limited to, the European Union’s (“E.U.”) General Data Protection Regulation (“GDPR”) and the UK General Data Protection Regulations (which implements the GDPR into UK law), which impose strict data protection requirements and provide for significant penalties for noncompliance.

Other states have enacted similar laws that take effect in 2023 and 2024, and the federal government along with other states are considering expanding or passing privacy laws in the near term.

Enforcement priorities from this body and others tasked with enforcing new privacy laws may be unclear or changing.

Failure to comply with these and any other comprehensive privacy laws passed at the international, federal or state level may result in regulatory enforcement action, the imposition of monetary penalties, and damage our reputation.

Other areas of particular focus for increasing requirements or risk of penalties include data collected from minors, biometric information, and data used in machine learning, all of which are subject to rapidly changing laws which are not consistent across jurisdictions.

our ability to obtain and use data to provide personalized experiences for our customers.

Failure to adequately manage implementations, updates or enhancements of new technology or interfaces between platforms could place us at a competitive disadvantage, and disrupt and otherwise adversely impact our operations and/or growth prospects.

Moreover, technology and consumer offerings continue to develop and evolve and we cannot predict consumer or team member acceptance of these existing and new technologies, such as new delivery channels or their impact on our business, and/or our growth prospects, nor can we be certain of our ability to implement or execute such technologies, which could result in loss of sales; dissatisfaction from our customers, employees, or employees of our Concepts’ franchisees; or negative publicity that could adversely impact our reputation, results of operations, growth prospects and financial condition.

to satisfy demand, materially change fees, access or visibility to our products or give greater priority or promotions to our competitors, our business and/or growth prospects may be negatively impacted.

In addition, third-party delivery services typically charge restaurants a per order fee, and as such utilizing third-party delivery services may not be as profitable as sales directly to our customers, and may also introduce food quality and customer satisfaction risks outside of our control.

The impacts of COVID-19 have included the loss of revenues due to store closures, reduced store-level operations, full or partial dining room closures and other restrictions on our business and operations.

During 2021, the overall adverse impact of COVID-19 on our operations was less significant than in 2020, but we continued to see negative impacts as of the end of 2021 due to COVID-19 outbreaks and resulting government restrictions limiting mobility in certain parts of the world, primarily in Asia.

Conversely, for our restaurants that prominently feature drive-thru, carryout and delivery options, the pandemic has in many cases contributed to an increase in sales since the onset of the pandemic.

If the impact of the pandemic continues to recede and the restaurant industry in general returns to more normal operations, the benefits to sales experienced by certain of our restaurants, including our Pizza Hut delivery restaurants, could wane and our results could be negatively impacted.

We and our franchisees have made operational changes intended to safeguard employees and customers in response to COVID-19, which have included increased cleaning and sanitization, installation of counter screens and the purchase of personal protective equipment.

These operational changes have increased and may continue to increase restaurant operating costs and impact restaurant-level margins and return on invested capital.

Our and our franchisees’ restaurants have also experienced, and may continue to experience, interruptions of food and other supplies as well as labor shortages.

In addition, the COVID-19 pandemic has required and may continue to require us to implement certain precautionary measures, such as in relation to vaccinations, testing and face coverings, which could adversely impact our operations, employee retention and satisfaction, and the willingness of customers to visit our restaurants.

Our success is heavily reliant on our Concepts’ franchisees, and the COVID-19 pandemic has caused and may continue to cause financial distress for certain franchisees, particularly those located in areas most significantly impacted by the COVID-19 pandemic.

As a result of this distress, certain of our franchisees have been unable to, or in the future may be unable to, meet their financial obligations to us as they come due, including the payment of royalties, rent, or other amounts due to the Company.

Additionally, certain of our franchisees have been unable to, or in the future may be unable to make payments to landlords, distributors and key suppliers, as well as payments to service any debt they may have outstanding.

Franchisee financial distress has also led to, and may continue to lead to, permanent store closures and delayed or reduced new franchisee development, which may further harm our results and liquidity.

of medical treatments and vaccines, the spread of potentially more contagious and/or virulent forms of COVID-19, including variants that may be more resistant to currently available vaccines and treatments, the extent to which COVID-19 may cause customers to continue to be reluctant to return to in-restaurant dining or otherwise change their consumption patterns (including after the COVID-19 pandemic has ended), actions that may be taken by governmental authorities, and the extent to which ongoing governmental restrictions in certain regions will be lifted, and the ongoing impact of the pandemic on economic conditions in the U.S. and globally.

In addition, instances or allegations of food or beverage-borne illness or food safety issues, real or perceived, involving our restaurants, restaurants of competitors, or our suppliers or distributors (regardless of whether we use or have used those suppliers or distributors), or otherwise involving the types of food served at our restaurants, could result in negative publicity that could adversely affect either our or our Concepts’ franchisees’ revenues and profits.

Even if such measures are not implemented and a virus or other disease does not spread significantly, the perceived risk of infection or health risk may adversely affect our business and operating results.

Our refranchising efforts have increased our dependence on the financial success and cooperation of our Concepts’ franchisees.

Our operating results could be impacted by any increased rent obligations for such leased properties to the extent our Concepts’ franchisees default on such lease agreements.

In addition, the failure of our Concepts’ franchisees to attract and retain quality personnel or adequately engage in succession planning may adversely affect their restaurant operations and the development of new restaurants, which in turn could hurt our business.

In addition to Yum China, we have other significant franchise relationships on which our success is dependent, including our strategic alliance with Food Delivery Brands Group, S.A. (previously named Telepizza Group S.A. (“Telepizza”)), which is the master franchisee of Pizza Hut in Latin America (excluding Brazil) and portions of Europe, and our relationship with certain other large franchisees.

- the possibility that investments we have made may decline significantly in value, which could lead to the potential impairment of the carrying value of goodwill associated with acquired businesses.

other markets, such as the Malaysian Ringgit and Russian Ruble, could have an adverse effect on our reported earnings.

In addition, our vendors and/or franchisees receive and maintain certain personal, financial and other information about our vendors, employees and customers.

We have experienced cyber-attacks and security breaches from time to time.

There is no assurance that any remedial actions will meaningfully limit the success of future attempts to breach our information technology systems.

For example, we are subject to numerous global laws including the General Data Protection Regulation (“GDPR”) applicable to the processing of personal data in the European Union, which was adopted by the European Union effective May 2018 and requires companies to meet new requirements regarding the handling of personal data and is subject to changing requirements, each of which could increase Company and franchisee resources necessary to comply.

In addition, the State of California enacted the California Consumer

In addition, several other states have introduced data privacy legislation which may impose varying standards and requirements on our data collection, use and processing activities.

Moreover, technology and consumer offerings continue to develop, and we expect that new or enhanced technologies and consumer offerings will be available in the future.

We may pursue certain of those technologies and consumer offerings if we believe they offer a sustainable customer proposition and can be successfully integrated into our business model.

However, we cannot predict consumer acceptance of these delivery channels or their impact on our business.

Many restaurants in each of our Concepts now offer consumers the ability to have the Concept’s food delivered through third-party delivery services.

The digital ordering platforms relied upon by our Concepts have experienced interruptions and could experience further interruptions, which could limit or delay customers’ ability to order through such platforms or make customers less inclined to return to such platforms.

The inappropriate use of social media by our

customers or employees could increase our costs, lead to litigation or result in negative publicity that could damage our reputation and adversely affect our results of operations.

failure or inability of our significant suppliers or distributors, including RSCS or McLane to meet their respective service requirements, could result in shortages or interruptions in the availability of food and other supplies.

The market for qualified employees in the retail food industry is very competitive.

Our and our Concepts’ franchisees are experiencing and may continue to experience a shortage of labor for positions in our restaurants, including due to the current competitive labor market and concerns around COVID-19.

*Changes in labor and other operating costs could adversely affect our and our franchisees’ results of operations.*

An increase in the costs of employee wages, benefits and insurance (including workers’ compensation, general liability, property and health) as well as other operating costs such as rent and energy costs could adversely affect our and our franchisees’ operating results.

Any increase in such operating expenses could adversely affect our and our Concepts’ franchisees’ profit margins.

Brands, Inc. and its subsidiaries (collectively referred to herein as the “Company”, “YUM”, “we”, “us” or “our”) franchise or operate a system of over [removed: 53,000] [added: 55,000] restaurants in [removed: 157] [added: more than 155] countries and territories, primarily under the concepts of KFC, Taco Bell, Pizza Hut and The Habit Burger Grill (collectively, the “Concepts”).

The [removed: Company's] [added: Company’s] KFC, Taco Bell and Pizza Hut brands are global leaders of the chicken, Mexican-style [added: food] and pizza [removed: food] categories, respectively.

The Habit Burger [removed: Grill, a concept we acquired in March 2020,] [added: Grill] is a fast-casual restaurant concept specializing in made-to-order chargrilled burgers, sandwiches and more.

Of the over [removed: 53,000] [added: 55,000] restaurants, 98% are operated by franchisees.

As of December 31, [removed: 2021,] [added: 2022,] YUM consists of four operating segments:

Through our Recipe for [removed: Growth and] Good [added: Growth] we intend to unlock the growth potential of our Concepts and YUM, drive increased collaboration across our Concepts and geographies and consistently deliver better customer experiences, improved unit economics and higher rates of growth.

Key enablers include accelerated use of [added: digital and] technology and better leverage of our systemwide scale.

Our [removed: Recipe for] Growth [added: agenda] is based on four key drivers:

Our global citizenship and sustainability [removed: strategy, called the Recipe for Good, reflects] [added: strategy is reflected in] our [added: Good agenda, which includes our] priorities for [removed: socially responsible growth,] [added: social responsibility,] risk management and sustainable stewardship of our people, food and planet.

- Allocates G&A in an efficient manner that provides leverage to operating profit growth while at the same time opportunistically investing in strategic growth initiatives; [removed: and]

- Pays a competitive dividend and returns excess cash to shareholders through share [removed: repurchases.][added: repurchases; and]

Throughout [removed: 2020 and] [added: 2022,] 2021 [added: and 2020] we [removed: have] had a significant number of restaurants that were temporarily closed including restaurants closed due to government and landlord restrictions as a result of COVID-19.

- System sales, System sales excluding the impacts of foreign currency translation [removed: (“FX”),] [added: (“FX”)] and System sales excluding FX and the impact of the 53rd week in 2019 for our U.S. subsidiaries [removed: and] [added: or] certain international subsidiaries that operate on a weekly period calendar.

All comparisons within this summary are versus the same period a year [removed: ago and unless otherwise stated include the impact of a 53rd week in 2019.][added: ago.]

For discussion of our results of operations for [removed: 2020] [added: 2021] compared to [removed: 2019,] [added: 2020,] refer to the [removed: Management's] [added: Management’s] Discussion and Analysis of Financial Condition and Results of Operations included in Part II, Item 7 of our Form 10-K for the fiscal year ended December 31, [removed: 2020,] [added: 2021,] filed with the SEC on February [removed: 22, 2021.][added: 23, 2022.]

[removed: 2021] [added: 2022] financial highlights:

| | | | System Sales, ex FX | | | | | | Same-Store Sales | | | | | | [removed: Net New] Units | | | | | | GAAP Operating Profit | | | | | | Core Operating Profit | | |

| KFC Division | | | [removed: +16] [added: +6] | | | | | | [removed: +11] [added: +4] | | | | | | [removed: +8] [added: +3] | | | | | | [removed: +33] [added: (3)] | | | | | | [removed: +29] [added: +5] | | |

| Taco Bell Division | | | [removed: +13] [added: +11] | | | | | | [removed: +11] [added: +8] | | | | | | +5 | | | | | | [removed: +9] [added: +12] | | | | | | [removed: +9] [added: +12] | | |

| Pizza Hut Division | | | [removed: +6] [added: +3] | | | | | | [removed: +7] [added: Even] | | | | | | +4 | | | | | | [removed: +16] [added: Even] | | | | | | [removed: +13] [added: +4] | | |

| Worldwide | | | [removed: +13] [added: +6] | | | | | | [removed: +10] [added: +4] | | | | | | [removed: +6] [added: +4] | | | | | | [removed: +42] [added: +2] | | | | | | [removed: +18] [added: +6] | | |

- Foreign currency translation [removed: favorably] [added: unfavorably] impacted Divisional Operating Profit [added: by $118 million] for the year [removed: by $54 million.][added: ended December 31, 2022.]

| | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2021] [added: 2022] | | | | | | | | | | | | [removed: 2020] [added: 2021] | | | | | | | | |

| Company sales | | | $ | [removed: 2,106] [added: 2,072] | | | | | $ | [removed: 1,810] [added: 2,106] | | | | | $ | [removed: 1,546] [added: 1,810] | | | | | [removed: 16] [added: (2)] | | | | | | | | | | | | [removed: 17] [added: 16] | | | | | | | | |

| Franchise and property revenues | | | [removed: 2,900] [added: 3,096] | | | | | | [removed: 2,510] [added: 2,900] | | | | | | [removed: 2,660] [added: 2,510] | | | | | | [removed: 16] [added: 7] | | | | | | | | | | | | [removed: (6)] [added: 16] | | | | | | | | |

| Franchise contributions for advertising and other services | | | [removed: 1,578] [added: 1,674] | | | | | | [removed: 1,332] [added: 1,578] | | | | | | [removed: 1,391] [added: 1,332] | | | | | | [removed: 18] [added: 6] | | | | | | | | | | | | [removed: (4)] [added: 18] | | | | | | | | |

| Total revenues | | | [removed: 6,584] [added: 6,842] | | | | | | [removed: 5,652] [added: 6,584] | | | | | | [removed: 5,597] [added: 5,652] | | | | | | [removed: 16] [added: 4] | | | | | | | | | | | | [removed: 1] [added: 16] | | | | | | | | |

| Company restaurant expenses | | | $ | [removed: 1,725] [added: 1,745] | | | | | $ | [removed: 1,506] [added: 1,725] | | | | | $ | [removed: 1,235] [added: 1,506] | | | | | [removed: (15)] [added: (1)] | | | | | | | | | | | | [removed: (22)] [added: (15)] | | | | | | | | |

| G&A expenses | | | [removed: 1,060] [added: 1,140] | | | | | | [removed: 1,064] [added: 1,060] | | | | | | [removed: 917] [added: 1,064] | | | | | | [removed: —] [added: (8)] | | | | | | | | | | | | [removed: (16)] [added: —] | | | | | | | | |

| Franchise and property expenses | | | [removed: 117] [added: 123] | | | | | | [removed: 145] [added: 117] | | | | | | [removed: 180] [added: 145] | | | | | | [removed: 18] [added: (4)] | | | | | | | | | | | | [removed: 20] [added: 18] | | | | | | | | |

| Franchise advertising and other services expense | | | [removed: 1,576] [added: 1,667] | | | | | | [removed: 1,314] [added: 1,576] | | | | | | [removed: 1,368] [added: 1,314] | | | | | | [removed: (20)] [added: (6)] | | | | | | | | | | | | [removed: 4] [added: (20)] | | | | | | | | |

| Refranchising (gain) loss | | | [removed: (35)] [added: (27)] | | | | | | [removed: (34)] [added: (35)] | | | | | | [removed: (37)] [added: (34)] | | | | | | [removed: 2] [added: (22)] | | | | | | | | | | | | [removed: (9)] [added: 2] | | | | | | | | |

| Other (income) expense | | | [removed: 2] [added: 7] | | | | | | [removed: 154] [added: 2] | | | | | | [removed: 4] [added: 154] | | | | | | NM | | | | | | | | | | | | NM | | | | | | | | |

| Total costs and expenses, net | | | [removed: 4,445] [added: 4,655] | | | | | | [removed: 4,149] [added: 4,445] | | | | | | [removed: 3,667] [added: 4,149] | | | | | | [removed: (7)] [added: (5)] | | | | | | | | | | | | [removed: (13)] [added: (7)] | | | | | | | | |

| Operating Profit | | | [removed: 2,139] [added: 2,187] | | | | | | [removed: 1,503] [added: 2,139] | | | | | | [removed: 1,930] [added: 1,503] | | | | | | [removed: 42] [added: 2] | | | | | | | | | | | | [removed: (22)] [added: 42] | | | | | | | | |

| Investment (income) expense, net | | | [removed: (86)] [added: (11)] | | | | | | [removed: (74)] [added: (86)] | | | | | | [removed: 67] [added: (74)] | | | | | | [removed: 16] [added: (88)] | | | | | | | | | | | | [removed: 211] [added: 16] | | | | | | | | |

| Other pension (income) expense | | | [removed: 7] [added: 9] | | | | | | [removed: 14] [added: 7] | | | | | | [removed: 4] [added: 14] | | | | | | [removed: 48] [added: (26)] | | | | | | | | | | | | [removed: (235)] [added: 48] | | | | | | | | |

| Interest expense, net | | | [removed: 544] [added: 527] | | | | | | [removed: 543] [added: 544] | | | | | | [removed: 486] [added: 543] | | | | | | [removed: —] [added: 3] | | | | | | | | | | | | [removed: (12)] [added: —] | | | | | | | | |

| Income before income taxes | | | [removed: 1,674] [added: 1,662] | | | | | | [removed: 1,020] [added: 1,674] | | | | | | [removed: 1,373] [added: 1,020] | | | | | | [removed: 64] [added: (1)] | | | | | | | | | | | | [removed: (26)] [added: 64] | | | | | | | | |

| Income tax provision | | | [removed: 99] [added: 337] | | | | | | [removed: 116] [added: 99] | | | | | | [removed: 79] [added: 116] | | | | | | [removed: 15] [added: (242)] | | | | | | | | | | | | [removed: (48)] [added: 15] | | | | | | | | |

- Targets a consolidated net leverage ratio that balances shareholder returns, cost of capital and flexibility against various risk factors.

As of the beginning of the second quarter of 2022, as a result of our progress towards exiting Russia and our decision to reclass future net profits attributable to Russia subsequent to the date of invasion from the Division segments in which those profits were earned to Unallocated Other income (see Notes 3 and 19), we elected to remove all Russia units from our unit count as well as to begin excluding those units’ associated sales from our system sales totals.

We removed 1,112 units and 53 units in Russia from our global KFC and Pizza Hut unit counts, respectively.

These units were treated similar to permanent store closures for purposes of our same-store sales calculations and thus they were removed from our same-store sales calculations beginning April 1, 2022.

Comparisons versus 2019, unless otherwise stated, include the impact of a 53rd week in 2019.

- As of the beginning of the second quarter, we elected to remove 1,165 Russia units from our unit count and begin excluding their associated sales from our total system sales.

We removed 1,112 units and 53 units in Russia from our KFC and Pizza Hut units counts, respectively.

As a result:

◦YUM and KFC Division year-over-year unit growth as shown above were negatively impacted by two and four percentage points, respectively.

◦YUM and KFC Division system sales growth excluding foreign currency as shown above were negatively impacted by two and three percentage points, respectively.

- Also, we elected to reclass future net profits attributable to Russia subsequent to the date of invasion from the Division segments in which those profits were earned to Unallocated Other income and reflected such profits as a Special Item

as they are not indicative of our ongoing results.

As a result of the decline in Core Operating Profits attributable to Russia:

◦YUM and KFC Division Core Operating Profit as shown above were negatively impacted by two and four percentage points, respectively.

| | | | | | | | | | | | | 2022 | | | 2021 | | | % Change | | |

| GAAP EPS | | | | | | | | | | | | $4.57 | | | $5.21 | | | (12) | | |

| Special Items EPS | | | | | | | | | | | | $0.06 | | | $0.75 | | | NM | | |

| EPS Excluding Special Items | | | | | | | | | | | | $4.51 | | | $4.46 | | | +1 | | |

- In addition to the aforementioned factors impacting Operating Profit, our diluted EPS, excluding Special Items, was also impacted by lower Investment income, net year over year.

Investment income, net added approximately $0.03 and $0.26 to our diluted EPS, excluding Special Items for the years ended December 31, 2022 and 2021, respectively,

- Gross unit openings for the year were 4,560 units resulting in 3,076 net new units.

| | | | | | | 2022 | | | | | | 2021 | | | | | | 2020 | | |

| | | | | | | 2022 | | | | | | 2021 | | | | | | 2020 | | |

| Operating profit impact from decision to exit Russia(b) | | | | | | 44 | | | | | | — | | | | | | — | | |

| Tax (Expense) - Income tax impacts from decision to exit Russia(e) | | | | | | (72) | | | | | | — | | | | | | — | | |

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

(b)In the first quarter of 2022, as a result of the Russian invasion of Ukraine, we suspended all investment and restaurant development in Russia.

We also suspended all operations of our 70 company-owned KFC restaurants in Russia and began finalizing an agreement to suspend all Pizza Hut operations in Russia, in partnership with our master franchisee.

Further, we pledged to redirect any future net profits attributable to Russia subsequent to the date of invasion to humanitarian efforts.

During the second quarter, we completed the transfer of ownership of the Pizza Hut Russia business to a local operator who has initiated the process of re-branding locations to a non-YUM concept.

In October 2022, we announced that we entered into a sale and purchase agreement to transfer ownership of our KFC Russia restaurants, operating system and master franchise rights, including the network of KFC franchised restaurants, to Smart Service Ltd., a business operated by one of our existing KFC franchisees in Russia.

Under the agreement, the buyer will be responsible for re-branding locations to a non-YUM concept and retaining the Company’s employees in Russia.

Completion of the transaction is subject to regulatory and governmental approvals, as well as other conditions.

Following the completion of the transaction, we will have ceased our corporate presence in Russia.

Our GAAP operating results presented herein reflect revenues from and expenses to support the Russian operations for Pizza Hut, prior to the date of transfer, and KFC, for the entirety of the year ended December 31, 2022, within their historical financial statement line items and operating segments.

However, given our decision to exit Russia and our pledge to direct any future net profits attributable to Russia subsequent to the date of invasion to humanitarian efforts, we reclassed such resulting net profits from the Division segment results in which they were earned to Unallocated Other income.

Additionally, we have incurred certain expenses related to the transfer of the businesses and other one-time costs related to our exit from Russia which we have recorded within Corporate and unallocated G&A and Unallocated Franchise and property expenses.

Also recorded in Unallocated Other income were foreign exchange gains attributable to fluctuations in the value of the Russian ruble.

The resulting net Operating Profit from these items of $44 million for the year ended December 31, 2022 has been reflected as a Special Item as the amount is not indicative of our ongoing results.

(d)In December of 2019, we completed intra-entity transfers of certain intellectual property (“IP”) rights.

- Targets a capital structure of ~5.0x Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) consolidated net leverage;

In 2019, when calculating same-store sales growth we also included in our prior year base the sales of stores that were added as a result of the Food Delivery Brands Group, S.A. (previously named Telepizza Group S.A. (“Telepizza”)) strategic alliance in December 2018 and that were open for one year or more.

See additional discussion of the acquisition of The Habit Restaurants, Inc. and Telepizza strategic alliance within this MD&A.

For 2021, GAAP diluted EPS increased 77% to $5.21 per share, and diluted EPS, excluding Special Items, increased 23% to $4.46 per share.

- During the year, 4,180 gross units were opened contributing to the addition of 3,057 net new units

- During the year, we repurchased 13 million shares totaling $1,580 million at an average price of $121.70.

| Impact of 53rd week | | | | | | N/A | | | | | | N/A | | | | | | 454 | | |

| System sales, excluding FX and 53rd Week | | | | | | $ | 56,911 | | | | | $ | 50,558 | | | | | $ | 52,130 | |

| Impact of 53rd week | | | | | | N/A | | | | | | N/A | | | | | | 167 | | |

| System sales, excluding FX and 53rd Week | | | | | | $ | 30,365 | | | | | $ | 26,481 | | | | | $ | 27,733 | |

| Impact of 53rd week | | | | | | N/A | | | | | | N/A | | | | | | 184 | | |

| System sales, excluding FX and 53rd Week | | | | | | $ | 13,263 | | | | | $ | 11,747 | | | | | $ | 11,600 | |

| Impact of 53rd week | | | | | | N/A | | | | | | N/A | | | | | | 103 | | |

| System sales, excluding FX and 53rd Week | | | | | | $ | 12,695 | | | | | $ | 11,960 | | | | | $ | 12,797 | |

| Costs associated with acquisition and integration of Habit Burger Grill (See Note 3) | | | | | | (4) | | | | | | (9) | | | | | | (1) | | |

| Costs associated with Pizza Hut U.S. Transformation Agreement(b) | | | | | | — | | | | | | (5) | | | | | | (13) | | |

These gains relate to

(b)In May 2017, we reached an agreement with our Pizza Hut U.S. franchisees that improved brand marketing alignment, accelerated enhancements in operations and technology and that included a permanent commitment to incremental advertising as well as digital and technology contributions by franchisees.

In connection with this agreement, we recognized charges of $5 million and $13 million in the years ended December 31, 2020 and 2019, respectively, related to operating investments required as part of this agreement.

The majority of these costs were recorded within Franchise and property expenses.

Based on their nature and the significance in related spending in 2017, these charges have been reflected as Special Items.

(c)During the second quarter of 2019, we recorded charges of $8 million and $2 million to Other (income) expense and Interest expense, net, respectively, related to cash payments in excess of our recorded liability to settle contingent consideration associated with our 2013 acquisition of the KFC Turkey and Pizza Hut Turkey businesses.

Consistent with prior adjustments to the recorded contingent consideration we have reflected this as a Special Item.

(d)On June 1, 2021, certain subsidiaries of the Company redeemed $1,050 million aggregate principal amount of 5.25% Subsidiary Senior Unsecured Notes due in 2026 (the “2026 Notes”).

The redemption amount was equal to 102.625% of the $1,050 million aggregate principal amount redeemed, reflecting a $28 million “call premium”.

We recognized the call premium and the write-off of $6 million of unamortized debt issuance costs associated with the 2026 Notes within Interest expense, net.

On September 9, 2020, KFC Holding Co., Pizza Hut Holdings, LLC and Taco Bell of America, LLC, each of which a wholly-owned subsidiary of the Company, issued a notice of redemption for $1,050 million aggregate principal amount of 5.00% Subsidiary Senior Unsecured Notes due in 2024 (the "2024 Notes").

The redemption amount included a $26 million call premium plus accrued and unpaid interest to the date of redemption of October 9, 2020.

We recorded the call premium, $6 million of unamortized debt issuance costs associated with the 2024 Notes and $2 million of accrued and unpaid interest associated with the period of time from prepayment of the 2024 Notes with the Trustee on September 25, 2020, to their redemption date within Interest expense, net.

We reflected the call premiums and charges associated with the redemptions as Special Items due to their collective size and the fact that the amounts are not indicative of our ongoing interest expense.

Further, in the fourth quarter of 2019, we increased our Income tax provision by $34 million to record a reserve against the tax recorded on a prior year divestiture, the effects of which were previously recorded as a Special Item.

| Impact of 53rd Week | | | | | | N/A | | | | | | N/A | | | | | | 24 | | |

| Core Operating Profit, excluding 53rd Week | | | | | | $ | 2,094 | | | | | $ | 1,779 | | | | | $ | 1,917 | |

| Impact of 53rd Week | | | | | | N/A | | | | | | N/A | | | | | | 8 | | |

| Core Operating Profit, excluding 53rd Week | | | | | | $ | 1,185 | | | | | $ | 931 | | | | | $ | 1,044 | |

| Impact of 53rd Week | | | | | | N/A | | | | | | N/A | | | | | | 13 | | |

| Core Operating Profit, excluding 53rd Week | | | | | | $ | 757 | | | | | $ | 696 | | | | | $ | 670 | |

| Impact of 53rd Week | | | | | | N/A | | | | | | N/A | | | | | | 3 | | |

| Core Operating Profit, excluding 53rd Week | | | | | | $ | 379 | | | | | $ | 335 | | | | | $ | 366 | |

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

We have a market risk exposure to changes in interest rates, principally in the U.S. Our outstanding total debt, excluding [added: the Revolving Facility balance,] finance leases and debt issuance costs and discounts, of [removed: $11.3] [added: $11.6] billion includes [removed: 80%] [added: 81%] fixed-rate debt and [removed: 20%] [added: 19%] variable-rate debt.

We have attempted to minimize the interest rate risk from variable-rate debt through the use of interest rate swaps that, as of December 31, [removed: 2021,] [added: 2022,] result in a fixed interest rate on $1.5 billion of our variable-rate debt.

As a result, approximately [removed: 93%] [added: 94%] of [removed: our $11.3] [added: this $11.6] billion of outstanding debt at December 31, [removed: 2021,] [added: 2022,] is effectively fixed-rate debt.

At December 31, [removed: 2021,] [added: 2022,] a hypothetical 100 basis-point increase in short-term interest rates would result, over the following twelve-month period after consideration of the aforementioned interest rate [removed: swaps,] [added: swaps and excluding the Revolving Facility balance,] in an increase of approximately $7 million in Interest expense, net within our Consolidated Statement of Income.

The fair value of our cumulative fixed-rate debt of [removed: $9.5] [added: $8.5] billion as of December 31, [removed: 2021,] [added: 2022,] would decrease approximately [removed: $565] [added: $455] million as a result of the same hypothetical 100 basis-point increase.

At December 31, [removed: 2021,] [added: 2022,] a hypothetical 100 basis-point [removed: increase] [added: decrease] in short-term interest rates would decrease the [removed: liability] [added: asset] associated with the fair value of our interest rate swaps by approximately [removed: $46] [added: $30] million.

The Company’s foreign currency net asset exposure (defined as foreign currency assets less foreign currency liabilities) totaled approximately $1.1 billion as of December 31, [removed: 2021.][added: 2022.]

For the fiscal year ended December 31, [removed: 2021,] [added: 2022,] Operating Profit would have decreased approximately [removed: $145] [added: $150] million if [added: all foreign currencies had uniformly weakened 10% relative to the U.S. dollar.]

As of December 31, [removed: 2021,] [added: 2022,] the National Stock Exchange of India Limited composite closing sales price of Devyani was Indian Rupee [removed: 165.05.][added: 180.75.]

A hypothetical 10% decline in the price of these shares would result in a $12 million decrease in the fair value of [removed: these investments,] [added: this investment,] which would be reflected as a charge in Investment (income) expense, net within our Consolidated Statements of Income.

all foreign currencies had uniformly weakened 10% relative to the U.S. dollar.

YUM has over [removed: 53,000] [added: 55,000] restaurants in [removed: 157] [added: more than 155] countries and territories primarily operating under the four concepts of KFC, Taco Bell, Pizza Hut and The Habit Burger Grill (the “Concepts”).

The Habit Burger [removed: Grill, a concept we acquired in March 2020,] [added: Grill] is a fast-casual restaurant concept specializing in made-to-order chargrilled burgers, sandwiches and more.

At December 31, [removed: 2021,] [added: 2022,] 98% of our [removed: Concepts'] [added: Concepts’] units are operated by independent franchisees or licensees under the terms of franchise or license agreements.

The following is a [removed: summary of our Concepts’ operations and a] brief description of each Concept [added: and a summary of our Concepts’ operations] as of and for the year ended December 31, [removed: 2021:][added: 2022:]

| KFC Division | | | | | | [removed: 26,934] [added: 27,760] | | | | | | [removed: 85] [added: 86] | | % | | | | 149 | | | | | | 99 | | % | | | | $ | [removed: 31,365] [added: 31,116] | | | | |

| Taco Bell Division | | | | | | [removed: 7,791] [added: 8,218] | | | | | | [removed: 10] [added: 12] | | % | | | | 32 | | | | | | 94 | | % | | | | [removed: 13,280] [added: 14,653] | | | | | |

| Habit Burger Grill Division | | | | | | [removed: 318] [added: 349] | | | | | | 3 | | % | | | | 3 | | | | | | [removed: 13] [added: 18] | | % | | | | [removed: 588] [added: 661] | | | | | |

[added: Today,] Pizza Hut [added: specializes in the sale of ready-to-eat pizza products and] operates in the delivery, carryout and casual dining segments around the world.

Through our Recipe for [removed: Growth and] Good [added: Growth] we intend to unlock the growth potential of our Concepts and YUM, drive increased collaboration across our Concepts and geographies and consistently deliver better customer experiences, improved unit economics and higher rates of growth.

Key enablers include accelerated use of [added: digital and] technology and better leverage of our systemwide scale.

Our [removed: Recipe for] Growth [added: agenda] is based on four key drivers:

Our global citizenship and sustainability [removed: strategy, called the Recipe for Good, reflects] [added: strategy is reflected in] our [added: Good agenda, which includes our] priorities for [removed: socially responsible growth,] [added: social responsibility,] risk management and sustainable stewardship of our people, food and planet.

[removed: Information] [added: Information] about Operating [removed: Segments][added: Segments]

As of December 31, [removed: 2021,] [added: 2022,] YUM consists of four operating segments:

The Company has franchise relationships that are particularly important to our business, such as our [removed: relationships] [added: relationship] with Yum China (defined [removed: below), and our strategic alliance with Food Delivery Brands Group, S.A. (previously named Telepizza Group S.A.), who is the master franchisee of Pizza Hut in Latin America (excluding Brazil) as well as portions of Europe] [added: below)] and our relationships with certain other large franchisees.

Of our over [removed: 52,000] [added: 54,000] franchised units at December 31, [removed: 2021,] [added: 2022,] approximately [removed: 30%] [added: 35%] operate under our master franchise programs, including nearly [removed: 10,800] [added: 12,100] units in mainland China.

Master franchisees are typically responsible for overseeing development within their territories and performing certain other administrative duties [added: with regard to the oversight of sub-franchisees.]

The use by Yum China of certain of our material trademarks and service marks is governed by a master license agreement between Yum Restaurants Consulting (Shanghai) Company [removed: Limited (“YCCL”),] [added: Limited,] a wholly-owned indirect subsidiary of Yum China, and YUM, through YRI China Franchising LLC, a subsidiary of YUM.

To this end, the Company invests a significant amount of time working with the franchisee community and their representative organizations on key aspects of the business, including products, [added: technology,] equipment, operational improvements and standards.

Most restaurants in each Concept offer consumers the ability to dine in, carryout [removed: food] and/or have the [removed: Concepts'] [added: Concepts’] food delivered either through store-level or third-party delivery services.

Restaurant management structure varies by [removed: Concept and] [added: Concept,] unit [removed: size.][added: size and franchise organization.]

Each Concept issues [removed: detailed] manuals, which may then be customized to meet local regulations and customs.

These manuals set forth standards and requirements for [removed: all aspects of] restaurant operations, including food safety and quality, food handling and product preparation procedures, equipment maintenance, facility standards and accounting control procedures.

[removed: The] [added: Each franchise organization and their respective] restaurant management teams are responsible for the day-to-day operation of each [removed: unit] [added: unit, including all matters related to employment of restaurant staff,] and for ensuring compliance with operating standards.

[removed: In response, we] [added: We have] accelerated our deployment of digital and technology initiatives to enhance the customer experience and our off-premise capabilities.

This [removed: included] [added: includes] increasing our focus on driving digital sales where customers utilize ordering interaction that is primarily facilitated by automated technology.

The core mission of RSCS is to provide the lowest possible sustainable store-delivered prices for [removed: restaurant products and equipment.]

The Company and its Concepts own numerous registered [removed: trademarks and service marks.][added: trademarks.]

The Company’s policy is to pursue registration of important marks whenever feasible and to [removed: oppose vigorously] [added: challenge] any infringement of our [removed: marks.][added: marks vigorously.]

The Company also has certain patents on restaurant equipment [added: and technology] which, while valuable, are not currently considered material to our business.

Competition has also increased from and been enabled by delivery aggregators and other food delivery services in recent years, particularly in urbanized [removed: areas, which trend has accelerated following the onset of the COVID-19 pandemic.][added: areas.]

During [removed: 2021,] [added: 2022,] there were no material capital expenditures for environmental control facilities and no such material expenditures are anticipated.

As of December 31, [removed: 2021,] [added: 2022,] the Company and its subsidiaries employed approximately 36,000 persons, including approximately 23,000 employees in the U.S. and approximately 13,000 employees outside the U.S. Approximately [removed: 90% and] 85% of our [removed: U.S. and international employees, respectively,] [added: employees] work in restaurants while the remainder work in our restaurant-support centers.

In addition to the persons employed by the Company and its subsidiaries, our approximately [removed: 52,000] [added: 54,000] franchise restaurants around the world are responsible for the employment of over an estimated 1 million people who work in and support those restaurants.

[added: As evidence of] the opportunities these positions create, approximately 80% of [removed: our] [added: the] Company-owned Restaurant General Managers (“RGMs”) located in the U.S. have been promoted from other positions in our [added: brands’] restaurants and such RGMs often earn [removed: competitive] pay greater than the average American household income.

Human capital management considerations are integral to our Recipe for [removed: Growth and] Good [added: Growth] strategy, the drivers of which include leveraging our culture and people capability to fuel brand performance and franchise success, as well as recruiting and equipping the best restaurant operators in the world to deliver great customer experiences.

We promote these efforts through initiatives such as our leadership development program (Heartstyles), our unconscious bias program (Inclusive Leadership) and training programs with respect to our compliance polices, [removed: including our Code of Conduct.]

In [removed: 2020,] [added: 2021,] approximately [removed: 45%] [added: 42%] of our global [added: corporate] leadership roles were held by women and approximately [removed: 55%] [added: 51%] of our global [removed: above-restaurant] workforce were women.

- Continuing to [removed: roll out] [added: make] Inclusive Leadership training and anti-racism training [added: available] across our system.

| Pizza Hut Division | | | | | | 19,034 | | | | | | 66 | | % | | | | 106 | | | | | | 99 | | % | | | | 12,853 | | | | | |

| YUM | | | | | | 55,361 | | | | | | 67 | | % | | | | 156 | | | | | | 98 | | % | | | | $ | 59,283 | | | | |

In 2022, our system restaurants generated digital sales of $24 billion and over 47,000 restaurants now offer delivery, which represents approximately 85% of our global system.

Delivery can be provided through either a delivery system owned and operated by our restaurants or through third-party delivery companies such as aggregators.

restaurant products and equipment.

including our Code of Conduct.

- Consistent with our Code of Conduct, making employment-related decisions based on an individual’s abilities and merit, not personal characteristics that are unrelated to the job.

- Increasing representation of underrepresented U.S. associates among our executive and management ranks, franchisees and suppliers over the next 10 years to achieve our aspirational goals to be representative of our customers and communities.

Through our membership with the OneTen coalition, we are partnering with a group of U.S. businesses to create career mobility and advancement opportunities for underrepresented people and communities.

| Pizza Hut Division | | | | | | 18,381 | | | | | | 64 | | % | | | | 111 | | | | | | 99 | | % | | | | 12,955 | | | | | |

| YUM | | | | | | 53,424 | | | | | | 67 | | % | | | | 157 | | | | | | 98 | | % | | | | $ | 58,188 | | | | |

Today, Pizza Hut is the largest restaurant chain in the world specializing in the sale of ready-to-eat pizza products.

with regard to the oversight of sub-franchisees.

CHAMPS – which stands for Cleanliness, Hospitality, Accuracy, Maintenance, Product Quality and Speed of Service – is our proprietary systemwide program for training, measuring and rewarding employee performance against key customer measures.

CHAMPS is intended to align the operating processes of our entire system around one core set of standards.

RGMs’ efforts, including CHAMPS performance measures, are monitored by Area Coaches, where sufficient scale allows.

Area Coaches typically work with approximately six to twelve restaurants.

Our restaurant operations and results were significantly impacted by a novel strain of coronavirus, COVID-19, beginning in 2020 and continuing into 2021.

As COVID-19 spread throughout the U.S. and the rest of the world, governmental authorities implemented measures to reduce the spread of COVID-19.

These measures include restrictions on travel outside the home and have other limitations on business and other activities as well as encouraging social distancing.

As a result of COVID-19, we and our franchisees have experienced significant store closures and instances of reduced store-level operations, including reduced operating hours and dining-room closures.

We and our franchisees have also experienced interruptions of food and other supplies as well as labor shortages that have impacted restaurant operations.

The impact on our sales in each of our markets has been dependent on the timing, severity and duration of the outbreak, measures implemented by government authorities to reduce the spread of COVID-19, as well as our reliance on dine-in sales in the market.

For our restaurants that prominently feature drive-thru, carryout and delivery options, COVID-19 has in many cases contributed to an increase in sales during 2020 and 2021.

In 2021, our system restaurants generated digital sales of $22 billion, which represented an approximate 25% increase over 2020.

Additionally, the number of restaurants that now offer delivery increased to over 45,000 restaurants, which represents over 85% of our global system, more than a 25% increase over 2020.

Trademarks and Patents

As evidence of

- Increasing representation of Black and Latinx U.S. associates among our executive and management ranks, franchisees and suppliers over the next 10 years to match the combined demographics of those groups within the U.S. We intend to further this goal through an increased focus on coaching capability, sponsorship programs and customized individual development plans.

Moreover, we have joined We Are All Human's Hispanic Promise, a national pledge to hire, promote, retain and celebrate Hispanics in the workplace.

We also plan to enhance our relationship with the Consortium for Graduate Studies in Management, which brings outstanding underrepresented talent of color and companies like YUM together to fill critical organizational roles.

Finally, as a publicly-traded company, disputes arise from time-to-time with our shareholders, including allegations that the Company breached federal securities laws [added: or that officers and/or directors breached fiduciary duties.]

or that officers and/or directors breached fiduciary duties.

| | | | | | | EXCHANGE ACT OF 1934 for the fiscal year ended | | | December 31, [removed: 2021] [added: 2022] | | |

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T [added: (§232.405 of this chapter)] during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

The aggregate market value of the voting stock (which consists solely of shares of Common Stock) held by non-affiliates of the registrant as of June 30, [removed: 2021,] [added: 2022,] computed by reference to the closing price of the registrant’s Common Stock on the New York Stock Exchange Composite Tape on such date was approximately [removed: $34.0] [added: $32] billion.

The number of shares outstanding of the registrant’s Common Stock as of February [removed: 15, 2022,] [added: 17, 2023,] was [removed: 288,980,982] [added: 280,107,863] shares.

Portions of the definitive proxy statement furnished to shareholders of the registrant in connection with the annual meeting of shareholders to be held on May [removed: 19, 2022,] [added: 18, 2023,] are incorporated by reference into Part III.

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

The Company has received no written comments regarding its periodic or current reports from the staff of the Securities and Exchange Commission that were issued 180 days or more preceding the end of its [removed: 2021] [added: 2022] fiscal year and that remain unresolved.

As of year end [removed: 2021,] [added: 2022,] the Company’s Concepts owned land, building or both for [removed: 325] [added: 322] restaurants worldwide in connection with the operation of our [removed: 1,051] [added: 990] Company-owned restaurants.

- The KFC Division owned land, building or both for [removed: 70] [added: 66] restaurants.

- The Taco Bell Division owned land, building or both for [removed: 253] [added: 254] restaurants.

The Company currently also owns land, building or both related to approximately 500 franchise restaurants that it leases to franchisees and leases land, building or both related to approximately [removed: 300] [added: 250] franchise restaurants that it subleases to franchisees, principally in the U.S., United Kingdom, Australia and Germany.

[added: A leased building in Irvine, California contains the Taco Bell Division and] The Habit Burger Grill Division [removed: leases its] corporate headquarters [removed: in Irvine, California.][added: and a Taco Bell research facility.]

Taco Bell Division leases its corporate headquarters and research facility in Irvine, California.

The executive officers of the Company as of February [removed: 22, 2022,] [added: 24, 2023,] and their ages and current positions as of that date are as follows:

David Gibbs, [removed: 58,] [added: 59,] is Chief Executive Officer of YUM a position he has held since January 2020.

Restaurants International, Inc. (“YRI”) from May 2012 through December [removed: 2013.]

Scott Catlett, [removed: 45,] [added: 46,] is Chief Legal and Franchise Officer and Corporate Secretary of YUM.

Mark King, [removed: 62,] [added: 63,] is Chief Executive Officer of Taco Bell Division, a position he has held since August 2019.

Aaron Powell, [removed: 50,] [added: 51,] is Chief Executive Officer of Pizza Hut Division, a position he has held since September 2021.

David Russell, [removed: 52,] [added: 53,] is Senior Vice President, Finance and Corporate Controller of YUM.

Sabir Sami, [removed: 54,] [added: 55,] is Chief Executive Officer of KFC Division, a position he has held since January 2022.

Tracy Skeans, [removed: 49,] [added: 50,] is Chief Operating Officer and Chief People Officer of YUM.

Christopher Turner, [removed: 47,] [added: 48,] is Chief Financial Officer of YUM, a position he has held since August 2019.

[added: Prior to leading PepsiCo’s] Walmart business, he served in various positions including Senior Vice President of Transformation for PepsiCo’s Frito-Lay North America business from July 2017 to December 2017 and Senior Vice President of Strategy for Frito-Lay from February 2016 to June 2017.

2013.

Prior to leading PepsiCo’s

As of February [removed: 15, 2022,] [added: 17, 2023,] there were [removed: 37,439] [added: 35,943] registered holders of record of the Company’s Common Stock.

In [removed: 2021,] [added: 2022,] the Company declared and paid four cash dividends of [removed: $0.50] [added: $0.57] per share.

In February [removed: 2022,] [added: 2023,] the [added: Company’s] Board of Directors declared a dividend of [removed: $0.57] [added: $0.605] per share to be distributed March [removed: 11, 2022] [added: 10, 2023] to shareholders of record at the close of business on February [removed: 18, 2022.][added: 22, 2023.]

Future decisions to pay cash dividends continue to be at the discretion of the [added: Company’s] Board of Directors and will be dependent on our operating performance, financial condition, capital expenditure requirements and other factors that the [added: Company’s] Board of Directors considers relevant.

The following table provides information as of December 31, [removed: 2021,] [added: 2022,] with respect to shares of Common Stock repurchased by the Company during the quarter then ended.

In May 2021, our Board of Directors authorized share repurchases from July 1, 2021 through December 31, [removed: 2022] [added: 2022,] of up to [removed: $2] [added: $2.0] billion (excluding applicable transaction fees) of our outstanding Common Stock.

This graph compares the cumulative total return of our Common Stock to the cumulative total return of the S&P 500 Index and the S&P 500 Consumer Discretionary Sector Index, a peer group that includes YUM, for the period from December 30, [removed: 2016] [added: 2017] to December 31, [removed: 2021.][added: 2022.]

The graph assumes that the value of the investment in our Common Stock and each index was $100 at December [removed: 30, 2016,] [added: 29, 2017,] and that all cash dividends were reinvested.

[removed: ][added: ]

| | | | | | | [removed: 12/30/2016] [added: 12/29/2017] | | | | | | [removed: 12/29/2017] [added: 12/31/2018] | | | | | | [removed: 12/31/2018] [added: 12/31/2019] | | | | | | [removed: 12/31/2019] [added: 12/30/2020] | | | | | | [removed: 12/30/2020] [added: 12/31/2021] | | | | | | [removed: 12/31/2021] [added: 12/30/2022] | | |

| 10/1/22 - 10/31/22 | | | | | | 2,037 | | | | | | $ | 110.44 | | | | | 2,037 | | | | | | $ | 2,011 | |

| 11/1/22 - 11/30/22 | | | | | | 935 | | | | | | $ | 123.82 | | | | | 935 | | | | | | $ | 1,895 | |

| 12/1/22 - 12/31/22 | | | | | | 1,124 | | | | | | $ | 129.30 | | | | | 1,124 | | | | | | $ | 1,750 | |

| Total | | | | | | 4,096 | | | | | | $ | 118.67 | | | | | 4,096 | | | | | | | | |

Shares repurchased under this authorization during the quarter totaled $236 million and this authorization was exhausted as of December 31, 2022.

In September 2022, our Board of Directors authorized share repurchases of up to $2.0 billion (excluding applicable transaction fees) of our outstanding Common Stock through June 30, 2024.

The new authorization took effect during the fourth quarter of 2022 upon the exhaustion of the authorization approved in May 2021 and $250 million in shares were repurchased under this authorization during the quarter ended December 31, 2022.

| YUM | | | | | | $ | 100 | | | | | $ | 115 | | | | | $ | 128 | | | | | $ | 140 | | | | | $ | 182 | | | | | $ | 171 | |

| S&P 500 | | | | | | $ | 100 | | | | | $ | 96 | | | | | $ | 126 | | | | | $ | 149 | | | | | $ | 191 | | | | | $ | 157 | |

| S&P Consumer Discretionary | | | | | | $ | 100 | | | | | $ | 101 | | | | | $ | 129 | | | | | $ | 172 | | | | | $ | 214 | | | | | $ | 135 | |

| 10/1/21 - 10/31/21 | | | | | | 1,303 | | | | | | $ | 124.89 | | | | | 1,303 | | | | | | $ | 1,507 | |

| 11/1/21 - 11/30/21 | | | | | | 2,177 | | | | | | $ | 126.00 | | | | | 2,177 | | | | | | $ | 1,233 | |

| 12/1/21 - 12/31/21 | | | | | | 2,153 | | | | | | $ | 131.22 | | | | | 2,153 | | | | | | $ | 950 | |

| Total | | | | | | 5,633 | | | | | | $ | 127.74 | | | | | 5,633 | | | | | | $ | 950 | |

As of December 31, 2021, we have remaining capacity to repurchase up to $950 million of Common Stock under this authorization.

| YUM | | | | | | $ | 100 | | | | | $ | 131 | | | | | $ | 150 | | | | | $ | 167 | | | | | $ | 184 | | | | | $ | 239 | |

| S&P 500 | | | | | | $ | 100 | | | | | $ | 122 | | | | | $ | 116 | | | | | $ | 153 | | | | | $ | 181 | | | | | $ | 233 | |

| S&P Consumer Discretionary | | | | | | $ | 100 | | | | | $ | 123 | | | | | $ | 124 | | | | | $ | 159 | | | | | $ | 211 | | | | | $ | 263 | |

| Report of Independent Registered Public Accounting Firm | | | [removed: [52](#i592f8a9a13034219896dc2f640528fc8_88)] [added: [51](#iba2024adf5954e3ca72d507e4d90aec2_88)] | | |

| Consolidated Statements of Income | | | [removed: [54](#i592f8a9a13034219896dc2f640528fc8_91)] [added: [53](#iba2024adf5954e3ca72d507e4d90aec2_91)] | | |

| Consolidated Statements of Comprehensive Income | | | [removed: [55](#i592f8a9a13034219896dc2f640528fc8_94)] [added: [54](#iba2024adf5954e3ca72d507e4d90aec2_94)] | | |

| Consolidated Statements of Cash Flows | | | [removed: [56](#i592f8a9a13034219896dc2f640528fc8_97)] [added: [55](#iba2024adf5954e3ca72d507e4d90aec2_97)] | | |

| Consolidated Balance Sheets | | | [removed: [57](#i592f8a9a13034219896dc2f640528fc8_100)] [added: [56](#iba2024adf5954e3ca72d507e4d90aec2_100)] | | |

| Consolidated Statements of Shareholders’ Deficit | | | [removed: [58](#i592f8a9a13034219896dc2f640528fc8_103)] [added: [57](#iba2024adf5954e3ca72d507e4d90aec2_103)] | | |

| Notes to Consolidated Financial Statements | | | [removed: [59](#i592f8a9a13034219896dc2f640528fc8_106)] [added: [58](#iba2024adf5954e3ca72d507e4d90aec2_106)] | | |

Brands, Inc. and subsidiaries (the Company) as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the related consolidated statements of income, comprehensive income, cash flows and shareholders’ deficit for each of the years in the three-year period ended December 31, [removed: 2021,] [added: 2022,] and the related notes (collectively, the consolidated financial statements).

We also have audited the Company’s internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in [removed: *Internal] [added: Internal] Control – Integrated Framework [removed: (2013)*] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, [removed: 2021,] [added: 2022,] in conformity with U.S. generally accepted accounting principles.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2021] [added: 2022] based on criteria established in [removed: *Internal] [added: Internal] Control – Integrated Framework [removed: (2013)*] [added: (2013)] issued by the Committee of Sponsoring Organizations of the Treadway Commission.

As discussed in Note 18 to the consolidated financial statements, the Company has recorded unrecognized tax benefits, excluding associated interest, of [removed: $116] [added: $128] million.

Tax laws are complex and often subject to different interpretations by [removed: taxpayers] [added: tax payers] and the respective [removed: taxing] [added: tax] authorities.

[added: On] February [removed: 22, 2022][added: 23, 2022, Yum!]

| Fiscal years ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019] [added: 2020] | | | | | | | | | | | | | | | | | | | | |

| | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | |

| Company sales | | | | | | $ | [removed: 2,106] [added: 2,072] | | | | | $ | [removed: 1,810] [added: 2,106] | | | | | $ | [removed: 1,546] [added: 1,810] | |

| Franchise and property revenues | | | | | | [removed: 2,900] [added: 3,096] | | | | | | [removed: 2,510] [added: 2,900] | | | | | | [removed: 2,660] [added: 2,510] | | |

| Franchise contributions for advertising and other services | | | | | | [removed: 1,578] [added: 1,674] | | | | | | [removed: 1,332] [added: 1,578] | | | | | | [removed: 1,391] [added: 1,332] | | |

| Total revenues | | | | | | [removed: 6,584] [added: 6,842] | | | | | | [removed: 5,652] [added: 6,584] | | | | | | [removed: 5,597] [added: 5,652] | | |

| Company restaurant expenses | | | | | | [removed: 1,725] [added: 1,745] | | | | | | [removed: 1,506] [added: 1,725] | | | | | | [removed: 1,235] [added: 1,506] | | |

| General and administrative expenses | | | | | | [removed: 1,060] [added: 1,140] | | | | | | [removed: 1,064] [added: 1,060] | | | | | | [removed: 917] [added: 1,064] | | |

| Franchise and property expenses | | | | | | [removed: 117] [added: 123] | | | | | | [removed: 145] [added: 117] | | | | | | [removed: 180] [added: 145] | | |

| Franchise advertising and other services expense | | | | | | [removed: 1,576] [added: 1,667] | | | | | | [removed: 1,314] [added: 1,576] | | | | | | [removed: 1,368] [added: 1,314] | | |

| Refranchising (gain) loss | | | | | | [removed: (35)] [added: (27)] | | | | | | [removed: (34)] [added: (35)] | | | | | | [removed: (37)] [added: (34)] | | |

| Other (income) expense | | | | | | [removed: 2] [added: 7] | | | | | | [removed: 154] [added: 2] | | | | | | [removed: 4] [added: 154] | | |

| Total costs and expenses, net | | | | | | [removed: 4,445] [added: 4,655] | | | | | | [removed: 4,149] [added: 4,445] | | | | | | [removed: 3,667] [added: 4,149] | | |

| Operating Profit | | | | | | [removed: 2,139] [added: 2,187] | | | | | | [removed: 1,503] [added: 2,139] | | | | | | [removed: 1,930] [added: 1,503] | | |

| Investment (income) expense, net | | | | | | [removed: (86)] [added: (11)] | | | | | | [removed: (74)] [added: (86)] | | | | | | [removed: 67] [added: (74)] | | |

| Other pension (income) expense | | | | | | [removed: 7] [added: 9] | | | | | | [removed: 14] [added: 7] | | | | | | [removed: 4] [added: 14] | | |

| Interest expense, net | | | | | | [removed: 544] [added: 527] | | | | | | [removed: 543] [added: 544] | | | | | | [removed: 486] [added: 543] | | |

| Income before income taxes | | | | | | [removed: 1,674] [added: 1,662] | | | | | | [removed: 1,020] [added: 1,674] | | | | | | [removed: 1,373] [added: 1,020] | | |

| Income tax provision | | | | | | [removed: 99] [added: 337] | | | | | | [removed: 116] [added: 99] | | | | | | [removed: 79] [added: 116] | | |

| Net Income | | | | | | $ | [removed: 1,575] [added: 1,325] | | | | | $ | [removed: 904] [added: 1,575] | | | | | $ | [removed: 1,294] [added: 904] | |

| Basic Earnings Per Common Share | | | | | | $ | [removed: 5.30] [added: 4.63] | | | | | $ | [removed: 2.99] [added: 5.30] | | | | | $ | [removed: 4.23] [added: 2.99] | |

| Diluted Earnings Per Common Share | | | | | | $ | [removed: 5.21] [added: 4.57] | | | | | $ | [removed: 2.94] [added: 5.21] | | | | | $ | [removed: 4.14] [added: 2.94] | |

| Dividends Declared Per Common Share | | | | | | $ | [removed: 2.00] [added: 2.28] | | | | | $ | [removed: 1.88] [added: 2.00] | | | | | $ | [removed: 1.68] [added: 1.88] | |

| Net Income | | | | | | $ | [removed: 1,575] [added: 1,325] | | | | | $ | [removed: 904] [added: 1,575] | | | | | $ | [removed: 1,294] [added: 904] | |

| Adjustments and gains (losses) arising during the year | | | | | | [removed: (24)] [added: (84)] | | | | | | [removed: 39] [added: (24)] | | | | | | [removed: 28] [added: 39] | | |

| Tax (expense) benefit | | | | | | — | | | | | | — | | | | | | [removed: (4)] [added: —] | | |

| | | | | | | (84) | | | | | | (24) | | | | | | 39 | | |

| | | | | | | (84) | | | | | | (24) | | | | | | 39 | | |

| | | | | | | (81) | | | | | | 81 | | | | | | 10 | | |

| | | | | | | (60) | | | | | | 62 | | | | | | 8 | | |

| | | | | | | 133 | | | | | | 62 | | | | | | (93) | | |

| | | | | | | 100 | | | | | | 48 | | | | | | (70) | | |

| Fiscal years ended December 31, 2022, 2021 and 2020 | | | | | | | | | | | | | | | | | | | | |

| Net Income | | | | | | $ | 1,325 | | | | | $ | 1,575 | | | | | $ | 904 | |

| Refranchising (gain) loss | | | | | | (27) | | | | | | (35) | | | | | | (34) | | |

| Fiscal years ended December 31, 2022, 2021 and 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

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

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

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

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

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

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

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

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

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

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

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

| Balance at December 31, 2022 | | | | | | 280 | | | | | | $ | — | | | | | $ | (8,507) | | | | | $ | (369) | | | | | | | | | | | $ | (8,876) | | | | | | | | | | |

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

We account for our investment in Devyani as an equity security.

The impact of this change in reporting calendar was not significant and accordingly, prior year amounts presented in these Consolidated Financial Statements have not been restated.

Such arrangements typically

In 2022, we recorded a $6 million net provision and in 2021 and 2020, we recorded $6 million and $7 million in net recoveries, respectively.

undiscounted cash flows we expect to generate from such assets.

economic events and other conditions that may be beyond our control.

| | | | | | | 2022 | | | | | | 2021 | | |

restaurant may not be recoverable.

If a qualitative assessment is not performed, or if as a result of a qualitative assessment it is not more likely than not that the fair

For each individual plan we amortize into pension expense the net amounts in AOCI, as adjusted for the difference between the fair value and market-related value of plan assets, to the

Recent Accounting Pronouncements. In March 2020, the Financial Accounting Standards Board issued guidance related to reference rate reform.

This guidance was updated in December 2022.

The guidance provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting to ease the financial reporting burdens related to the expected market transition from LIBOR and other interbank offered rates to alternative reference rates.

The guidance was effective upon issuance and generally can be applied to applicable contract modifications through December 31, 2024.

We adopted this guidance during fiscal year 2022.

The adoption of the new guidance did not have a material impact to our Consolidated Financial Statements.

Russia Invasion of Ukraine

| | | | | | | (24) | | | | | | 39 | | | | | | 28 | | |

| | | | | | | (24) | | | | | | 39 | | | | | | 24 | | |

| | | | | | | 81 | | | | | | 10 | | | | | | (29) | | |

| | | | | | | 62 | | | | | | 8 | | | | | | (22) | | |

| | | | | | | 62 | | | | | | (93) | | | | | | (76) | | |

| | | | | | | 48 | | | | | | (70) | | | | | | (56) | | |

| Balance at December 31, 2018 | | | | | | 306 | | | | | | $ | — | | | | | $ | (7,592) | | | | | $ | (334) | | | | | | | | | | | $ | (7,926) | | | | | | | | | | |

| Adoption of accounting standards | | | | | | | | | | | | | | | | | | (2) | | | | | | | | | | | | | | | | | | (2) | | | | | | | | | | | |

As of December 31, 2021, over 45,000 of our restaurants are also currently offering delivery.

When the fair value of these equity securities is not readily determinable we apply the measurement alternative in accordance with Accounting Standards Codification (“ASC”) Topic 321 and, when applicable, record fair value changes from observable prices as well as impairment in Investment (income) expense, net.

We account for our investment in the entity that operates Taco Bell units in India as an available-for-sale debt security.

This available-for-sale debt security is carried at fair value with unrealized gains and losses, net of tax, included as a component of Other comprehensive income (loss), on the Consolidated Statements of Comprehensive Income.

Fiscal year 2019 included 53 weeks for our U.S. businesses and for our international subsidiaries that reported on a period calendar.

The 53rd week added $66 million to Total revenues, $24 million to Operating Profit and $17 million to Net Income in our 2019 Consolidated Statement of Income.

the application of the sales-based royalty exception within Topic 606.

These revenues are recognized as the goods or services are transferred to the franchisee.

In 2021 and 2020 we recorded $6 million and $7 million in net recoveries, respectively, and in 2019 we recorded $19 million in net provisions, within Franchise advertising and other services expense related to recoveries on and provisions for uncollectible franchisee receivables.

liability and property losses (collectively, "property and casualty losses") are accrued when deemed probable and reasonably estimable.

These receivables

Effective with the adoption of Topic 326 on January 1, 2020, our receivables are now stated net of expected credit losses.

The impact to our net receivables as a result of adopting the standard was not significant.

Leases and Leasehold Improvements. We adopted ASU No. 2016-02, Leases (“Topic 842”) as of the beginning of the year ended December 31, 2019, using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of 2019.

The cumulative effect of this transition was recorded as an increase to Accumulated deficit of $2 million as of this date.

Subsequent amortization

For purposes of our impairment analysis, we update the cash flows that were initially used to value the definite-lived intangible asset to reflect our current estimates and assumptions over the asset’s future remaining life.

Additionally, $18 million related to shares cancelled upon employee share-based award exercises in 2019 were recorded as an addition to Accumulated deficit.

The

During the quarter ended March 31, 2021, we finalized our estimate of the fair value of the net assets acquired, which resulted in goodwill being reduced by $15 million compared to the initial fair value estimate recorded in the quarter ended March 31, 2020 ($2 million of this reduction was recorded in the quarter ended March 31, 2021).

This final allocation of consideration to the net tangible and intangible assets acquired upon the March 18, 2020 acquisition is presented in the table below.

| | | | | | | | | |

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

| Total Current Assets | | | | | | $ | 11 | |

| Habit Burger Grill brand (included in Intangible assets, net) | | | | | | 96 | | |

| Total Assets | | | | | | 442 | | |

| Total Current Liabilities | | | | | | (68) | | |

| Total Liabilities | | | | | | (238) | | |

| Total identifiable net assets | | | | | | 204 | | |

| Goodwill | | | | | | 204 | | |

| Net consideration transferred | | | | | | $ | 408 | |

As we continued to refine our preliminary purchase price allocation in the quarter ended September 30, 2020, the impairment charge was adjusted upward by $5 million, which resulted in a corresponding income tax benefit of $1 million.

Based on our evaluation under the framework in *Internal Control – Integrated Framework (2013)*, our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2021.][added: 2022.]

There were no changes with respect to the Company’s internal control over financial reporting or in other factors that materially affected, or are reasonably likely to materially affect, internal control over financial reporting during the quarter ended December 31, [removed: 2021.][added: 2022.]

However, on January 18, 2023, we announced a ransomware attack that impacted certain IT systems.

See Part II, Item 7 included in this Annual Report on Form 10-K for additional information.

As a result of the ransomware attack, we performed tests of manual compensating controls and validated existing controls continued to operate effectively.

Information regarding Section 16(a) compliance, the Audit Committee and the Audit Committee financial expert, the Company’s code of ethics and background of the directors appearing under the captions “Stock Ownership Information,” “Governance of the Company,” “Executive Compensation” and “Item 1: Election of Directors” is incorporated by reference from the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, [removed: 2021.][added: 2022.]

Information regarding executive and director compensation and the Management Planning and Development Committee appearing under the captions “Governance of the Company” and “Executive Compensation” is incorporated by reference from [added: the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, 2022.]

the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, 2021.

Information regarding equity compensation plans and security ownership of certain beneficial owners and management appearing under the captions “Executive Compensation” and “Stock Ownership Information” is incorporated by reference from the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, [removed: 2021.][added: 2022.]

Information regarding certain relationships and related transactions and information regarding director independence appearing under the caption “Governance of the Company” is incorporated by reference from the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, [removed: 2021.][added: 2022.]

Information regarding principal accountant fees and services and audit committee pre-approval policies and procedures appearing under the caption “Item 2: Ratification of Independent Auditors” is incorporated by reference from the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120 days after December 31, [removed: 2021.][added: 2022.]

| Date: | | | February [removed: 22, 2022] [added: 24, 2023] | | |

Pursuant to the requirements of the Securities Exchange Act of 1934, this annual report has been signed on February [removed: 22, 2022,] [added: 24, 2023,] by the following persons on behalf of the registrant and in the capacities indicated.

| 4.2.2 | | | | | | | | | [Second Supplemental Indenture, dated as of April 1, 2021, by and between the Company and U.S. Bank National Association, as Trustee, [added: relating to the 4.625% Notes due 2032,] which is incorporated herein by reference from Exhibit 4.1. to YUM’s Report on Form 8-K filed April 1, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000110465921045542/tm2111412d1_ex4-1.htm) | | | | | |

| 10.1.1 | | | | | | | | | [Refinancing Amendment, dated as of March 21, 2017, to Credit Agreement dated as of June 16, 2016, among Pizza Hut Holdings, LLC, KFC Holding Co. and Taco Bell of America, LLC, as borrowers, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Collateral Agent, Swing Line Lender, an L/C Issuer and Administrative Agent for the Lenders, which is incorporated herein by reference from Exhibit 10.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K [removed: as] filed on March 23, 2017.](http://www.sec.gov/Archives/edgar/data/1041061/000104106117000020/form8kexhibit101032317.htm) | | | | | |

| 10.1.2 | | | | | | | | | [Refinancing Amendment No. 2, dated as of June 7, 2017, to Credit Agreement dated as of June 16, 2016, as amended, among Pizza Hut Holdings, LLC, KFC Holding Co. and Taco Bell of America, LLC, as borrowers, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Collateral Agent, Swing Line Lender, an L/C Issuer and Administrative Agent for the Lenders, which is incorporated herein by reference from Exhibit 10.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K [removed: as] filed on June 8, 2017.](http://www.sec.gov/Archives/edgar/data/1041061/000110465917038206/a17-14950_2ex10d1.htm) | | | | | |

| 10.1.3 | | | | | | | | | [Refinancing Amendment No. 3, dated as of April 3, 2018, to Credit Agreement dated as of June 16, 2016, among Pizza Hut Holdings, LLC, KFC Holding Co. and Taco Bell of America, LLC, as borrowers, the Lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Collateral Agent, Swing Line Lender, an L/C Issuer and Administrative Agent for the Lenders, which is incorporated herein by reference from Exhibit 10.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K [removed: as] filed on April 9, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000110465918022987/a18-9774_1ex10d1.htm) | | | | | |

| 10.4.1† | | | | | | | | | [YUM! Brands Executive Income Deferral Program, Plan Document for the 409A Program, as effective January 1, 2005, and as Amended and Restated as of January [removed: 1, 2021, as] [added: 1,](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1041.htm) [2022,](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1041.htm) [as] attached [removed: herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex1041.htm)] [added: herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1041.htm)] | | | | | |

| 10.5.1† | | | | | | | | | [The Yum! Brands, Inc. Pension Equalization Plan, Restated Plan Document for the 409A Program effective January 1, 2005, and as Amended and Restated as of January [removed: 1, 2021, as] [added: 1,](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1051.htm) [2022,](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1051.htm) [as] attached [removed: herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex1051.htm)] [added: herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex1051.htm)] | | | | | |

| 10.11† | | | | | | | | | [Form of YUM 1999 Long Term Incentive Plan Award [removed: Agreement,] [added: Agreement (2013) (Stock Options),] which is incorporated herein by reference from Exhibit [removed: 10.26] [added: 10.15.1] to [removed: YUM's] [added: YUM’s] Quarterly Report on Form 10-Q for the quarter ended [removed: September 4, 2004.](http://www.sec.gov/Archives/edgar/data/1041061/000104106104000318/form10q3q04.htm)] [added: March 23, 2013.](http://www.sec.gov/Archives/edgar/data/1041061/000104106113000020/yum-3232013xex10151.htm)] | | | | | |

| [removed: 10.11.1†] [added: 10.13†] | | | | | | | | | [Form of YUM 1999 Long Term Incentive Plan Award Agreement (2013) (Stock [removed: Options),] [added: Appreciation Rights),] which is incorporated [removed: herein] by reference from Exhibit [removed: 10.15.1] [added: 10.18.1] to YUM’s Quarterly Report on Form 10-Q for the quarter ended March 23, [removed: 2013.](http://www.sec.gov/Archives/edgar/data/1041061/000104106113000020/yum-3232013xex10151.htm)] [added: 2013.](http://www.sec.gov/Archives/edgar/data/1041061/000104106113000020/yum-3232013xex10181.htm)] | | | | | |

| [removed: 10.11.2†] [added: 10.11.1†] | | | | | | | | | [Form of YUM 1999 Long Term Incentive Plan Award Agreement (2015) (Stock Options), which is incorporated herein by reference from Exhibit 10.15.2 to [removed: YUM's] [added: YUM’s] Annual Report on Form 10-K for the fiscal year ended December 27, 2014.](http://www.sec.gov/Archives/edgar/data/1041061/000104106115000007/yum-1227x2014xex10152.htm) | | | | | |

| [removed: 10.11.3†] [added: 10.11.2†] | | | | | | | | | [Form of YUM Long Term Incentive Plan Global YUM! Non-Qualified Stock Option Agreement (2019), which is incorporated herein by reference from Exhibit 10.11.3 to YUM’s Quarterly Report on Form 10-Q filed on May 8, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000018/yum-3312019xex10113.htm) | | | | | |

| [removed: 10.13†] [added: 10.13.2†] | | | | | | | | | [removed: [Form of 1999] [added: [Yum! Brands, Inc.] Long Term Incentive Plan [removed: Award Agreement (Stock] [added: Form of Global YUM! Stock] Appreciation [removed: Rights)] [added: Rights Agreement (2019),] which is incorporated [added: herein] by reference from Exhibit [removed: 99.1] [added: 10.13.3] to [removed: YUM's] [added: YUM’s Quarterly] Report on Form [removed: 8-K as] [added: 10-Q] filed on [removed: January 30, 2006.](http://www.sec.gov/Archives/edgar/data/1041061/000104106106000088/form8k013006.htm)] [added: May 8, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000018/yum-3312019xex10133.htm)] | | | | | |

| 10.13.1† | | | | | | | | | [Form of YUM 1999 Long Term Incentive Plan Award Agreement [removed: (2013)] [added: (2015)] (Stock Appreciation Rights), which is incorporated [added: herein] by reference from Exhibit [removed: 10.18.1] [added: 10.18.2] to YUM’s [removed: Quarterly] [added: Annual] Report on Form [removed: 10-Q] [added: 10-K] for the [removed: quarter] [added: fiscal year] ended [removed: March 23, 2013.](http://www.sec.gov/Archives/edgar/data/1041061/000104106113000020/yum-3232013xex10181.htm)] [added: December 27, 2014.](http://www.sec.gov/Archives/edgar/data/1041061/000104106115000007/yum-12272014xex10182.htm)] | | | | | |

| 10.13.3† | | | | | | | | | [Yum! Brands, Inc. Long Term Incentive Plan Form of Global [removed: YUM!] [added: Restricted] Stock [removed: Appreciation Rights] [added: Unit] Agreement (2019), which is incorporated herein by reference from Exhibit [removed: 10.13.3] [added: 10.20] to YUM’s Quarterly Report on Form 10-Q filed on May 8, [removed: 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000018/yum-3312019xex10133.htm)] [added: 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000018/yum3312019-ex1020.htm)] | | | | | |

| 10.13.4† | | | | | | | | | [Yum! Brands, Inc. Long Term Incentive Plan Form of Global Restricted Stock Unit Agreement [removed: (2019),] [added: (2022), as effective February 11, 2022,] which is incorporated herein by reference from Exhibit [removed: 10.20] [added: 10.13.5] to YUM’s Quarterly Report on Form 10-Q filed on May [removed: 8, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000018/yum3312019-ex1020.htm)] [added: 10, 2022.](http://www.sec.gov/Archives/edgar/data/1041061/000104106122000019/yum-3312022xex10135.htm)] | | | | | |

| 10.14.1† | | | | | | | | | [YUM! Brands Leadership Retirement Plan, Plan Document for the 409A Program, as effective January 1, 2005, and as Amended and Restated as of January 1, 2021, [removed: as attached herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex10141.htm)] [added: which is incorporated herein by reference from Exhibit 10.14.1 to YUM’s Annual Report on Form 10-K filed on February 23, 2022.](http://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex10141.htm)] | | | | | |

| 10.16.1† | | | | | | | | | [YUM! Brands Third Country National Retirement Plan Amendment, as effective January 1, 2021, [removed: as attached herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex10161.htm)] [added: which is incorporated herein by reference from Exhibit 10.16.1 to YUM’s Annual Report on Form 10-K filed on February 23, 2022.](http://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex10161.htm)] | | | | | |

| [removed: 10.20] [added: 10.19] | | | | | | | | | [Indenture, dated as of June 15, 2017, by and among KFC Holding Co., Pizza Hut Holdings, LLC and Taco Bell of America, LLC, as issuers, the Guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee, which is incorporated herein by reference from Exhibit 4.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K filed on June 16, 2017.](http://www.sec.gov/Archives/edgar/data/1041061/000110465917039850/a17-14950_4ex4d1.htm) | | | | | |

| [removed: 10.21] [added: 10.20] | | | | | | | | | [Base Indenture, dated as of May 11, 2016, between Taco Bell Funding, LLC, as issuer and Citibank, N.A., as trustee and securities intermediary, which is incorporated herein by reference from Exhibit 4.1 to YUM’s Report on Form 8-K filed on May 16, 2016.](http://www.sec.gov/Archives/edgar/data/1041061/000110465916121437/a16-11235_1ex4d1.htm) | | | | | |

| [removed: 10.21.1] [added: 10.20.1] | | | | | | | | | [Series 2016-1 Supplement to Base Indenture dated as of May 11, 2016, by and between Taco Bell Funding, LLC, as issuer and Citibank, N.A. as Trustee and Series 2016-1 securities intermediary, which is incorporated herein by reference from Exhibit 4.2 to YUM’s Report on Form 8-K filed on May 16, 2016.](http://www.sec.gov/Archives/edgar/data/1041061/000110465916121437/a16-11235_1ex4d2.htm) | | | | | |

| [removed: 10.21.2] [added: 10.20.2] | | | | | | | | | [Series 2018-1 Supplement to Base Indenture, dated as of November 28, 2018, by and between the Issuer and Citibank, N.A. as Trustee and Series 2018-1 securities intermediary, which is incorporated herein by reference from Exhibit 10.1 to YUM’s Report on Form 8-K filed on December 3, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000110465918071068/a18-40974_1ex10d1.htm) | | | | | |

| [removed: 10.21.3] [added: 10.20.3] | | | | | | | | | [Series 2021-1 Supplement to Amended and Restated Base Indenture, dated as of August 19, 2021, by and between Taco Bell Funding, LLC, as issuer, and Citibank, N.A. as trustee and Series 2021-1 securities intermediary, which is incorporated herein by reference from Exhibit 10.2 to YUM’s Report on Form 8-K filed on August 25, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000110465921109373/tm2124137d2_ex10-2.htm) | | | | | |

| [removed: 10.21.4] [added: 10.20.4] | | | | | | | | | [Amendment No. 1 to Base Indenture, dated as of August 23, 2016, by and between the Issuer and Citibank, N.A. as Trustee and Series 2016-1 securities intermediary, which is incorporated herein by reference from Exhibit 10.22.3 to [removed: YUM's] [added: YUM’s] Annual Report on Form 10-K for fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000010/yum-12312018xex10223.htm) | | | | | |

| [removed: 10.21.5] [added: 10.20.5] | | | | | | | | | [Amendment No. 2 to Base Indenture, dated as of November 28, 2018, by and between the Issuer and Citibank, N.A. as Trustee and the Series 2018-1 securities intermediary, which is incorporated herein by reference from Exhibit 10.2 to YUM’s Report on Form 8-K filed on December 3, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000110465918071068/a18-40974_1ex10d2.htm) | | | | | |

| [removed: 10.21.6] [added: 10.20.6] | | | | | | | | | [Amended and Restated Base Indenture, dated as of August 19, 2021, by and between Taco Bell Funding, LLC, as issuer, and Citibank, N.A. as trustee and the Series 2021-1 securities intermediary, which is incorporated herein by reference from Exhibit 10.1 to YUM’s Report on Form 8-K filed on August 25, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000110465921109373/tm2124137d2_ex10-1.htm) | | | | | |

| [removed: 10.22] [added: 10.21] | | | | | | | | | [Guarantee and Collateral Agreement, dated as of May 11, 2016, by Taco Bell Franchise Holder 1, LLC, Taco Bell Franchisor, LLC, Taco Bell IP Holder, LLC and Taco Bell Franchisor Holdings, LLC in favor of Citibank, N.A., which is incorporated herein by reference from Exhibit 10.2 to YUM’s Report on Form 8-K filed on May 16, 2016.](http://www.sec.gov/Archives/edgar/data/1041061/000110465916121437/a16-11235_1ex10d2.htm) | | | | | |

| [removed: 10.23] [added: 10.22] | | | | | | | | | [removed: [Management] [added: [Amended and Restated Management] Agreement, dated as of [removed: May 11, 2016, among] [added: August 19, 2021, by and between] Taco Bell Funding, LLC, as issuer, Taco Bell Franchise Holder 1, LLC, Taco Bell Franchisor, LLC, Taco Bell IP Holder, LLC, Taco Bell Franchisor Holdings, [removed: LLC, Citibank, N.A.] [added: LLC] and Taco Bell Corp., as manager, [added: and Citibank, N.A. as trustee,] which is incorporated herein by reference from Exhibit 10.3 to YUM’s Report on Form 8-K filed on [removed: May 16, 2016.](http://www.sec.gov/Archives/edgar/data/1041061/000110465916121437/a16-11235_1ex10d3.htm)] [added: August 25, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000110465921109373/tm2124137d2_ex10-3.htm)] | | | | | |

| [removed: 10.24] [added: 10.23] | | | | | | | | | [Indenture, dated as of September 11, 2019, by and between Yum and The Bank of New York Mellon Trust Company, N.A., as trustee, which is incorporated herein by reference from Exhibit 4.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K filed on September 16, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000040/a8kex419112019.htm) | | | | | |

| [removed: 10.25] [added: 4.2.3] | | | | | | | | | [removed: [Indenture,] [added: [Third Supplemental Indenture,] dated as of April 1, [removed: 2020] [added: 2022,] by and between [removed: Yum and] the [added: Company and U.S.] Bank [removed: of New York Mellon] Trust Company, [removed: N.A,] [added: National Association,] as Trustee, [added: relating to the 5.375% Notes due 2032,] which is incorporated herein by reference from Exhibit [removed: 4.1] [added: 4.1.] to YUM’s Report on Form 8-K filed [removed: on] April [removed: 6, 2020.](http://www.sec.gov/Archives/edgar/data/1041061/000104106120000023/a8kex41412020.htm)] [added: 1, 2022.](http://www.sec.gov/Archives/edgar/data/1041061/000110465922041723/tm2210501d1_ex4-1.htm)] | | | | | |

| [removed: 10.26] [added: 10.24] | | | | | | | | | [Master License Agreement, dated as of October 31, 2016, by and between Yum! Restaurants Asia Pte. Ltd. and Yum Restaurants Consulting (Shanghai) Company Limited, which is incorporated herein by reference from Exhibit 10.1 to [removed: YUM's] [added: YUM’s] Report on Form 8-K filed on November 3, 2016.](http://www.sec.gov/Archives/edgar/data/1041061/000104106116000097/a16-20742_3ex10d1.htm) | | | | | |

| [removed: 10.26.1] [added: 10.24.1] | | | | | | | | | [Confirmatory License Agreement, dated as of January 1, 2020, by and between YRI China Franchising, LLC and Yum Restaurants Consulting (Shanghai) Company Limited, which is incorporated herein by reference from Exhibit 10.26.1 to YUM’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020.](http://www.sec.gov/Archives/edgar/data/1041061/000104106121000012/yum-12312020xex10261.htm) | | | | | |

| [removed: 10.27] [added: 10.25] | | | | | | | | | [Tax Matters Agreement, dated as of October 31, 2016, by and among YUM, Yum China Holdings, Inc. and Yum Restaurants Consulting (Shanghai) Company Limited, which is incorporated herein by reference from Exhibit 10.2 to [removed: YUM's] [added: YUM’s] Report on Form 8-K filed on November 3, 2016](http://www.sec.gov/Archives/edgar/data/1041061/000104106116000097/a16-20742_3ex10d2.htm). | | | | | |

| [removed: 10.30] [added: 10.26] | | | | | | | | | [Yum! Brands, Inc. Long Term Incentive Plan Form of Global Performance Share Unit Agreement (2021), which is incorporated herein by reference from Exhibit 10.20 to YUM’s Quarterly Report on Form 10-Q filed on May 5, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000104106121000022/yum-3312021xex1020.htm) | | | | | |

| 21.1 | | | | | | | | | [Active Subsidiaries of [removed: YUM.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex211.htm)] [added: YUM.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex211.htm)] | | | | | |

| 23.1 | | | | | | | | | [Consent of KPMG [removed: LLP.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex231.htm)] [added: LLP.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex231.htm)] | | | | | |

| 31.1 | | | | | | | | | [Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) of Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex311.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex311.htm)] | | | | | |

| 31.2 | | | | | | | | | [Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) of Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex312.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex312.htm)] | | | | | |

| 32.1 | | | | | | | | | [Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex321.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex321.htm)] | | | | | |

| 32.2 | | | | | | | | | [Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106122000009/yum-12312021xex322.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex322.htm)] | | | | | |

| 10.13.5† | | | | | | | | | [Yum! Brands, Inc. Long Term Incentive Plan Form of Global Restricted Stock Unit Agreement (2023), as effective February 10, 2023, as attached herein.](https://www.sec.gov/Archives/edgar/data/1041061/000104106123000009/yum-12312022xex10135.htm) | | | | | |

| 10.24.2 | | | | | | | | | [Amendment No. 1 to Master License Agreement, dated as of April 15, 2022, by and between Yum! Restaurants Asia Pte. Ltd. And Yum Restaurants Consulting (Shanghai) Company Limited, which is incorporated herein by reference from Exhibit 10.26.1 to YUM’s Quarterly Report on Form 10-Q filed on May 10, 2022.](http://www.sec.gov/Archives/edgar/data/1041061/000104106122000019/yum-3312022xex10261.htm) | | | | | |

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

| /s/ Lauren R. Hobart | | | | | | Director | | | | | |

| Lauren R. Hobart | | | | | | | | | | | |

| /s/ Elane B. Stock | | | | | | Director | | | | | |

| Elane B. Stock | | | | | | | | | | | |

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

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

| 10.13.2† | | | | | | | | | [Form of YUM 1999 Long Term Incentive Plan Award Agreement (2015) (Stock Appreciation Rights), which is incorporated herein by reference from Exhibit 10.18.2 to YUM's Annual Report on Form 10-K for the fiscal year ended December 27, 2014.](http://www.sec.gov/Archives/edgar/data/1041061/000104106115000007/yum-12272014xex10182.htm) | | | | | |

| 10.23.1 | | | | | | | | | [Amendment No.1 to Management Agreement, dated as of August 24, 2016, among Taco Bell Funding, LLC, as issuer, Taco Bell Franchise Holder 1, LLC, Taco Bell Franchisor, LLC, Taco Bell IP Holder, LLC, Taco Bell Franchisor Holdings, LLC and Taco Bell Corp., as manager, which is incorporated herein by reference from Exhibit 10.25.1 to YUM's Annual Report on Form 10-K for fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000010/yum-12312018xex10251.htm) | | | | | |

| 10.23.2 | | | | | | | | | [Amendment No. 2 to Management Agreement, dated as of November 28, 2018, among Taco Bell Funding, LLC, as issuer, Taco Bell Franchise Holder 1, LLC, Taco Bell Franchisor, LLC, Taco Bell IP Holder, LLC, Taco Bell Franchisor Holdings, LLC, Citibank, N.A. and Taco Bell Corp., as manager, which is incorporated herein by reference from Exhibit 10.25.2 to YUM's Annual Report on Form 10-K for fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000010/yum-12312018xex10252.htm) | | | | | |

| 10.23.3 | | | | | | | | | [Amended and Restated Management Agreement, dated as of August 19, 2021, by and between Taco Bell Funding, LLC, as issuer, Taco Bell Franchise Holder 1, LLC, Taco Bell Franchisor, LLC, Taco Bell IP Holder, LLC, Taco Bell Franchisor Holdings, LLC and Taco Bell Corp., as manager, and Citibank, N.A. as trustee, which is incorporated herein by reference from Exhibit 10.3 to YUM’s Report on Form 8-K filed on August 25, 2021.](http://www.sec.gov/Archives/edgar/data/1041061/000110465921109373/tm2124137d2_ex10-3.htm) | | | | | |

| 10.28† | | | | | | | | | [Offer Letter dated June 19, 2019, between the Company and Christopher Turner, which is incorporated herein by reference from Exhibit 10.28 to YUM’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106119000033/yum-6302019xex1028.htm) | | | | | |

| 10.29† | | | | | | | | | [Offer Letter dated July 16, 2019, between the Company and Mark King, which is incorporated herein by reference from Exhibit 4.2 to YUM's Annual Report on Form 10-K for the fiscal year ended December 31, 2019.](http://www.sec.gov/Archives/edgar/data/1041061/000104106120000015/yum-12312019xex1029.htm) | | | | | |

| Exhibit Number | | | | | | | | | Description of Exhibits | | | | | |